QER SMT Scenario Planning Workshop by Professor Ron Johnston 28 April 2009 Brisbane

QER faces a future marked by uncertainty, complexity and change Structure of the global economy Extent and impact of potential climate change Range of responses to growing oil scarcity New technologies with high impact on supply and demand for energy Conflict between economic and environmental values State, national and international legislation and policies

Foresight Assisting organisations to think systematically about the future so they can develop robust strategies for it by: –Understanding what types of futures might be possible –Challenging presumptions –Building greater resilience into strategy

Differentiating Foresight Action-oriented [vs. ‘contemplative’ (passive)] Participatory [vs. non-participatory] Alternative futures [vs. a single future state] Probable, possible and preferred futures

Basic types of dialogue in a Foresight exercise Diagnosis PrognosisPrescription Understanding where we are… Exploring what could happen… Debating what we would like to happen… Deciding what should be done … Structured stakeholder dialogue

ToolFutureTime-horizon (years) Expert Vs Participative Strategic PlanningPreferred1-3E+ Trend AnalysisProbable2-5E++ Horizon ScanningPossible2-5E + P Panel/InquiryPreferred2-5E + P RoadmappingPreferred3-7E++ Delphi PollingProbable5-15E++ Scenario PlanningPossible5-50E + P++ ModellingProbable5-50E++

Scenario Planning Avoids the incrementalism of traditional planning TIME GOAL What should we do today? Where we are now Where do we need to be years from now? Anticipating TIME GOAL Where we are now Where can we be next year? And the next?… Incrementalism Versus Annual Planning Scenario Planning

Avoiding Limitations We will: Master Plan Core Strategies Today Most Likely Future Alternative Futures Instead of: …A set of core strategies, but not a single “grand strategy”…

Developing Future Scenarios The “Planning Space” Key Global Affairs Mission Drivers Energy Economy Education Trade Regional Conflict Technology Demographics Health & Disease Fiscal Health Ethics Derive Key Forces For Change (Dimensions) Outside Direct Control Set the Boundary Conditions of the Planning Space Scenarios Selected to Capture The Range of Planning Uncertainty

Evergreen II Scenarios Profits & Principles Congagement Asian Way Lockdown Future Operating Environments Be Careful What You Wish For USCG Expertise (Workshop) Immersion in Future “Worlds” Optimal USCG Strategies Set of Robust Strategies

Scenario Planning A scenario is a ‘ story ’ illustrating visions of possible future or aspects of possible future.. Scenarios are not predictions about the future but rather simulations of some possible futures. They are used both as an exploratory method or a tool for decision- making, mainly to highlight the discontinuities from the present and to reveal the choices available and their potential consequences

Elements of Scenario Planning 1.Identify the focal issue 2.Identification and analysis of the drivers 3.Rank by importance and uncertainty 4.Selecting scenario parameters 5.Writing the scenarios 6.‘ Back-casting ’ to identify key interventions

Economic Drivers Resumed economic growth  High energy demand from China, India  Strong drive for alternate fuels  Commodity prices soar again Truncated economic growth  High oil prices constrain economic recovery  Capital availability limited

Environmental Drivers Strong environmental pressures  High range climate change  Copenhagen sets tough ETS requirements – targets to decarbonise economies  Major investment in climate change Moderate environmental pressures  Low range climate change  Increasing doubt about greenhouse science  Priority to create jobs High range climate change

Technological Drivers Major advances in supply technology  Efficiency of oil extraction doubled through application of biological agents  Electric car production soars based on new battery technology Major advances in demand technology  Energy management industry booming with new products and services  High efficiency cars dominate global production

Political Drivers Market based approaches  High level of taxation on road use  Private sector investment drives alternate fuel development Interventionist approaches  Major government investment in alternate fuel development  Governments strongly influenced by environmental pressures

Social/Values Drivers Values dominated by environmental concerns  Hydrocarbon anathema  Large decrease in transport of goods Values dominated by economic concerns  Environmental extremism rejected in favour of jobs and community well-being alternate fuels