DC Velocity - IdeaBook 2014

million-dollar enterprise resource planning (ERP)
system?”
x Identify the “driving forces.” Driving forces are
internal or external factors that will shape future
supply chain dynamics and consequently impact
the business environment in which the organiza-
tion operates. Driving forces can include such issues
as literacy rate, aging population, gross domestic
product (GDP) growth, political stability, govern-
ment regulations, technological innovations, and
so forth.
x Develop scenarios. Once a comprehensive list
of driving forces has been identified, the next step
is to prune the list down to the two sets that are
most relevant to the focal question, along axes of
uncertainties. By combining the two driving forces
along horizontal and vertical axes, we end up with
four quadrants, each of which represents a unique
future-state scenario that needs to be explored.

For example, let’s assume that for the focal question “Should we expand into China and open X number of additional distribution centers?” the two driving forces identified are “strength of China’s economy” and “government regulations.” By assuming the extreme possible outcome of each driving force, and then combining these two driving forces along the X and Y axes, four quadrants are created, each of which houses a unique future-state scenario. Each scenario is identified by a unique name, and the predicted resulting environment is described in as much detail as possible. For example, for the scenario titled “Accelerated Growth,” you might write a short narrative that paints a picture of a booming economy, double-digit business growth, productive labor force, and so forth. The core objective here is to identify the conditions under which your organization would have to operate if the said scenario were to materialize. (See