Scenarios

1. Read the text.

Making up stories about the future might seem a curious occupation for grown-up executives. But there was a time, in the 1970s and early 1980s, when scenarios were a familiar part of the planning process. They then fell out of fashion for a while, as did strategic planning overall. Now that strategy is making a comeback, so are scenarios. In essence, the scenario technique consists of describing a range of possible futures. Let us suppose that the Chinese economy collapses, or that it flourishes: that the Internet enriches the telephone companies or drives them out of business. What then?

The aim is not to make predictions, but to provide a framework into which subsequent events can be fitted. If executives have thought out the possible outcomes, they should be quicker to react when one of them arrives. As Arie de Geus, former head of planning at Shell, puts it, they can remember the future.

Since the oil industry undertakes vast single investments such as refineries or petrochemical complexes, scenarios appealed as a form of risk analysis. What would happen if the oil price soared or plummeted? What was the probability of a given host government collapsing, or nationalising the industry?

Then came the reaction. In a recent book, The Living Company, Mr. de Geus describes how in the 1980s, Shell’s senior executives became skeptical. Making up stories, they said, was great fun and good public relations. But how many decisions could be attributed directly to the scenario process?

Over the last 10 years, says Roger Rainbow, Shell’s present head of planning, there has been more emphasis on getting the managers involved. “The trend has been to get them to bring scenarios into their decision processes,” he says. “We need to help people to make decisions on quite specific issues, down to the level of a specific strategy in a given country, or a specific project.”

At the same time, he reports, there is a rising level of interest outside. “We get one or two companies a week calling us up to ask our advice on scenarios. If we were a consultancy, we’d be making a lot of money.” There are a number of consultancies doing just that. Northeast Consulting, of Boston, was founded by a group of consultants who had previously done scenario work for IBM.

According to Keith Anderson, senior associate for Northeast Consulting Resources in Europe, the difference in origins is fundamental. Where Shell began with geopolitical change, the computer industry was more concerned with detailed developments in technology.

As Mr. Anderson puts it, the task is not merely to describe possible futures, but to identify the preferred one and work to bring it about. Microsoft, he observed, was dismissive about the Internet at the outset. When it perceived its mistake, it set out not merely to catch up, but to take a lead in determining how the Internet developed.

By Tony Jackson

from the Financial Times

2. Number this information in order it appears in the text:

1. People call Shell in order to ask how to develop and use scenarios.

2. At Shell, they get managers to participate more in developing scenarios.

3. Several consultancies are working in the area of scenarios.

4. People outside Shell are getting more interested in scenarios.

5. At Shell, managers have to make decisions on particular projects.

6. Northeast Consulting was started by people who had worked at IBM.

3. What do these figures refer to in the text?

1. 1980s

2. 1970s

3. 10

4. Choose the correct alternative:

1. If the price of something soars, it

a. stays the same.

b. falls really very quickly.

c. increases by a lot very quickly.

2. If the price of something plummets, it

a. stays the same.

b. falls really very quickly.

c. increases by a lot very quickly.

3. If you undertake something, you

a. carry it out.

b. take it over from someone else.

c. plan to avoid it.

4. If something appeals, it looks

a. uninteresting.

b. attractive and interesting.

c. boring.

5. If a government collapses, it

a. loses power.

b. gains power.

c. stays in power.

5. All of the following statements are false. Your task is to correct them:

1. Scenarios are of no real practical use.

2. The scenario technique involves thinking of one possible series of future events.

3. Scenarios were a part of strategic planning right through the 1980s.

4. Executives started to use scenarios before the Second World War.

5. Getting executives to make up stories is a normal thing to do.

6. Translate the following sentences into good Russian.

1. Scenarios fell out of fashion for a while, as did strategic planning overall.

2. Since the oil industry undertakes the vast single investments such as refineries or petrochemical complexes, scenarios appealed as a form of risk analysis.

3. Making up stories about the future might seem a curious occupation for grown-up executives.

4. In essence, the scenario technique consists of describing a range of possible futures.

5. If we were a consultancy, we’d be making a lot of money.

6. At the same time there is a rising level of interest outside.

7. What would happen if the oil price soared or plummeted?

8. The aim is not to make predictions, but to provide a framework into which subsequent events can be fitted.

9. When it perceived its mistake, it set out not merely to catch up, but to take a lead in determining how the Internet developed.

10. Over the last 10 years, says Roger Rainbow, Shell’s present head of planning, there has been more emphasis on getting the managers involved.

7. a) Match the words to build new word combinations:

1. computer	a. events
2. to make	b. change
3. the difference	c. process
4. to be	d. company
5. strategic	e. level
6. subsequent	f. stories
7. to drive	g. development
8. scenario	h. industry
9. geopolitical	i. technique
10. telephone	j. in origins
11. to make up	k. occupation
12. planning	l. predictions
13. detailed	m. out of business
14. a rising	n. a consultancy
15. curious	o. planning

b) Now compete with your classmates. Individually or in small groups make the longest sentence trying to include as many word-combinations as possible.

8. Explain these words in English:

1) Framework – ______________________

2) Collapse – ______________________

3) Economy – ______________________

4) Prediction – ______________________

5) Strategy – ______________________

6) Government – ______________________

7) Fashion – ______________________

8) Development – ______________________

9) Decision – ______________________

10) Consultant – ______________________

9. Jumbled words. Put the letters in their right places and unscramble the words from the articles:

1. TTRENENI

2. SSMAPEHI

3. OOHNELYGTC

4. CSORNAEI

5. OOMETUC

10. Take any of the really existing contemporary companies.

Make a research into their current situation.

Be a marketing consultant – predict the development of the chosen company for the next 5 years.

11. Project Work. Imagine you have just started a company. Your task is:

a. Give a name to your company;

b. Specify the type of your company, its sphere of business;

c. Make a detailed plan for your company for the next year; 5 years; 10 years.

KEY:

Ex. 7. 1. h; 2. l; 3. j; 4. n; 5. o; 6. a; 7. m; 8. i; 9. b; 10. d; 11. f; 12. c;13. g;14. e;15. k

Ex. 9. 1. Internet; 2. Emphasis; 3. Technology; 4. Scenario; 5. Outcome