Scenario/contingency planning

Question 1

Why is scenario planning important?

Answer 1

In business, always expect the unexpected!​

Question 2

What are the 3 types of scenario planning?

Answer 2

Risk management​
Identifying and dealing with the risks threatening a business​

Scenario planning​
Planning (including expected responses) for unforeseen events​

Crisis management​
Handling potentially dangerous events for a business​

Question 3

What is risk in business?

Answer 3

The possibility of loss or business damage​

A threat that may prevent or hinder the ability to achieve business objectives​

The chance that a hoped-for outcome will not occur (e.g. customers do not respond well to a new product launch)

Question 4

What is scenario planning?

Answer 4

Scenario planning involves:​
Preparing for predictable and quantifiable problems​
Preparing for unexpected and unwelcome events​

Aim: minimise the impact of a foreseeable event and to plan for how the business will resume normal operations after the crisis​

Question 5

How do you evaluate the need for scenario planning?

Answer 5

Risks vary in terms of their​
Significance to the business​
Likelihood​

Scenario planning is not required for every eventuality​

However, risks of strategic significance cannot be ignored​