Dealing with environmental uncertainty

Purpose – The purpose of this commentary is to discuss environmental uncertainty and to illustrate the value of scenario planning for small to medium‐sized enterprises (SMEs) operating in a volatile environment. Design/methodology/approach – The literature regarding strategy formulation, environmental uncertainty and scenario planning is reviewed and considered in the context of managerial decision making. Findings – Given the way managers learn to “know” what is happening in their business environment, scenario planning can be adapted for use by SME owner/managers. Originality/value – Although scenario planning was developed for use by large companies, this paper illustrates that it can be used by smaller firms.