On Overcoming Strategic Uncertainty Through the Integration of Robust Control and Scenario Planning

Abstract

A model of a robust control mechanism is a constructed homeostatic space based on adaptive homeostasis at the input and robust homeostasis at the output, which creates dampers for overcoming uncertainty. The most difficult task is to overcome environmental increasing uncertainty, particularly one of its components – strategic uncertainty. In the theory of strategic management, developing reliable strategies is the purpose of scenario planning. By integrating adaptive homeostasis into its mechanism, robust control serves as a reference point for the formation of scenarios for the future of economic systems. Aim . The presented study aims to substantiate an approach to the development of robust control that consists in integration with scenario planning and increases opportunities for overcoming the increasing uncertainty of the state of the polysubjective external environment, while also implementing convergence into strategic management. Tasks . The authors examine the opportunities for integration with scenario planning offered by the application of the robust control mechanism; provide an integrated view of the increasing uncertainty of the state of the polysubjective external environment; reveal the logic of the convergence of strategic developments using the method of focused, narrow scenarios. Methods . The theory of robust control of economic systems is evolving towards the development of methods for the formation of a systemic convergence of two open systems (economic system and polysubjective environment) and integration with scenario planning, which contribute to overcoming strategic uncertainty. Results . The decision to integrate the robust control mechanism with scenario planning is substantiated. The phenomenon of increasing uncertainty in the characterization of the polysubjective environment is confirmed. The implementation of convergence in strategy development is rationalized, and an example of its realization in strategy development according to the methods of focused, narrow scenarios is given. Conclusions . Once implemented into the robust control mechanism, adaptive homeostasis – a special information structure with indicators of the polysubjective environment with increasing uncertainty of the economic system – expands opportunities for integration with scenario planning and serves as a reference point for the future of the economic system. An algorithmic representation of strategy development according to the method of focused, narrow scenarios shows that the strategy is a synthesis of contradictory actions formed in the process of convergence, and the strategy is characterized as convergent.