Scenarios: A Proxy for Hard Data
Scenario planning originated with military war games in the United States in the 1940s and was taken up as a commercial tool around 1970, notably by Shell, whose chief planner referred to it as “the art of strategic conversation”.1
Beyond the commercial uses, scenario planning has proved especially useful in dealing with what economists call “externalities” — the damage to others from (say) CO2 emissions generated at no cost to those responsible for the emissions. In the first article of this project (Putting Numbers on Our Cultural Assets: Not Yet Possible ), I discussed why externalities cannot be measured by orthodox economic analysis — but the implications can be captured in scenarios ranging from “best” to “worst” possible futures. These scenarios have concentrated on the long-term vulnerability caused by climate change and other environmental factors, but there is a close parallel between damage to the natural ecology and damage to cultural assets which can also be affected by actions and policies initiated by other agents in the national or international economy.
In either case, the impact extends into an indefinite future populated by future generations. The environmental damage is visibly larger and more talked about, involving as it does huge physical survival factors such as global and local temperature changes, rainfall, water quality and availability, biodiversity, population growth and the rest. It warrants a longer future perspective as far as to the end of the 21st century and beyond, with the next 20 years being seen as the “near term”.
The perspective on culture would be shorter — in practical terms perhaps a couple of decades. But there is no justification for pushing cultural planning under the carpet. Positive policies are essential to avoid “worst cases”, whether we deal with culture or nature.
Scenario Planning and Climate Change
Not surprisingly, socioeconomic scenarios became a feature of the periodic reports of the Intergovernmental Panel on Climate Change (IPCC), culminating in its Fourth Assessment Report in 2007. The brief exposé shown in this link is part of a socioeconomic study I carried out for the US National Oceanic and Atmospheric Administration (NOAA) between 2007 and 2010, Climate Change and the Florida Keys.2
The exposé highlights the problem of medium- and long-term planning in an increasingly unpredictable world and how scenario analysis became a major strategic planning tool in the context of climate change. It also demonstrates the ability of scenarios to encompass a very wide range — from how the world could fare under conditions of “business-as-usual” (or worse) in contrast to more environmentally friendly policies; to how the alternative futures would look in a vulnerable area with its own special problems like the Florida Keys; and into more detail such as applying these findings to individual “keys” (islands), or to the city of Key West versus the rest of the Keys.
Scenario planning also lends itself well to analysis of a specific part of a national economy or culture, such as the Australian music sector. Generally it is a tool for those concerned to define the most desirable outcomes and promote policies that could prevent a “worst case” from happening.
Three or four alternative scenario stories is commonly regarded as a suitable number of broad options, covering perhaps a desirable case, a worst case, and a “business-as-usual” case (assuming this is not itself the worst case!). In the 2007 IPCC report, there were two dimensions, one “global” and one “regional”, each of which might be either “economic” or “environmental” (see the “IPCC tree” above)3 In the Florida Keys report, adaptations of each of these four options were converted from the global setting through a total US setting to a local Florida Keys setting.4
Scenario Planning Dimensions for the Music Sector
This can only be identified as a starting point. The whole idea of scenario planning is that it is based on consensus reached through informed discussion. A top-down approach would prejudice any attempt to develop credible scenarios. Many people should contribute to these stories about the future from their own perspective. All that can be done now is to provide some guidelines for designing an analytic framework.
Time frame: It is proposed that the analysis will provide alternative medium- to long-term perspectives, with “milestones” in 2025 and 2035 (a 20-year span). Maybe with a “peep” beyond 20 years, depending on how robust the 20-year scenarios turn out to be.
Future options: Three scenario stories are proposed, all derived from “the present” (2014-15) and covering as many aspects of the music sector as possible:
- Best case for the music sector — should also reflect policies that acknowledge the value of music and other cultural activities in boosting the wider economy.
- “Business-as-usual”, basically assuming that present trends will continue (spelling out how).
- Worst case, identifying things that may go wrong, and will (again explaining how).
These three variants are subjective, devised to get this show on the road in the first place. The three cases could change character and content as the scenario planning process proceeds.5
Defining the music sector, and its dimensions: The music sector, in the current model adopted by The Music Trust and its Knowledge Base, comprises the music “industry” as it is commonly defined based on paid live and recorded performance across the board, plus music education, community music, and the supporting wide-ranging infrastructure. These segments define the role of music in Australia — one of the challenges is to get the social and cultural qualities as well as the economic role into the frame of reference.
Parallel with the development of scenario planning for the sector will be a statistical project to establish its current economic role — what has been called “music GDP”. The statistics will tell an incomplete story, because GDP analysis cannot account for the “externalities” as discussed in more detail in the first article (Putting Numbers on Our Cultural Assets: Not Yet Possible the statistical analysis only attempts to measure the past and present. We are planning to proceed with the scenario project while the numerical analysis is also going on.
We don’t pretend to know all the factors that will have future relevance. All we can offer initially is a set of ideas to be developed with the panel of participants that we need to assemble. Any apparent attempt to make this proposal impervious to new ideas would kill it. We expect that a final viable model, or set of ideas, will emerge through the participation of many people in the exercise.
Which brings us to the crucial part.
Applying the Art of Strategic Conversation
This project depends on the active collaboration of knowledgeable people who are interested in and concerned where the music sector may be headed, or parts of it. We can only put the ball in the air. Unless there is a team out there to catch it this project will be handicapped. It needs to attract ideas from many different parts of the music sector.
In the past, strategic conversation was expensive, as in Shell where it was first developed in a commercial environment. It remained costly and might have been unrepresentative even in the IPCC process as it existed in 2007, to the extent that the IPCC pre-defined it internally.
In 2014, we benefit from the digital revolution as never before. It is possible, with a modest budget which is all we have, to launch a project as long as a group of supporters and friends can be gathered. We have been greatly encouraged by the broad positive response during the initial six months’ existence of The Music Trust (which includes the Knowledge Base in its new life).
In short, we invite our friends and supporters across the music sector to participate in an email-based project which will start on a general basis but through a subsequent round or “iteration” will develop particular topics which should then become draft scenarios in a final round.
We ask each participant to spend a short time only. The estimate is less than two hours spread over three occasions.
There is still some preparation to do before we can define the whole project, but we hope to start shortly, primarily by gathering a group of participants. We will keep communicating and would greatly appreciate expressions of interest and comments on crucial aspects and priorities as we move along. You realise, of course, that the music sector is a broad church and that it is important to deal with as many activities as possible, and show how these activities are mutually dependent.
Defining the Project
”Note inserted June 2015: The scenario project was a pioneering effort, and the time involved was underestimated, exacerbated by complexities we didn’t anticipate. The basic scenarios were published in paper #11 in June 2015, A First Set of Music Sector Scenarios. Late 2015 or early 2016 became more realistic target dates for statistically based scenarios considering the grossly inadequate numbers in existence for the Australian music sector. The approach in this section did not work as planned but provided valuable experience along the way. It is retained as a record for that reason.”
The first step, as explained above, is to secure participation since this is a collaborative process.
Subsequent steps are all designed to receive descriptions from participants, based on a simple questionnaire, on what participants regard as the key opportunities for a successful music sector, and the key risks that it could run into difficulties over the next 10 to 20 years. This may sound simplistic, but it covers the basic purpose to develop ideas towards defining a “best case” and a “worst case” to compare with “business-as-usual”.
The initial survey will be brief and the responses verbal (the main purpose is to develop “stories”), apart from any numbers respondents might wish to quote. It might be contained in just five items:
- Is your concern with the whole of the music sector or part of it (in which case which part)?
- Current strengths and weaknesses there
- Is “culture” in this context robust or threatened, and why?
- Best case (where would you like it to be in 10 years’ time?)
- Worst case (where do you fear it might be in 10 years’ time?)
We will analyse the first set of responses and put them together for comment in a second iteration. The analysis of these second-round comments should be sufficiently close to the end result for us to produce draft scenarios for comment in a final third iteration. It remains to be seen, of course, whether this will prove to be so but we anticipate it will largely be the case.
The time asked of participants, in other words, will be generally limited to three occasions:
- Responding to the original survey,
- Commenting on our interpretation of the survey results, and
- Commenting on our draft scenarios.
This time spent by those participating will be invaluable for the success of the project. The estimated total elapsed project time as his article was written was close to six months according to the “milestones” chart, Fig. 1. This turned out to be an under-estimation, and the project generally moved on without the detailed participation envisaged for the original paper.
Participants were assumed to approach the project from many different backgrounds and will concentrate on some parts of the music sector rather than others — this is to be expected and in accordance with the wide-ranging scope of the sector. Fig. 2 is derived from but not identical with the categories in the Knowledge Base. Its purpose is to promote an understanding that “almost anything goes” in scenario analysis — particularly in the initial stage of gathering ideas.
Some of the areas covered by Fig. 2 are very large, others are not. All are grist to the mill. For example, the red box in the top right-hand corner invites participants to consider how government policies might develop to the detriment or benefit of the music sector, or parts of it. There may also be international perspectives such as the policies of other countries which might be related to Australia. Then there are issues of what the music sector can do itself to influence the future, and how it might cooperate in a broader cultural policy. And there would be other aspects which are not graphed but may be considered important by the participants.
Views on how music, and cultural policy generally, can affect the total economy and cultural society is one example.
Fig. 2 should be reasonably self-explanatory. Some of the technology and research areas in the bottom left-hand corner are wide-ranging, and will probably eventually be spelled out in more detail. They may also give rise to very different perspectives for the participants, depending on where they fit into the music sector. This is all good for the project.
“Music education” and “Venues and audiences” are part of the “Support and Infrastructure” category in the basic Knowledge Base classification. They are shown as two separate groups in Fig. 2. This was not done to judge their “importance” but to spell out some of the components of each of the two groups. Many will be aware, however, that The Music Trust has a special mission to promote better school music education. It would not be surprising, of course, if education comes to be seen as a major issue in the scenario analysis, but some participants may have different perspectives, and all are welcome.
Fig. 3 is an assembly of 30 randomly selected keywords, demonstrating that there is a very wide scope for anyone with a reasonable knowledge of the music sector to get ideas. We don’t pretend that Fig. 3 is more than a small sample. The selection was the result of a quick scan of the Knowledge Base and does not pretend to be authoritative or to cover everything. The sole purpose of the illustration is to show the wide scope that the initial responses may cover.
Articles in This Series
- Putting Numbers on Our Cultural Assets: Not Yet Possible (27.3.2014)
- How to Explore the Cultural Future (7.4.2014)
- Cultural and Creative Activity in Australia (15.4.2014)
- Global Risk Factors and Music in Australia (17.10.2014)
- Scenarios, Virtual History, and Chaos (20.10.2014)
- Ideas from Other Global Scenarios (8.12.2014)
- Four Global Scenarios Set the Stage (18.12.2014)
- Music Sector Structure for Scenarios (28.2.2015)
- Valuing the Invaluable (5.3.2015)
- Some Big Possible Positives – Or? (20.6.2015)
- A First Set of Music Sector Scenarios (23.6.2015)
- Global Leadership Challenges: A Missing Link in the Scenario Planning (31.10.2015)
- Present and Future Changes and Their Role in the Scenarios (20.12.2015)
- Complex Adaptive Systems and Music (9.1.2016)
Hans Hoegh-Guldberg, 7 April 2014. Some parts revised 11 May 2014.
- Kees van der Heijden, Scenarios: The art of strategic conversation. Wiley, New York (1996).↩︎
- IPPC’s Fifth Assessment Report (2014) changed to another approach to assessing the future.↩︎
- “SRES” stands for the IPCC’s Special Report on Emissions Scenarios.↩︎
- IPCC’s Fifth Assessment Report, published in 2013 and 2014, abandoned the socioeconomic scenario planning approach of the 2007 report in favour of “Representative Concentration Pathways” (RCPs), applied directly to scientifically generated indicators of climate change. Two main reasons were given. First, “predicting socioeconomic developments is arguably even more difficult than predicting the evolution of a physical system.” (IPCC Working Group 1, Climate Change 2013: The Physical Basis, September 2013, p 1036). Secondly, the knowledge of climate change mechanisms has improved as a result of recent massive scientific progress, making a more direct approach possible. There is no way this can be matched in an analysis of the Australian music sector — so conventional scenario planning, with its inherent uncertainties based on human (“anthropogenic”) activities in their broadest sense, remains the best approach.↩︎
- And they did, as subsequent papers in this series will show. See in particular Paper #6 Ideas from Other Global Scenarios which noted that four scenarios were commonly used, and paper #7, Four Global Scenarios Set the Stage.↩︎
Hans founded his own consulting firm, Economic Strategies Pty Ltd, in 1984, following 25 years with larger organisations. He specialised from the outset in applied cultural economics — one of his first major projects was The Australian Music Industry for the Music Board of the Australia Council (published in 1987), which also marks his first connection with Richard Letts who was the Director of the Music Board in the mid-1980s. Hans first assisted the Music Council of Australia in 2000 and between 2006 and 2008 proposed and developed the Knowledge Base, returning in an active capacity as its editor in 2011. In November 2013 the Knowledge Base was transferred to The Music Trust, with MCA's full cooperation.
Between 2000 and 2010 Hans also authored or co-authored several major domestic and international climate change projects, using scenario planning techniques to develop alternative long-term futures. He has for several years been exploring the similarities between the economics of cultural and ecological change, and their continued lack of political clout which is to a large extent due to conventional GDP data being unable to measure the true value of our cultural and environmental capital. This was announced as a major scenario-planning project for The Music Trust in March 2014 (articles of particular relevance to the project are marked *, below).