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Discovery Driven Planning

I've mentioned Rita McGrath's discovery driven planning before now. It's a useful concept that forces you to identify a desired outcome, and then ask what needs to be true in order for that outcome to happen. It can reveal some previously hidden (or toxic perhaps) assumptions. Conventional planning is based on a premise that future results can be accurately extrapolated from the predictable platform of past results and so may be useful in a stable, incremental or known scenario. Discovery-driven planning however, focuses on establishing the key truths that are needed for an outcome to be achieved and so is much more useful for those ventures that are new, more unknown, or characterised by a greater degree of uncertainty. 

There's a great case study that McGrath uses to illustrate the folly of using conventional planning techniques for a new venture – the launch of Euro Disney (what is now DisneyLand Paris). The launch in 1992 was something of a disaster, with numbers of visitor-days falling far short of expectations. Two years after launch it had accumulated losses of more than $1 billion and only achieved its target of 11 million admissions after a drastic drop in ticket prices.

In the planning process Disney had used assumptions based on their extensive knowledge derived from their experience running parks in other parts of the world (US and Japan). There were some pretty big assumptions around the admissions price that punters would be prepared to pay, how European customers would want to eat, and the type of merchandise they would buy. But the really punishing assumption was that (based on their experience in other markets) they had assumed that people would stay an average of four days in the park’s hotels. And yet the average stay in the early days was only two days. Euro Disney opened with only 15 rides, compared with 45 at Disney World. People could do all the rides in a single day and so had little reason to stay longer.

Photo Credit: Bart van de Biezen

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