Resilient: Confronting the COVID-19 crisis Episode 8 | April 2020

Resilient: Confronting the COVID-19 crisis Actionable insights to help businesses respond and recover Episode 8: Scenario planning: Tune in to possible futures, risks, and actions Host: Mike Kearney, partner and chief marketing officer, Risk & Financial Advisory LLP

Guests: Peter Schwartz, futurist and senior vice president, Strategic Planning, Salesforce Andrew Blau, managing director, Deloitte Consulting LLP

Mike Kearney: Welcome to Resilient. My senior vice president of strategic planning at the area. And obviously, name is Mike Kearney, the Deloitte Risk & Salesforce. one of the things that is top of mind for Financial Advisory CMO. As part of a new everybody as we’re sheltering in place is series on the Resilient podcast, we are Both Peter and Andrew are kind of famous what we’re doing just to manage our well- continuing to shift our focus to the evolving for pioneering scenario planning back in the being. So, I just wanted to start off with a impact of COVID-19. The special series is all day, which is why they recently published a light question, and that is, what are you about providing actionable insights to help point of view that looks at possible scenarios doing to take care of yourself during these you think through what you’re facing now that could take place and questions that times? And maybe, Andrew, I’ll start and what to do next. Today, we gathered two leaders should be asking today to help with you. leaders to explore a few future scenarios that shape their strategy in managing through they have developed on COVID-19; they will the current crisis, the recovery and beyond. Andrew Blau: Sure. Thanks, Mike. also share the uncertainties that contributed So let’s get to it: my conversation with These are just incredible times—so little to these scenarios and how leaders can use Andrew and Peter. to compare them to. For me, there are a them in planning for the future. First up is couple things I really try and focus on, the Andrew Blau, a managing director who leads Peter and Andrew, we were talking before few things that do feel like they’re maybe Deloitte’s signature issues program. Joining we jumped on about the beautiful weather in my control, like taking care of my family, Andrew is Peter Schwartz, a futurist and that we’re in right now in the East Bay within like cooking together. If we’re going to be Scenario planning: Tune in to possible futures, risks, and actions | Resilient: Confronting the COVID-19 crisis E8

sheltered in place at home, let’s make home So scenario planning is a tool created to us, like me, this was a moment of maximum a good place to be. So I do that. I’ve also help leaders think about and manage the uncertainty. A moment that actually invited been finding myself checking in with friends uncertainty that is in their lives in order to scenario thinking. And good scenario a lot more. I’ll go out for a walk and I’ll just make better decisions. Scenarios, at one thinking is usually done in teams. So it was open up my phone and sort of flip through level, are stories, and they’re nothing more a natural thing for this group of people to my contacts and who I have not talked to than that, but they’re nothing less than that. want to come together. Most of us have in a while and just call them. Because I feel They’re stories told in a rigorous, methodical worked together for almost 20 years, or like we’re all hungry to be connected. And way designed to enable the people who longer in some cases. And so the moment so thinking about just calling someone to create or use the stories to see choices they and the history brought us together. say, “Hey, I’m thinking of you, how are you might not have seen before—scenarios or doing?” Those are things that I hope are stories that allow you to see possibilities Mike Kearney: Awesome. Andrew, have good for those people, and I know they’re in the future by focusing on what’s really anything to add? good for me, too. uncertain rather than what is certain, and how might those uncertainties add up in Andrew Blau: Yeah, I think that’s right. Mike Kearney: Yeah, I actually create a list surprising ways. It was a moment. Listen, these are of five people every day that I try to call. extraordinary times, and extraordinary And it’s kind of the highlight of my day. So They’re used by leaders to do all kinds of times invite extraordinary collaboration. great tip. things. They’re used by leaders to identify As Peter said, we’re a group that in various strategic choices. What are options that we configurations have worked together for Peter, how about you? What are you doing to might have if the future turns out different decades, in one form or another. And the take care of yourself in these trying times? than the one we expect? They are similarly chance to reconnect and get this group of used to identify risks. What are the things extraordinary scenario planners into one Peter Schwartz: Well, like everybody, I feel that might be coming at us over the horizon virtual chat room, or to get us together again badly for so many people in the world who that we’re not prepared for? They’re used to think about what could be the biggest are in much worse circumstances than I am, for innovation. Scenarios can be a start to challenge that many of us in organizations but the honest truth is I’m in pretty good allow you to see the outlines of markets are going to face, was too good an circumstances. I have a beautiful home. I’m that you haven’t seen before or consumer opportunity to pass up. I can’t remember getting to spend more time with my wife, behaviors that you haven’t imagined before. where exactly it started or who had the and I’m truly enjoying it. We live in an area And in some cases, they’re actually used to first idea. where it’s easy to get good food. So I have do executive education and organizational no complaint of the life I’m living day-to-day. design. Who are the people that we need Peter Schwartz: You initiated it. I love being here. I love being with my wife. to be to lead in the future? So they’re I’m feeling like my work is giving me a lot of very flexible. They have been enormously Andrew Blau: Thank you. We were already opportunity to contribute. I love walking. powerful for organizations for now decades. thinking at Deloitte, obviously, our clients We go for a long walk every day, both for But at their heart, they are stories about need to respond to the crisis on the exercise and, you know, to get out. the future designed to create and support doorstep, and how can we help them do better decisions today. that? But the crisis will pass, and thinking Mike Kearney: Absolutely. I’m going to be scenarically about what might come seemed taking a hike after this. Andrew, let’s move Mike Kearney: So, Peter, as a teacher, like a natural opportunity. The chance . . . to you. I want to have you describe what how did the student do? Once Peter said, “I’d be interested in having scenario planning is. I think, you know, when that conversation with you,” well, it just took you listen to the term, I think it’s pretty Peter Schwartz: Just fine, and he aced off from there. And pretty soon, it was just logical, but can you talk about what the the test. this extraordinary group of scenario thinkers science behind scenario planning is and how who all just showed up and said, “Yeah, I leaders actually use it to identify different Mike Kearney: Good job. So, Peter, want to be in that conversation with you options about the future and even potential Andrew, you just wrote The world remade guys.” And it was a thrill to be part of. risks? So let’s just ground ourselves in what by COVID-19. Planning scenarios for resilient it is before we move forward. leaders. And this was a joint effort by Deloitte Mike Kearney: And, Andrew, Peter, who did and Salesforce. What spurred you coming you actually bring? When you say a group Andrew Blau: Sure. Let me just start by together? Why did you guys write it? Peter, I’ll of scenario thinkers, it obviously wasn’t just saying it is both an honor and you know, start with you. the two of you. Who else contributed to it? a challenge to try and define scenario And you don’t have to give all the names, but planning with Peter Schwartz on the line, Peter Schwartz: Well, look, this is a group folks and their backgrounds—please share. who literally wrote the book that we all learn of people who’ve worked together for a long from. So he’ll tell me whether I’m doing a time. And we were all, each of us, individually Andrew Blau: Yeah. Peter is a very good job or not. wrestling with the fact that I suspect for all of generous, very collaborative leader. And so 2 Scenario planning: Tune in to possible futures, risks, and actions | Resilient: Confronting the COVID-19 crisis E8

I want to give props to Peter for starting to Mike Kearney: And you ultimately picked this is a story where the virus is relatively invite some of the . . . really the world’s most two, though, that you use to really drive the constrained. Government action is pretty extraordinary futurist thinkers. Peter, tell stories that you talked about with scenario coordinated. Listen, this is a story. Even the story. planning. though we call it “The passing storm,” it’s a storm that definitely leaves its impact, right? Peter Schwartz: Well, first of all, there were Andrew Blau: I mean, there’s certainly This is not something that has no impact. a couple of people who work with me at other things that feel uncertain right now, Salesforce who had been part of the group right? I know there’s uncertainty about the We want to be clear that there will be before, Mick Costigan and Noah Flower. But ability of the health care system to deal with significant impact, especially for smaller then some of the other folks that had been the potential demand depending on what . . . potentially for smaller businesses, for part of our community for a long time. First happens with the virus. There’s uncertainty lower-income individuals. But, you know, of all, , who helped found the about the economic consequences, and when we see stories in the press about Global Business Network. , who many countries and cities and companies “the peak is quickly approaching,” or maybe was one of the first editors of Wired and a are wondering about the economic it’s being passed in some places, or we founder of Long Now. And then Katherine consequences. There is uncertainty about see stories about how maybe we’ll find a Fulton, who led all of our work on NGOs and what will happen in communities that are vaccine sooner, and the testing, maybe we’ll on philanthropy. So this was a group, the under this kind of a shelter-in-place or find something that’s already in the market three of them, each quite unique, each quite restrictions for potentially an extended that will be effective. Those are stories that, distinctive in their thought process. And all period of time. I mean, there’s so much I think, imagine a world like we call “The three of them contributed a great deal to we don’t know. And yet, to Peter’s point, passing storm.” our collaboration. there were two that seemed to rise to the top, because once we could understand “Good company” is a story, a scenario, Mike Kearney: So, Peter, in the document, what might be the trajectory of the disease where the disease has a longer trajectory, The world remade by COVID-19, you talk itself and once we could understand how more high-impact trajectory, and about a lot of uncertainties, and two rose much cooperation, collaboration, or lack governments struggle more over time. to the top, but could you talk about some of cooperation there could be among What’s interesting about “Good company,” of the underlying uncertainties that you countries, the kind of governments that it’s a scenario in which trust is restored in identified, and then talk about the two that we depend on, to manage a response, the out years of the scenario, but not to did rise to the top and how you ultimately once we knew what would happen with governments or media or health experts. got to those? And that was, I think, the those uncertainties, once we could track This is a story in which companies step up severity of the pandemic and the level of that, then that’s how the scenarios really and really become the heroes of the story, collaboration amongst countries. But can started to come together. And these other where they . . . because of the role that they you talk about that? uncertainties, you could see the ways that play in helping communities and economies they would flow from those other questions. rebuild. So here again, we’re already starting Peter Schwartz: In all candor, it’s pretty to see stories of companies stepping up, obvious. This isn’t one of those things Mike Kearney: Can you guys talk about whether it’s tech companies working with where . . . What the uncertainties are are what the four uncertainties are? And health agencies to help with the monitoring pretty clear. And at the beginning of it is obviously, there’s a lot more detail in the or companies that are good at logistics, what the dynamics of the actual disease paper that we’ll reference and people could helping communities to rebuild or build. This are: how rapidly it spreads, what happens go read, and I would recommend that is a story where we think companies could with you know immunity, and so on. So everybody take a take a look at it. It’s really actually come out of this with renewed trust. these questions are biological, ecological good. But can you just share what those four And some of the skepticism people have had questions that are fundamentally uncertain. scenarios are at a high level? about companies in the last couple of years And then the second thing is really about might be replaced with a new appreciation the ability to respond to those events. Do we Andrew Blau: Sure. So there are four for what they do well. do them collaboratively or in competition? scenarios that that emerged when Are we effective in our response or not? So we combined originally these two big Mike Kearney: And, Andrew, as you’re this is one of those situations where, frankly, uncertainties. What’s the trajectory of the going through these, it’s not that any of it wasn’t too hard to get to the uncertainty. disease, and what is the level or quality of these stories are right or wrong. These Now, thinking about how all that will play the collaboration between, and even in are potential scenarios, futures that out and what the right combinations are, some cases within, across governments? organizations could look to to try to that’s a different question, but the kind of The first one is a story that we did called understand, like you were talking about fundamental drivers were pretty clear in “The passing storm,” a story where earlier, the risks and opportunities this case. collaboration’s pretty good, and the disease associated with it. But these are just actually passes faster than we fear. And so possible scenarios of the future. If you

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could comment on that as you’re going is one of the possible effects of COVID-19 Peter Schwartz: You’d ask yourself the through these. and the pandemic that we are experiencing question, if you were CEO, “What would is an acceleration of a trend where East I do if we live in a world of ‘The passing Andrew Blau: When we talk about Asian countries come out of the pandemic storm [scenario]?’ What would I do if we’re scenarios, they are not predictions. In fact, I stronger on the world stage. And so a lot of operating in the world of ‘Lone wolves?’” and think of them as the antidote to predictions. the kind of international cooperation that so on. And then I’d ask myself the second They’re stories; they’re a way of thinking flows after that, the lead is now taken by set of questions: What are the indicators about what might happen. But listen, East Asian countries. that I should watch to tell which ones are there are a lot of possible outcomes and happening? And finally, what are the risks it’s frankly far too soon to tell which future Mike Kearney: And the final scenario? in the following sense: “I cannot afford to we’re actually going to emerge into. The take fatal risks. There are things that I can goal of this work is not to say this scenario Andrew Blau: There’s a fourth scenario do that are no-regrets, no matter what. And or that scenario is what surely will happen. called “Lone wolves.” “Lone wolves” is a there are things that I can do that would It’s to start to see the ways in which this scenario that says, what would happen if the have a maximal regret if one or more of combination of the way the disease plays pandemic actually goes on longer than any these scenarios occurred.” So let us say, out and the way government institutions of us are really prepared for? Perhaps, rather hypothetically, the “Lone wolves” scenario cooperate or don’t to deal with it. Those than ramping down over time, it actually occurred. If I take certain risks that would could play out in very different ways. And accelerates or ramps up over time. What if lead to the death of my company, I can’t so what we’re doing is we’re not making our attempts to control that are ineffective? afford to take that risk, period, because predictions. We’re not trying to tell you What if government collaboration is very today, I don’t know whether “Lone wolves” what’s going to happen. We’re creating weak and is not effective at managing the will occur. So I need to address that question settings. Once you start to think, Oh, if disease over time? So imagine a world where of, what are those risks that would be fatal that happened, what would I do. If that the disease feels out of control, government under those scenarios? And then the final happened, you know, where, where would action is . . . turns out to feel uncoordinated question is, what are the opportunities that we end up? How might society be different? and ineffective. And the kind of feeling might emerge during those scenarios? But How might technology be adopted in new that people might have where they don’t critically, as we move into those new worlds, ways. So, yeah, in each case that I want know where the enemy is, that the sense what kind of resources do I need to take to tell you about, these are stories about of a disease that no one can control goes advantage of those opportunities as they what might happen and really created to on for longer than anyone wants. This is a begin to emerge? structure our thinking about what they world in which we could imagine countries might mean. really putting up new borders or really Mike Kearney: Andrew, Peter talked shortening their supply lines, feeling that about the whole monitoring process. Is Mike Kearney: So, you’ve shared two so even within traditional allies, countries sort there anything that you’re recommending far: “The passing storm,” “Good company.” of turning against each other in an effort to companies to monitor beyond just kind What’s the third one? to secure their own populations. We can of looking at these scenarios and seeing imagine this is a world that plays into kind how they unfold? Are there any tools or Andrew Blau: There’s another scenario of a next generation of demagogues who techniques that you would recommend? that we’ve talked about called “Sunrise in really are trying to speak to a population that the east.” So imagine a world created as feels like “The government’s failing me. I’m Andrew Blau: These are tools for learning, the pandemic plays out for a longer period really afraid for my family. I can only trust and we should continue to engage with the of time, and the recovery is actually really something very close at hand.” And so “Lone world, watching for what direction do we uneven, where China and some of the other wolves” is a kind of worst-case scenario think things are going. I think that there are East Asian countries actually manage the with a prolonged pandemic with ineffective techniques that are more formal and less pandemic more effectively, they come out government action and a world of all against formal. Informally, I think that a leadership of it more quickly. They lead in terms of their all, just in the name of security and safety. team should be watching the world around collaboration around the health response, them and collecting evidence that really are able to manage the disease. And the Mike Kearney: So, Peter, let’s go to you. challenges their own assumptions. One kind of coordination that they demonstrate These are all interesting scenarios. But if I’m of the things that are really great about turns out to be quite effective. So they really a leader listening to the two of you, what scenarios is, they give us a framework for take the reins over time as an economic guidance, what pragmatic advice would you watching events in the world and, rather power. This is a scenario that takes some give to them when they’ve heard these four than discount the things we don’t believe, trends that people had already been talking different stories of the future? How can they or we think that’s probably unlikely, it gives about: growing economic might in China, use them? And I guess what I’m really trying us a framework for understanding “What growing influence, and that whole pivot to to get to is, it’s interesting, but now what? am I seeing?” How could this actually be Asia that people talked about in the last What do they do with us? an example of a world that I either think is decade, and accelerates it and says that this improbable, but you start to see evidence 4 Scenario planning: Tune in to possible futures, risks, and actions | Resilient: Confronting the COVID-19 crisis E8

getting created or starting to accumulate? machine learning, whether it’s big data and and I and many others have been doing Another possibility is that you begin to data analytics—people should be using scenarios for years that have been talking create frameworks for having a leadership those tools to look at not just “What’s the about the potential for a pandemic. In many conversation that the scenarios are kind of next couple of weeks going to look like,” ways, this isn’t a black swan. What should like a kind of a framework for interpreting but to begin to think about “How would I change is less our definition about what a the world. scan those much larger data sets for early black swan is; what should change is the indications of what might be happening with way we think about the future, right? Many So I would encourage leaders to be engaged the pandemic and its consequences?” And of us have been talking about pandemics, in that dialogue. What are we seeing? Don’t then what the scenarios do is give you a tool and I know Peter was involved in some work tell me whether you believe it or not. Let’s to take those perceptions and start to turn maybe 15 years ago, when you were looking start to collect these things and start to put them into kind of a longer view, like “Ah, I at the implications of SARS [Severe Acute them in against these different possibilities. see; if this is starting to happen already, now Respiratory Syndrome]—there have been There are more formal things that you can I’m going to start looking more for other scenarios about a coming pandemic for do. I mean, we’re already starting to see evidence,” right? This is a way that you can years. In some ways, this is closer to what techniques for using artificial intelligence, tune your radar to see longer-term change some people are calling a gray rhino, right? scanning very large data sets, looking for happening before it surprises you. It’s something that’s readily apparent. It’s evidence, that kind of stuff that I think a lot charging right at us. I mean, everyone can of companies are using shorter-term, we can Mike Kearney: And, Peter, you’ve been see it. start to apply longer-term. What are some doing scenario planning, as we talked about of the ways in which we don’t just have to at the outset, for years. Is there anything Mike Kearney: Andrew, you talked about rely on our own judgment about the things different with this pandemic and kind of the the fact that a lot of organizations knew that that we see in whatever news feeds we have, size and severity of it from different scenario there was a pandemic coming down the but use the tools of artificial intelligence and planning, or anything different about the pike, right, but many organizations may not data analytics, to start to comb through current environment, that leaders should have prepared for it, and I’m curious: In your much bigger data sets to look for evidence? take into consideration? opinion, how would an organization use But you want to put it against, again, is scenario planning in order to identify these that evidence that we are probably getting Peter Schwartz: Yes, first of all: a very futures, but then also maybe be prepared out of this sooner or not so soon? Are we rare event. The short-term uncertainty, in for when it ultimately happens? Because I looking for evidence that the governments some ways, is greater than the long-term think that’s part of the challenge, is there’s a are coordinating effectively or not? And uncertainty. And so you have to look at lot of things that are out there that we know then what are the kinds of combinations short-term phenomena as well as long- are going to come at some point in time, but that allow us to see what this might mean term phenomena. You need to make those oftentimes risk management structures or for us? Because I think these scenarios are short-term decisions in light of what you systems don’t necessarily account for that. going to have really different consequences think about the long term, particularly where You have a thought on that? And Peter, you depending on what industry or sector you’re you want to come out of it. But we’re in an could jump in as well. in, what kind of business you’re in, what environment where one has to look at these region you’re in, etc. several timeframes of the short term, the Andrew Blau: Sure. Listen, scenarios that kind of transition to a new world, which we don’t change action are interesting, but not Mike Kearney: Andrew, I hear a really clearly acknowledge is going to be quite effective. We need good scenario planning important point, though, and that is, we’ve different from today’s world, and we see that that really causes people to say more than, got these stories for the future, but you in the scenarios that are presented here, “Oh, that was interesting.” I had a lot of fun also need to monitor them. And monitoring but it’s that interplay of how do you make in that scenario session, because, listen, is a pretty straightforward process, but those short-term decisions in light of the thinking about the future, thinking about organizations likely have tools in place. And, long term. what might happen, is often a lot of fun to you know, we’ve obviously talked a lot about do, and it’s one of the great pleasures of this sensing over the last several years, but Mike Kearney: Great. Andrew, we work. But if it doesn’t change what people there’s likely tools in place where you could oftentimes talk about a “black swan” event. do, it’s just interesting, and interesting is not get kind of unbiased information to help you How do you think that definition is going to enough when we’re talking about issues determine whether or not these stories are change based on what we’re experiencing like this. coming to fruition or not. Is that what I hear with this crisis? you saying? So what can leaders do? A couple things. Andrew Blau: So, you know, it’s interesting One I found in our practice around doing Andrew Blau: Yeah. Listen, we live in a that you put it that way. What I think is, scenarios—and really interested in Peter’s world with more data than our parents or people may be talking about this as a black perspective on those having done it even grandparents ever knew anything about, swan, but if we take seriously what a black longer—it’s really important to engage and let’s put it to work. And I think that swan is, something that no one saw coming, critical stakeholders and decision-makers. tools—whether it’s artificial intelligence, that has an enormous impact, listen, Peter 5 Scenario planning: Tune in to possible futures, risks, and actions | Resilient: Confronting the COVID-19 crisis E8

I’m not saying they need to be in every to make sure that the point of view of the this is, how do we sustain, you know, that scenario development conversation, but executives that you are speaking to is also ability to kind of push past bureaucracy scenarios need to be developed with an eye representative. What’s their scenario? What and administration and get things done? toward who are the actual decision-makers do they already believe? And show them So that’s my hope for all of this. Let me just that need to act on this, and what do we how that could happen, but then give them end with one question. I’m going ask both of need to engage with them. Because if they an alternative. And if they don’t see the you. Andrew, I’ll let you start. We’ve talked are not feeling compelled by what we find, scenario, they already believe . . . they tend about scenario planning, we’ve talked about then we haven’t really done the job that we to discount the other alternatives. But it is these four different stories. We’ve talked need to do. So scenario-builders, scenario also important that they see a way forward about the paper that’s come out. You guys thinkers need to think about “Who’s the user from there, that they have options and have given incredible guidance on how of this? What kinds of decisions am I asking choices they can actually make. If they don’t, leaders can actually use scenario planning them to consider, and what’s the context then they’re going to try and figure out why and think about the different futures, the in which they’ll feel confident making that this can’t possibly happen. risks, the opportunities. The question that choice as a result?” Secondly, I think that the I would have for both of you is, what is one scenarios—you know, these stories about Mike Kearney: So, Peter, just let me ask. actionable step? If you’re a leader and you’ve what might happen—if we just leave it as So on a process question, if you were to never engaged in this type of scenario stories that might happen, we haven’t done come up with the different scenarios, and a planning, what’s that first actionable step enough to actually make the consequences leader or two had a different point of view, that you should take? Andrew, I’ll start real. So I think a second part of a good you would actually even want to factor their with you. scenario process is to say, “So what?” What scenarios in to create that net new story so would it mean if we end up in “Lone wolves?” that they feel that they’re included, so that Andrew Blau: Well, first, it may sound What would we do differently? What are the they’ll take into consideration the scenarios obvious, but we’d love you to read the actions we could take now to prepare? What that you had developed offline. Is that kind paper: that what it lays out is a set of these are the signals we would watch for? of where you’re going? four futures. And, listen, they’re not the We need to translate the work into the kinds only futures that could happen. There’s a of choices that decision-makers can actually Peter Schwartz: That’s exactly right. lot of possibilities. But they’re structured in act on rather than just say, “Oh, you know, a way to tease out, push out, require a kind it could be this or it could be that.” So we Mike Kearney: Okay, perfect. Peter, how of different way of thinking about where translate the work into “This is what it would do you think that this crisis is going to might we be going. Secondly, understand mean. These are what your options are.” spur leaders maybe to think differently in that the choices you make today are actually Hear what some of the trade-offs are; let’s the future? going to situate you for not just the next have a strategic conversation about that couple of weeks, but actually position you and begin to put in place the playbooks that Peter Schwartz: I think every leader in a for what comes later. And then third, I think we know what we would need to activate company, whether it’s at an operating unit that what folks can do, what people can once we start to see this or that scenario or at the whole corporate level, is asking do with this work, is start from a premise. developing. Peter, I would love for you to himself a very big question. They’ve had to I know I feel strongly about this. Whatever comment on this, because the work that you innovate to adapt to the new reality. What we thought the early 2020s were going to did over the last 30, now 40 years, is some have they learned? What has worked well? be like two months ago, I don’t think that’s of the defining features of how executives What has worked better than before, or what’s going to happen. I think that certain should be using this kind of work. what do they need to fix? So this has been things will endure for sure. But we all live in an enormous learning experience. And so a remarkable moment in history where our Peter Schwartz: Well, you know, I think the very first question in sort of coming expectations need to be examined, where you basically got it right, Andrew. The out of the crisis that people are going to our assumptions about what was certain only thing I would add to what you’ve just be asking themselves is, “What do I want to need to definitely be challenged. Where said: In a sense, you have to give people keep that was good? Did my workers like the things that we thought were 15 years a route out. By that, I mean an alternative working at home? What has to be done in away, maybe they’re five years away, and to denial, options for dealing with each of the office? Did people like shopping it in my the things that we thought would never these scenarios. If they can’t see any way retail operation online? Do I need a store? happen actually may become our reality in out, they’re going to be in denial. And so it’s What happens to my supply chain in this a year or two. So I think that what leaders important that they see, when these are world?” And I think leaders are going to need can do is use the work to structure the being presented, that there are choices that to articulate that for their companies. thinking, challenge yourself to really go they can actually make to deal with this. I back and think about, “What did I assume would only add, I guess, one other thing: Mike Kearney: Yeah. What I keep thinking was going to happen that may not? What My experience tells me that if particularly about is, we are getting things done so did I assume was far away that could be you’re trying to present very controversial much faster, just generally speaking, than close? What do I assume was implausible or and very challenging information, you want we used to. And my hope coming out of 6 Scenario planning: Tune in to possible futures, risks, and actions | Resilient: Confronting the COVID-19 crisis E8

improbable, and actually we’re starting to future. So get a diverse group of people who is about making sure that you take action. see it every day?” If we ask ourselves those challenge your thinking. The other thing that I heard is that if you are questions, if we think, in a sense, some of doing scenario planning for the organization, the “unthinkables” and start to actually get Mike Kearney: That is such a great way make sure that you engage leadership. We’re into position to think, “What would I need to to end it. It’s not just about staying within going to continue to bring incredible guests do if this were happening?” I think leaders the circle of folks that you engage with; and perspectives to help you respond, and the organizations they lead will become it’s about finding people that may even recover, and even thrive through COVID-19. much more resilient despite the uncertainty, think, obviously, Peter, very differently from I will say that our backlog of guests keeps despite the inability for any of us to see, you you, right? Maybe people that are going growing, so stay tuned. know, very far into the future right now. By to challenge the way that you think, but asking those questions, I think we’ll all be broadening your circle, applying scenario If you have a COVID-19 topic you want to better off. planning, and then moving on from there. hear more about, suggest them at deloitte. com/us/resilient, our Resilient page. Mike Kearney: And, Andrew, you exposed Peter Schwartz: Exactly right. And for more insights on all aspects of me personally to scenario planning, I don’t COVID-19, look to deloitte.com and look at know, five or six years ago. And the way that Mike Kearney: Awesome. Peter and our COVID-19 page. You can also find us I think about how an organization identifies Andrew, I know you guys are extremely on Apple podcasts, SoundCloud, Stitcher, risks, since that’s the area that I practice in, busy. I appreciate your time here. Like I said, Google Play, and even Spotify. it’s changed drastically. And so this is not go out and read the paper. We’ll put it on just about using it for COVID-19. I think what our website, we’ll put it in the notes for the And until next time, stay safe and leaders are going to find is, if they have not podcast, but it is a great read, and I think remain resilient. adopted this type of practice before, it can one thing leaders every leader should be be applied to so many different futures doing today is thinking about these different beyond the timeframe that we’re in. stories and then preparing for them, Peter, I’m going to ask you to take it preparing for the risks, and obviously seizing home. What’s one thing that you would the opportunities. So, Andrew and Peter, recommend a senior leader do today, based thank you for your time. on this conversation? Andrew Blau: Thanks, Mike. Peter Schwartz: All of the scenario planning is about challenging your mental Peter Schwartz: A pleasure. maps, forcing you to think differently, thinking the unthinkable. And the best way Mike Kearney: Thank you, Peter and to do that, besides actual . . . The good Andrew. That was incredible. I have a scenario is find people around you that few key takeaways. The first is, scenario challenge your thinking. People you trust; planning is powerful. It’s helpful, because smart, informed people whose judgment it has you think about different alternative and point of view matter to you. Start having futures that you could identify the risks conversations with them. Ask them what and the opportunities and then obviously their scenarios are. Share our scenarios take action. The other thing that I heard with them. Widen your circle so that you’re loud and clear is, we do not know how not just talking to people that are inside the story is going to unfold, but leaders your own mental map. People who will should understand the scenarios, how they challenge your mental map. Every time I’ve may evolve, and they should be prepared. been wrong about the future is because I The last thing is, if you are using scenario didn’t talk to a wide enough circle of people. planning, this is not just an exercise in Diversity matters for thinking about the talking about how the future may unfold; this

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