Effectiveness of Delphi‐ and scenario planning‐like processes in enabling organizational adaptation: A simulation‐based comparison

This study compares two foresight processes—modelled according to empirical evidence of judgment changes in the Delphi method and scenario planning—against aggregation of unaided predictions of key decision‐makers, for guiding an organization's adaptation to its changing environment. Using computer simulation to examine adaptations to environments evolving incrementally (i.e., from one state to another of the same type) and radically (i.e., between states of opposite types), this study seeks to make four contributions to the foresight processes literature. One, it affirms the virtue of decision‐making based on majority agreement among experts by showing that it allows even unaided decisions to outperform the Delphi‐ and scenario planning‐like processes in numerous environmental conditions. Two, it highlights the moderating effect of ambiguity on decision process–performance relationship by showing that slow decision‐making can outperform fast one in hypercompetitive environments when ambiguity is high. Three, it shows that the cost of implementing changes in organizational strategy influences the superiority between the Delphi method and scenario planning for enabling adaptation in turbulent environments. Four, it reveals that the Delphi method and scenario planning outperform unaided decision‐making when managers are slow to update their mental models of the changing environment, and thus, can compensate for this limitation of human decision‐making.