During recent in-person discussions with boards and senior leaders in Asia, the Americas and Europe, the directors and executives cited the inability to plan as their single greatest business challenge in 2025. Consequently, effective leaders are conducting robust scenario planning to avoid stagnation or delayed decision making as recent advances in generative AI change how they approach scenario development.
The global leaders provided several concurrent challenges that make planning difficult:
Said one senior executive recently, “We used to have a core scenario in place with a handful of backups, but now we need to have literally hundreds of options on the table and know which one to follow at any given time. And the answer can change daily or weekly and vary by product line or country.”
Peter Schwartz, a pioneer of scenario planning and author of The Art of the Long View, likened the use of scenarios to “rehearsing the future.” Similar to rehearsing a theater production, the process of scenario development historically required a collaborative effort of numerous individuals and several days, weeks or months of refinement before the scenarios were ready for their intended audience. This traditional approach to scenario development generally was time-consuming and resource intensive.
Recently in Silicon Valley, PruVen Capital Managing Partner Ramneek Gupta shared the concept of “no scenario left behind.” He and his colleagues have been studying advances in scenario planning and funding solutions that could enable business leaders to leverage advanced AI such as large language models (LLMs) and large geotemporal models (LGMs). LGMs use frameworks that analyze and reason across both time and space to exhaustively simulate virtually any and every event and scenario. These AI models provide dynamic risk modeling and real-time simulations for a vast array of business scenarios, allowing business leaders to address the inability to plan.
WTW’s Jessica Boyd and Cameron Rye explain that advances in generative AI tools have enabled the rapid generation of numerous scenario narratives across a wide range of disciplines. These models accelerate the traditional, resource-heavy process of scenario development, streamlining the steps while introducing novel perspectives that human analysts might overlook. They help overcome the limitations of human imagination that occur when people overlook or underestimate potential risks that have not yet happened in historical data. This can reduce potential blind spots that otherwise leave organizations vulnerable to highly disruptive events.
Already, AI breakthroughs have enabled the next stage of scenario planning using advanced language models in areas such as weather forecasting, including hurricane landfall predictions, as well as political and economic modeling. These models provide the opportunity to expand beyond the traditional exploratory scenarios that most businesses currently use. For example, normative scenarios (similar to a reverse stress test) can add significant value when they are built around specific business objectives.
Further, within the U.K. and Europe, new regulations focused on financial institutions have sparked considerable attention on scenario testing (Operational Resilience 2025 in the U.K. and Digital Operational Resilience Act [DORA] in the EU). These rules have further increased the importance of well-developed and defined scenarios, including scenario testing with third parties.
Recently, WTW’s Laura Kelly explained how scenario building and impact analysis have become crucial parts of business planning and risk management. She suggests three key steps in scenario planning and impact analysis:
Effective leaders are not halted by uncertainty but rather mobilize around it. They identify the broad range of scenarios that might occur in a given set of circumstances, prioritize the greatest risks as well as the solutions that can mitigate these risks and enable the company to thrive.
A version of this article originally appeared on Forbes on August 15, 2025.
