The art, science, and technology of geopolitical scenario planning

Large companies and governments have long monitored flashpoints and modeled scenarios to anticipate and prepare for disruptions. Yet some of the defining shocks of this century—from the COVID-19 pandemic to Russia’s invasion of Ukraine to the biggest global energy crisis in history, caused by the war on Iran—have caught many off guard and left them unprepared to react. Moreover, the scope and velocity of such disruptions seem to be on the rise. While “black swans” (unpredictable events with high impact) and “gray rhinos” (probable events with high impact) used to occur sporadically, today several alight or stampede simultaneously. All of which begs the question: Can organizations do more to anticipate and plan their responses to external shocks?

The question is germane given that, in recent years, geopolitics has evolved from a risk and public policy issue into a core aspect of corporate strategy and board-level consideration for many organizations. Numerous companies have adjusted their operating models, geographic footprints, and capital allocation in response to rising trade tensions, industrial-policy interventions, and export controls. In many cases, however, these actions may not fully reflect the intensity of the risks—or the size of potential opportunities.

To be sure, structured thinking about the future is not a crystal ball. However, the authors’ experience of leading policy planning for a multilateral defense institution, steering strategic foresight at a global energy company, and helping multinational corporations strengthen their geopolitical capabilities and strategic planning under uncertainty has demonstrated the value of strategic foresight in verifying assumptions, future-proofing organizational policies, and providing senior leadership with situational awareness. In this article, they offer a playbook for developing geopolitical foresight, covering the science, art, and technology of the long view.

Strategic foresight is not an academic exercise. Its purpose is to help leaders make better decisions in highly uncertain and complex environments. Once leaders have defined their objectives, they can choose from a tool kit of foresight development instruments. Below, we outline five that organizations frequently employ:

Horizon scanning: gathering internal and external perspectives to create a baseline understanding of the geopolitical context

Scenario planning: developing a range of possible event-driven scenarios, their outcomes, and implications for critical strategic and tactical decisions.  Suggested principles are:  assume most of the business will continue as usual, adopt a broad range of scenarios, focus on a few consequential decisions, cocus on risk appetite, not probabilities, and capitalize on uncertainty.

Contingency planning: creating playbooks for crisis response that help leaders weigh numerous factors and determine actions

Simulations: role-playing scenarios that test leadership teams under pressure to make decisions in real time

Tabletop exercises: role-playing scenarios with adversarial red and blue teams to challenge leaders’ assumptions

Together, the five methods for generating geopolitical foresight constitute a tool kit leaders can use to guide their strategies amid geopolitical uncertainty: Horizon scanning builds awareness of potential near-term developments, scenario planning captures multiple futures to guide strategy, contingency planning bolsters internal alignment and operational readiness, simulations stress-test resilience and response capabilities, and tabletop exercises reveal actions that governments may take that could shape the business environment in a crisis. These instruments help fuse foresight with action.

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