Blog: “Scenario thinking for a ‘new normal’” – Ewan Mearns, Scottish Enterprise
We hear a lot about the ‘new normal’ these days. But what exactly does this mean? And do we all have the same interpretation?
The term implies that we would all recognise what the ‘old normal’ looks like. You know, the routine, stable economic environment where things were predictable, and we could readily create our five-year plans with a high degree of confidence in the future…
What the phrase ‘new normal’ is really getting at is the concept of uncertainty. Change is inevitable but there are periods in life where the pace of change is accelerated and the level of uncertainty skyrockets. We want to gain reassurance by attempting to put a degree of order around something we can name; to get back to ‘business as usual’.
Scottish Enterprise and the Scottish Government have been delivering a scenario engagement process since late April where scenarios have provided a very useful tool to help generate insights about the uncertainties facing us. Our scenario engagement process featured in a recent EDAS Covid Conversation.
This is much more than an abstract exercise. We’re using the insights to directly feed into the Scottish Government’s medium-term Renew Programme, as well as informing SE’s planning for Scotland’s future economy. From the vantage point of 2025 the perspectives we gain are quite different to today’s pressing concerns of furloughed jobs, precarious businesses and social distancing. In planning for the future it’s important we take a future-oriented perspective. Or as Peter Drucker, the great management theorist put it: “The greatest danger in times of turbulence is not the turbulence itself but to act with yesterday’s logic”.
Covid-19 is at the heart of the critical uncertainties used to frame our four plausible scenarios, both in terms of the relative impact and duration of the pandemic as well as the degree of collaboration within and between countries. However, the uncertainties that feature in the scenarios cover everything from impacts on inequalities, shifts to new business models, the adoption of new technologies, and geopolitical and technological conflicts between the US and China.
We designed an online workshop process to explore the potential implications of the scenarios with a wide range of organisations across Scotland. Over 175 individuals were involved throughout June in exploring 10 policy and delivery themes. We used the four future scenarios to test the likely robustness of existing policies and plans, and identified ways in which they could be strengthened to accommodate a wider range of uncertainties.
What did we learn?
Without giving too much away – this is a live input to policy thinking – it’s fair to say that across the board, our existing policies and plans were designed for a more benign, less turbulent world. We need to prepare for a broader range of potential eventualities and build more flexibility and agility into policy making and delivery. Covid has accelerated a range of structural shifts and laid bare our historic under-investment in infrastructure (particularly digital infrastructure), skills, business innovation and the adoption of new technologies. Looking ahead, we can anticipate a shifting pattern of global trade relationships and perhaps see business stepping up permanently alongside governments to provide solutions to pressing societal needs.
One of the key issues relates to our collective capacity and capability to anticipate and prepare for future uncertainties. It’s clear that Covid-19 will be with us for some time yet. And then there may be similar pandemics – plus the much bigger but much slower-burning crisis that is climate change.
In this context it seems strange to talk about a ‘new normal’. In fact, following the biggest recession for almost a century, it’s likely to be anything but. Instead, we need to prepare for a future that remains highly uncertain and abnormal, where resilience is prioritised over efficiency and where agility and leadership are stretched to the limit. Hold on tight, it’s going to be a bumpy ride.
See more from Ewan at our third Covid Conversation on Future Scenario Planning.