In the face of another year of slowing economic growth and shifting opportunity, executives’ strategic planning must be adaptable. While strategies should be built and adjusted according to the most likely base-case view of the future, scenario planning around potential large disruptive events will also pay substantial dividends.

Each month, FSG analysts provide an updated base case view for each country they monitor. They assess the consequences of recent social, political and economic events, and make forecast revisions to guide clients’ decision-making processes and strategic thinking. This analysis is reflected in FSG’s yearly Events to Watch report, which highlights specific potential future scenarios that could have a substantial impact on businesses around the and thus must be considered by planners.

FSG’s report differs from many competitors’ because it is calibrated to offer the most practical value to busy executives. Instead of highlighting the most extreme or the most novel changes possible in 2016, it compares scenarios based on likelihood, velocity and impact to business. For example, an extreme occurrence may require insurance but not planning, and large technology shifts often require substantial thought but are a cost of doing business rather than a sudden disruption. FSG’s Events to Watch are not just possible and meaningful, but are those events that businesses can and should be planning for now.

In 2016, FSG sees slowing growth leading to two major categories of potential threat for businesses worldwide. In some cases, strained national governments may be forced to make significant changes. This could mean cracking down on compliance, removing subsidies, or even unlocking currency pegs. In other countries, local political gridlock could stall necessary reforms, increase the likelihood of financial instability and slow investment.

The stakes for business are high. Any of these events could erode addressable markets, reduce sales, disrupt cost and pricing assumptions, or lock up investment. This could cause teams to miss their targets and companies to falter.

Don’t let the strategic planning process go to waste. In a global business portfolio, shifts will certainly occur in the coming year, and it is essential that executives consider now how these changes will impact business performance in order to equip their teams to react swiftly as disruptions occur.

FSG clients can access the full report, “2016 Events to Watch” via the client portal. Not a client? Contact us to learn more.