Scenario Planning & Forecasting Flashcards

Which technique involves assigning probabilities to different future states and calculating expected outcomes across scenarios?

Answer: Probabilistic scenario analysis

Probabilistic scenario analysis attaches likelihood estimates to each scenario and computes weighted expected outcomes.

In scenario planning, a 'wild card' event is best described as:

Answer: A low-probability, high-impact discontinuity

Wild cards are low-probability but potentially transformative events that can invalidate existing scenarios.

The primary purpose of wind-tunneling a strategy is to:

Answer: Test how a proposed strategy performs across all scenarios

Wind-tunneling stress-tests a strategy against each developed scenario to reveal vulnerabilities and robustness.

Which forecasting method is most appropriate when historical data is absent but expert knowledge is available?

Answer: Qualitative Delphi method

The Delphi method systematically collects and refines expert opinions when quantitative data is lacking.

A 'focal question' in scenario planning serves to:

Answer: Frame the central strategic uncertainty that scenarios will explore

The focal question anchors scenario development by articulating the key strategic decision or uncertainty under examination.

In the GBN (Global Business Network) scenario matrix, the two axes represent:

Answer: The two most critical and most uncertain driving forces

The GBN matrix places the two most impactful and uncertain drivers on each axis to generate four distinct scenarios.

Early warning indicators (EWIs) in scenario planning are used to:

Answer: Signal which scenario is beginning to materialize

EWIs are pre-identified metrics or signals that alert planners when a particular scenario is becoming reality.