Transformative Scenario Planning: Working Together to Change the Future

South Africa at a crossroads

In February 1990, South African president F. W. de Klerk unexpectedly announced that he would release Nelson Mandela from 27 years in prison, legalize Mandela’s African National Congress (ANC) and the other opposition parties, and begin talks on a political transition. This had launched an unprecedented and unpredictable process of national transformation. Although South Africans knew that things could not remain as they had been, they disagreed vehemently and sometimes violently over what the future should look like. Nobody knew whether or how this transformation could happen peacefully.

Professors Pieter le Roux and Vincent Maphai, from the ANC-aligned University of the Western Cape, thought that it could be useful to bring together a diverse group of emerging national leaders to discuss alternative models for the transformation. They had the idea that the scenario planning methodology that had been pioneered by the multinational oil company Royal Dutch Shell could be an effective way to do this. At the time, I was working in Shell’s scenario planning department at the company’s head office in London. Le Roux asked me to lead the meetings of his group, and I agreed enthusiastically.

My job at Shell was as the head of the team that produced scenarios about possible futures for the global political, economic, social, and environmental context of the company. Shell executives used our scenarios, together with ones about what could happen in energy markets, to understand what was going on in their unpredictable business environment and so to develop more robust corporate strategies and plans. The company had used this methodology since 1972 and continued to develop it. It helped Shell to anticipate and adapt to, for instance, the first and the second oil crisis, the fall of the Soviet Union and the rise of Islamic radicalism.¹

In 1980, Anglo American, the largest mining company in South Africa, produced two scenarios of possible futures for the country as an input to the company’s strategizing: a “High Road” of negotiation leading to a political settlement and a “Low Road” of confrontation leading to a civil war and a wasteland.² Six years later, Anglo American made these scenarios public. They were presented to hundreds of audiences around the country, including de Klerk and his cabinet, and Mandela, at that time still in prison. These scenarios played an important role in opening up the thinking of the white population to the need for the country to change. Then in 1990, de Klerk, influenced in part by this work, made his unexpected announcement.

The Mont Fleur Scenario ­Exercise

Le Roux and Maphai’s initial idea was to produce a set of scenarios that would offer an opposition answer to the establishment scenarios prepared at Anglo American and to a subsequent scenario project at Old Mutual, the country’s largest financial services group. When le Roux asked my advice about how to put together a team to construct these scenarios, I suggested that he include some people who could prod the team to look at the situation from challenging alternative perspectives. What le Roux and his coorganizers at the university did then was to include current and potential leaders from across the whole of the emerging South African social-political-economic system. Their key inventive insight was that such a diverse and prominent team would be able to understand the whole of the complex South African situation and also would be credible in presenting their conclusions to the whole of the country. So they recruited 22 insightful and influential people: politicians, businesspeople, trade unionists, academics, and community activists; black and white; from the left and right; from the opposition and the establishment. Some of the participants had sacrificed a lot – in prison or exile or underground – in long-running battles over the future of the country; many of them didn’t know or agree with or trust many of the others. Nevertheless, the members talked together fluidly and creatively, asked questions of each other and explained themselves and argued and made jokes. They agreed on many things.

The scenario method asks people to talk not about what they predict will happen or what they believe should happen but only about what they think could happen. At Mont Fleur, this subtle shift in orientation opened up dramatically new conversations. The team initially came up with 30 stories of possible futures for South Africa. They enjoyed thinking up stories (some of which they concluded were plausible) that were antithetical to their organizations’ official narratives, and also stories (some of which they concluded were implausible) that were in line with these narratives. Trevor Manuel, the head of the ANC’s Department of Economic Policy, suggested a story of Chilean-type “Growth through Repression”. Mosebyane Malatsi, head of economics of the radical Pan-Africanist Congress (PAC) – one of their slogans was “One Settler [white person], One Bullet” – told a wishful story about the Chinese People’s Liberation Army coming to the rescue of the opposition’s armed forces and helping them to defeat the South African government; but as soon as he told it, he realized that it could not happen, so this scenario was never mentioned again.

Howard Gabriels, an employee of the Fried­rich Ebert Stiftung (the primary funder of the project) and a former official of the socialist National Union of Mineworkers, later reflected on the openness of this first round of storytelling:

“The first frightening thing was to look into the future without blinkers on. At the time there was a euphoria about the future of the country, yet a lot of those stories were like ‘Tomorrow morning you will open the newspaper and read that Nelson Mandela was assassinated’ and what happens after that. […] You are looking into the future and you begin to argue the capitalist case and the free market case and the social democracy case. Suddenly the capitalist starts arguing the communist case. And all those given paradigms begin to fall away.”³

Johann Liebenberg was a white Afrikaner executive of the Chamber of Mines. Mining was the country’s most important industry, its operations intertwined with the apartheid system of economic and social control. So in this opposition-dominated team, Liebenberg represented the arch-establishment. Gabriels later recalled with amazement:

He was the enemy, and here I was, sitting with this guy in the room […]. I think that Mont Fleur allowed him to see the world from my point of view and allowed me to see the world from his.⁴

In one small group discussion, Liebenberg was recording on a flip chart while Malatsi of the PAC was speaking. He was calmly summarizing what Malatsi was saying: “Let me see if I’ve got this right: ‘The illegitimate, racist regime in Pretoria ... ’” Liebenberg was able to hear and articulate the provocative perspective of his sworn enemy.

A message of hope 

In the following six months, the team and I returned to Mont Fleur for two more weekend workshops. They eventually agreed on four stories about what could happen in the country – stories they thought could stimulate useful debate about what needed to be done. “Ostrich” was a story of the white minority government that stuck its head in the sand and refused to negotiate with its opponents. “Lame Duck” was a story of a negotiated settlement that constrained the new democratic government and left it unable to deal with the country’s challenges. “Icarus” was a story of an unconstrained democratic government that ignored fiscal limits and crashed the economy. “Flight of the Flamingos” was a story of a society that put the building blocks in place to develop gradually and together.⁵

The first three scenarios were prophetic warnings about what could happen in South Africa if the South African political leaders made the wrong decisions. The fourth scenario was a vision of a better future for the country if all three of these errors were avoided. When they started their work together, this politically heterogeneous team had not intended to agree on a shared vision. But both the content of the “Flight of the Flamingos” scenario and the fact that this team had agreed on it served as a hopeful message to a country that was uncertain and divided about its future.

The team wrote a 16-page summary of their work that was published as an insert in the country’s most important weekly newspaper. Lindy Wilson, a respected filmmaker, prepared a 30-minute video about this work. The team used these materials to present their findings to more than 100 political, business, and nongovernmental organizations around the country.

The impact of Mont Fleur

Of the four scenarios, the one that had the biggest impact was “Icarus.” Economist Nick Segal summarized the warning about the dangers of macroeconomic populism as follows:

“A popularly elected government goes on a social spending spree accompanied by price and exchange controls and other measures in order to ensure success. For a while this yields positive results, but before long budgetary and balance of payment constraints start biting, and inflation, currency depreciation and other adverse factors emerge. The ensuing crisis eventually results in a return to authoritarianism, with the intended beneficiaries of the programme landing up worse off than before.”⁶

This scenario directly challenged the economic orthodoxy of the ANC, which in the early 1990s was under strong pressure from its constituents to be ready, once in government, to borrow and spend money in order to redress apartheid inequities. When members of the scenario team presented their work to the party’s National Executive Committee, it was Joe Slovo (chairperson of the South African Communist Party), citing the failure of socialist programs in the Soviet Union and elsewhere, who argued that “Icarus” needed to be taken seriously.

When le Roux and Malatsi presented “Icarus” to the National Executive Committee of the Pan-Africanist Congress – which up to that point had refused to abandon its armed struggle and participate in the upcoming elections – Malatsi said: “This is a scenario of the calamity that will befall South Africa if our opponents, the ANC, come to power. And if they don’t do it, we will push them into it.” With this sharply self-critical statement, he was arguing that his party’s declared economic policy would harm the country and also its own popularity.

One of the committee members then asked Malatsi why the team had not included a scenario of a successful revolution. He replied: “I have tried my best, comrades, but given the realities in the world today, I cannot see how we can tell a convincing story of how a successful revolution could take place within the next ten years.” Later, le Roux recalled that none of the members of the committee could do so, “and I think this […] was crucial to the subsequent shifts in their position. It is not only the scenarios one accepts but also those that one rejects that have an impact.”⁷

This conversation about the scenarios was followed by a fullday strategic debate in the committee. Later the PAC gave up their arms, joined the electoral contest, and changed their economic policy. Malatsi said that many of these changes were “directly or indirectly influenced by Mont Fleur.”⁸

These and many other debates – some arising directly out of Mont Fleur, some not – altered the political consensus in the opposition and in the country. (President de Klerk defended his policies by saying “I am not an ostrich.”⁹) When the ANC government came to power in 1994, one of the most significant surprises about the policies it implemented was its consistently strict fiscal discipline.¹⁰ In 1999, when Mboweni became the country’s first black Reserve Bank governor (a position he held for ten years), he reassured local and international bankers by saying: “We are not Icarus; there is no need to fear that we will fly too close to the sun.” In 2000, Manuel, by then the country’s first black minister of finance (a position he held for 13 years), said: “It’s not a straight line from Mont Fleur to our current policy […], but there’s a fair amount in all that going back to Mont Fleur. I could close my eyes now and give you those scenarios just like this.”¹¹ The economic discipline of the new government enabled the annual real rate of growth of the South African economy to jump from 1 percent over 1984-1994 to 3 percent over 1994-2004. 

The Mont Fleur team’s messages about the country’s future were simple and compelling. Although some commentators thought that the analysis was superficial and many on the left thought that the conclusion about fiscal conservatism was incorrect, the team succeeded in placing a crucial hypothesis and proposal about post-apartheid economic strategy on the national agenda. This proposal won the day, in part because it seemed to make sense in the context of the prevailing global economic consensus and in part because Manuel and Mboweni exercised so much influence on the economic decision making of the new government for so long. 

Mont Fleur not only contributed to but also exemplified the process through which South Africans brought about their national transformation. The essence of the process – a group of leaders from across a system talking through what was happening, could happen, and needed to happen in their system, and then acting on what they learned – was employed in the hundreds of negotiating forums (most of them not using the scenario methodology as such) on every transitional issue from educational reform to urban planning to the new constitution. 

Neither the Mont Fleur project in particular nor the South African transition in general was perfect or complete. Many issues and actors were left out, many ideas and actions were bitterly contested, and many new dynamics and difficulties arose later on. But Mont Fleur contributed to creating peaceful forward movement in a society that was violently stuck. 

When to use transformative scenario planning

The South African context that gave birth to the Mont Fleur Scenario Exercise turns out to have been a particular example of a general type of situation. Transformative scenario planning can be useful to people who find themselves in a situation that has the following three characteristics.

First, these people see the situation they are in as unacceptable, unstable, or unsustainable. In any event, these people cannot or are not willing to carry on as before, or to adapt to or flee from what is happening. They think that they have no choice but to try to transform their situation. The participants in the Mont Fleur project, for example, viewed apartheid as unacceptable, unstable, and unsustainable, and saw the just-opened political negotiations as offering them an opportunity to contribute to changing it. 

Second, these people cannot transform their situation on their own or by working only with their friends and colleagues. The larger social-political-economic system within which they and their situation are embedded is too complex to be grasped or shifted by any one person or organization or sector, even one with lots of ideas and resources and authority.¹²

South Africans who wanted to transform the apartheid situation had been trying for decades to force this transformation, through mass protests, international sanctions, and armed resistance. But these efforts had not succeeded. Mont Fleur and the other multistakeholder processes of the early 1990s (which the previous forceful efforts had precipitated) provided South Africans with a new way to work with other actors from across the system.

Third, the actors who need to work together to make the transformation are too polarized to be able to approach this work head-on. They agree neither on what the solution is nor even on what the problem is. At best, they agree that they face a situation they all find problematic, although in different respects and for different reasons.¹³ Any attempt to implement a solution directly would therefore only increase resistance and rigidity. So the transformation must be approached indirectly, through first building shared understandings, relationships, and intentions.

The actors who came together in Mont Fleur all agreed that apartheid was irretrievably problematic and needed to be dismantled, but they came in with deep differences in their diagnoses and prescriptions. The scenario process enabled them to create common ground.

How transformative scenario planning works

I have learned how to do transformative scenario planning through 20 years of trial and error. During this time, I have been able to discern what works and what doesn’t and why, and to piece together a simple five-step process:

1. Convene a team from across the whole system
2. Observe what is happening 
3. Construct stories about what could happen
4. Discover what can and must be done
5. Act to transform the system 

Transformative scenario planning is simple, but it is not easy or straightforward or guaranteed. The process is emergent; it almost never unfolds according to plan; and context-specific design and redesign are always required. The five steps therefore constitute not so much a recipe to follow as a set of guideposts to keep in view.

In a transformative scenario planning process, actors transform their problematic situation through transforming themselves, in four ways.

First, they transform their understandings. Their scenario stories articulate their collective synthesis of what is happening and could happen in and around the system of which they are part. They see their situation – and, critically important, their own roles in their situation – with fresh eyes. 

Second, the actors transform their relationships. Through working together in the scenario team, they enlarge their empathy for and trust in other actors on the team and across the system, and their ability and willingness to work together. This is often the most important and enduring output of such projects.

Third, the actors transform their intentions. Their transformed understandings and relationships shift how they see what they can and must do to deal with what is happening in their system. 

Fourth, the actors’ transformations of their understandings, relationships, and intentions enable them to transform their actions and thereby to transform their situation.

Transformative scenario planning can generate transformations only if three components are in place. It is a composite social technology that brings together three already existing technologies into a new way of working that can generate new results.¹⁴

The first component is a whole-system team of insightful, influential, and interested actors. These actors constitute a strategic microcosm of the system as a whole: they are not from only one part or camp or faction of the system, and they are not only observers of the system. They all want to address a particular problematic situation and know that they cannot do so alone. 

The second component is a strong container within which these actors can transform their understandings, relationships, and intentions.¹⁵ The boundaries of this container are set so that the team feels enough protection and safety, as well as enough pressure and friction, to be able to do their challenging work. Building such a container requires paying attention to multiple dimensions of the space within which the team does their work: the political positioning of the exercise, so that the actors feel able to meet their counterparts from other parts of the system without being seen as having betrayed their own part; the psychosocial conditions of the work, so that the actors feel able to become aware of and challenge (and have challenged) their own thoughts and actions; and the physical locations of the meetings, so that the actors can relax and pay attention to their work without interruption or distraction.

The third component is a rigorous process. In a transformative scenario planning process, the actors construct a set of relevant, challenging, plausible, and clear stories about what could happen – not about what will happen or about what should happen – and then act on what they have learned from this construction. The uniqueness of the scenario process is that it is pragmatic and inspirational, rational and intuitive, connected to and challenging of dominant understanding, and immersed in and disconnected from the complexity and conflict of the situation. Furthermore, the future is a more neutral space about which all actors are more equally ignorant.

A new way to work with the future

The transformative scenario planning process that was invented at Mont Fleur originated in the adaptive scenario planning process that had been invented at Shell two decades earlier – but it turns this process on its head. In an adaptive scenario planning process, the leaders of an organization construct and employ stories about what could happen in the world outside their organization. The aim is to formulate strategies and plans to enable their organization to fit into and survive and thrive in a range of possible futures that they think they cannot predict and cannot or should not or need not influence.

But this is useful only up to a point. Sometimes people need an approach not simply for anticipating and adapting to the future but also for influencing or transforming it. For example, an adaptive approach to living in a crime-ridden community could involve employing locks or alarms or guards, whereas a transformative approach could involve working with others to reduce the levels of criminality. Both approaches are rational, feasible, and legitimate, but they are different and require different kinds of alliances and actions.

The key difference between adaptive and transformative scenario planning is, then, one of purpose. Adaptive scenario planning uses stories about possible futures to study what could happen, whereas transformative scenario planning also uses stories about possible futures to influence what could happen. To achieve these two different purposes, adaptive scenario planning focuses on producing new systemic understandings, whereas transformative scenario planning also focuses on producing new cross-system relationships and new system-transforming intentions. And to produce these two different sets of outputs, adaptive scenario planning requires a rigorous process, whereas transformative scenario planning also requires a whole-system team and a strong container.

Transformative scenario planning addresses problematic situations slowly and from the inside out. Over the course of the five steps, the actors gradually transform their understandings, relationships, and intentions, and thereby their actions. Meanwhile, the transformation ripples out from the individual leaders to the scenario team, the organizations and sectors they lead, and the larger social system, either within the project or well beyond its end. A transformative scenario planning project can get a process of systemic transformation started, but the process may take generations to be completed.

This article is an abridged version of the first two chapters from Adam Kahane’s book “Transformative Scenario Planning: Working Together to Change the Future” (San Francisco: Berrett-­Koehler, 2012).