The Scenario Tree

Jones calls this a “Scenario Tree.” It maps choices and events along alternative paths, each representing a scenario. The source refers to three diagrams that are not included here; their captions and described branches follow.

The dilemma posed by Frank Stockton’s famous story, “The Lady or the Tiger," in which a man must choose between two doors, one leading to a beautiful lady, the other to a ravenous tiger, serves admirably to illustrate the decision/event tree (Figure 9-1).

FIGURE 9-1 The Lady or the Tiger: Scenario Tree

This tree portrays two alternative scenarios, or sequences of events:

• Scenario A: Chooses door—opens Door 1—gets lady (lives).
• Scenario B: Chooses door—opens Door 2—gets tiger (dies).

This example demonstrates the two immutable, universal characteristics of a scenario tree:

1. The branches of the tree are mutually exclusive, meaning that, if the actor (the person making the choice) picks Door 1, he can’t also pick Door 2. And if he picks Door 1, he gets the lady, not the tiger.
2. The branches are collectively exhaustive, meaning that the alternatives at each branch incorporate all possibilities; no other options (other decisions or events) are possible at that point in the sequence or scenario. (There is no third door, nor is there anything other than a lady or a tiger waiting behind the two doors.)

Here’s another example of a scenario tree (Figure 9-2). Make a purchase, buy a raincoat/umbrella, and keep it/return it are all both decisions and events, but repels rain/leaks are events, not decisions.

FIGURE 9-2 Scenario Tree

Let’s review the principles involved in constructing and using a scenario tree by examining another example. This particular diagram (Figure 9-3) portrays an admittedly oversimplified sequence of possible decisions/events following a woman’s blind date with a man. Each branch of the tree presents alternative options that are mutually exclusive (if we pick one, we can’t pick the other) and collectively exhaustive (all available options are considered; there are no other possibilities). The diagram represents a total of five alternative scenarios:

1. Go on blind date —date him no more.
2. Go on blind date—date him again—stop dating.
3. Go on blind date—date him again—get engaged—break engagement.
4. Go on blind date—date him again—get engaged—get married—get divorced.
5. Go on blind date—date him again—get engaged—get married-stay married.

FIGURE 9-3 Scenario Tree

Note that the tip of each branch marks the end of a scenario; there are five tip ends and five scenarios.

Mapping decisions and events into branches helps structure an analysis:

• It dissects a scenario into its sequential events.
• It shows the assumed links between decisions and events, including which precede and follow others.
• It shows which decisions or events are dependent on others.
• It shows where the linkages are strongest and weakest.
• It enables us to visually compare how one scenario differs from another.
• It can reveal overlooked alternatives and give us a way to examine each one.