Scenario Thinking

Scenario Principles Scenario planning or scenario thinking is a strategic planning tool used to make flexible long-term plans. It is a method for learning about the future by understanding the nature and impact of the most uncertain and important driving forces affecting our world. Many of the regular methods for strategy development assume that the world in three to ten years' time will not significantly differ from that of today and that an organisation will have a large impact on its environment: they assume we can mould the future. Scenario planning however assumes that the future can differ greatly from what we know today. The method is based on creating a series of 'different futures' generated from a combination of known factors, such as demographics, with plausible alternative political, economic, social, technical, legal and environmental (PESTLE) trends which are key driving forces. The goal is to craft diverging worlds by extrapolating these heavily-influencing driving forces. The technique can also include anticipatory thinking of elements that are difficult to formalise, such as subjective interpretations of facts, shifts in values, new regulations or inventions. It is a group process which encourages knowledge exchange and development of mutual deeper understanding of central issues important to the future of your organisation. Although the method is most widely used as a strategic management tool, it can also be used for enabling other types of group discussion about a common future. The thought processes involved in getting to the scenarios have the dual purpose of increasing knowledge of the environment in which you operate and widening the participant's perception of possible future events - encouraging them to 'think the unthinkable'. The starting point for the workshop is a scenario set derived from scenario studies from a range of European business environments. These scenarios sketch the context for further and higher education and not the FE/HE sectors themselves. Bear in mind that these outputs are not forecasts but simply a sketch of a possible future, the intention being to get you to 'think outside the box' and consider the fit of your strategy into these future possibilities. As with any future-gazing, factors in the present can radically change future possibilities - so make sure you keep reappraised of your trend analysis to verify the plausibility of your scenarios.

Global Market In this world people and nations focus on free trade and competition: in effect, the world has become a giant marketplace, without trade barriers. Both developing and developed countries profit. Competition between countries, people and organisations is seen as a great good: it has positive effects on quality and efficiency, it lowers overall price levels. It is a world that offers lots of opportunities and possibilities to anyone who is willing to take a risk. We don't appreciate a government that intervenes and sets too many rules and regulations. Slogans: Keeping up with the Joneses, The sky is the limit, Just do It! Individual responsibility and self-fulfilment are central concepts in this scenario. Self-interest dominates; adaptation to your fellow citizen is seen as unnecessary. Achievement, making money are what it is all about. People are seeking to lead a life of luxury and full of experiences, both at work and in private: the world is one big amusement park. If the economy is okay, then we're okay, as well as the others in our world. We have to keep on growing, achieving, become more beautiful and better. Everyone is the master of his own destiny: take care of yourself and speak out: it's up to you and only you. Governments and governing bodies such as the UN become smaller. There's more room for private initiative, in healthcare, but also in education. The energy market has become fully privatised. Most governments see it as their core task to stimulate competition and free trade. The bill is picked up by those that live on the edge and by our natural environment. Government is there for purely public interests, such as defence, police and justice. There is no active policy to redistribute income or to provide public insurances. International cooperation is limited to economic affairs, that's why international organisations such as the World Trade Organisation are the only successful ones. The EU has become a truly economic union. Its focus is on facilitating an efficient and productive European economy. Harmonisation of national regulations (also in Eastern Europe) is a main activity of the EU. The agricultural subsidy system has been dismantled. Technological developments follow each other at a fast pace. Confidence in technology is enormous. Time and again, new technologies deliver on their promises, for instance in energy and healthcare. Gene technology in agriculture and healthcare is now well accepted. Food production and quality has increased to very high levels across the globe. Nutritional additives have become normal business. Obesity has become a main focus area for researchers and it is expected that through gene manipulation we can solve this worldwide problem. High Economic Growth (3%) The service economy. Lower taxes, a beneficial innovation climate, top class universities all contribute to the fact that Western economies remain worldwide leaders. Research is financed by large corporations, which keep increasing in size and number. Many EU countries see a growing number of small start-ups in the hitech and service sectors that contribute substantial value to the national economies. The service sector is the fastest growing sector and entrepreneurship is a central concept.

Company structures are based on dynamic and ever changing networks. New products and services are launched into the marketplace at relentless pace. Success is determined by temporary corporate advantages and therefore on temporary partnerships: to find the right partners at the right time is crucial to survival. Collaboration with partners across the globe, across the entire value chain is a pattern for successful industries.

Mobility in the labour market has increased tremendously, due to globalisation, rapid technological development and retreating governments. Not only women, but upper age groups participate in paid labour. Resizing, downsizing, right sizing is the name of the game. Employees have to be flexible, have to be focused on their next job in and outside the company, even outside of their own sector, sometimes even outside of their own country or continent. Especially employees with higher education levels follow outsourced labour to developing countries. Rapid growth of the population due to labour migration and family reunion. Europe maintains a selective immigration policy. Larger groups of welleducated young professionals enter the EU and find jobs quite easily. Family reunion also leads to rapid growth of national populations. A higher birth rate (certainly amongst non-western immigrants) also contributes to larger numbers of students in the education system. In this scenario Europe has a selective immigration policy. A 20% increase in student numbers by 2050 is foreseen.

This summary of a scenario set was created by CIBIT (www.cibit.com) from a 2004 European (EU) scenario study and the JISC InfoNet Scenario Planning Resource

Regional Communities Responsibility and care are key values. Citizens in this world have had enough of the focus on material wealth and globalisation. There is more attention to the human side, for our own personal social environment (family and neighbourhood). Volunteer work is thriving, we solve problems together and with our local government. Brussels is far away and deemed too bureaucratic to provide solutions that fit the local scope we have. Slogans: Small is beautiful, a good neighbour... More social cohesion and more social control. People have a sense of community and intervene by directly addressing non-tolerated behaviours, we develop initiatives to care for fellow citizens in our direct environment and to improve the quality of our own living environment. There is no need to make things bigger, faster and higher. The social welfare state is maintained in many European countries. Strong lobbies of trade unions, consumer organisations, NGOs and industries block major changes. The public sector remains large and regulation is complex. Reform in the energy sector, public transport and healthcare is stopped or even turned back. Local government is very close to people, despite a lack of transparency. Europe has two speeds. Both within and outside the Union we find a group of economic and political front-runners. Within this group, further integration takes place, the rest follows, but at a much slower speed. The Union does not increase any further; in fact Europe has become a non-issue for most Europeans. We focus on our direct environment. We may worry about Europe and the world, but we know we don't have any effect. The EU is partly successful in harmonising regulation, but the complexity is not really reduced. Expensive subsidies for agriculture are still in existence. Sceptical view on technology and lack of international cooperation slow down technological innovations. There is no fertile innovation climate. There is a lack of competition, governments are expensive, taxes are high and collaboration across borders is cumbersome due to protectionism. The scattered nature of market places impedes further diffusion of innovation and knowledge. Furthermore, citizens have adopted a sceptical view on new technology: people worry about their environment and about their security. Focus is on improvement of tried and tested technologies, certainly in the area of environmental technologies. Sustainable energy is a hot topic. Improvements in agriculture are completely realised using traditional technologies. Gene manipulation is not accepted. Economic growth is poor (0.6 % per year). A large public sector, complex regulations, low participation in the labour market and increasing costs for health care all slow down the economy. Most countries see a risk in being dependent on other countries. National industries are protected. People don't seek luxury, so the service industry is suffering. Especially organisations that provide non-financial services to companies and consumers feel the pain. The care sector grows, but moderately, since we take care of each other in this scenario. No real developments in labour mobility since 2000. There are no incentives for non-participants to enter the labour market. European policy is focused on protecting national jobs, minimum wage and uniform taxes. Immigration policies are restrictive.

The population size remains the same. Low economic growth, restrictive immigration policies and focus on local solutions in the Third World leads to low levels of immigration. Young people keep postponing starting a family. The number of students decreases by 15% by 2050 (against 2000). This summary of a scenario set was created by CIBIT (www.cibit.com) from a 2004 European (EU) scenario study and the JISC InfoNet Scenario Planning Resource

Strong Europe People, government and even to some extent commercial organisations focus on cooperation, solidarity and social integration. It is the only way to solve the big problems of climate change, HIV/AIDS, war and poverty. This is important because money will not buy you happiness. The quality of life (yours and the life of others) is equally important. You care about others in society and you are responsible for the well-being of your fellow man. Therefore, you are prepared to give up something of your own wealth. We believe that problems related to food shortages in the Third World cannot be solved simply by ensuring open markets and free trade. Citizens as well as corporations have urged for a strong European government. The EU has become a political and economical superpower. The environment and protection of the have-nots are placed at the core of policy making in a strong EU. Government is seen as necessary to correct market imperfections. Freedom and material wealth are important, but within accepted boundaries. Slogan: Together we're strong. Government and EU reform in various nations has led to involved and capable public institutions. Citizens are really linked up to government policy making, using instruments such as referenda and direct election of government officials. Participation of citizens in policy-making has really led to the implementation of innovative ideas. For instance, a number of changes in social welfare and labour market policies have been implemented swiftly and smoothly, including the increase of the pension age (in alignment with the increasing life expectancy) and the breakdown of social benefit regulations. Effectiveness of public services overrules privacy. Furthermore, it is widely accepted that government and other databases are linked up, so that each individual citizen can be scrutinised ifneeded. The consequences (decreasing privacy) are borne without complaint. The production of public goods has become much more efficient, partly because of government benchmarking and partly because of performance contracts between central government and its institutions. We'd like to speak of our government as a corporation. The EU has a strong position in the international political arena. International issues such assecurity and immigration are the full responsibility of Brussels. Together with the other economical blocks and organisations such as the WTO and the UN, the EU ensures successful international cooperation on climate change and the world economy. The EU leaves much room for individual member states to adopt local policies for social security and taxes, respecting the heterogeneity within the ever increasing EU membership. Turkey enters the Union as the 28th member state. The internal market is strengthened by denationalising postal, energy and public transport services: national governments are well acquainted with European calls for tender in these areas. Technological development in Europe is not as quick as in the US and Asia. Patenting and market preparation are still time consuming and expensive in Europe. Security concerns dampen speed of development in many areas. There are exceptions though: the advent of hybrid cars, such as the Toyota Prius that was introduced back in 2004, has spun out a host of new developments in the area of mobility. Economic growth is moderate and stable (1.5%). People prefer honest distribution and a healthy living environment over economic growth. Markets are working smoothly and, given the focus on international cooperation, growth is still considerable. Public-private partnerships are quite common. Recognition of mutual strengths and dependencies has led to a positive climate for cooperation and resulting stable networks and supply chains.

Slight growth in job mobility: a higher pension age, sparse social security, international recognition of diplomas and straightforward international taxation systems have led to an increasein job mobility, though moderately. Population grows due to labour migration and influx of refugees. The number of participants in higher education will therefore grow up with 20% by 2050 (compared to 2000). Population growth makes many citizens think that there is struggle with choosing between solidarity and a liveable, environmentally-friendly country. This summary of a scenario set was created by CIBIT (www.cibit.com) from a 2004 European (EU)scenario study.

Transatlantic Market Cautious and 'conservative' citizens and consumers. The focus on security and independence (as a means to eliminate risk) determines all our actions. Terrorism, criminality, open borders are threats for us all and for our economy. More and more consumers have problems to make the right choices at supermarkets, when choosing a career, job, insurance policy, doctor, telecoms or energy provider. They want less complexity in products, services and production processes. Simplicity and functionality are core, good is good enough. Government has retreated and is primarily occupied with protecting national interests. Slogans: mind your own business, survival of the fittest, clash of civilisations. Increased individualism has become our main orientation in life and this forms a powerful counterforce to collective state arrangements. The deprived and the environment suffer from the increased appreciation of entrepreneurship. The welfare state is a relic from the past and only makes people lazy. We don't want to pay taxes if there is no concrete return that has a positive impact on me/us as individuals. Leave things to the market: you get what you deserve. Citizens and consumers demonstrate calculated behaviours: pragmatic and always interested in a quick return on their money. Governments are there to protect. Our own problems are far more important than those of Europe, let alone the wider world. Privatisation in the social sector and parts of the education sector has shown to be cumbersome, mainly due to a lack of transparency and competition. The envisaged advantages of the market model have not materialised in practice: costs remain high, quality hardly improves. Europe is oriented to the west, not to the east. Turkey does not join the EU. The schism between the poor and the rich becomes wider and wider, not only on a global scale, but also within Europe. We are concerned about our welfare and security. We feel that we need to stand up for ourselves, our culture and our beliefs and values. We are not responsible for solving other people's problems, in fact, it remains to be seen if we can solve them at all. In this way, we preserve what we have and lead comfortable lives. We are focused on nurturing our relationship with our main partner, the US. The EU fails to create breakthroughs in supranational legislation and regulation, because national governments are too focused on protecting national interests. The new member states have not integrated into the old European family. International organisations such as the WTO, WHO and UN haven't succeeded in creating breakthroughs either: their role and influence is dwindling. Rapid developments in ICT, the gene revolution is not there yet. Consumers put a lot of trust in ICT: developments in ICT are very much consumerled. The ICT industry thrives based on excellent cooperation with the US. Other technologies that help us reduce our dependency on non-EU countries enjoy investment. The focus is on efficiency improvements. Eco-style products and services didn't make it in this scenario. Life science technologies do not flourish, due to the lack of coordination and finance of long term basic research in this field. Economic growth is reasonable (1.5%). ICT-intensive sectors profit most (e.g. the financial world, business services and local government). Growth in other sectors lags behind. Agriculture is under pressure, but we don't choose to

outsource to developing countries. We choose for stability, our (kn)own culture and the satisfyingly high levels of competence in the western world. Job mobility is high. State-led pension and social security schemes have been dismantled. Longer employment (hours and years) and moonlighting have become normal. Limited population growth. Considerable income inequality results in a strong immigration. But governments adopt a restrictive immigration policy and fight illegal labour. Work permits are only issued on a temporary basis. Integration of minorities is not actively promoted. Demographic reasons explain why the numbers of students remain roughly at the same levels as back in 2000.

This summary of a scenario set was created by CIBIT (www.cibit.com) from a 2004 European (EU) scenario study and the JISC InfoNet Scenario Planning Resource

Education Characteristics for the four Scenarios Global Market Flexible and adaptable, market driven sector Corporate branding and drive Specialisation Less socially aware Results-focused Premium pay-for services Universities as PLCs Tailored delivery Products and commodities Institution Metaphor: Marriott College, Nokia Research & Development Institution Typical degree/diploma: Entrepreneurship

Transatlantic Market E-teaching, bite-sized chunks Pay-for sector Script-based Learn what you need Employer-driven Customer-led Assessment and tracking Education as a job not a vocation Institution Metaphor: McDonald’s College, BurgerKing University Typical degree/diploma: Decision Making and Economics

Strong Europe Standardisation and harmonisation Pan-European qualifications, comparability Mobility and flexibility Limited innovators Collaborative Learning Vocationally-driven Eco/social awareness Centrally regulated institutional collaboration for societal impact Institution Metaphor: World Health University Network Typical degree/diploma: Citizenship and Society, Sustainable Development

Regional Communities Community-based, collegiate Skills-based, apprenticeships, mentoring Polarised use of IT Inward-looking silos education and research focussed on broader agenda and contributing to sustainable development specific for the region Less innovation Local standards Reflective Institution Metaphor: Kent College of Food & Agriculture Typical degree/diploma: Sustainable Local Development