Definition
Scenario Analysis is a method for evaluating possible future situations by describing alternative ways events may develop and comparing their potential consequences.
Human Explanation
Instead of assuming one future, several plausible possibilities are considered to understand what each could mean for an organisation.
Why it Matters
It supports decisions under uncertainty and helps evaluate the consequences of different changes, assumptions and actions.
Conceptual Boundary
Scenario Analysis does not predict which scenario will occur and should not assign certainty to imagined futures. Its purpose is to improve preparedness across several plausible developments.
Practical Perspective
Useful scenarios are plausible, internally consistent and sufficiently different to reveal distinct risks, needs and decisions. Several versions of the same expected future provide little additional insight.