Is your construction firm forward-thinking? Today's shifting landscape demands scenario planning.
If your firm had a plan three years ago for operating during a worldwide economic meltdown, how valuable would it have been?
How beneficial would it be to have a plan right now that would help you succeed during a slow-moving economic recovery?
These are contingency plans and can be developed when using scenario planning, either as a stand-alone process or as an integral part of strategic planning. Traditional planning processes tend to focus on visualizing the ideal future and listing the actions that should be taken to reach that goal. But when unexpected shifts change the marketplace and that ideal future suddenly moves out of reach, using the traditional planning process does not work.
In the past, it was sufficient to simply know your clients, keep an eye on competitors and review your strategic plan every few years to decide if you should open a new office, enter a new geographic area or drop an unproductive line of work. Today, business owners deal with a landscape that shifts daily.
What is Scenario Planning?
Scenario planning is the process of looking at how current trends and projected future trends may develop over time and what might happen if some play out more strongly than others. Several drivers must be considered and viewed at many levels (from local impacts to international trends) - economic, political, environmental, social, global and technological.
Everyone has a different opinion about these drivers and how the current level of uncertainty will shape them going forward. And most firms do not have the skills needed to build usable scenarios.
Some firms have tried using a shortcut to determine the best-case and worst-case scenarios and have planned for both. But as the forces behind the drivers develop in the world and marketplace, the future will not be black and white. Creating these plans based on only two alternative futures will not likely offer a sufficient, robust framework for strategic planning.
Forward-thinking firms must use true scenario planning based on a variety of possible future situations that have been predicted from actual trends. The major difficulties firms face with this type of planning is the expense and time investment needed to create the scenarios.
Firms tend to have thorough knowledge about their own markets, clients and local or regional conditions. But they do not have staff trained to do macro- or fine-grained analyses of national and international trends and predict the significant impacts these trends can have on their businesses.
To mitigate this situation, FMI's Research Services Group brought together more than 50 leaders from design and construction firms, academia, clients and industry organizations to develop a set of base scenarios for planning use. The resulting four scenarios (see page 2) are designed specifically for design and construction firms to use in their planning process. These scenarios were created in 2009 by in-depth analyses of trends and key drivers and the entire team's assumptions and expert projections through 2020. The scenarios explore four possible directions the future will take, reflecting the complexity and changeable nature of the real world.
Four Key Scenarios
These four key scenarios were developed by FMI Corporation during the AEC Futures Research Project. Firms can adapt these scenarios to their unique situations.
Perfect World
In 2020, the world economy has fully recovered from the Great Recession of 2008 to 2009 and rebounded beyond expectations. A global, interdependent marketplace flourishes, in which private investment, low-cost capital, expertise and goods and services flow readily across market segments and national borders. Levels of innovation and collaboration are high, with government and private enterprises working to build each nation's unique brand.
Experts of various nationalities work together to design and build projects to the highest degree of sustainability through a set of integrated project delivery practices that leverage technology to both accelerate
