From “What If” to “What Now?” – Scenario Thinking When Predictability Breaks Down

By Dr. Iris Heckmann, VP Product Strategy & Industry Solutions

Not all supply chain uncertainty is created equal - and that’s where the real complexity begins. Some disruptions are transient, others systemic. Some you see coming, others emerge overnight. What matters is not just detecting them, but grasping how they manifest across decision layers – strategic, tactical, and operational – and what kind of response each layer demands. Especially now, when trade policy has become one of the most unpredictable variables in the mix.

Note - this the second post in a three-part series about tariffs. See my first post, Strategic Fragility: What New Tariff Volatility Reveals about Supply Chain Stability.

Shifts in U.S. tariff policy are a prime example. Announcements are made, walked back, then reissued with higher or lower rates - sometimes within days. And because these changes affect not just prices but sourcing, compliance, and lead times, they cut across the entire planning spectrum.

The Challenge: When Planning Logic No Longer Holds

Traditional supply chain planning systems are excellent at absorbing variation within known boundaries - like demand fluctuations or supplier lead time variability. But these systems were never designed to handle sudden rule changes or guide organizations through structural reconfiguration. When tariffs are introduced or modified suddenly, or applied retroactively to allies, even the best-optimized supply chains lack the systemic adaptability required to transition into new operating models.

In this environment, we don’t need better forecasting. We need better foresight. Because resilience doesn’t start with reaction; It starts with the ability to anticipate, prepare, and adapt before the shock arrives.

That means moving beyond basic "what-if" questions and into robust, structured scenario thinking. It also means moving beyond traditional planning systems - toward a new generation of intelligent, adaptive solutions designed to support dynamic decision-making in times of uncertainty. Not every disruption is worth detailed planning, but some absolutely are. And the goal isn’t to predict and prepare for every outcome. It’s to develop the strategic clarity and preparedness to respond effectively when the unexpected becomes real.

Good Scenario Design Starts with Relevance

Scenarios are only helpful if they explore not only plausible but also occasionally less likely uncertainties your business could face.That’s why good scenario design starts by anchoring in the most plausible and high-impact disruptions, while also leaving room to explore less likely or emerging risks.

• A sudden 25% tariff on key Chinese inputs like raw materials or APIs.
• A reclassification of EU goods as non-preferential origin.
• A regulatory bottleneck that slows down substitute onboarding by six months.

Each of these triggers different responses, on different timescales, with different financial implications.

Building Scenarios That Drive Action

A robust scenario framework doesn’t just describe a disruption. It tests what it means across planning levels:

• Strategic: Does this change where we manufacture long-term?
• Tactical: What happens to landed cost, margin, and capacity?
• Operational: Can we ship next month’s order or not?

And importantly: it tests the interaction between disruptions. What if the tariff hits and a key supplier fails? Or what if the regulatory lead time doubles and our safety stock gets stuck at customs?

The best teams aren’t just running simulations. They’re embedding scenario-based thinking into how they make decisions - from sales and operations planning (S&OP) to budgeting to board-level strategy.

Bottom Line: Decision-Making Needs a Broader Imagination

The world is not becoming more stable. Waiting for clarity is not a strategy. And the companies that are investing now in cross-functional, risk-informed scenario thinking will be the ones that respond faster, decide smarter, and recover stronger.

In the next post, we’ll explore the role of digital twins in this context - why they matter, how they enable decision-making under uncertainty, and what it takes to make them truly effective beyond the buzz. It’s not about proving the concept anymore, it’s about putting it to work.