Few people could have anticipated the year weâre having. Weâve experienced substantial oil price cuts, liquidity issues in the bond market, a dramatic stock market correction and ongoing economic concerns related to the COVID-19 pandemic.
The magnitude of these simultaneous challenges underlines the need for business leaders to implement scenario analysis. Scenario thinking helps top managers assess the companyâs readiness to respond to a wide range of situations and make any needed adjustments to the business as a result. Quantifying possible changes in the near future and defining the forces driving these changes gives businesses a powerful tool to guide their decisions in the present.