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Chartered Institute of Housing North West Conference

Chartered Institute of Housing North West Conference. 24 March 2010. What’s going on out there? Why environmental scanning is important in planning our future. Kim Penfold Consultant. Penfold Associates – who we are and what we do. Housing Planning Regeneration. What is it all about?.

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Chartered Institute of Housing North West Conference

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  1. Chartered Institute of HousingNorth West Conference 24 March 2010

  2. What’s going on out there? Why environmental scanning is important in planning our future. Kim Penfold Consultant

  3. Penfold Associates – who we are and what we do • Housing • Planning • Regeneration

  4. What is it all about? “Environmental scanning in a strategic sense is about building a global context for your work, your organization, your competitive environment, and your industry. It is about recognising that the future is unlikely to be anything like the past, and that we therefore need to spend some time understanding the trends and likely influencers on the future of our organizations. High quality scanning is the core of effective futures work”. Maree Conway (2009)

  5. A simple definition “Careful monitoring of a firm’s internal and external environments for detecting early signs of opportunities and threats that may influence its current and future plans. In comparison ‘surveillance’ is confined to a specific objective or narrow sector.” (www.businessdictionary.com)

  6. Approaches to scanning • Ad-hoc – unstructured • Regular – perhaps linked to planning cycle • Continuous • IMPORTANT – need structure and purpose to be systematic

  7. Terminology • Event or scanning “hit” • Trend – suggests a pattern of change • Driver of change – broad in scope and long term • World view – how you see the world BUT beware because it influences what you ignore!

  8. Aims of environmental scanning • Identify the relevant information for you • Trends – generally known about • Weak signals – on the horizon – harder to spot • Avoid surprises • Risk aware, not risk averse • Can then manage risk • A written report • Reality check • Words make an audit trail • Respond, rather than just react

  9. Process • Input – information gathering • Analysis – what does it mean? • Interpretation – how does it affect you? • Prospection – what might happen? (could develop scenarios)

  10. Feeds into planning - SWOT • Strengths – mainly internal • Weaknesses – mainly internal • Opportunities – mainly external • Threats – mainly external

  11. Time-frame • At least 5 – 10 years • Don’t be afraid to go further • BUT, heavy political influence points to rapid short term change

  12. Assessing relevance of trends • Scoring system • Time-frame • Scope • Impact • Likelihood • Urgency • Responses – act now, manage or watch • Beware counter-trends • Beware “wild cards” high impact/low probability

  13. Simple techniques • PEST • STEEP • PESTLE • Help gather data • Help organize data

  14. PEST • Politics • Economy • Social • Technology

  15. STEEP (or PEEST) • Social • Technology • Economics • Environmental • Politics

  16. PESTLE • Politics • Economy • Social • Technology • Legal • Environmental

  17. Does it work? Could it have predicted...? • US sub-prime crisis • UK house price collapse • Credit crunch • World recession

  18. “The Times” – ten people who predicted financial meltdown • Vince Cable MP – UK personal debt • Christopher Ward (broker) – sub-prime • www.stock-market-crash.net • Henry Weingarten – astrologer • NourielRoubini (Dr Doom) – sub-prime • Nikolai Koudriatev (d.1938) • www.housepricecrash.co.uk (2003) • Lord Oakeshott – Icelandic banks • Stephen Roach – “economic Armageddon” (2004) • Ron Paul, Republican (2003)

  19. Gordon Brown “I called for global financial reform ten years ago.”

  20. The signs were ignored – hubris! • Neo-classical economists (Chicago) • Retreat from Keynes • More monetarist than Friedman • Deregulation both sides of the Atlantic • Ignored lessons of past • Ignored sub-prime and housing bubble in US • Some economists spotted it – Robert Shiller, Dean Baker, RaghuramRajan, Paul Krugman – cried in the wilderness!

  21. We all knew, of course! • Excessive personal debt • High loan to income ratios • Self-certified mortgages • Marginal owner-occupation • We’d seen it all before! • What did we do about it?

  22. PEST exercise

  23. Politics • General Election • “Hung” Parliament? • New Government/Ministerial team • National housing policy – targets? • Public spending priorities • Regional structures/plans • HCA priorities/working methods

  24. Politics (2) • Regulatory approach – TSA/AC • Sub-regional/cross authority working • Local authority policies, priorities, resources • Environmental policy

  25. Economy • Pace/nature of world and UK recovery • Public debt issue • Housing market performance • House prices • Rental demand • Access to borrowing • Condition of sector - mergers

  26. Economy (2) • Unemployment/jobs market • Making regeneration work • Stalled projects • New delivery models

  27. Social • Demographics • Ageing population • Migration • Changing housing aspirations • Changing lifestyle aspirations • Deprivation • Health • Education/skills • jobs

  28. Social (2) • Crime and anti-social behaviour • Community cohesion • Neighbourhood issues • Changing attitudes to work • Public attitude to environmental issues

  29. Technology • Workplace technology • Customer access to technology and skills • Construction technology • Environmental technologies • Broader technological impacts

  30. Conclusions • Environmental scanning is essential • Must be systematic - regular and continuous • Feed into planning process • Techniques are simple – no excuses! • Apply judgement – respond not react • Write up the results

  31. Contact details kim.penfold@ntlworld.com www.penfoldassociates.co.uk

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