Future scenarios for FDI ?
An optimist looking at the markets this week would see an end to the bear market and a return to bullish ways. A pessimist would see another bear market rally. Who is correct ? That is (unfortunately) impossible for me to judge. A wise investor has a strategy in place that will be robust in both scenarios.
At this time of market uncertainty it would benefit most IPAs to assess how robust their grand strategy is. Scenario planning techniques provide methods of constructing potential futures where strategies can be tested. National governments often have scenarios in place that can be adapted for FDI specific work. Some regions and cities have also carried out scenario generation projects. Even if you have to start from scratch, basic but useful scenarios can be put together quite quickly. The scenario generation process should focus on uncertainties that would impact most heavily on FDI. Time horizons will depend on how long your strategic plan is due to last. Obviously GDP Global would be pleased to assist. Once the future scenarios are constructed the performance of the IPA grand strategy can be assessed in the context of each potential future. The sort of questions you will want to examine include:
1.
Is our location as attractive to inward investment in each scenario ?
2.
Do our rivals gain advantages over us in some scenarios ?
3.
How will our key/target sectors perform in each scenario ?
SWOT analysis is a quick and easy method to assess how well the strategy performs in the various futures. If your strategy performs adequately in all scenarios – great. If it has weaknesses in some circumstances then you have been alerted. I would not advocate wholesale change on the basis of poor performance in one particular future. However, if events start to move in the direction of that scenario you have the opportunity to act ahead of your competitors and alter your strategy accordingly.
