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Towards the integration of system modelling with scenario planning to support strategy : the case of the UK energy industry

Burt, George (2010) Towards the integration of system modelling with scenario planning to support strategy : the case of the UK energy industry. Journal of the Operational Research Society, 62 (5). pp. 830-839. ISSN 0160-5682

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Abstract

A key aspect of strategy is sense-making of the unfolding uncertainty in the business environment and responding appropriately to achieve organisational objectives. However, uncertainty means that there is more than one futue open to an organisation. Sense-making is therefore problematic. Scenario planning is one approach to sense-making that helps to explore and understand uncertainty, aiming for the identification of potential predetermined elements in the business environment. In this paper we propose the integration of systems modelling with scenario planning to support the exploration of uncertainty, identify knowledge gaps that set a (subsequent) research agenda, understand the role and usefulness of historical data, and model research outcomes to help reveal potential predetermined elements. Specifically, scenario planning identifies potential predetermined elements in the business environment; system modelling in the form of behaviour-over-time graphs, casual mapping and feedback loops helps in structuring and linking variables and their interaction to provide an understanding of the systemic drivers of these predetermined elements. Methodological integration of this type enhances modellers' ability to support strategy in organisations.