Advisor Dennis Stearns of Stearns Financial Group in Greensboro, N.C., is a heavy dabbler in scenario learning the process by which corporate leaders combine possible wild card events as a way to identify future scenarios that nobody is expecting, and then plot out how they would respond.
The classic example is Shell Oil in the 1970s, which used the process to determine in advance how the company might turn to its advantage such strange futures as a major oil supply disruption, an unexpected market glut or as actually happened OPEC nations banding together and demanding dramatically higher market prices for the crude that was being pumped out of their soil. Other oil companies ended up being blindsided by the cartels emergence but Shell executives knew exactly how to respond, and gained significant market share in the ensuing chaos.
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