Scenario planning â how to find the right strategy at ... - Roland Berger

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Roland Berger Strategy Consultants 1. Defining the scope The first step defines the project focus, the markets to develop scenarios for and the time frame. To illustrate in general terms how the process works, we will use a recent scenario planning study from the global manufacturing industry. "Manufacturing industry" here refers to a wide spectrum of sectors, from mining and chemicals to metals manufacturing and materials fabrication. f3 Manufacturing sectors are surging ahead in many emerging economies. Over the past five years, their share of global manufacturing output climbed from 30% to 50%. Annual revenues now reach around USD 20 trillion. 1 Emerging economy governments recognize the special importance of a manufacturing base. Not only does industry employ a significant share of their labor force, but it also supplies strategically important products to improve critical sectors such as the national infrastructure. How a country's manufacturing industry will evolve is clearly strategically relevant to foreign producers and suppliers seeking to enter and expand in emerging markets. But manufacturing's diversity presents a challenge for developing coherent manufacturing industry scenarios. To tackle this challenge, Roland Berger Strategy Consultants has defined a set of scenarios and appropriate business opportunities within the general manufacturing industry. The concept development was grounded in the customer and industry needs and trends of 2020 and factored in input from internal stakeholders and external experts. F3 Manufacturing sectors are surging ahead in many emerging economies. Over the past five years, their share of global manufacturing output climbed from 30% to 50% 2012 50% 2007 30% 1) IHS Global Insight (2012) Source: IHS Global Insight
Study 11 2. Selecting stakeholders 3. Conducting the survey Scenario planning can help companies better anticipate how macro-environment events could affect future performance and business opportunities. A key initial step is to canvass the views and opinions of the most important internal stakeholders, such as board members, top executives, key strategic and managerial staff, and industry experts. When assessing emerging country markets, we also identify appropriate external stakeholders and market experts, such as politicians, members of the chamber of commerce or local customers and suppliers. Identifying and accessing the most knowledgeable individuals may not proceed as efficiently as in familiar or advanced markets, but their voices are critically important. It's also advisable to interview people who work at competitors. One leading German electronics group, for example, always attempts to talk with local competitors' staff before launching operations in a newly industrializing country. Plant visits can also offer valuable insights into local conditions. In our survey, we approach a broad range of stakeholders and generally 40 to 50 respondents participate. To illustrate how we conduct the survey and apply its findings to create key scenarios, we'll refer to the previously mentioned global manufacturing industry study. We start by using Roland Berger's "360° stakeholder feedback questionnaire" to identify those factors most likely to affect the global manufacturing industry. First, we list influencing factors along the so-called STEEP dimensions – Social, Technological, Economic, Environmental and Political/legal – and develop a questionnaire about them. We then distribute this questionnaire to internal stakeholders (across functions) and external experts (e.g. from local industry, think tanks, academia, etc.) across critical manufacturing sectors and geographical locations. The respondents identify 40 to 50 separate influencing factors, which are then clustered in a second survey to score each factor in terms of two key criteria: Impact – How significant is the influencing factor in a global context Certainty – What is the probability the influencing factor will occur
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