10. Scenario Analysis
Description and Purpose
A scenario is a detailed description of what the future may look like. It is based on a set of assumptions that are critical to the evolution of an economy, industry, market, or technology. Scenario analysis is a structured way of developing multiple scenarios that help executives address two common decision-making errors—underprediction and overprediction of change. The objectives of scenario analysis are building a shared baseline for strategic thinking, enhancing flexibility in long-term planning, and providing strategic early warning.
This type of analysis has been in place for decades and is used extensively in a range of industries and by a variety of different organizations (business, not-for-profit, ...
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