Z/Yen has a long history of innovation in strategic planning, including experimentation with various strategic techniques from scenario planning to portfolio modelling to market analysis. One of our most popular “war gaming” techniques we picked up in work from the 1990’s with the Ministry of Defence – Decision Cards. We love working with one guru of Decision Cards, Mike Young of Decision Workshops – www.decisionworkshops.com. Avid Now & Z/Yen readers, London Accord aficionados and some Lady Daphne guests, may remember that we worked with Mike back in 2007 on the “Warm Game”, a multi-player negotiation game about climate change; so readers won’t be surprised that we cooperated with Mike on a Decision Card simulation of Euro negotiations.
We ran two workshops at Z/Yen in November with an interesting and kind cast of former central bankers, regulators, policy makers and financial services professionals. The objective was to see how the Euro crisis might develop. Everyone agreed that over a year earlier, circa late 2010, it would have been considered wonderful if Markozy (Angela Merkel and Nicolas Sarkozy) could just muddle through. Well, they have muddled through in spades. But where do they go from here? Z/Yen ‘s strategic advice to clients emphasises that commentators underestimate the potential scale of German support especially when contrasted with German support for absorption of the former Deutsche Demokratische Republik, as well as over-discount the idea of a Greek default while a new Greek government continues to use the Euro.
Intriguingly, in the first workshop it was the Troika (tripartite committee of European Commission with the European Central Bank and the International Monetary Fund) and the Germans who began to prepare for a Greek exit, in the second the Greeks themselves, but the net effect of the preparations was to start the exit process, perhaps unwittingly. However, in both workshops once preparations started the EU did not want things to go too easily for the Greeks because of the fear that it would spread contagion. Equally, the Greeks wanted to string things along as long as possible, feeling that the debt was really a carousel for EU banks and not their problem. Whew! So where to go from here? Things go could many ways – remember we told you so.