Strategic Decision-Making in Policy Formulation and the Role of Foresight

1
Strategic Decision-Making in Policy Formulation
and the Role of Foresight

• Professor Ben Martin
• SPRU Science and Technology Policy Research
• University of Sussex, Brighton, BN1 9QE, UK
• (B.Martin_at_sussex.ac.uk)
• 2006/7 Training Programme on Technology Foresight
  Module 3 Technology Foresight for
  Decision-Makers UNIDO, Budapest, Hungary, 9
  November 2006

2
Structure

• Challenges related to strategic decision-making
• the role of Foresight
• Particular challenges for CEE countries
• Evolution and impact of Foresight as a policy
  tool
• 1950/60s US
• 1970s Japan
• 1980s France, Sweden, Australia etc.
• 1990s US, Netherlands, Germany, France
• 1993-date UK Foresight Programmes 1, 2 and 3
• Factors driving the development of Foresight
• The changing social contract
• Wiring up the national system of innovation
• Conclusions and challenges for CEE countries

3
Challenges for strategic decision-making and
policy

• Economy society becoming more
  knowledge-intensive
• New generic technologies
• likely revolutionary impact on economy and
  society
• dependent on advances in basic research
• Growing strategic importance of sc technology
• Explicit longer-term policy for ST essential in
  era of growing international competition

4
Particular challenges for CEE

• Weak/less connected national (and regional)
  system of innovation
• Danger of being squeezed between high tech
  and low wage economies
• Lack of Foresight experience and expertise
• Resistance to any policy mechanism that smacks of
  planning

5
The nature and role of Foresight

• Foresight is
• the process involved in systematically attempting
  to look into the longer-term future of science,
  technology, the economy, environment and society
  with the aim of identifying the areas of
  strategic research and the emerging generic
  technologies likely to yield the greatest
  economic and social benefits
• Foresight is not the same as forecasting a
  process not a technique
• Not predicting, but shaping or constructing the
  future by integrating ST push with demand pull
• Different approaches/methods (Cuhls)

6
United States early experiences

• 1950s
• Early technology forecasting
• Development of techniques by RAND etc. (e.g.
  Delphi, scenarios)
• 1960s
• Large forecasting exercises by DOD e.g. US Navy,
  USAF
• COSPUP Field Surveys (e.g. astronomy, life
  sciences)
• provided overview of field platform to educate
  indy govt
• But
• reflected interests of elite scientists only
• little more than public relations exercises?
• over-academic and too long
• expensive
• largely ignored economic and social demands
• failed to identify priorities
• ... Impact limited

7
Japan STA 30-year forecasts

• Aim to provide a holistic overview (not to
  set specific policies)
• Approach based on 4 principles
• incorporate economic social needs as well as
  ST advances
• holistic (... need to identify new areas of
  technology fusion)
• must evaluate relative importance and identify
  priorities
• forecasts have 2 aspects
• predictive
• normative setting goals
• Results 2 main uses
• Background anticipatory intelligence
• Monitoring ST including level of Japanese RD

8
Impact of STA Delphi surveys

• Utility to companies
• Survey of 250 firms 59 found results very
  important 36 worthwhile
• Accuracy of 1970 forecasts
• 64 fully or partially realised in first 20 years
• Variation with field
• IT health 80
• resources (e.g. energy) 50
• Experts in a subfield slightly less accurate than
  experts from neighbouring areas
• (... some experts also advocates/proponents)
• ... Foresight needs to draw upon a wide range of
  expertise

9
Japan (continued)

• Process Benefits
• Process benefits more important than specific
  forecasts the 5 Cs
• Communication
• Concentration on the longer term
• Co-ordination
• Consensus
• Commitment
• Forecasts become national goals and ... to a
  large extent self-fulfilling prophecies

10
Japan (continued)

• Different Levels of Foresight
• Holistic STA
• Macro-level MITI (10 year visions) and other
  ministries
• Meso-level groups of companies
• Micro-level a individual companies or research
  institutions
• Each level draws upon, and feeds into, higher and
  lower levels
• i.e. a national foresight system

11
Foresight in other countries in 1980s

• France
• 1981 Socialist Govt technology a priority for
  industrial competitiveness social devlpt ?
  various foresight initiatives
• e.g. National Colloquium on Research Technology
  ? mobilising programmes
• But new Govt in 1986 dropped most of foresight
  initiatives
• Sweden
• Initiatives by e.g. Council for Planning and
  Co-ordination of Research (FRN), National Board
  for Technical Development (STU), Royal Academy of
  Engineering Sciences (IVA), Defence Research
  Institute (FOA) and in industry

12
Foresight in other countries in 1980s

• Canada, Australia
• Various initiatives by government ministries,
  research funding agencies and industry mixed
  experiences
• Elsewhere
• Little or no foresight in Britain, Germany or US
  (apart from field surveys)

13
US lists of critical technologies

• Late 1980s upsurge of interest in foresight ...
  concern about declining competitiveness
  especially cf. Japan
• Department of Defense
• Identified 22 technologies critical to weapons
  systems
• Department of Commerce
• Identified 12 new technologies benefiting US
  economy over 1990-2000 also compared US, Japan
  EC and identified 13 policy actions to enhance
  exploitation by US

14
US lists of critical technologies

• Other critical technologies exercises
• Aerospace Industries Association 4 criteria ?
  8 crucial technologies
• Computer Systems 16 technologies factors to
  enhance US performance
• Council on Competitiveness experts in 9 sectors
  ? list of 23 technologies
• OSTP National Critical Technologies Panel 22
  critical technologies in 6 main groups (e.g. ICT,
  materials)

15
US lists of critical technologies

• Comparison of critical technologies exercises
• Similar approach long list explicit criteria
  ? short list
• Similar lists creation of consensus?
• Criticisms
• Little empirical data
• Criteria quite general and not clear how applied
• Concentration on fashionable technologies?
• Critical technologies identified too broad for
  funding decisions?
• Over-reliance on a committee limited
  interaction with industrial and scic communities
  ? less commitment to results
• Impact
• Exercises led to discussion of longer-term future
  for science technology (e.g. in Congress)

16
Netherlands

• 1987-89 SPRU study of foresight in 8 countries
  for MES
• Ministry of Economic Affairs
• 1990 exercise 4 steps
• consultation 5 selection criteria ? 3 areas
  (e.g. mechatronics)
• analysis study by consultants (key players,
  bottlenecks, opps)
• strategic conf of stakeholders test results,
  create consensus commitment
• follow-up e.g. pilot project, new institute
• Repeated in 1992 and 1994 ( study of 15 sectors
  in 1995-98)
• Assessment time-consuming (especially to
  involve SMEs) but results valuable to
  participants (75) many implemented (60)
• Ministry of Education and Science
• Foresight Steering Committee initiate
  co-ordinate foresight activities e.g. in
  chemistry (scenarios), agriculture, energy,
  social sciences
• Ministry of Agriculture 1995-98 Foresight
  programme

17
Germany

• Post-1990 upsurge of interest in foresight
• 1. ISI and BMFT Projektträeger
• Review overseas foresight exercises (especially
  US critical technologies lists) ? starting list
  of 100 emerging technologies
• Explicit ranking criteria formal approach
  (relevance tree analysis) ? short list of
  technologies critical to Germany
• 2. 30-Year Delphi survey of ST
• Collaboration with Japan used Japanese qus
  survey of gt1000 researchers
• Comparison with Japanese results
• Similar realisation times
• Differ over importance constraints (...
  differences in national tech systems)
• Some experts biased ... act as proponents

18
Germany (continued)

• 3. Mini-Delphi with Japan
• To develop improved methodology
  co-determination of qus, add qus on market
  demand, seek qualitative as well as quantitative
  information
• 4. Other Foresight exercises
• 1998 Delphi
• Futur programme (Cuhls)
• Impact of Foresight
• Federal Government e.g. IT priorities, strategic
  talks with industry
• Länder stimulated regional Foresight (Cuhls)
• Industry input to company strategy, sector
  studies by industrial associations (e.g.
  chemicals), survey of doctors by pharmaceutical
  company, in-house foresight by companies
• Public impact discussion in media ? more
  positive debate on future technologies

19
France

• Ministry of Industry identification of key
  techs
• Ministry for HE Research 1994 Delphi survey
  (using Japanese qus) ? comparison of views of
  French experts with German and Japanese
• Similar views on timing of new technologies/innova
  tions
• Different views on most important
  technologies/innovations
• More likely to see US as leaders (cf. Germans
  see Japanese as stronger)
• Differ over technological constraints, and over
  which topics require international collaboration
  (implications for EU RTD policy?)
• Showed can use Delphi to identify groups of
  experts with different views (e.g. large firms
  less optimistic over timing of innovations than
  SMEs)
• Other lower-level foresight e.g. at regional level

20
UK Technology Foresight Programme

• 1983 SPRU report
• Learn from Japan try foresight on an
  experimental basis
• Little impact 10 years too early!
• 1992 SPRU review ? options for UK
• 1993 White Paper on Science and Technology
  launched Technology Foresight Programme (TFP)
• Aims
• increase UK competitiveness
• create industry/science base/government
  partnerships
• identify exploitable technologies
• focus attention on market opportunities better
  use of sc. base
• Organisation
• Office of Science and Technology (and other
  departments etc.) consultants
• Steering Group (industry, universities, govt)
  15 sector panels

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TFP three phases

• 1. Pre-Foresight
• Focus on Foresight seminars, co-nomination to
  identify experts, selection of 15 sectors and
  panels
• 2. Main Foresight Stage
• Initial analysis panel discussions,
  scene-setting, UK strengths weaknesses, consult
  expert pools, preliminary reports
• Wider consultation regional workshops etc.,
  Delphi survey (7000 experts)
• Panel reports trends, driving forces,
  challenges, barriers ? identified ST priorities
  recommendations for implementing
• Steering Group synthesis identified generic ST
  and infrastructural priorities
• 3. Post-Foresight (i.e. implementation)
• Influence government RD priorities wider
  policy (e.g. regulation)
• Influence company RD strategies improve
  industry/science base partnerships

22
TFP conclusions

• 27 generic science and technology priorities
• e.g. communicating with machines,
  bio-informatics, chemical biological synthesis,
  security privacy technology, product
  manufacturing life-cycle analysis, risk
  assessment management
• Classified into 6 categories
• Harnessing future communications computing
• From genes to new organisms, processes products
• New materials, synthesis processing
• Getting it right precision control in
  management
• A cleaner world
• Social trends impact of new technology
• NB Human and social factors important as well as
  generating new technologies

23
TFP conclusions (continued)

• Identified main bottlenecks
• Getting potential of technology understood by
  managers, workforce, consumers
• Complementing new technology with right skills
• Freeing up markets ensuring market transactions
  conducted on orderly basis
• ? 18 generic infrastructure priorities
• e.g. communication skills, incentives for
  multidisciplinary research, information
  superhighway, special incentives for SMEs,
  supportive regulations (environmental, financial
  communications)
• Classified into 5 categories
• Education and training infrastructure
• Research infrastructure
• Communications infrastructure
• Financial infrastructure
• Policy and regulatory infrastructure

24
UK TFP (continued)

• Impact
• Process benefits (the 5 Cs) substantial
  addressed areas of UK weakness
• Foresight Challenge Fund gt90M of government
  matching private funds
• Re-orientation of spending by Research Councils
  Ministries (partly)
• Impact on companies engaged key decision
  makers, influenced sectors without a track record
  of working with the science base, provided case
  studies industrial champions

25
UK TFP (continued)

• 1997 Labour Government review ? continue
  strengthen Foresight
• 1999-2001 Second Foresight Programme
• Learn from 1st and improve
• Getting foresight into boardrooms, City, SMEs
  etc. change in title (technology dropped)
• More emphasis on societal aspects (e.g. ageing
  population, crime)
• Delphi dropped but introduced digital knowledge
  pool
• No final overview/report

26
Assessment of UK TFP

• Factors for successful implementation of
  Foresight
• Learnt from overseas experiences but evolved
  approach suited to UK
• Pre-foresight developed enthusiasm in scientific
  and industrial communities
• Co-nomination ? large numbers of new people
  involved
• Generated impressive amount of info on
  longer-term future
• Process benefits substantial 5 Cs all areas
  where UK previously weak TF strengthened links in
  NSI
• Communication
• Concentration on the longer-term
• Co-ordination
• Consensus
• Commitment
• ? Strengthened links in national system of
  innovation

27
Assessment of TFP (continued)

• Weaknesses
• Time-scale too tight
• Co-nomination ? some areas not represented
• Limited amount of data used by panels
• Uncertain relationship between OST Govt
  departments (especially post-1995)
• Over-emphasis on Research Councils spending cf.
  Government departments?
• Weaker on implementation action
• Only limited success in encouraging other levels
  of foresight to take root (e.g. regional,
  sectoral, company)

28
UK 3rd Foresight Prog, 2002-date

• Focused foresight on selected areas
• flood coastal defence
• cognitive systems
• exploiting the electromagnetic spectrum
• cyber trust crime prevention
• brain science, addiction drugs
• intelligent infrastructure systems
• detection identification of infectious diseases
• tackling obesity
• sustainable energy management in the built
  environment

29
UK FP3 (cont.)

• Mixed success in terms of
• involving companies, other stakeholders public
• generating sustainable networks
• Limited impact of Foresight outside these areas
• Rationale for choice of areas unclear
• Little use for overall priority-setting
• New ST horizon-scanning centre but rather
  isolated from Foresight
• Problems from staff turnover
• Attempts to develop international links but not
  very substantial

30
UK FP Phase 3 (cont.)

• PREST evaluation Foresight
• successful in
• mobilising diverse groups of high-calibre
  specialists
• stimulating collaboration across disciplinary
  boundaries
• engaging senior policy-makers with science and
  scientists
• informing national policies and programmes
• generating a reservoir of knowledge that will
  enable rapid policy responses to future
  challenges
• weaker in terms of
• providing adequate resources (altho good value
  for money)
• aftercare need to ensure persistence of
  networks
• involving business contributing to wealth
  creation
• public engagement treated as end-of-pipe
  activity
• prioritisation across research areas

31
Factors Driving Devlpt of Foresight

• The changing social contract for science
• 1945-1990 Vannevar Bush social contract
• Investment by government in science will ?
  increased wealth, health national security. But
  no very specific expectations.
• Changing world context since 1990 revised
  social contract
• Increasing competition, globalisation, emphasis
  on innovation knowledge-based industry ?
  Technology science becoming competitive
  resources
• Increased pressures on public expenditure ? Need
  to link science technology to economic social
  needs
• Changing nature of knowledge production (Mode 2?)
  ? Need for communication, networks, partnerships
  and collaboration
• ... Fundamental change needed in social contract
  for science
• Technology foresight a tool for creating a new
  relationship between ST and society

32
Factors Driving Devlpt of Foresight

• Wiring up the national system of innovation
• Concept of national innovation system
  emphasis on links
• Many important innovations characterised by
  technology confluence and fusion
• Requires multi-disciplinary/institutional/sectoral
  effort i.e. networks, partnerships
• Need for systemic policies mechanisms to
  strengthen NSI so that it becomes more effective
  at learning and innovating
• (Cf. Organl learning need to stimulate
  strengthen interns)
• Technology Foresight ?
• more effective knowledge distribution
• enhanced learning
• greater capacity for innovating
• Foresight a tool for wiring up the national
  (or regional) innovation system

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Conclusions and challenges for CEE countries

• Foresight a useful tool for strategic
  decision-making on science and technology at
  macro, meso micro levels
• Japan 30 years of experience
• Post-1990 other OECD countries taken up and
  derived benefits
• Now spreading to other countries (CEE, Latin
  America, Asia, etc.)
• No approach to foresight is perfect each has
  strengths and weaknesses
• Learn from other countries, then adapt to local
  circumstances
• Balancing ST push against demand pull crucial to
  success of Foresight

34
Conclusions (cont.)

• 5. Individual countries and organisations may
  adopt different approaches
• Japan, Germany, France, UK big bang approach
• cf. Netherlands, Australia (and later UK) focus
  on selected areas using panels, studies, networks
  etc.
• 6. Spread of foresight may herald revised social
  contract between ST and society way of
  linking society's needs to ST opportunities
• 7. Foresight offers policy tool for wiring up
  the national and regional innovation system so
  can learn and innovate more effectively
  potentially very useful in CEE