Fusing strategic risk and futures methods to inform long-term strategic planning: case of water utilities

• DOI: 10.1007/s10669-021-09815-1
• Publication Date: 2021-05-25T19:02:37Z
• Authors: Ana Luís; Kenisha Garnett; Simon J. T. Pollard; Fiona Lickorish; Simon Jude; Paul Leinster
• Keywords: Scenario Planning

Abstract Risks and futures methods have complementary strengths as tools for managing strategic decisions under uncertainty. When combined, these increase organisational competency to evaluate manage long-term risks, improving the flexibility agility of organisation deal with gross uncertainties. Here, we set out a framework guide assessment risks business planning, based on its application at Portugal’s largest water utility, Empresa Portuguesa das Águas Livres. Our approach extends risk by incorporating scenario planning—a used help utility move beyond single point forecast focus critical dimensions uncertainty that are fundamental resilience corporate objectives their vulnerability external pressures. We demonstrate how combine two approaches—risk futures—and use them assess (i) baseline evolves alternative futures, (ii) aggregate corporate-level exposure, (iii) process responses needed multiple, interdependent risks. The offers evolving improves utility’s knowledge uncertainties, ability impacts developments over long time horizons consequences actions degree adapt possible future challenges. supports managers in through appraisal management can be replicated other contexts bridge operational perspectives enterprise risk.