While hosting our Generative AI “Work and Play” group today, a dear friend and colleague offered this sobering bromide:
“Trust takes decades to build, and a moment to lose.”
Why does this matter? Because hype cycles take us—and our stakeholders—on a wild ride. Without strategic guardrails, our brand may be forever damaged.
Yet here we are, diving into countless ChatGPT and other generative AI use cases and experiments, skipping the strategic questions and downplaying the consequences of unfettered use.
I am guilty as charged. I swim daily in the ChatGPT pool, building prompts for my LinkedIn Learning programs, articles, blog posts, and streaming shows. The tool takes me on a cruise through Curiosity Cave.
Sometimes we need to resist (or at least slow down) sexy ideas–and ask the pragmatic, unsexy questions, such as:
- What stage of disruption are we currently experiencing with generative AI? What behaviors confirm that?
- What is the impact (short and long term) on our own business? (Trust, brand, profits, other?)
- How is generative AI aligning with, or challenging our values?
- What is the impact of generative AI on our customers and their business?
- How will we quickly adapt and shift strategies?
Generative AI is currently disrupting societal norms, jobs, workflows, and accelerating confirmation bias. As disruption expert and bestselling author Charlene Li recently told me, “We are just climbing a steep disruption bell curve…the way we work will look completely different a year from now.” (check out her resource-rich newsletter here)
This is an ideal time to seek help from a tried and trusted process to calm the disruptive beast: scenario planning.
Lisa Nirell leading a planning session with Charlene Li in 2020
This process is unfamiliar to many leaders who rely on traditional forecasting and budgeting approaches. It may sound un-sexy, yet it can help you make sense of this exponential change moment.
Smart leaders are becoming re-acquainted with the power of scenario planning and, in the process, boosting their career impact.
And for marketing leaders specifically, you need this process to address myriad shifts. In addition to technology disruption, consider these:
- New product launches: how might a pre-mortem soften the blow of missed revenue or market share goals? What if the product goes viral…are you ready?
- Macro shifts: what cultural, regulatory, or economic factors might impact your growth plan? Have any of your customers suffered from the SVB or Credit Suisse debacle? How might you help them?
- Changes in your customers’ behavior: in the USA, our traditional values have plummeted since 2019. Check out this recent summary of a Wall Street Journal/University of Chicago USA Values study. How are you adjusting your go to market, messaging and digital strategies to these tectonic shifts?
- Industry-specific changes: Does AI represent a new competitor? What if your top two competitors merged? What regulations stunt growth? Scenario planning can help here.
- Natural disasters and pandemics. No need to explain this one.
You might be new to scenario planning. So was I! That inspired me to interview CMOs and board executives to uncover essential rules for scenario planning success. Consider these five:
- Include outsiders. It’s tempting to read the label from inside the bottle and run your own planning sessions. It can be costly.Consider Goldman Sachs, which reported a 69% drop in fourth quarter 2022 profits. Chairman David Solomon admitted that they were juggling too many priorities. The Economist’s Patrick Foulis attributes their financial and strategy woes to a lack of reflection and hubris during the post-2008 financial crisis era. “I don’t think they have really gone through a stern self-examination of how they would adapt to business model changes.” They either excluded or ignored outside advisers and consultants to facilitate difficult conversations, which would have led to greater priority setting rigor. This led to what Foulis calls a “mediocre, pedestrian, and humdrum valuation.” Find and hire outside voices who can promote and support your AI innovations. They might include academics in the field, friends, other CEOs, and industry experts.
- Select the right leaders. Your ideal team members will exhibit creative and flexible mindsets. They realize and assume we cannot accurately predict the future. For some team members, that ambiguity will feel paralyzing. For others, it is liberating.
Siteworks CMO Tracey Mustacchio uses scenario planning not only to mitigate competitive and market surprises. She also considers it invaluable for developing collaborative leaders and removing silos. “My teams must be strategically and financially prepared for multiple potential future scenarios—including best case, worst case, and most likely…we also work through tabletop exercises to simulate scenarios and test our ability to work as a cross-functional team.”
- Create constraints. Prior to the first meeting, gather the top drivers of change (or scenarios) that could significantly impact your future. Some may include, for example, a future pandemic, supply chain disruptions, or getting acquired by your biggest competitor. Select no more than three potential scenarios and impose time constraints. This will help you avoid overtaxing teams. Mustacchio observes that “if you don’t timebox decision- making and building out plans for different scenarios, you can quickly fall victim to “analysis paralysis.”
- Establish clear guiding principles. Identify and publish a small set of filters, or guiding principles, to set priorities. You will use them to set priorities and build action plans within the best case, worst case, and most likely case scenarios. Seasoned Board Chair, investor, and former Coca-Cola officer, Eric McCarthey, often uses three guiding principles:
- In response to this potential scenario, does our strategy align with our values?
- Will this approach boost the bottom line?
- Will this option drive predictable results in 2023?
- Resist short-term thinking. It’s a tempting time to over-index on end-of-quarter activities and share price. This leaves the door open for your competitors to seize on new, unexplored opportunities. Scenario planning should be part of your emergency toolkit, regardless of your economic health.
Recently, the Chief Experience Officer from a large U.S. based investment firm participated in a scenario planning exercise to address the potential loss of their largest business partner. The company was reporting solid returns to investors. Yet that large partner represented 40% of their investor mix. This left them competitively and financially vulnerable. The President asked the planning team to develop three new growth strategies (most probable/moderately probable/least probable) if they were to lose that partner. The team sprang into action and created a short list of new growth strategies to pursue.
A new opportunity also emerged during the session. The team also generated a plan that eventually launched a successful new lending platform. This platform differentiated them from a sea of sameness. Today, it’s also boosting investor returns.
ChatGPT did not attend that pivotal planning session.
In a 2020 HBR article, J. Peter Scoblic reminds us that “It takes strength to stand up against the tyranny of the present and invest in imagination.”
Thoughtfully designed scenario planning gives you a winning hand during disruptive stages of AI adoption—and help you leap from a marketing fulfillment center to a strategic adviser.
Sexy? Not at all.
A brand and career cred builder? More than you can imagine.
P.S. I’ll be covering this topic in upcoming keynotes and livestreams. Interested in hiring me for your next marketing conference or customer event? Drop me a note.