The best way to face uncertainty is to be prepared with the information needed to effectively respond to potential situations. With scenario planning, you can use the data you already have to make informed decisions that ensure the long-term success of your funeral home business.
Scenario planning can be broken down into these simple-to-follow steps:
- Selecting the key variables to examine
- Identifying risks and opportunities
- Researching data trends
- Determining likely outcomes and formulating plans to anticipate and respond to these outcomes
The scenario planning discipline underscores the importance of regularly (and thoroughly) conducting market research. Because consumer preferences and community demographics are constantly changing, funeral directors need access to reliable and relevant information about the people in the area they serve.
So how can a funeral professional get started with using the data for scenario planning? You’ll first need to identify the “drivers of change” for your funeral home – the variables (scenarios) that are likely to make the most significant impact on your business. Strategic management expert Paul Schoemaker recommends asking a series of questions to ensure the scenarios are relevant, including: “Do your scenarios surface new risks that you need to protect against or new opportunities that thus far were overlooked?”
When it comes to risks, potential scenario examples for a funeral home business include:
- Increasing cremation rates
- Longer life expectancies
- Changing religious beliefs
It’s important to note that Schoemaker’s question also includes the possibility for new opportunities, not just risks. Examining opportunities through scenario planning, and then taking advantage of them, is one of the ways you can protect your market share and help grow your business. If you aren’t anticipating these opportunities, your competitors may take note and gain ground among families who seek new service offerings.
Gathering the data (and making assumptions based on trends) is only part of developing a scenario plan. Writing down the scenario in a meaningful format will help make it more impactful for those who are involved in planning and for others in your firm who could be affected by the scenario.
Think of your scenarios as stories about what will happen to your firm in the future, and remember that the goal of scenario planning is to make informed decisions about how to ensure the long-term success of your funeral home business. Developing a detailed description of the scenarios will help you form a more complete and realistic response. Then you can define strategies for responding to the scenarios you’ve developed.
You may find that each question answered during the scenario planning and strategy process will raise more questions to be considered. But addressing these possibilities now, instead of after the scenario is already causing a significant impact to your business, can help you influence the scenario for a more favorable outcome.
Further reading: Get Kates-Boylston’s 2015 edition of The Funeral Director’s Guide to Statistics to read Homesteaders’ article, “Using Data in Funeral Home Scenario Planning.”