Scenario analysis is not intended to predict possible futures, as is sometimes believed. Its purpose is to test an organisation’s strategies and assess whether it is prepared for events that may, but need not, occur.
An interview with Andrzej Danilkiewicz – President of the Polish Digital Society
What is the main focus of the Polish Digital Society?
We are endeavouring to mitigate the potential negative social consequences of mass automation and digitalisation. Our main focus is on identifying possible systemic problems and proposing appropriate measures. In other words, we are considering how to minimise the ‘turbulence’ resulting from the massive and unprecedented change we are currently experiencing.
In our work, we employ scenario-based methods that are not widely used but are extremely useful. Research of this kind is commonly used by the military, intelligence services and corporations around the world to identify overlooked risks and test strategies. We are among the pioneers in applying this research and analytical approach to the Polish public sector and businesses. At this stage, a significant part of our work involves research, the development of methodologies and the dissemination of up-to-date knowledge in the field of strategic planning. Our work results in proposals for proactive measures.
How do scenarios of this kind work?
Scenario analysis is not intended to predict possible futures, as is sometimes believed. Its purpose is to test an organisation’s strategies and assess whether it is prepared for events that may, but need not, occur. They go beyond the traditional extrapolation of trends, thereby enabling preventative measures to be taken and, consequently, building resilience. In many countries, specialised government centres carry out this type of research.
So what exactly does the term ‘Digital Resilience Agenda 2040’ refer to?
This is a complex and, I believe, unprecedented scenario study based on the method of multidimensional deduction – or, to be precise, five such studies combined into a single process. We have prepared a set of scenarios that seek to answer the question of how mass automation and digitalisation might affect the Polish economy, social and health policy, education and science, as well as the energy and IT sectors.
We shared the preliminary results at the end of March this year. We hope that by the end of the year we will be able to produce a suitable, more widely read and accessible publication. In a sense, Agenda 2040 is a ‘mass-market’ tool to support businesses and other organisations. The aim is that, after reading the scenarios or their analyses, anyone interested should be able to answer the following questions for themselves: what will happen to my organisation if the reality described in a given scenario comes to pass? What should I be doing right now?
In practice, the cost of such research can be shared amongst a large number of organisations and form the basis for a professionally developed, independent strategy. When properly publicised, research of this kind is therefore an extremely effective tool for development.
What inspired the idea of setting up the Agenda?
I have spent virtually my entire professional life dealing with research issues and developing strategies within public administration and large business organisations. Many years ago, I came across an OECD report which stated that by 2040, 40 per cent of jobs in Poland could disappear or change significantly as a result of technological advances.
I shared this report with a group of fellow managers and academics, and together we ‘connected the dots’. This gave rise not only to a vision for the Agenda, but also for the organisation itself, as it became clear in practice that the institutional framework within which we operate does not reflect the interdisciplinary nature of this issue.
We also came to the conclusion that the use and development of predictive tools is the best way to manage the huge, systemic risk we face. At that time, nobody was talking about so-called artificial intelligence. It was, rather, the stuff of science fiction films. It was only a few years later that things suddenly gathered pace.
Who was responsible for drawing up the Agenda, and how did the work proceed?
From the outset, we drew on the expertise of industry specialists, although the work as a whole was carried out by a small team of just a few specialists. I believe that over a hundred experts were involved throughout the project, and each contributed something of their own. We would certainly not have managed without the support of researchers from several institutes and without the systematic backing of the Central and Eastern Region of NSZZ ‘Solidarność’, which recognised this project from the outset as crucial to the vision for the labour market in Poland.
The methodology employed was designed to minimise the influence of ‘common knowledge’ on the formulation of scenarios. The first stage of the project involved identifying as many so-called ‘drivers of change’ as possible – that is, phenomena that are already determining a given process. At this stage, it was essential to use carefully designed questionnaires and to analyse existing literature; the knowledge gathered was then verified through interviews with invited experts.
We then moved on to a series of workshops designed to classify the identified factors appropriately and to identify the most significant and particularly uncertain ones amongst them. A great deal of effort was also devoted to organising sector-specific workshops, during which cause-and-effect relationships were established between the identified factors.
Another very important element of the workshop was the special classification of factors. We used the ‘classification orbits’ methodology here, which is the equivalent of the PESTEL method for this type of project. The aim is to ensure that global factors do not overshadow the local ones over which we have a real influence.
The next stage involved developing the scenarios themselves, which entailed constructing so-called ‘future tables’ – that is, a set of the most significant uncertainties, together with a definition of their potential end states. Next came the painstaking process of analysing the strength of the interactions between these end states within each of the key uncertainties. This could not have been done without the use of a specialised application.
Finally, all that remained was to formulate scenarios based on the correlations we had identified and the material we had gathered previously. I know this sounds rather obscure, but in practice it isn’t all that complicated. However, going through this process no fewer than five times in a short space of time was a real organisational challenge.
As a result, we have obtained – integrated with one another – the potential variants for each of the key uncertainties. This is already almost a finished scenario, which requires only the development of an appropriate narrative, that is, an overall picture of the whole. And so on, four times for each of the five strategic areas.
Importantly, these 20 scenarios form a sort of system of interconnected vessels, and on closer inspection, the individual narratives come together to form a coherent whole. We have shared the results on our website, cyfryzacja.org.
What challenges relating to digitalisation, according to experts, lie ahead for the public sector?
A key theme running through many of the scenarios is the potential functional privatisation of the public sector by IT corporations , understood as a global process. This applies to healthcare, education and public administration alike.
Particular problems – in light of the scenarios – concern the Polish public higher education sector. We may be facing a systemic collapse here, and it is by no means our fault. A potential free programme of distance learning in Polish, covering a wide range of subjects and offered by several centres around the world, could undermine the very foundations on which many universities operate. If this process is compounded by a systemic ‘brain drain’ of the most talented individuals, the sector could face a genuine collapse.
And this raises the question of what we can do to prevent this from happening. This is where the ‘magic’ of scenarios comes into play. They transport us into a different, proactive dimension of planning. Perhaps every centre should already be looking for its own global specialisation in the field of knowledge transfer?
Interestingly, one of the scenarios set out in the Agenda sets out a vision for the development of innovation in Poland despite the systemic collapse of the institutional framework. It is all based on what could be the key ‘fuel’ for the economy in the 21st century: the ability to seek out and nurture unique talents.
Another recurring theme in the Agenda is potential social stratification and numerous social problems arising, amongst other things, from difficulties in accessing energy and advanced medical services. In the latter case, digital solutions based on machine learning will be welcomed as a godsend and adopted on a massive scale. Predictive medicine will also emerge as a form of preventative care based on the integration of distributed data. On this basis, the public administration might, for example, consider how to regulate the operation of such systems.
What should be the priority for public administration in the age of digital transformation?
The fate of public administration depends on the entire system of regulations and policies, which are trends rather than uncertainties – and it is precisely on uncertainties that our methodology is based. Our preliminary research indicates that, within the large organisational structures we analysed, no job roles are immune to digitalisation. Of course, it is not necessarily the case that institutions will ‘implode’; they will continue to carry out their tasks despite reduced staffing levels. However, the possibility of such an institutional implosion cannot be ruled out.
The long-term future of public administration will depend on whether we are willing and able to identify, in good time, new, useful and socially significant roles for it. For example, it seems to me that we should start now to set up and properly regulate local time banks, which could be managed by local authorities. Within time banks, people exchange services, and the time devoted to others serves as a substitute for money. This strengthens social bonds and keeps people active, making them feel needed, whilst also enabling them to discover and develop their talents.
The aim is to use such solutions to weather crises. This creates a new role for the administration, including in the development of new digital services that anticipate the public’s needs. However, strategic awareness and a commitment to such innovation are required. And this depends largely on whether we are willing at all to take on the challenge of an emerging, unknown future – one for which it is worth preparing, even if it may not necessarily come to pass.
How can Agenda help the public sector with its digital transformation?
The traditional role of carrying out administrative processes will be largely automated and transferred to a central level. In my view, the administration of the future will be more like a local development accelerator, integrating the current functions of business support institutions with advanced educational functions. Such functions need to be developed as soon as possible.
We help identify new potential needs and develop a vision for public administration services, transforming its role from a service-providing one to a strategic one. In other words, the Agenda can serve as an inspiration for the creation of pro-social IT solutions that will not be subject to centralisation and standardisation, but will instead solve the real problems faced by specific communities.
As far as public administration itself is concerned, it would appear that in-depth scenario analysis is needed to shed light on the question of to what extent it will survive in the long term and in what form. Regulatory trends should be analysed in conjunction with an assessment of potential developments and technological possibilities, and the scope of activity that will remain within local or sectoral remit should be precisely defined.
Paradoxically, it may turn out that the future of public administration depends on our ability to develop an area of economic specialisation of global significance. For the time being, the main problem remains a ‘culture of short-termism’, in which few people are interested in development concepts that extend beyond a single electoral term.
Which organisations have already expressed an interest in the research findings? What feedback has been gathered?
This is precisely where this ‘culture of short-termism’ makes itself felt. We are only at the beginning of a long and bumpy road. Simply convincing decision-makers that such research is worthwhile is already a challenge. Grassroots initiatives cannot replace state policy, which clearly fails to recognise the need for this kind of reflection.
Interestingly, our work has been very well received by both trade unions and business organisations. Perhaps, for the first time in history, these institutions – despite their theoretically conflicting interests – will begin to work together. I don’t know, but I certainly hope so.
What further steps does the Polish Digital Society plan to take to enhance the country’s resilience?
The fundamental problem is that we are a social, grassroots initiative, rather than a body of a forward-thinking state capable of looking to the future and taking proactive action. We are happy to share our knowledge and experience. We are also developing a range of services that will enable businesses to develop new business models and seek out the unique qualities that serve as a starting point for creating niche global products.
One of the key issues associated with digitalisation is, in fact, the potential widespread loss of competitiveness – particularly amongst small businesses – and sudden changes in the labour market. Several years ago, we developed a programme designed to enable the launch of a second business model, based on existing potential. This programme is preceded by a mechanism for assessing the economic climate.
Now, regardless of any further scenario analyses, we will focus on implementing this mechanism. It is in the local economic climate that we see the main solution to mitigating the effects of a potential ‘digital tsunami’. It all depends on whether it is just us who want this, or whether anyone else does too.
Interview by Szymon Cisicki
The interview appeared in the June issue of the monthly magazine “IT in Administration”