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Summary Strategic Technology Management & Innovation (STMI)
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Scenario-Driven Roadmapping to cope with uncertainty: Its application in theconstruction industry (lecture 2)
Strategy should enable a firm to continuously adapt to changing environments and cope with
uncertainty. In order to simultaneously cope with uncertainty and prepare for the future, strategies
need to be robust. By robustness it is meant that the strategy is successful under a wide range of
circumstances.
The aims of this paper are therefore twofold. First, we aim to bring greater insight into the topic of
coping with uncertainty in business roadmaps. Second, we intend to provide a convenient approach
that enables firms to benefit from guiding their strategic innovation activities while being able to be
successful under a wide range of possible future environments. An approach is developed that
integrates scenario planning into business roadmapping (termed Scenario-Driven Roadmapping).
Roadmapping has a communicative and directive strength.
Business roadmapping
A business roadmap is a visual representation of the evolution over time of those markets that a
company wants to serve in the future, the products it wants to offer on these markets, and the
technologies and other capabilities that are necessary to make these products. Hence, it is a useful
tool in formulating and implementing (corporate) strategies. The roadmap ensures that the right
capabilities are in place at the right time and ensures that the firm can communicate complicated
issues to both employees and external stakeholders. Developing a business roadmap involves two
critical components formulating a strategy and developing it into a roadmap.
The widely-tested roadmapping approach T-plan contains three stages: a planning stage, a workshop
stage and a rollout stage.
Environmental uncertainty
Environmental uncertainty is made up of two elements: 1) a lack of information available for making
accurate predictions, 2) uncertainty is not a constant feature of the environment, it rather is
dependent on the perceptions of organization members.
There is a difference between changing environments and environmental uncertainty. Uncertainty is
not created by a changing environment but by the unpredictability of the changes. The roadmap
discussed in this article is very useful in coping with the environmental uncertainty.
, Type of uncertainty Source
State uncertainty - Lack of understanding on Macro-environmental uncertainty – uncertainty
how elements in the external environment in the broad, high-level environment that
might change and how these elements are influences all organizations to some extent.
interrelated. Meso-environment uncertainty – Uncertainty
about the industry structure.
Micro-environmental uncertainty – Uncertainty
about those factors that have to do with a
company doing business in a specific market.
Effect uncertainty – Lack of knowledge about Extend to which ‘state uncertainty’ affects a
how the changing external environment will company
affect the organization
Response uncertainty – Lack of understanding Uncertainty about new solutions and
about the options an organization has to capabilities and their desirable or undesirable
respond to the changing environment and/or consequences.
the inability to predict the consequences of
these response options.
Scenario planning
Scenario planning is an approach of probing the future (gaining insights into what is likely to occur in
the future and what the best response is) to capture a wide range of possible future environments
about which a firm can then anticipate. Scenario planning directs the attention of managers to
changes they would otherwise never consider. Through this, it reveals assumptions that one makes
about the future, it structures uncertainty and it can create a different view and awareness about the
possibility of changing environments.
The scenarios should be developed based on the driving forces that shape the future and have an
impact on the success of a business. Examples are: economic climate and emerging technologies. The
next step is to consider what these scenarios mean for the organization. This may involve observing
market needs and conducting a SWOT analysis.
Development of the scenario-driven roadmapping approach
Scenario-driven roadmapping integrates scenario planning into roadmpapping to arrive at a robust
roadmap. It ensures that the resulting business roadmap is able to cope with multiple future
environments and it prevents the firm from taking the high risks associated with assuming one
future. The approach both pays attention to winning support for the roadmap within the
organization and increases the employees’ understanding of the firm’s internal and external
environment.
I-Preparing the workshops
A project team needs to be formed that guides the development of the roadmap and conducts
preparatory activities for the workshop. This project team at least involves an internal/external
facilitator with expertise in the area of (strategic) innovation and scenario planning, an employee
who is knowledgeable about the organization, and various members with analytical skills.
II-Analysing the current situation
There is a state uncertainty associated with each driving force. In order to arrive at both a
comprehensive set of driving forces and a clear overview of the state uncertainty facing a company,
driving forces should be examined at the macro-, meso-, and micro-environmental levels. An
example of a tool that can be used is the Pestel+ model:
, • Macro: high level factors that influence all organizations to some extent:
o Politics, economics, social influences, technology, environment, legislation
• Meso: industry factors and trends that reveal industry attractiveness and whether an
organization is likely to be successful:
o Easy to enter industry (barriers/access) existence of substitute products, power of
customers, power of suppliers, existing competition (rivalry). Also industry trends
• Micro: factors (i.e. actors) that have to do with an organization doing business in a specific
market:
o Customer’s needs, competitor’s activities/performance supplier’s activities,
interaction with other stakeholders.
One must find valuable or weak aspects of the current organization:
• Resources: tangible/intangible assets
• competencies: skills and abilities to use the resources effectively and efficiently.
• Capabilities: combination of resources and competency → exploit core capabilities.
III-Exploring future business environments
Here, a wide range of possible future outlooks are explored. The driving forces from the previous
phase are used in developing the scenarios.
IV-Determining robust areas
, Shared implications among (mor or less) all scenarios may result from driving forces wor which the
future is considered certain. All these shared implications are taken as the basis for the business
roadmap. Next, a SWPT analysis is conducted from which sub-layers for each main layer of the
roadmap are extracted. At the end of this phase, a company has established a list of likely
implications and possesses a list of robust, high-level focus areas and preconditions that can be
included in the business roadmap. After evaluation, only the most strategically relevant and
promising focus area will be included in the roadmap to ensure a sound ratio between focus areas
and preconditions.
V-Designing the business roadmap
Within each focus area and for each precondition, the firm has to determine which market segments
it is prioritizing for the coming years. Next, it sets aims for those segments and considers what the
customers’ key requirements in these segments will be. To conclude, the firm determines the
products or processes it wants to develop in these segments and stipulates the chain of markets,
products, processes and capabilities it will require in the future.
VI-Implementing the roadmap
The firm needs to communicate the roadmap and keep it up-to-date to reflect current situations.
Conclusion/limitations
Scenario-Driven Roadmapping: This comprehensible approach aims to develop a robust roadmap
while coping with uncertainty and retaining its communicative and directive strengths. The
effectiveness of the approach should be studied more. Also look into what ICT can offer in this
context.
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