Preparation For A Dangerous Uncertain Future

As part of its “Knowledge Miles” series of talks,  Z/Yen hosted a discussion between Sir David Omand and Professor Brian Collins, two commissioners from the National Preparedness Commission. The Commission’s programme of work is intended to be both strategic (recognising that what is needed to be better prepared for many shocks is the same whatever the initiating crisis or incident), and practical to encourage comprehensive actions.

Sir David is an ex Director of GCHQ and Permanent Secretary of the Cabinet and his book “How to Survive a Crisis” has just appeared in paperback. He began the discussion by noting that resilience – the ability to bounce back after a crisis – was he suggested the difference between using a cricket bat to hit a piece of copper pipe (which is damaged) compared with using it to strike a cricket ball (which bounces off).

This is a system-level characteristic requiring planning and preparation, and critically investment in spares, supply chains and dormant capacity. In a crisis many of the conventional levers don’t work and the system can feel out of control – “crises manage you rather than the other way around”.

Leaders need to take control, mobilise talent, seek out innovative solutions and build “adaptive resilience” so the organisation emerges stronger after the crisis.

The main dangers are behavioural: avoidance, denial, delay, displacement, disruption, blaming the messenger. The hardest crises to deal with are the slow mouldering ones where it is harder to recognise the need for early action. We have seen from various events that it is cheaper to act early, but it can be hard to divert the organisation to focus on the one key issue.

Professor Collins, of UCL, is a vice-Chair of the Commission. He concentrated on the mind set of the leadership group needing to be open to change rather than resisting action, and concentrating on solving the problem rather than having a blame culture. We are lucky in the UK that we have many bodies of expertise that can be mobilised for rapid analysis and response (he gave an example of a vulcanologist whose specialism was the Icelandic volcano that exploded disrupting flights for several days).

Increasingly, the past is not a good predictor of the future, change is often non-linear and historical statistics less valuable. We have to think of plausible futures -we need to be curious, imaginative. Tomorrow will be different. – we must be prepared for difference. However, “there are no crystal balls”.

The conversation returned to the issue of avoiding a blame culture. It is crucial to learn from near misses, to use them as an opportunity to stop something more serious.

It is often a challenge to get resources mobilised – a focus on short-term efficiency is a problem. Continuous monitoring, attention to detail (eg in sub-contracts and supply chains) and detailed system analysis are needed for effective corporate governance.  This analysis may need to go beyond the normal organisational boundaries to capture the relevant interactions.

The Q&A session covered a wide range of issues. One major one was the ability to react quickly, expanding operations as needed. This was made more difficult by lack of resources – notably in local authorities – due to years of austerity there is no reserve capacity.

The organisational mindset was touched on again. Groupthink and vested interests need to be constantly challenged – – perhaps actively by external “ginger groups”.  . Asking “what would it take to change our mind on that?” following a final (board) judgement is a way of testing your bias.  Other cognitive biases include optimism bias (“it’ll be OK”) and perseverance bias (“if we keep at it we’ll sort it”). Short-termism is a big danger – we need serious long-term thinking with proper research.

The lessons from the Covid pandemic were that resources had to be mobilised, the whole organisation has to focus.

Overall, the talk was a clear call to use a range of foresight tools to prepare for a changing world. Ongoing horizon scanning, linked with driver mapping and scenario planning, culminating in a set of contingency plans are all approaches SAMI uses with its clients to take “robust decisions in uncertain times”.

Written by Huw Williams, SAMI Principal

The views expressed are those of the author(s) and not necessarily of SAMI Consulting.

Achieve more by understanding what the future may bring. We bring skills developed over thirty years of international and national projects to create actionable, transformative strategy. Futures, foresight and scenario planning to make robust decisions in uncertain times. Find out more at www.samiconsulting.co.uk.

Image by Franz26 from Pixabay

What’s wrong with Museums of the Future?

In the new Futures Toolkit, we consider some ways of showing people what the future might be like (in the “Experiential Futures” section, here). This includes everything from narratives and storytelling, to artefacts and speculative design. We also talk about video and virtual reality, citing Dstl’s Museum of the Future – of which there is an excellent video here.

A good description comes from Lancaster University. “Alongside VR exhibits that are futuristic versions of things that already exist – a space-going version of a naval ship, for example – the museum houses a set of fully immersive VR ‘worlds’. These speculative settings are experimental, and are intended to highlight the uncertainty of the future, using techniques of cognitive estrangement and other appropriate narrative and world-building techniques to encourage audiences to query their anticipatory assumptions and cognitive biases. The aim of this project is therefore to promote cognitive flexibility, enhance futures literacy (FL), and ameliorate against the effects of knowledge shields.” (taken from here)

The concept of Museums of the Future got a real boost, of course, with the launch of The Museum of the Future in Dubai. This is astonishing as only the Gulf can be – an amazing building…

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whose architecture matches its ambition. The Museum invites guests to “Go on a journey through possible futures and bring hope and knowledge back to the present.“.

Meanwhile, in Linz, Austria, the Ars Electronica centre is both a Museum of the Future and a place where that future can be created: “Together with artists, scientists, technologists, designers, developers, entrepreneurs and activists from all over the world, we address the central questions of our future. The focus is on new technologies and how they change the way we live and work together.” Ars Electronica is a hub for futures thinking: it includes a Futurelab, an “artistic R&D laboratory and atelier” and runs many events. 

_{Ars Electronica                                                                                               J Blanchard Smith}

“The Future Starts Here”, an exhibition at the Victoria and Albert museum in 2018, used 100 objects “as a landscape of possibilities for the near future”. 

There are plenty of good reasons why museums of the future are a good idea. As Emily Spiers says (above), they “promote cognitive flexibility, enhance futures literacy (FL), and ameliorate against the effects of knowledge shields”. They are inherently interesting – people are interested about their future, else why would pension plans, life insurance and science fiction exist? Artefactualising the future makes it more “real”, and makes its achievement seem more possible – a vital service when politics and the budrends of the day-to-day can make people feel stuck in the present.

There are, though, some very valid critiques of trying to capture the future in a box – however beautifully designed, well illuminated or even contained virtually within a computer. 

The first issue is what we could call speculative limitations. So many of these exhibitions are anchored in existing paradigms – current technological trends, ways of warfighting – which could limit speculation to simple linear progression of current capabilities. There is a balance to be struck here between confining visitors’ imaginations to what is presently conceivable and offering the chance to explore the unforeseen or the disruptive.

We might call the next issue technological determinism. Museums of the Future focus on technology, because that’s sexy. Progress, though, is not always technological – a fact that Ars Electronica understands by incorporating art and the social sciences into its thinking. Technology, for instance, can both be a cause of and a response to human factors like diplomacy, international relations, or socio-economic factors, but by restricting our lens on those issues to be the technological one, we seem to claim that progress here is mediated through silicon – rather, than, for instance, through new ways of thinking about how we relate to each other. Ultimately, this runs into ethical questions and diminishes human agency – autonomous robots, AI agents, independent weapons systems are all very well, but they diminish people’s roles, and potentially, people’s value.

The issue of commercialisation and consumerism is obvious. Explorations of the future, it seems, are for those who can afford to enter the Museum in the first place. Ironically, this just reinforces the issue that the poor will live in the future, yet are often powerless to influence it.

As futurists, we work hard to exclude – as much as is possible – bias from our work, whilst recognising that is never fully possible. It will not be a surprise, then, that a number of issues could be classed under the heading of “Potential bias”. 

Almost by definition, the action of Museums of the Future in concretising concepts of the future spring from the inherent biases, overt and hidden, of their creators and curators. A Museum of the Future from a military research organisation may not encompass pacifism; a technological museum may not include off-grid living. A museum is in its own way a marker in the ground of some claim to leadership in a subject – which privileges its cultural context and excludes, for instance, non-Western or low-technology societies and cultures. 

Since the future is constantly happening, it could be argued that a Museum of the Future is by definition outdated from the moment it is opened. Building methods and architectural styles change, the concerns of society develop, some apparently positive developments are dead ends while others turn bad, and yet more spring seemingly out of nowhere. The false sense of certainty that museums imply in the futures they contain are inherently limiting – making it difficult for visitors to challenge the trajectories that they show.

So where do we take this? It is no surprise that a futurist would both welcome and question the existence of museums of the future. We encourage the use of alternate ways of looking at and thinking about the future in all our work. These museums and exhibitions are ways of doing that with far more flair and, frankly, budget, than we could ever bring to one of our projects. 

The issues around them are solvable – and should be addressed. We need to capture the idea that the future is the property of all people, rich or poor, born and not yet born, from wherever they live. Particularly in a age when we recognise, with climate change as well as increasing geopolitical tensions, that any future will happen worldwide, not just in one pocket or nation of the world, sharing understanding about that future and how to change it, is key. Occupy that space, and Museums of the Future will move from being interesting but flawed to compulsory guides to negotiating the world, as it changes and we change with it.

Written by Jonathan Blanchard Smith, SAMI Fellow and Director

The views expressed are those of the author(s) and not necessarily of SAMI Consulting.

Achieve more by understanding what the future may bring. We bring skills developed over thirty years of international and national projects to create actionable, transformative strategy. Futures, foresight and scenario planning to make robust decisions in uncertain times. Find out more at www.samiconsulting.co.uk.

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UK Covid-19 Inquiry – Report on Module 1

“The resilience and preparedness of the United Kingdom”

Part 2

In the first part of our review of the Module 1 Report of the Covid-19 Inquiry, we looked at the lessons that could be learnt around “risk assessment”. In this second part we pick up on several other key points identified that could have more general application. 

SYSTEMS

The Report concludes that “The institutions and structures responsible for emergency planning were labyrinthine in their complexity.” The system ought to have been simple, clear and purposeful. It should have been organised in a rational and coherent form.

A look at the organogram shows this clearly.

The system was inefficient with too many entities, groups, sub-groups, committees and sub-committees involved with preparedness and resilience. Yet there were also gaps where no-one took responsibility, and an overall lack of leadership with no ongoing oversight of one of the most significant risks. The effect was that preparedness and resilience were not being scrutinised at the highest levels of decision-making. 

It’s hard to imagine that other organisations have structures of similar complexity. It is true that for Government the range of issues to be considered and the number of teams with an interest is necessarily complex. But other large organisations should also review who makes decisions in emergency situations and who is just “co-ordinating”, how “emergency” is defined (when is it a “normal” emergency?), what level of local autonomy needs to be maintained, how leadership is manifested. 

A further issue surrounds surveillance and alerts. There is a balance to be struck between overreaction and being excessively cautious. More elaborate surveillance may lead to more “‘false alarms’”. Thus, surveillance itself carries the risk of ‘crying wolf’. 

Critical to an effective alert system are transparency and the flow of information. One expert witness on infectious disease surveillance commented: ”The earlier your alert, the more likely you can actually respond to it, because the response will be much, much smaller, and a much smaller response can be mounted more often.”

EFFECTIVE STRATEGY

The only explicit pandemic strategy dated from 2011. The Report concludes it “was outdated and lacked adaptability.” It was virtually abandoned on its first encounter with the pandemic.

Although it stated that it was a strategy for an influenza pandemic, the intent was for it to be sufficiently flexible and adaptable for use in the event of other pandemics. Sir Patrick Vallance suggested: “ [I]t’s not about trying to end up with highly specific responses in the back pocket all ready for every single eventuality. That’s not possible. But there are generic capabilities which are important across the piece.”

A more broadly based and comprehensive strategy, which assessed a range of potential scenarios and had a range of measured potential countermeasures, would have been more capable of preventing the spread of a dangerous disease rather than mitigating its effects.

An effective strategy should cover:

• analysis of the costs and benefits of a range of interventions; 
• modelling of the impacts of responses over the short, medium and long term; 
• explicit recognition of the trade-offs; 
• assessment of the impact of the responses on different groups; and 
• consideration of the totality of the intervention and its potential side effects.

Ex-Chancellor George Osborne said: “[T]here’s no point having a contingency plan you can’t pay for, …. [and for your] finances to flex in a crisis.”

There appears not to have been any formal system, nor any direct ministerial oversight, for ensuring that a document as important as the 2011 Strategy was subject to this sort of review

When the pandemic struck, the UK government did not adapt the 2011 Strategy. The doctrine that underpinned it (ie to respond to the emergency as opposed to prevent it from happening) was effectively abandoned. Mr Hancock described it as “woefully inadequate”.

For futurists, this is shocking.  The whole point of a futures exercise is to provide a range of contingency plans that can be picked up, adapted and implemented rapidly. All organisations should be aiming for this. 

LEARNING EXERCISES 

There was a failure to learn sufficiently from past and from a range of exercises that had been carried out. Over a dozen exercises, some just in individual nations of the UK, were carried out between 2003 and 2019. 

The most significant exercise, of considerable scale (involving 950 people over 3 days), was Project Cygnus in 2016.  It concluded that “[T]he UK’s preparedness and response, in terms of its plans, policies and capability, is currently not sufficient to cope with the extreme demands of a severe pandemic that will have a nation-wide impact across all sectors”

The lessons that were learned were not sufficiently shared and debated. In many cases, learning and recommendations, while nominally recorded in documentation, were simply not acted upon or were forgotten. “[Reports] became an end in themselves rather than a means of learning lessons for the future.” “planning guidance was insufficiently robust and flexible, and policy documentation was outdated, unnecessarily bureaucratic and infected by jargon.”

Causes of inaction 

A number of workstreams for pandemic preparedness were paused due to a reallocation of resources to Operation Yellowhammer (planning for a ‘no-deal’ Brexit). The UK government’s preparedness and resilience system was, quite evidently, under constant strain. It was reliant on stopping work on preparing for one potential emergency to concentrate on another. Yet the trend is for there to be more complex and concurrent risks. 

There was a failure of the institutions to identify and accurately describe the underlying problems, compounded by the use of jargon and euphemism to disguise, for example, tasks that had not been completed.

A third cause of inaction was the lack of institutional memory. This is often caused by frequent and rapid changes in personnel and, as a consequence, a loss of experience and knowledge. It is not a problem unique to government – it is a problem faced by all major institutions. This is especially important when there is a high turnover of people – “churn in the system” or a “revolving door” of decision-makers.

GROUPTHINK, CERTAINTY AND CHALLENGES

Many witnesses who gave evidence to the Inquiry blamed ‘groupthink’. There was often a lack of sufficient freedom and autonomy to express dissenting views and a lack of significant external oversight and challenge. 

The Report notes: “It is necessary to understand how and why it happens and what can be done to remedy it. The dynamics of being part of a group may explicitly or implicitly encourage consensus and discourage internal challenge to consider alternatives. This may result in irrational or poor decision-making. However, consensus by itself is not necessarily a bad thing, provided there is adequate discussion before a consensus is reached and provided it remains open to being challenged.”

But in many ways the consensus was wrong. We’ve already discussed planning only for an influenza pandemic and not planning to mitigate or suppress its spread. 

One fundamental error was a failure to address uncertainty. An integral part of any advice given by scientists should be its inherent uncertainty. Many of the scientific advisory groups provided advice to decision-makers as a “consensus” view. 

Michael Gove admitted: “[W]e seek certainty but it’s often elusive, and it would be better if politicians and decision-makers were to say, ‘Tell me about the debate, what is the lead option within the academic community here, but what also are the alternatives?’ ”.

Ending the culture of consensus and orthodoxy is necessary to allow decision-makers to have access to the full range of opinion or exposure to the uncertainties in the opinions that they are given. 

Oliver Letwin, reflecting on the fact that Ministers were amateurs compared with their scientific advisers, said: “ I think that I should have said to myself, in retrospect, not, ‘Are all these experts wrong?’ but, ‘Have they asked the right questions?’ Because that is something an amateur can do. Perhaps only an amateur can do that. In a sense you have to be outside to the system, I think, to a degree, to be able to ask that question.”

How expert advisers are used is also important. They felt that their agendas were “filled” with tasks set by ministers and officials. As a consequence, they did not have the time to consider “the unexpected”. 

Chris Whitty suggested an “80/20 rule”, where most of the time (80%) should be spent on things the government has asked about, but a significant minority (20%) should be spent on things the government has not asked about. Scientific advisers ought to be “‘licensed dissidents’” with a general remit to provide scientific opinion and challenge throughout the system.

Red teams

The Report looks favourably on the concept of “red teams” – external experts with experience in a range of relevant backgrounds, including scientific, economic and social disciplines, with the licence to challenge the orthodoxy.  These groups of people sit outside  the advisory and decision-making structures.

They are less susceptible to any ‘groupthink’, optimism bias, received wisdom or assumed orthodoxy that can grow within those institutions over time. Secondly, their independence makes them better placed to ask difficult questions and challenge biases, without the defensiveness or fear of personal or professional repercussions that can exist among colleagues working within the same institution

The distinct structure of independent red teams makes them well suited to carrying out a number of different roles to help improve decision-making, such as: 

• assessing the strength of the evidence base; 
• challenging assumptions and beliefs; 
• considering the perspectives of those enacting or impacted by a plan; 
• identifying flaws in logic; 
• widening the scope of enquiry; 
• stress-testing advice and plans; 
• identifying how the current approach might fail; and 
• identifying different options and alternatives.

The use of red teams should also stimulate a change in culture, as it will be known that decisions may have to be justified in a ‘red teaming’ exercise. Access to a wide range of high-quality, competing advice and regular, external, independent input will make the system better equipped to prepare for and build resilience to a pandemic in the future

SAMI THOUGHTS

The Report does an excellent job of highlighting many of the failures and challenges of the preparedness and resilience system. There are many lessons here that all organisations can learn from. From SAMI’s standpoint though there are a number of key issues the Report does not address strongly enough.

Prediction

The Report repeatedly emphasises that the planning was for an influenza pandemic – which was not was what the country faced. We feel it is wrong to over-emphasise the accuracy (or otherwise) of predictions.  An influenza pandemic was a perfectly reasonable scenario, probably the most likely. The failure comes with not being open-minded enough to consider other scenarios as well. But as Patrick Vallance said it is not possible to plan for every eventuality. 

Monitoring and flexibility

Contributing to that failure is the lack of responsiveness to a changing world. It may be that Module 2 of the Inquiry addresses this issue, but our view is that a plan should not be a fixed, unchanging edifice. Instead, it should have identified important “trigger points” that indicate a change of direction in the environment. This should go along with an extensive monitoring system tracking these issues, so that once they are observed a renewed effort would consider whether actions should change – whether contingency plans should be enacted. We call this “Adaptive Planning”. 

In the case of the Covid-19 pandemic, trigger points would have included noting that the Wuhan outbreak was not influenza but a respiratory disease, the nature of its spread (infection and death rates); another trigger point would be noting when it spread outside China, and certainly its arrival on ski slopes in Europe. 

Fatalism vs mitigation. 

There is a philosophical challenge at the heart of scenario planning that the Report picks up on – and indeed it was a difference of perspective between Oliver Letwin and Matt Hancock.  Do we regard a scenario as a view of the future and try to work out what we would do should that future come about? Or do we regard it as a potential future which we should try to avoid or mitigate?

Perhaps the problem in the Covid-19 case was that the pandemic scenario put a figure on the number of deaths. That leads to developing strategies to cope with that number of deaths – body bags, gaps in labour force, avoiding widespread fear. Whereas had the scenario only been described in terms of the disease characteristics – infection rates, death rates, asymptomatic transmission – the focus would have been on how to limit the spread, to minimise the number of deaths.  

This is an important consideration to build into your scenario planning. Generally, it will be beneficial to look at both perspectives. 

Risk-agnostic resilience

As was pointed out earlier, it is not possible to have detailed plans to cope with every eventuality. But there are things one can do to build resilience to a range of shocks. 

Largely these come under the heading of capability and capacity: 

• Where can we find resources to use to address the challenge?
• Are there skills we will need to be able to access? Where will we find them? Can we build them?
• Is our decision-making system sufficiently agile to react rapidly enough?
• Can we build strengths into the system (eg better health) beforehand?
• Do we understand the trade-offs we may have to make?
• Are there standard responses (eg suspending elective surgery) that we can draw on? Possibly a menu of options or set of building blocks?

Clearly the Covid-19 pandemic was an immense challenge, far beyond scenarios most organisation may have to face. Many of the Report’s recommendations are specific to Government and to pandemics. But many other of the issues highlighted do apply more widely and represent important lessons we all can learn from. 

Written by Huw Williams, SAMI Principal

The views expressed are those of the author(s) and not necessarily of SAMI Consulting.

Achieve more by understanding what the future may bring. We bring skills developed over thirty years of international and national projects to create actionable, transformative strategy. Futures, foresight and scenario planning to make robust decisions in uncertain times. Find out more at www.samiconsulting.co.uk.

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UK Covid-19 Inquiry – Report on Module 1

“The resilience and preparedness of the United Kingdom”

Part 1 – Five flaws

The first module of the Baroness Hallett Inquiry into the Covid-19 pandemic that took evidence between 13 June and 20 July 2023 looked into resilience and preparedness of the UK.  Since this is exactly the topic that futurists should be engaged with, we wanted to see whether there were general lessons we could draw from its conclusions that could be applied to “resilience and preparedness” in other organisations and other situations.

Naturally, much of the report deals with “whole-system” events that only governments will be facing. But when a risk as clear as a pandemic has been identified, how the planning for that risk worked – or not – holds lessons for us all.

In this first blogpost, we focus on “risk assessment” and five specific flaws the Report identifies. A second one will look at systems, organisation and planning.

The Report starkly states that “it is not a question of ‘if’ another pandemic will strike but ‘when’” and that “there must be radical reform.”. The government had convinced itself – and indeed others abroad – that it was one of the best-prepared countries in the world to respond to a pandemic. The Report concludes that, in reality, the UK was “ill prepared for dealing with a catastrophic emergency”, let alone the coronavirus (Covid-19) pandemic that actually struck. Clearly this demonstrates a fault that any of us could make – a lack of self-awareness and self-criticism.

Building resilience and proper preparation for a risk costs money. It involves preparing for an event that may never happen. Going into the pandemic, there had been a slowdown in health improvement, and health inequalities had widened. Public services, particularly health and social care, were running close to, if not beyond, capacity in normal times. Organisations that fail to invest in resilience and that run with little spare capacity (ie “efficiently”) are always at risk.

The Report identifies five major flaws in the approach to risk assessment in the UK that had a material impact on preparedness for and resilience:

1. Too narrow a scenario 
2. Assumed impact, rather than focus on mitigation and suppression
3. Lack of a system-wide view – feedback and spiral
4. Failure to understand who was vulnerable; and who was vulnerable to the response
5. Failure to connect assessment of risk with strategy of dealing with it

Risk assessment centres on answering:

• What could go wrong? 
• How likely is it to go wrong? 
• If it does go wrong, what harm will it cause?

Flaw 1 – too narrow a scenario – focus on a “reasonable worst-case scenario”

Too much reliance was placed on a single scenario – pandemic influenza – and on the likelihood of that scenario occurring. The effect was that risk was assessed too narrowly in a way that excluded other types of pandemic.

It is not reasonable to anticipate and plan for everything that could happen. There was a concern that the use of multiple scenarios would have been too resource-intensive. So there was a focus on a “reasonable worst-case scenario”  (RWCS) – pandemic influenza – which was a relatively high probability and certainly high impact event.

RWCS have the potential to be interpreted as a prediction rather than as just one scenario against which to plan. Setting out multiple scenarios, up to and beyond the reasonable worst case, should result in more sophisticated planning and a greater range of possible responses. Respiratory diseases such as SARS and MERS had been identified as a risk but no contingency plan seemed to have existed. 

The Royal Academy of Engineering suggested that “[L]ikelihood should not be the main driver for prioritisation as this can be difficult to assess with a high degree of confidence across all risks. Decision-making should be driven by impact and preparedness linked to capability across prevention, mitigation, response, and recovery. Less weight should be given to likelihood, since there should be planning for unlikely events too.”

Similarly, Sir Oliver Letwin said that the focus on likelihood was a mistake “because events with huge impacts that are very unlikely and may not occur for many years, if they do occur, will nevertheless have huge impacts”. 

Although the Report does not address it, there are ways in which resilience planning can cover a range of scenarios. Rather than going into detail of a particular type of pandemic, planners could consider what would be required regardless of the specific threat – contact tracing, vaccine development, PPE – and what general policies could be enacted. Hospitals generally have a “major incident” plan – generally suspending elective surgery – that can be enacted whatever the cause of the incident. “Risk agnostic” resilience is the goal.

Flaw 2 – accepting the impact rather than mitigating the threat

Planning was focused on dealing with the impact of the disease (in this case, influenza) rather than preventing its spread. As a consequence, the levels of illness and fatalities of a pandemic were assumed to be inevitable and there was no consideration of the potential mitigation and suppression of the disease.

The National Risk Register “ explicitly assumed that in the event of a pandemic large numbers of people would fall ill. It did not mention action that might be taken to prevent this from happening”.  The RWCS for pandemic influenza was a largely unmitigated scenario. 

“[A] good risk register should drive thinking about how risks can be prevented, mitigated, handled if they transpire and to clear up afterwards.”  

There is a risk that scenarios are viewed fatalistically rather than used as warnings of futures to be avoided.

Flaw 3 – interconnected risks and “domino effects”

This may be a more specific concern for government and “whole system” threats but it is worth all organisations considering not only second- and third-order effects of change, but the consequences of mitigating actions. “The cure for a specific emergency can have harmful side effects”. 

Sir Patrick Vallance said “Many risks are interconnected and can act as contributors or enablers of other risks. This in turn can amplify certain risks. This issue is not currently captured sufficiently well in the [National Security Risk Assessment] methodology.”

A single emergency may create a domino effect in which, when one thing goes wrong, other things go wrong as well. 

Different responses to emergencies will have a range of side effects across the system. It should be a fundamental aspect of all risk assessment that all potential impacts are taken into account. Note, that these impacts may not necessarily be all negative – new relationships may be developed, new skills learnt, new opportunities identified. 

An analysis of how risks are connected may well be both challenging and resource intensive, but foresight tools such as Futures Wheels can help. 

Flaw 4 – Long-term risks and differential impacts

Resilience depends on having a resilient population. The existence and persistence of vulnerability in the population is a long-term risk to the UK. Long-term risks are different from acute risks because they gradually affect resilience over time. An unhealthy population is at significantly greater risk of experiencing higher rates of serious illness and death as the result of an infectious disease.

Covid-19 was not an “equal opportunity virus”. It resulted in a higher likelihood of sickness and death for people who were most vulnerable in society. A quote at the time was “we are all in the same storm at sea, but not all in the same boat”. 

Organisations generally may be able to choose which parts of the system to allow to fail, while focus is maintained on existential threats. (Interestingly, the human body itself can behave in this way).  But, again, thinking this through in advance will enable an organisation to respond more effectively. 

Long-term, chronic risks can often be harder to deal with than acute, more immediate threats. The “boiled frog” apologue shows how it can be difficult to decide when to act.  Identifying “trigger points” which are actively monitored can help in this regard. 

Flaw 5 – Capabilities and capacity

There was insufficient connection between the assessment of risk and the strategy and plan for dealing with it. This led to a failure to focus on the technology, skills, infrastructure and resources that would be needed to prevent or respond to the threat.  We need to ask “what can actually be done in response to an emergency?”.                                     

“If risk assessment does not take into account what is and is not practically feasible, it is an academic exercise distant from those on whom it will ultimately have an impact”. The need is for decision-making to be “driven by impact and preparedness linked to capability across prevention, mitigation, response, and recovery”.

Consideration of capability and capacity can also lead to the development of preventative strategies – drawing in or developing new skills, identifying “surge capacity” and backfill tactics, deliberately maintaining excess capacity. 

These five flaws together led to Recommendation 3 of the report: A better approach to risk assessment that moves away from a reliance on single reasonable worst-case scenarios towards an approach that: 

• assesses a wider range of scenarios representative of the different risks and the range of each kind of risk; 
• considers the prevention and mitigation of an emergency in addition to dealing with its consequences; 
• provides a full analysis of the ways in which the combined impacts of different risks may complicate or worsen an emergency; 
• assesses long-term risks in addition to short-term risks and considers how they may interact with each other; 
• undertakes an assessment of the impact of each risk on vulnerable people; and 
• takes into account capacity and capabilities.

Most of these are applicable more widely.

Other failures we’ll look at in Part 2 include:

• labyrinthine institutions;
• strategy, from 2011, was outdated and lacked adaptability;
• failure to learn sufficiently from past;
• planning guidance was insufficiently robust and flexible, and policy documentation was outdated, unnecessarily bureaucratic and infected by jargon;
• lack of adequate leadership, coordination and oversight. Ministers, who are frequently untrained;
• lack of sufficient freedom and autonomy to express dissenting views and a lack of significant external oversight and challenge; ‘groupthink’.

Written by Huw Williams, SAMI Principal

The views expressed are those of the author(s) and not necessarily of SAMI Consulting.

Achieve more by understanding what the future may bring. We bring skills developed over thirty years of international and national projects to create actionable, transformative strategy. Futures, foresight and scenario planning to make robust decisions in uncertain times.

If you enjoyed this blog from SAMI Consulting, the home of scenario planning, please sign up for our monthly newsletter at newreader@samiconsulting.co.uk 

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bp Energy Outlook 2024

In their annual energy outlook, bp reviewed two distinct scenarios. The first is the Current Trajectory based on climate policies already in force and on global aims and pledges for future decarbonization. The second looks at a Net Zero scenario which explores how what might change if the world collectively acts for CO₂ equivalent (CO₂e) emissions to fall by around 95% by 2050. Unsurprisingly, the difference between the two is considerable, with CO₂e emissions in the former falling only by 25%.  Net Zero is “Paris consistent” (ie would limit temperature increase to 1.5˚C) whereas the current trajectory exceeds 2˚C

 Before focussing on the scenarios themselves, the report identifies some recent developments and emerging trends:

• Carbon emissions are continuing to grow and at current levels will exceed the budget for a 2˚C increase by 2040.
• Global energy demand continues to grow, driven by prosperity and growth in emerging economies
• Investment in low carbon energy has grown rapidly since 2019, with wind and solar power generation doubling between then and 2023
• But this has not been enough to meet growing demand, meaning that fossil fuel consumption is still increasing
• The increasing adoption of generative AI applications looks set to increase electricity demand materially
• Sales of electric vehicles and heat pumps have risen steadily, but other technologies (hydrogen, biofuels, carbon capture) remain at an early stage

The key insights drawn from these trends are that the carbon budget is running out and the longer governments delay the more difficult the transition will be.  Wind and solar power generation will experience reducing costs stimulating growth, but investment in upstream oil and gas will be required over the next 10-15 years. Strong policy action is required worldwide to drive the use of biofuels and hydrogen while carbon capture will require continued subsidies.  The considerable inertia in the energy system means that its evolution over the next few years is unlikely to vary significantly across scenarios.

The report also considers a “Delayed and disorderly” scenario, where the Current Trajectory is followed until the mid 2030’s, then extreme action is taken to try to hit Net Zero in 2050.  This would entail having to resort to policies and actions that have outsized economic and social costs.

Looking an energy demand the report suggests that oil is replaced by electricity in road transport, and by biofuels and hydrogen in aviation and shipping. 

Natural gas demand varies significantly between the scenarios.

In Current Trajectory, demand increases in emerging economies and China, though it begins to fall in the second half of the period. In Net Zero greater efficiency (notably heat pumps) and carbon capture reduce LNG demand by 50%. 

Coal consumption peaks in the mid-2020s and then declines steadily. In Net Zero consumption falls by around 85% by 2050 with three-quarters of remaining use being in conjunction with carbon capture; in Current Trajectory continued increases in coal consumption in India and other emerging economies means consumption falls only by about a third. 

Modern bioenergy – modern solid biomass, biofuels and biomethane – increases significantly over the outlook, providing a source of low carbon energy to help decarbonize sectors and processes that are hard to electrify.

The rapid growth in wind and solar power is underpinned by further gains in cost competitiveness and by the successful scaling of a number of enabling factors. Wind and solar capacity increases around eight-fold by 2050 in Current Trajectory and by a factor of 14 in Net Zero. The increasing penetration of wind and solar means power systems need to be resilient to the fluctuations in generation as the prevalence of wind and sunshine varies solutions include: building excess capacity; battery storage; low carbon hydrogen; and in some cases fossil fuel back-up for rare circumstances.

The higher cost of low carbon hydrogen relative to fossil fuel alternatives means its significance in the global energy system is only noticeable in Net Zero and even then only towards the end of the period.

Carbon capture, use and storage (CCUS) plays an important role in supporting deep decarbonisation pathways. In Net Zero it is supported by a range of policies incentivising the energy transition but long project lead times mean that most of the CCUS capacity is built out in the second half of the outlook. The use of CCUS in Net Zero complements the rapid decline in natural gas and coal consumption: it does not act as an alternative.

In summary, the Current Trajectory  is likely to lead to global temperature increase of more than 2˚C. To achieve Net Zero by 2050 and hence limit the rise to below 1.5˚C, there a need for greater electrification fuelled by even faster growth in wind and solar power, a significant acceleration in energy efficiency improvements, together with increasing use of a whole range of other low carbon energy sources and technologies, including biofuels, low carbon hydrogen, and carbon capture, use and storage (CCUS).

At SAMI,  we encourage all our clients to consider the implications of climate change mitigation and adaptation to their situations. The second- and third-order effects can be very powerful and resonate in unexpected ways. 

Written by Huw Williams, SAMI Principal

The views expressed are those of the author(s) and not necessarily of SAMI Consulting.

Achieve more by understanding what the future may bring. We bring skills developed over thirty years of international and national projects to create actionable, transformative strategy. Futures, foresight and scenario planning to make robust decisions in uncertain times. Find out more at www.samiconsulting.co.uk.

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Leading societal resilience

A recent conference discussion by the National Consortium for Societal Resilience (NCSR+) addressed what leadership skills were needed to build societal resilience. The NCSR+ is co-chaired by Alliance Manchester Business School, Suffolk Resilience Forum and Sussex Resilience Forum.

Participants included:

➡ Professor Caroline Field, Partner, PA Consulting
➡ Mike Adamson, Director, Systems Leadership Development
➡ Dr Kathy Oldham, CRO, Greater Manchester Combined Authority

The NCSR+ advocates a “whole-of-society resilience” approach seeking to drive the resilience community to take an integrated approach to build national resilience.  as the product of multiple factors, including effective and trusted governance, government capabilities, social cohesion, and local resilience capabilities. More information can be found at ambs.ac.uk/ncsr and (25) National Consortium for Societal Resilience [UK+]: Overview | LinkedIn.

The discussion covered the qualities Chief Resilience Officers and broader resilience professionals (such as members of Local Resilience Forums) need to take to bring a balance between reactive responses to short-term threats and longer-term community resilience.

Resilience professionals must themselves be resilient if they are to empower others to lead within their communities and organisations. A resilient leader must be able to lead during uncertainty, change, and crisis but also have the skills to build trust, cohesion, and capacity across a wide variety of systems and with a diverse range of people. Being a leader in resilience is substantially about developing horizontal collaboration. 

Professor Caroline Field from the Centre for Whole of Society Resilience and Loughborough University began by outlining the nature of the world we live in today. Most people prefer stability or moderate change to turbulence or volatility, but we are now in a VUCA world – volatile, uncertain, complex, and ambiguous. 

Resilience involves preparation, adaptability and an attitude that thrives on change.  A whole of society approach looks at systems, not silos, where everyone plays a part. Resilient leaders need not just the right skillset but the right mindset. 

She outlined a resilient leadership model:

• Clarity of direction: a distinct vision, multi-level communication, and a determination to overcome challenges
• Robust decision-making: creatively responding to new situations, being aware of bias, evidence-based, versatile, operating at pace
• Awareness: of motivations – your own and others’ – of the organisational/societal culture, strengths and weaknesses
• Leadership presence: authentic, with a focus on serving, intentional, and empowering.

Michael Adamson, until recently CEO of the British Red Cross, addressed the issue of Systems Leadership 

He suggested that common factors in most disaster situations were that:

• The community always responds first – local leaders do what they can
• We always wish we’d invested more ahead of time; even though we know it is worth it, we never do; resilience is a public good, so is always under-invested
• The whole is less than the sum of parts – elements fail to build on one another 

He sees Collaborative Leadership as a team sport that is concerned about justice and equity.  It needs to deal with threats layered on chronic challenges and requires: 

• Humility at all levels
• Active listening
• Curiosity about adjacencies – where are the boundaries, what is around them “boundary spanners”
• Sensing skill
• Courage to seek change in the system
• A pragmatic approach based around testing and learning about the long term – build on small victories
• Presuming good intentions

Disasters can feel disempowering, but we all have agency. We can make choices about our use of time and our primary focus. 

He sees systems more as a jazz band rather than an orchestra, reactive, building together and based on trust.  Ultimately leaders need to build experience and develop their “Collaboration muscle”. 

Kathy Oldham, Chief Resilience Officer at the Greater Manchester Combined Authority, discussed their approach to resilience. This has moved on from emergency preparedness and response to become more central and proactive, looking for the opportunity to build better out of a crisis.

The GMCA resilience strategy involves:  

• Communities
• Discovery
• Leaderships
• Place-making
• Responding 

It also requires futures thinking and foresight, exploring various scenarios particularly around AI and climate change.

They are creating indices of resilience for use as investment metrics. 

She, too, was concerned about justice and equity, quoting author Damian Barr: “We are all in the same storm but not in the same boat…An unequal society is unlikely to be a resilient one”

The online “chat” discussion and following short Q&A tackled some key questions.

“Return on resilience investment”

If resilience is usually under-invested, then perhaps we need better measures – maybe RoRI. Investing in resilience gives:

• Value if the risk materialises
• Value in reducing the risk 
• Creation of jobs and social value now
• Chronic risks – reduce impact but also tackles community
• Adaptive capacity – collaborative opportunities

Another approach is the Integrated Reporting of “6 capitals” promulgated by IFRS

Supporting local leaders

If, as suggested, the community always responds first, what can be done to support the local leaders and help them deliver better first responses? This requires a cultural change towards devolved responsibility and empowerment. Bite-sized learning is available, but peer networks may be a better way forward. A previous Resilience Framework had an emphasis on local councillors as “connectors” bringing together the required support. 

Overall,  this was an interesting exploration of the resilience leadership field, building on valuable personal experience. However, I left feeling that some greater coherence and structure are required and that this remains a relatively new and underdeveloped area worthy of much more consideration. 

SAMI has recently completed a year-long, in-depth, project on resilience for a government client. We recognise many of the issues raised in the conference. We also understand the real value that foresight and futures thinking brings to effective resilience and look forward to continuing to contribute to its development.

Written by Huw Williams, SAMI Principal

The views expressed are those of the author(s) and not necessarily of SAMI Consulting.

Achieve more by understanding what the future may bring. We bring skills developed over thirty years of international and national projects to create actionable, transformative strategy. Futures, foresight and scenario planning to make robust decisions in uncertain times. Find out more at www.samiconsulting.co.uk.

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The future is interested in you

“We can’t think about the future just now – everything is so unpredictable”.  Many people feel like that, with looming ground-breaking elections in the UK, France and the US, not to mention war in Ukraine and the Middle East, but perhaps you should think again. It’s in such turbulent times that you need Futures thinking more than ever. After all, to slightly adapt Leon Trotsky’s famous quote, “You may not be interested in the future – but the future is interested in you”. 

Once you move away from the idea that the future is predictable, that a slightly more elaborate mathematical model will sort out all your problems, then you can start to take some real steps towards building a robust strategy in uncertain times. A combination of looking below the current transient issues to fundamental global trends and building rich descriptions of alternative future worlds will put you in a position to really explore radical alternatives. 

First, despite political uncertainty and geo-political conflict, there are things you can be pretty sure of:

• Demographics: with Western fertility rates falling well below replacement levels, and even China and India’s populations going into decline mid-way through the century, supporting ageing populations will be a major challenge. Global uncertainties are driving up migration – whether we view that as a threat or an opportunity is a choice. The SNP is already calling for more immigration, Italian villages are offering cut price homes for people to move in to, Hungary is encouraging guest worker migration, China is promoting high-birthrate policies. In a low-fertility future, might sending asylum seekers to the Highlands be a better option than Rwanda? (I’m not suggesting there would be a “deterrence” effect!).

• The climate crisis is with us. There is already enough CO2 in the atmosphere to cause a major increase in extreme weather events with consequential impacts on habitable areas, migration, and costs. Many areas will become uninsurable.  The scale and speed of Governments’ reactions may well be uncertain but it is clear that the carbon transition will create costs and opportunities. Internal migration from flood-hit areas will be complemented by international migration from uninhabitable ones.

• Technological advances will continue to accelerate. We are still in the early days of an AI revolution, biotechnological advances can re-shape health, personal care and the food industry. Identifying areas of opportunity here will put you in a better position to address other challenges. 

• The move from a unipolar world to a multipolar one leads to geopolitical uncertainty and conflict and as power blocs rub up against each other. But there are opportunities in the competition for growth, technological advancement and skills.

Second, some major uncertainties remain but are amenable to scenario thinking. In fact, some of the major uncertainties are themselves remarkably predictable.  Back in 2019 we did a major project for the EC Research and Innovation Directorate (SAFIRE) where we created a “Journey Game” based around a classic scenario cross with four future worlds that we characterised with tree names. 

The axes of this scenario cross remain very pertinent after all the shocks of the intervening  years, including the pandemic and the Russian invasion of Ukraine. Indeed, we continue to use SAFIRE as a base for, for instance, our recent work in cybersecurity. You need to develop strategies to cope with each of the four potential outcomes. You may find other axes more suited to your situation but the basic model applies – international politics and the ambitions of people will continue to be major factors. 

Third, come what may, you will have to respond, to change. Building resilience into your organisations, and developing a culture willing to adapt and develop will be critical whatever happens. There are many aspects to resilience, including:

• Flexibility and agility – how quickly can you change course, how smooth is your decision-making?
• Awareness – how sound is your horizon scanning and monitoring of changes in the world? Will others know what’s happening before you do? Are key “trigger points” in place to escalate to decision-makers?
• Capacity – systems running at full capacity, maximised for short-term profit, find it impossible to react to sudden shocks. Years of austerity left the NHS struggling to cope with the pandemic. 
• Relationships – are your supply chains robust (unlikely in the current world)? Do you have alternatives lined up? Are you talking to enough people to see new opportunities? 
• Cognitive biases – where are your blind spots? What fundamental assumptions have you made that could turn out to be wrong? Are you listening to enough diverse voices?

In all these areas SAMI can help. We produce regular updates on Drivers of Change. We regularly facilitate scenario building exercises with clients and we are just completing a major resilience project. We understand that today, when you’re faced with the uncertainties and complications of the present, thinking about the future seems difficult. We also know that if you do not think about and prepare for whatever the future may bring, you will be in a state of uncertainty and complication not just today, but next year and in the years after that.

Written by Huw Williams, SAMI Principal

The views expressed are those of the author(s) and not necessarily of SAMI Consulting.

Achieve more by understanding what the future may bring. We bring skills developed over thirty years of international and national projects to create actionable, transformative strategy. Futures, foresight and scenario planning to make robust decisions in uncertain times. Find out more at www.samiconsulting.co.uk.

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Headwinds to growth

The Economist Intelligence Unit has once again updated its Global Economic Outlook with GDP growth forecasts and has produced a new Global Trade Outlook.  In its usual way, it has produced a single line forecast, based on various regional assumptions, giving a quantitative forecast of global GDP growth for 2024 – 2.5%, up from 2.4% previously.

Unusually, however, they also recognise that this might not be the final outcome – that there are “headwinds” which may hold growth back.  These are akin to our usual “Megatrends” or drivers of change and represent a recognition that single point forecasts have their limitations.

The most significant of these is “geo-politics”.  Several aspects of inter-country relationships worry the EIU:

• Conflict in the Middle East could escalate as Israel and Iran face off against each other more directly, worsening supply-chain disruptions and maritime trade risks
• Russia’s war in Ukraine shows no sign of resolution, with several scenarios still possible
• Tensions in relationships with China are exacerbated by its worsening industrial overcapacity – pushbacks against unfair subsidies will create more trade problems
• Uncertainty over the direction of US foreign policy, notably in the event of a presidential victory for Donald Trump.

They also note that the growing strength of the Indian economy – its growth is forecast to continue to exceed that of China and the EU – will have an impact on its role in the world. The BRICS+ economies are likely to exceed the size of the G7 by 2045.  

Growth in mid-range countries’ economies is likely to lead to more fragmentation and regionalisation in the world economy in 2024-28 as alliances tighten and competing blocs form bringing supply chains under further pressure. Mexico could benefit from an increase in “near-shoring”.

But mid-range countries, especially those in Africa, are vulnerable to climate change. Poorer countries will be disproportionately affected by climate change and will struggle to secure financing to mitigate its impact. Climate risks, such as the effect of drought on water levels in the Panama Canal, will complicate global shipping operations (and make them more costly).

Food security concerns will intensify, particularly over rice. The negative effects of El Niño weather patterns will cause the agricultural protectionism evident in 2023 to persist into 2024. India had already imposed a ban on rice exports in July 2023. The inability of other major producers like Thailand and Vietnam to offset the resulting shortfall consequently caused regional rice prices to surge. The likelihood of India keeping its export ban in place until after its elections in mid-2024 suggests that rice prices will remain elevated.

Export restrictions on critical minerals and rare earths will come into greater focus. South-east Asian nations are looking to take advantage of their own natural resource endowments, increasing trade protectionism. Indonesia’s prohibitions on nickel ore exports and its planned restrictions on copper ore— alongside Malaysia’s consideration of a similar ban on rare earth exports—may encourage other nations with reserves of critical minerals or rare earths to adopt similar measures.

The EIU is sceptical about the productivity benefits of Artificial Intelligence.  Those improvements that do emerge will accrue mainly to developed economies; this will create challenges for countries aiming to move up the manufacturing and services value chains.

There are also complex interactions between forces. Climate change induced migration will harden attitudes to immigration in the US and Europe. This has a feedback effect as policymaking will generally push in a more insular direction, to the disadvantage of international co-operation on climate.

The war between Russia and Ukraine, which are both critical sources of grain and other staples to the region, has highlighted the vulnerability of food inflows centred heavily on a few major suppliers. Domestic production across the region has become increasingly precarious, given the effects of climate change on reducing crop yields and arable lands. South American countries able to fill the gap will see many new opportunities.

Authoritarian regimes will face challenges of their own, and governance in many parts of the world will be challenged by threats ranging from climate change to terrorism.

SAMI recognises many of these challenges and would add many more. The short-term nature of the EIU forecasts mean that longer term trends such as the impact of demographics – declining populations in Western countries, and even peaks in India and China – are not considered. Skills gaps due to ageing populations are already emerging, so there are countervailing pressures on immigration.

Ai and other digital technologies, combined with biotech, may not affect 2024 GDP, but undoubtedly will be critical factors in years to come. And the multi-faceted impacts of all these forces on social attitudes may well be game-changing.

All this shows that single point forecasts may not be very helpful in developing your strategy, despite the seductions of plugging in just one number into your models.

Written by Huw Williams, SAMI Principal

The views expressed are those of the author(s) and not necessarily of SAMI Consulting.

Achieve more by understanding what the future may bring. We bring skills developed over thirty years of international and national projects to create actionable, transformative strategy. Futures, foresight and scenario planning to make robust decisions in uncertain times. Find out more at www.samiconsulting.co.uk.

Intelligent Money

The Lord Mayor of the City of London for the year 2023/24 (the 695^th, no less), Right Honourable Alderman Professor Michael Mainelli, is running a series of online webinars under the banner “Knowledge Miles”, which explore the connections of the Square Mile and how its knowledge clusters are addressing diverse global challenges. Michael refers to the Square Mile as the World’s coffee house, tipping a nod to the meeting places where the Stock Exchange and Lloyds of London, amongst other institutions, were originally founded.

The webinars are eclectic and compelling, and are being delivered by a variety of accomplished, celebrated individuals. Importantly, in the true intended tradition of Sir Thomas Gresham (1519–1579), himself a Lord Mayor and founder of the Royal Exchange and Gresham College, they are free of charge and open to everyone, as are the regular lectures from the College itself.

Recently, Chris Skinner, a long-time friend of SAMI Consulting, gave a talk entitled “Intelligent Money: Our Future Is Where We Do Not Think About Money, As Our Money Thinks For Us”.

Chris was keen to point out that he is not a Futurist, but we believe his observations should help to inform some of our futures thinking. After all, money is fundamental to every one of us. Death and taxes may be inevitable consequences of human life, but so is money. How else would the tax be paid?

The title of the talk was somewhat alarming. AI gone mad? And Chris does bill himself as a troublemaker. An alarmist? In fact, his message was more subtle and re-assuring.

Chris has written seven books on technology and finance, his latest being “Intelligent Finance”. What is the future? What’s coming next? Can PEST (Political, Economic, Social, Technological) analysis help us find answers? It’s very difficult to predict and there are always black swans…

Chris’s take is to look at this in the context of finance and banking, not as a Futurist, and there are two big questions. Can you really have de-centralised finance (DeFi), where everything is run by (a network of) the people (Bitcoin, Ethereum, Dogecoin, etc.), or does everything need to remain centralised through government (CeFi) even allowing for controlled cryptocurrencies?

Secondly, Generative AI. What does Generative Finance look like?

There has to continue to be human involvement (in other words, future jobs) and there are four converging critical enablers, heading towards the “Metaverse”: Digital Social Life; Investments; Technology; and a De-centralised Economy.

However, Bill Gates is credited as saying “We need banking but we don’t need banks anymore.” Chris says this is very naïve: “only banks can do banking, but they need to do it digitally.” This has resulted in huge increases in investments in FinTech. Look at the valuations of, say, Stripe, and the number of its customers and employees compared to those of the big banks.

So, what is the bank of the future?  Chris says there will always be a place for them and they must be regulated and licensed. They will be digital asset managers and data stores of value. Trust and security must remain top of mind.

“You need the right tools and technologies to build the right bank at the right time” and “AI is only as good as what people put into it”.

Chris gave us a final thought. If you learn digitally alone, the whole thing is seen as a game. There is no exposure to realmoney. Financial literacy is imperative.

Where does this leave us contemplating the future?

At SAMI, this is what we specialise in doing: providing expert consultants who help our clients to use tried and tested methodologies in order to make sensible, considered decisions about possible futures. No-one can tell you accurately what will happen in the future, but the most successful organisations are those who are prepared for what might happen. This is as relevant to the future of money as it is to anything else.

Chris’s webinar has been posted here.

Forthcoming Knowledge Miles webinars are at this address. 

Past events can be viewed on the YouTube channel.

Written by Jonathan Soar, SAMI Associate

The views expressed are those of the author(s) and not necessarily of SAMI Consulting.

Achieve more by understanding what the future may bring. We bring skills developed over thirty years of international and national projects to create actionable, transformative strategy. Futures, foresight and scenario planning to make robust decisions in uncertain times. Find out more at www.samiconsulting.co.uk.

If you enjoyed this blog from SAMI Consulting, the home of scenario planning, please sign up for our monthly newsletter at newreader@samiconsulting.co.uk and/or browse our website at https://www.samiconsulting.co.uk

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Reasons to be anxious

We have noted changing attitudes and behaviours of different generational cohorts since we first produced our Drivers of Change document back in 2017. We noted then that

 “Generation Z smoke less, drink less alcohol and have less under-age sex. On the other hand they are more likely to be obese, and experience increased mental health issues as the use of social media becomes increasingly ubiquitous.”  

But also 

“A BBC documentary explored views of Generation Z. They may be viewed as shallow digital natives by older generations, incapable of real world friendships, but they see themselves as hardworking, entrepreneurial and about to change the world for the better.”

As time has moved on, we are indeed seeing evermore increased mental health issues, notably anxiety and depression.

In the UK, a Resolution Foundation report reported that “34% of people aged 18 to 24 reported symptoms of mental disorder, such as depression, anxiety or bipolar disorder in 2021-22”  (up from 24% in 2000) and that the number of young people who are workless due to ill-health has more than doubled over the past decade.”

This pattern appears to be replicated across the English speaking world.

One theory is that, as this data is based on self-reporting, the effect is due to a greater openness and less stigma about mental health issues amongst that generation. An argument against that is that rates of self-harm are also increasing. 

Now in a new book, The Anxious Generation, Jonathan Haidt argues that there are two main explanations:

• The decline of outdoor, unsupervised social play as adults increasingly become fearful for children’s safety meant that children no longer explored the world and built confidence in their abilities
• The ubiquity and high use of smartphones and social media which leads to atomisation and unrealistic comparisons, being bullied and harassed or encountering harmful content.

Haidt suggests that the correlation between smartphone use and poor mental health is very close – girls who spent more than five hours a day on social media were three times more likely to become depressed than those who didn’t use it at all.

Whilst Haidt’s theory is certainly plausible and may be recognised by many parents, it is based on correlation rather than proof of causation and there are alternative explanations to the trends. For a start, it’s quite possible that depressed people spend more time online, so the correlation works the other way. 

There is a sense that Haidt’s theory is the latest in a long line of scare stories about new technology – video games, TV, radio and even novels have all in their time been blamed for perceived decline in standards and behaviour. 

Then there is the world Gen Z inhabits. 

• Research back in 2017  showed that 14-year-olds from better-off families were less likely to have high levels of depressive symptoms compared to their peers from poorer homes. 
• They are generally experiencing more limited economic prospects – by 2020 52% of young adults were living with their parents: “boomerang children” and the chances of home ownership declined. 
• The failure to properly address the climate change crisis may be inducing a fatalistic view of the future. More than 80 per cent reported being ‘concerned’ or ‘very concerned’ about climate change, with many revealing they felt anxious over the issue with overwhelming distress about future climate disasters and the continuing fate of humanity and the world.
• The 24-hour news cycle highlights and amplifies disasters and threats increasing parental concerns.

With Covid, Trump and Brexit, young people are showing an even greater degree of helplessness and hopelessness. They can’t afford a house or even rent, their world is at war and boiling away, and their countries are run by the old and the far right. Our view is that this is not primarily due to social media but to the feeling that their future has been captured by the old, who have been given every opportunity in their lives but who are now protecting themselves at the expense of the younger generation. Anxiety and depression are natural responses to these circumstances.

Haidt argues that these factors don’t correlate with the increased incidence of poor mental health as well as his theory; that previous generations suffered from global challenges too (threat of nuclear war, recession etc).  

We are not arguing that we should ignore the effects of social media and smartphones. To propose that governments should legally assert that tech companies have a duty of care to young people, that the age of internet adulthood should be raised to 16, and that companies forced to institute proper age verification is perfectly reasonable. However, it is by no means clear that the mental health challenge is then completely sorted. 

Our approach is to give young people a sense of hope and agency by helping them create their own futures for themselves – because if they do not make their future, the old will make it for them.

Written by Huw Williams, SAMI Principal

The views expressed are those of the author(s) and not necessarily of SAMI Consulting.

Achieve more by understanding what the future may bring. We bring skills developed over thirty years of international and national projects to create actionable, transformative strategy. Futures, foresight and scenario planning to make robust decisions in uncertain times. Find out more at www.samiconsulting.co.uk.

If you enjoyed this blog from SAMI Consulting, the home of scenario planning, please sign up for our monthly newsletter at newreader@samiconsulting.co.uk and/or browse our website at https://www.samiconsulting.co.uk

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