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Assess the usefulness of scenario planning to a business, such as ASOS. - Edexcel - A-Level Business - Question 2 - 2019 - Paper 2
Question 2
Assess the usefulness of scenario planning to a business, such as ASOS.
Worked Solution & Example Answer:Assess the usefulness of scenario planning to a business, such as ASOS. - Edexcel - A-Level Business - Question 2 - 2019 - Paper 2
Step 1
Arguments for scenario planning
Answer
Scenario planning can help ASOS to prepare for uncertainties in the market by analyzing potential risks and opportunities. By considering various possible futures, the company can develop strategies that ensure resilience against unexpected events, such as supply chain disruptions.
Furthermore, scenario planning encourages a proactive approach to decision-making, allowing ASOS to allocate resources effectively. This aligns with their rapid response to market changes, which is crucial in the fast fashion industry. Overall, it helps ASOS to maintain its competitive advantage.
Step 2
Arguments against scenario planning
Answer
However, there are limitations to scenario planning. One major drawback is the time and resources required to develop comprehensive scenarios. For a business like ASOS, this may divert attention from immediate operational challenges.
Additionally, if the scenarios are poorly constructed, they could lead ASOS to make misguided strategic decisions. The dynamic nature of the fashion industry also means that scenario planning may not always accurately predict future trends.
Step 3
Potential recommendation
Answer
In conclusion, while scenario planning is a useful tool, ASOS should balance it with agile operational strategies. By integrating scenario planning with real-time data analysis, ASOS can validate its strategies against rapidly changing market conditions, ensuring that it remains both innovative and responsive.