How to use nimble scenarios for decision-making in a complex world

Earlier this year, we reported that boards and senior leaders are conducting robust scenario planning to avoid stagnation or delayed decision-making in an environment where the inability to plan is considered a material business challenge. These leaders also said recent advances in generative AI are changing how they approach scenario development.

One example comes from David Shrier, Professor of Practice with Imperial College London. He introduced the concept of nimble scenarios, which combine elements of dynamic scenario analysis, underwriting risk analysis and venture capital valuation methodologies to enable a broader range of planning in today’s complex environment.

Why is scenario planning important today and how has AI changed it?

WTW’s Jessica Boyd and Cameron Rye wrote last year in How generative AI promises to reshape scenario analysis that advances in generative AI tools have reduced the time required to create scenario narratives. These models accelerate the traditional, resource-heavy process of scenario development, streamlining steps while reducing blind spots that could increase organizations’ vulnerability to highly disruptive events.

Professor Shrier’s nimble scenario model complements the type of “no scenario left behind” model that PruVen Capital Managing Partner, Ramneek Gupta introduced earlier this year. The PruVen model advances scenario planning and funding solutions that help business leaders use 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.

Professor Shrier explained during a recent discussion, “We are in a period of significant uncertainty, both economically and geopolitically. In this kind of chaotic environment, a linear forecast approach to strategy does not prepare appropriately for both the circumstances you are going to face and what your optimal responsibility will entail. Nimble scenarios integrate foresight projections and expert inputs to produce more imaginative and wider-ranging scenarios. This is important when it seems that every week we breed a new black swan.“

According to Professor Shrier’s research, only about one-third of companies currently use scenario planning as a regular part of their management processes. Furthermore, those who do, find keeping up with the current pace of change challenging.

What are examples of nimble scenarios?

In traditional scenario planning, a board or senior leadership team of a global financial services organization might ask, “What actions would we take” if:

• The U.S. Federal Reserve raises interest rates by 50 basis points?
• Country X invades country Y?
• An earthquake and typhoon hit country Z, where we have 13,000 employees?
• Our U.K. data center were hit by the first significant quantum computing breach in the industry?
• A new and unknown highly contagious human virus spreads across Europe?
• Our primary AI tool malfunctions, and an audit reveals widespread inaccuracies due to hallucinations?
• A disgruntled employee triggers a cyber breach involving millions of customers’ data?
• A terror attack impacts transit or utility infrastructure in a key operating location?
• Our CEO and CFO experience simultaneous health emergencies?

Nimble scenarios take the next step to create a series of 30 to 50 specific scenarios using AI tools to attach quantitative indicators for different combinations of factors involving market conditions and structural constraints. For example:

• Goldilocks growth: Low recession risk, favorable credit markets, moderate interest rates, pro-growth regulation, robust venture capital markets and strong consumer demand
• Tech pull: Moderate recession risk, inconsistent credit markets, pro-entrant regulation, tight capital markets, moderate interest rates and mixed consumer demand
• Regulatory spring: Unclear recession risk, moderate credit defaults, regulators strongly encourage new entrants, capital markets hesitate, fluctuating interest rates, unclear consumer demand
• Defensive consolidation: High recession risk, high credit defaults, restrictive regulators, frozen venture capital markets, constricted consumer demand

The above represent illustrative examples – leaders customize scenarios for each particular company and problem space with details of their own situations.

Leaders track these indicators continuously to monitor emerging trends, rather than the periodic annual process found in conventional scenario planning. Historical data from robust sources (e.g., insurance underwriting models, longitudinal proprietary data) provide confidence in trend analysis. Scenario planners create action plans against each scenario, forming an outline of the series of steps leaders could take if a given scenario develops, enabling them to respond faster in each case.

Applying this technique enables leaders to:

• Mitigate board risk by providing greater transparency and discipline around board decisions. (Boards are often retroactively criticized for decisions; nimble scenarios provide quantitative documentation of the fact pattern around why a decision was made)
• Provide greater confidence and board support in major investments by making the underlying assumptions in key decisions transparent
• Deliver more executive autonomy while retaining strong governance (defining guardrails within which management is authorized to make decisions between board meetings)
• Transition the strategy area from a cost to an investment function

Why are businesses having trouble planning today?

Concurrent challenges make planning difficult for board members and senior leaders worldwide because:

• A “new normal” remains elusive following the unprecedented market disruption of the pandemic and various global conflicts in recent years
• More frequent and interconnected risks. Events once thought rare, occur more often at scales previously unseen (e.g., climate events, property peril, wars and gray-zone attacks, shipping infrastructure, cyberattacks, disinformation campaigns, commodity prices, and employee and executive security)
• AI and new tech (e.g., generative AI, agentic AI, quantum computing and other new technologies) continue to surprise users and leaders in what it can and cannot do
• Country-specific policy changes, including rules and regulations, trade conditions and tariffs, occur frequently

How to use scenario planning to conduct an impact analysis

In Bridging the gap between risk and insurance: Operational resilience and scenario testing, WTW’s Laura Kelly outlined three key steps in conducting an impact analysis of scenario planning:

1. Prioritize key risk scenarios: Identify operational risks using robust internal and external data
2. Facilitate workshops: Conduct workshops with potentially impacted teams from across the business; for example, risk, legal, HR, regulatory, technical and IT
3. Analyze and document outcomes: Create outputs that include action plans

Effective leaders enable their organizations to thrive by identifying the broad range of scenarios that might occur under a range of circumstances and then prioritizing the greatest risks and the solutions to mitigate them.

A version of this article originally appeared on Forbes on November 18, 2025.

Author

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John M. Bremen

Managing Director and Chief Innovation and Acceleration Officer

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