An entirely new approach to planning is helping Urban Utilities remain prepared and agile, even while facing an uncertain future.
In the water sector, as in most other infrastructure-focused arenas, major issues including climate change, aging assets, population growth, regulatory reform, old and new contaminants, evolving technologies and increasingly informed customers, are interacting in ways that are difficult or even impossible to model using traditional forecasting alone.
For Urban Utilities, a provider of retail water and wastewater services across local government areas in South East Queensland, those increasing levels and areas of complexity have brought a fundamental shift in how long-term strategies are developed.
Rather than developing and sticking to a master plan for the future, Urban Utilities now utilises strategic foresight to ensure it is prepared for any eventuality.
Civil and environmental engineer Annabel Hofstee, Manager Futures Servicing at Urban Utilities, says this means the organisation has moved beyond asking what is most likely to happen and instead examines and prepares plans for a range of plausible futures.
“Forecasting is more like, ‘This is probably going to happen’,” Hofstee says. “Whereas strategic foresight is knowing the range of things that are plausible and preparing actions for each of them.”
It doesn’t indicate that the organisation is no longer planning generations into the future. The difference now, Hofstee says, is that Urban Utilities is confident in its knowledge of the actions it will need to take in numerous operating environments, instead of only planning for the most likely.
This means the business planning is now adaptive to what is going on around it, rather than conventionally confined to a single path of action, and potentially ambushed by unforeseen changes.
A utility prepared for any possibility
Under the strategic foresight model, various potential scenarios are identified using horizon scanning and trend analysis to identify emerging changes. For Urban Utilities, this resulted in the development of four different images of what the service region could look like in 2050.
Not all of the scenarios are desirable, but each takes into account changes in climate-related events, customer expectations, regulatory effects, population shifts and more.
The team worked backwards from 2050 in five-year blocks, a process known as backcasting, to analyse what would need to be in place for the organisation to continue providing its services in each specific environment.
“We know the sorts of things that we need to be doing to be realising success in each particular version of the future,” Hofstee says.
Developments along the way become signposts pointing to a particular type of future. Then, as Urban Utilities has planned and prepared for actions for numerous potential outcomes, including onboarding talent, sourcing materials, preparing clients and communicating with customers, it can put in place the appropriate response.
One of the values of such a process, Hofstee says, is that it helps avoid committing to a specific solution too early. Potential interventions can instead be developed to an initial level and only advanced further when real evidence confirms the need to do so.
“We can do this, then we can do that, and then we can make a decision between three other things,” Hofstee says. “That staging has really shown up in our investment so far.”
“It gives us confidence on the way forward around a number of those assets when we don’t want to be increasing customer bills to lift and shift infrastructure, which is expensive and disruptive.”
“It means we have a much better idea around when to invest that money, when the time is right, not going too early and potentially not needing to do anything at all. Sometimes it means we identify components that can safely stay right where they are.”
Strategic foresight brings informed courage
Building the capacity for strategic foresight has involved upskilling people within the organisation and engaging external stakeholders.
“One lesson along the way was the importance of bringing people outside the organisation into the process early,” Hofstee says. “We’ve now seen the real value of that early engagement.”
The process began during the COVID years, when Urban Utilities recognised the agility of other organisations that utilised strategic foresight.
That included Shell, Hofstee says, and that organisation’s ability to move quickly when the shift to renewables occurred.
It has changed the way various departments and disciplines within Urban Utilities co-operate and collaborate. For example, scenario development is typically conducted through workshops that bring electrical, mechanical, chemical, planning, risk and other specialists together.
“There are a lot of voices in the room,” Hofstee says. “There is also more courage to defend an outcome.”
“The conversations I hear in our office now are more like, ‘The customer is experiencing this’, combined with, ‘The asset is in this condition’.”
The result of strategic foresight is not necessarily simpler. Adaptive planning introduces complexity. But it also creates a stronger connection between engineering decisions and their purpose.
Hofstee says the process has given Urban Utilities engineers greater confidence to engage with councils, regulators, state government and other groups that are working on housing growth and the Brisbane 2032 Olympic and Paralympic Games.
That is important, she says.
“The way we’ve done things before physically cannot be done the same,” Hofstee says. “We simply will not have the required space, time, resources or talent.”
Strategic foresight doesn’t completely remove uncertainty, she says. But it does help utilities better plan the future of water.
To find out more about Urban Utilities, visit their website. Or view their Water Leadership Plan here.
