Fortune Magazine has an article by columnist Geoffry Colvin addressing risk management. Many companies have failed to learn the key lessons of risk management, including the need to build scenarios. Colvin writes:
To get into the scenario mindset, check the scenarios others have built. Shell publishes the outline of its annual exercise (www.shell.com/scenarios), and while it's intended to help a global energy company, it's widely applicable. The latest version foresees a world shaped by three large forces: a demand for efficiency and corporate performance as capitalism spreads and capital markets become global, a demand for community as developing nations seek a more peaceful future, and a demand for security as the world seemingly becomes more dangerous. Those forces will inevitably conflict. What might happen when they do? How might it affect your company?
Another recent set of deeply developed scenarios that will stimulate your mind comes from the National Intelligence Council, picturing possible futures for 2020. Will globalization advance peacefully and prosperously—with China and India becoming economic superpowers? Or will the U.S. continue to dominate the new global order? Or will spreading nuclear weapons lead to a world so secure it's Orwellian? Your company's future is no more than two steps removed from the answers to those questions.
