Scenario planning dominates enterprise risk management. It also fails, structurally and repeatedly, for exactly the kind of risks that threaten global companies most.
On February 1, 1997, a fire broke out at the Aisin Seiki factory in Kariya, Japan. Aisin was the sole supplier of a specific brake component to Toyota, and just-in-time inventory meant Toyota carried roughly two days of stock. Analysts predicted a disruption of weeks, possibly months. Production resumed in five days.
What made the recovery possible was not a contingency plan, and it was certainly not a scenario document. It was the structural properties of Toyota's supplier network: the trust, the technical transparency, and the modularity of manufacturing that let 200 firms self-organize an improvised production system over a single weekend.
There is a meaningful difference between preparing for what you think will happen and building the capacity to absorb whatever does.