Victoria Mulligan says the current oil shock gives business leaders the strong message to question what they're assuming about the future, and ask what happens to their business if they're wrong?

By Victoria Mulligan*

Recently the finance minister gathered a group of journalists in her office to share new scenarios released by the Treasury. Her briefing was a welcome, novel approach to uncertainty that said: “here's what we know, here's what might happen next, and here's how we're preparing for it”.

The Treasury document explored three pathways, from short-lived disruption through to prolonged and severe conflict, each carrying different consequences for oil prices, inflation, growth and unemployment. It was designed to answer some big national questions, but the process behind it is instructive for any business leader looking to what the future holds for their own organisation.

Treasury’s scenario planning gives us a glimpse of what the best companies around the world do every day. But it is largely missing from New Zealand business. The number eight wire mentality we’re rightly proud of has a downside. By backing ourselves to adapt to whatever arises, we miss the opportunity to anticipate what’s on the horizon. We think moving nimbly is the answer to volatility - but the best international organisations have already rehearsed where they’re moving next.

We may well be enduring the biggest oil shock in human history, but the second biggest shock - in the 1970s - provides a famous case study of how scenario planning helps businesses to thrive amidst uncertainty. Royal Dutch Shell - a company that had perhaps the most to lose in that crisis - had already gamed it out. They entered a period of unprecedented turmoil equipped with a plan while their competitors were caught flat-footed. Their foresight work didn't just change what Shell knew. It changed what they were prepared to do.

Shell’s success made an impact, and is seen by many as the birth of “strategic foresight”. Since then, many Fortune 500 companies have made long-range thinking a core function, appointing directors or teams whose job is to look past this quarter, past this financial year to what the world might look like in five years’ time and how best to position the organisation to thrive in those conditions.

In practice, that means running regular exercises that test the assumptions embedded in current strategy, stress-testing them against plausible disruptions, and making decisions now that will look prescient later. Crucially, it means doing that work at a level of seniority where it can actually change what the organisation does - not just produce interesting reports that circulate, settle then get forgotten in some deep system folder.

It’s common for companies to treat the future as a single line extending forward from the present. But Treasury’s report reminds us that in fact the future branches, with each branch having different consequences. The question is not "what will happen?" but "what would we do if any of these unfolded?" This is the starting point for serious organisational thinking.

Why doesn’t this approach to foresight come naturally to teams running strategy? Because the default planning cycle moves through time horizons sequentially: address the immediate operational issue, then look at medium-term strategy. Anything longer term gets de-prioritised because the short-term noise is always louder. Right now it is deafening.

But a shock like the one we’re living through needs more than reactive action. It forces every time-horizon into play at once, offering huge rewards to organisations that can manage planning across them all. In the near term: which costs are moving first, which revenue lines are most exposed, which decisions already deferred now need urgent resolution? In the medium term: which contracts, procurement arrangements and capital plans were built for a world that no longer exists? At the longer horizon: what does this shock reveal about the assumptions embedded in the current strategy - about energy costs, supply chain stability, labour availability, customer tolerance - and which of those are no longer sound?

Beyond those sits a fourth horizon, which the best leadership teams always have one eye on. This horizon challenges an organisation to consider not what it needs to do but what it needs to become - and whether the sector it operates in must itself evolve.

So what might meaningful foresight practice look like for a New Zealand business in 2026, looking to position itself among the top performers of 2031?

It doesn't have to mean a costly new hire or a dedicated new strategy unit. But it does mean embedding long-term thinking into the way the organisation already runs - not as a side project or an annual offsite, but as a dedicated practice with time ring-fenced for it and a clear expectation that the output will change something.

It all begins with a question the leadership team has possibly never formally asked: what are we assuming about the future, and what happens to this business if we're wrong?

Most organisations already have an answer, it’s just never explicitly stated. I call it a “ghost scenario”. It sits invisibly inside the strategy, the budget, the workforce plan and the capital programme, saying: costs will stay manageable, customers will keep behaving as they have, the conditions that made this business successful will persist. Of course these are not facts, they are bets. A good scenario exercise makes those bets visible while there is still time to hedge them.

The benefit of doing this in 2026 rather than 1976 is that there are now proven and accessible tools to assist with this kind of work. No crystal balls required, no science fiction novels. Just a systematic version of "what if?", followed by some thoughtful exploration of the implications for the operating environment and, crucially, some actionable steps that begin tomorrow morning.

*Victoria Mulligan is a foresight strategist and founder of Design Futures Aotearoa. She works with organisations across commercial, government and philanthropy to enable futures thinking, including scenario development. She is co-chair of the Australia-New Zealand Node of The Millennium Project, a global futures think tank.