Strategic Planning Case Study: Shell Energy Scenarios to 2050
As part of their strategic planning process, major corporations and research firms often develop and share future scenarios specific to an industry’s future or to address major global problems. Shell Oil continues to be the leader in scenario planning, with a specific eye toward the impact of oil on our society, economy, and environment.
Here’s a quick overview of the drivers and the two scenarios Shell developed in its “Shell Energy Scenarios to 2025” report:
Key Drivers: The three key driving forces are (1) step-change in energy use, (2) supply will struggle to keep pace, and (3) environmental stresses are increasing. World population is set to increase 40 percent by 2050. History has shown that as people become richer, they use more energy.
Scenario 1 — Scramble: Under this scenario, policymakers pay little attention to more efficient energy use until supplies are tight. Greenhouse gas emissions aren’t seriously addressed until major climate shocks exist.
Scenario 2 — Blueprints: Under this scenario, growing local actions begin to address the challenges of economic development, energy security, and environmental pollution. A price is applied to a critical mass of emissions, giving a huge stimulus to the development of clean energy technologies, such as carbon dioxide capture and storage, and energy efficiency measures. The result is far lower carbon dioxide emissions.
Shell’s website provides tools for scenario planning as well as fully developed scenarios. Check out the Explorer’s Guide developed by Shell scenario planners for a detailed guide on how to do scenario planning. Look for Scenarios: An Explorer’s Guide on the left side of the page.
Want more? You can find an outstanding library of scenarios compiled by Daniel Eramsus, professor and scenario planning pioneer, at ScenarioThinking. Since 1996, post-graduate MBA students have published scenarios about the future of the information society online as part of his classes on scenario thinking at the various business schools around the world. This site includes more than 100 scenarios (and growing) on everything from climate change to the future of work.