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“Disaster Proof: Scenario Planning for a Post-Pandemic Future” Episode 133

with Lance Mortlock

“Disaster Proof: Scenario Planning for a Post-Pandemic Future” with Lance Mortlock Episode 133

Scenario Planning is the topic of this episode and our guest is Lance Mortlock - a Senior Strategy Partner with Ernst & Young (EY),

Based in Canada, Lance has provided management consulting services on +150 projects around the globe. He is also a columnist, the author of “Disaster-proof scenario planning for the post-pandemic future” and a visiting Professor at the University of Calgary Haskayne School of Business.

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Highlights from “Disaster Proof: Scenario Planning for a Post-Pandemic Future” with Lance Mortlock

Tell us a little about yourself. You spent more than 20 years living abroad in a plethora of different countries, advising companies on strategy and project management, and currently, you’re partnering with the EY in Canada.

So, yeah I’m a career consultant, as you point out. My career has really been going from country to country and project to project, advising all kinds of companies, mining, oil, gas, utilities, government public sector, organizations, working on some of the most strategic issues, whether that’s reforming the strategy, changing the business model, mergers, acquisitions.

So 90% of my time is spent as a strategic advisor, and then I would say the rest of my time I split between writing and, as you mentioned, I love to write points of view around business challenges and different business topics. I’m also a visiting professor at the business school here in Calgary. So, I teach strategy and mentor students and so I really enjoy that.

Tell us how you came into the world of scenario planning. How did it all begin?

As a strategy consultant, I have had the opportunity to work with all kinds of organizations on future settings and thinking about an organization’s path forward. And very early on in my career, I worked with Shell. Actually, I was based in Aberdeen for a couple of years. And I worked with which Shell’s integrated planning team.

And if you know anything about scenario planning and if you research it, you quickly realize that Shell is one of the eminent leaders in the scenario planning space. They have, in fact, been doing it for 50 years. It’s evolved quite a bit over the last 50 years, but they are doing it nonetheless.

And so, the early exposure gave me a sense of the power of this tool. I would say, over my career, from project to project, I’ve used aspects of it in different ways to help the clients that I’ve been working with on their complex issues, and it kind of stemmed from there.

And then I would also say it strikes me that we live in a world where there’s a huge amount of volatility, uncertainty, complexity, ambiguity. It feels like that is accelerating and so clients and organizations, both in business and in the government and public sector are looking for ways to make sense of this uncertainty. This is a very powerful tool to help with that.

What can history teach us about scenario planning?

It’s interesting. Like when you go back to as far back as the 1970s and we look over the last 50 years, we keep having these boom and bust cycles where there are periods of boom. There’s growth, there’s the investment, there’s prosperity. And then something happens.

There is the OPEC oil prices crisis in the 70s, there’s the Latin American sovereign debt crisis in the 80s, the dot-com, the economic crisis, the Covid-19 pandemic that we’ve been living in for the last year, and a half. It keeps happening and it’s interesting because it feels like we go through this crisis and then we get back to normal.

Hopefully, we’ll get back to normal when it comes to Covid. And then our memory seems to be short-term, we sort of forget about it. And what I’m saying is, like it’s going to happen again. We don’t quite know what the next crisis is going to be but there will be one and it will likely happen within the next 10 years.

So, what are we doing as a society and as businesses to prepare for that? Do we have the right level of business resilience, the shock absorbance in our organization to be ready for that next crisis because it’s going to occur?

And so, what I advocate for, in my book “Disaster Proof” is leaders need to take this more seriously, they need to take the results of this more seriously, as we go forward. I talk about in the book a couple of case studies, one being the center for strategic and international studies, CSIS, in the US. Also, the World Economic Forum, which, by the way, endorsed my book.

Both of those organizations a couple of years ago had done some future thinking around the use of scenarios and global pandemics and they were largely ignored like people are not taking the results of these things seriously. So, it’s not only about using the tool, but it’s actually going through the process. But I would say it’s also taking the result seriously which did not, from the research that I’ve done, happen, as it related to Covid and we’re now dealing with the consequences of that.

Why don’t we listen?

I think it’s a combination of “I go back to people who have a short-term memory and I think we look for things in the environment that reconfirm our beliefs and we fail sometimes to recognize those signals in the external world that might not confirm our existing beliefs”. So that’s one thing. Secondly, I would say what I call in the book, we get into this sort of these confined riverbanks and we need to expand the riverbanks and actually say what’s possible and what’s probable could be much wider than what we’re thinking right now.

Humans generally do not like change. We struggle to deal with change, and there are all kinds of research that supports that. One of the great change management professors that I quote in the book is Professor John Kotter at Harvard. And if you read any of his work in any of his very popular books, he just talks about like how as humans like particularly in business, we struggle with change. I think you get into a comfort zone and then you get squarely hit on the side of the face with something unexpected.

That’s why I’m advocating for more progressive thinking, use of tools like scenarios and future thinking, to create more intelligent organizations, organizations that are more systems-based in their thinking, trying to understand what’s happening in the world and the uncertainty, more formalized processes for understanding uncertainty.

Some companies do it pretty well, like Rolls-Royce, a really great luxury car company. They formalize uncertainty management and they do a good job in a very competitive car market, understanding the uncertainties in the world, through the use of scenarios. We need to do more of that, companies need to do more of that.

Why is it important to wallow in ambiguity sometimes?

I think part of the challenges and I see this: I work with a lot of companies that have a lot of engineers in their workforce; is there’s this convergence on deciding what to do too quickly. Humans are in some ways solution-orientated. But sometimes if you get to the solution and you converge on that solution too quickly, you might be solving the wrong problem.

And so, one of the things that I talked about building some concepts from an American psychologist, Joy Guilford, is this sense of it’s important to diverge in our thinking, to wallow in the ambiguities, as I call it, for a bit longer.

And so, leaders have to be out of balance, convergent, in divergent thinking, and spending enough time in each of those zones. Don’t too quickly get to the solution. Let’s spend enough time, exploring the possibilities so that the solving the right problem versus the wrong problem, at the end of the day.

And that feels uncomfortable, I would say, to wallow in the ambiguity as it were because you might not have the answers and those conversations and those meetings and those discussions that you have where there is no solution. But you’re just discussing and thinking about uncertainty, volatility, complexity, and ambiguity. That’s powerful to play with that mentally and say: “Well, what are the possibilities? What could happen?” before you get to: “Okay. What are we going to do about it?”

Can you give me an example of a company or an organization or a government, that hasn’t handled scenarios or events well or where they haven’t had a good reaction or good handling of the situation?

One of the examples that I talk about in my book is with the Canadian government, in fact. Prior to Covid, they had a unit setup that was using signal monitoring and, in fact, some pretty interesting technology called natural language processing which is an AI technology. And they were using it to monitor diseases around the world and the idea being was an early-warning system that would inform their strategic thinking around potential pandemics before they become major issues.

And so this unit had played a successful role in SARS, MERS, and other diseases. Unfortunately, right before Covid, the Canadian government decided to defund it. There was an article in The Globe and Mail, I talk about it in the book and that struck me as an example of these kinds of signal monitoring, which are part of the scenario planning process, are equally as important.

Had we not defunded that, had we got that early warning in time, we could have averted potentially the number of deaths. We could have advance prepared the PPE equipment that we didn’t have in those early days last year. We could have prepared hospitals and ventilators for an increase in patient numbers. We could have taken different measures to shut down the airline traffic and testing. But we didn’t, we defunded something and again we’re dealing with the consequences now.

Show Notes

Learn more about Lance’s work at lancemortlock.com

Connect with Lance on LinkedIn.