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HomeMy WebLinkAbout2003-11-19; City Council; Minutes (2)MINUTES SPECIAL MEETING OF: DATE OF MEETING: November 19,2003 TIME OF MEETING: PLACE OF MEETING: CITY COUNCIL STUDY SESSION 9:00 a.m. - 500 p.m. Farmers Building, Third Floor 5815 El Camino Real, Carlsbad The Mayor called the special meeting to order at 9:09 a.m. and all Council Members were present. Also present were the City Manager, City Attorney, Administrative Services Director, Public Works Director, Police Chief, Community Development Director, Fire Chief, and Finance Director. Also present was Joe Sterling of Sterling Insights, Inc. who acted as facilitator for the meeting. The Mayor reported on certain County Water Authority activities as they related to proposed desalination projects and noted the fact that the City of Huntington Beach had denied a proposed desalination project this week. The Mayor then called on the City Manager to introduce a discussion of scenario planning with an emphasis on future budget and financial scenarios and to review the work product and priorities from the November 19, 2003 City Council meeting. The.City Manager then introduced Joe Sterling who outlined the goals for the day of the Council workshop and who noted staff members who were not present for the previous Council workshop discussion Ana Tan, Intern in the City Manager’s office, Denise Vedder, Communications Officer, Joe Garuba, Management Analyst in the City Manager’s office and Lisa Hildabrand, Finance Director. Mr. Sterling then further explained the purpose of the workshop, and reviewed the previous work product from the City Council special workshop of November 19, 2003 with the aid of a handout. (On file in the City Clerk’s office). He asked for Council Member’s comments and summarized the importance of certain qualities and characteristics that are necessary for future scenario planning including competence, candor, courage, commitment, creativity, confidence and communication. This will lead to constructing future scenarios addressing probable future developments in budget planning especially as it relates to funding and reimbursement of local government revenues. The Mayor called for a break at 1O:OO a.m. and the Council reconvened at 10:09 a.m. and the City Manager introduced Lisa Hildabrand, Finance Director, who presented a draft financial forecast through 201 5. Mr. Sterling continued the discussion of developing four future scenarios over the forecasted years. The Council divided itself into four sub-groups to discuss four possible future scenarios. The Council then reconvened and adjuourned for lunch at 12:OO noon and reconvened at 12:30 p.m. to report on the four future scenarios involving different levels of financial forecasting through the next ten years. Mr. Sterling summarized the reports and Council and staff discussed them in depth including various state funding reductions. The purpose of developing these four possible future scenarios was to develop ways and means of addressing them over the next ten years. The Community Services Director arrived at 1 :30 p.m. The Mayor then called for a brief recess at 1:38 p.m. and the Council reconvened at 1:55 p.m. Mr. Sterling asked the Council and the Leadership Team and staff to individually address and discuss the characteristics of a highly successful outcome in the next five years. This included proposed ways and means to increase City revenues, to increase productivity without a corresponding increase in expenditures and possible reduction of expenditures. The Council, Leadership Team and staff then made individual reports on such a future scenario and reconvened for a Council discussion. Mr. Sterling identified themes common throughout these individual reports including: Partnerships leading to solutions to the anticipated fiscal challenges to local government; Basic and enhanced core services; Ways and means to achieve greater revenues and efficiencies; 0 Enhanced use of communication tools; and 0 Employee and citizen involvement. Mr. Sterling summarized the work plan of the day and promised to memorialize it and distribute it to all participants prior to the January 2004 workshop. The Public Works Director was excused at 3:30 p.m. There was no public comment. complete participation and adjourned the meeting at 352 p.m. The Mayor thanked everyone for their thoughtful and Rpepqtfully submitted, RONALD R. BALL City Attorney as Clerk Pro Tem 2 L y Work Session iil November 20,2003 I NSI. GHlS IC, SI'EH LING 0 2003, Sterling Insights, Inc. All rights reserved. Table of Contents About the Synthesis How to Use Table of Contents Overview: Purpose Participants Process Outcomes Event: Module 1: Welcome Module 2: Fire Stories Module 3: Systems Maps Module 4: Breaking Points Module 5: Weak Signals Synthesis & Scenarios This Event Synthesis presents the key findings from this Council & Leadership Team work session. The ideas and diagrams presented here will become the foundation for a set of scenarios of the future for the City of Carlsbad and surrounding communities. This synthesis was developed by Joe Sterling, Sterling Insights, Inc. after the first event of this series. Use this documentation like a scrapbook. Punch them for a three ring binder and add them to other notes from strategic planning sessions. Read it aloud, mark up the pages, highlight them, add to them, make references, etc. The first time through it, look for the information and ideas that intrigued you and sparked your imagination during the session. Show it to friends who weren't at the event and tell the story, work the issues, and have fun. ~~ ~~ ~ ~~ ~ ~~ City of Carlsbad City Council & Leadership Team Event #1 November 20,2003 Overview The leaders of the City of Carlsbad including Mayor, Council and executive staff met offsite on November 20, 2003 to explore, dialogue, and diagram the various cause-effect relationships that influence the Carlsbad and the city government. These are the notes from that full-day session. Overview Purpose The intentions for this event were: Set the context for a four month long process to develop scenarios of the future for Carlsbad, develop strategic goals for 2004 and set in motion an ongoing strategic conversation among City of Carlsbad leaders. Begin mapping the critical cause-effect relationships that shape Carlsbad and the region. Highlight key thresholds or breaking points that may reveal significant opportunities or threats to Carlsbad and the city government. Participants Ball, Ron Crawford, Kevin Elliot, Jim Finnila, Ramona Hall, Matt Holder, Sandy Hubbs, Lloyd Kulchin, Ann Lewis, Bud Mannen, Frank Pac ka rd , Mark Patchett, Ray Vedder, Denise Zoll, Tom Process Facilitation City Attorney Fire Chief Admin. Services Insights, Inc. Mayor Pro Tem City Council Co-facilitated by Karen Community Development Dietzr PhD-r Polaris Public Works Associates, LLC. City Council Mayor Asst. City Manager City Council City Manager Communications Manager Police Chief Design and lead facilitation by Joe Sterling, Sterling Outcomes The event featured: These are the key outcomes: 0 Module 1: Welcome Overview of the scenario building and strategic goal setting process that will be conducted from October '03 though January of '04. The participants engaged in a dialogue based on accounts of the Cedar Fire that swept through San Diego County on October 26-30. The group reflected on the fire, how it was responded to by government, and how people in the town of Alpine responded on their own to save lives and property. Module 3: Systems Maps Participants mapped key cause- effect relationships shaping Carlsbad and the surrounding region. 0 Module 2: Fire Stories 0 The Council learned about the steps that they would be taking on their way to developing their 2004 strategic goals in January. actually city functions independent of desired, espoused or official descriptions of how it functions. A high degree of candor and openness was demonstrated by all that transcended philosophical differences. 0 Greater awareness of how the 0 Further appreciation of the balance that must be maintained between competing priorities: 0 Residential attractiveness 0 Commercial attractiveness 0 Fiscal health of the City government Module 4: Breaking Points Participants listed plausible breaking points in the cause-effect relationships that could lead to major opportunities or major problems. Participants explored the small changes that could lead to large impacts: Breakthroughs and ago. Breakdowns. Frank dialogue about the fiscal future of the Carlsbad, the disciplines that created its fiscal fitness, and the pressures to relax those disciplines. Reconnection to the solidarity and collaboration that dominated the scene after the Harmony Grove Fire ten years Module 5: Weak Signals ~ City of Carlsbad City Council & Leadership Team Event #1 November 20,2003 Welcome Macro Process for Setting Strategic Direction & Goals Interviews of Research of Lea de rs h i p Trends Building Systems Maps S Ira teg I c Planning \ Scan ) Study City Data Scenarios Goals & Measures tocus Staff Goals City of Carlsbad City Council & Leadership Team Event #1 November 20,2003 Fire Stories Cedar Fire - 10/26-27/2003 Saturday 10/25 - 5:35PM: The Cedar Fire was started near Ramona, CA by a lost outdoorsman trying to signal for help. Sunday10/26 Peutz Valley, a community in Alpine, CA where Joe Sterling lives was consumed in flames. Monday 10/27 By the end of the day 75 of the 100 homes in Peutz Valley were destroyed and one woman was dead. Essentially unchecked, the fires in San Diego County grew in less than 36 hours to over 400,000 acres, destroying over 2200 homes and killing 16 people. How did this happen? . High ‘ ‘NIRVANA” Fire Risk - LOW “DIE HARD“ Fire Risk - HIGH Effectiveness - HIGH Effectiveness - HIGH Totally prepared Work to plan Don’t worry, be happy We can cope Under funded The “officiul” conditions: Complacent assumed, defended, advertised, believed ” LU C K-OUT” Fire Risk - LOW “PERFECT STORM” Fire Risk - VERY HIGH Effectiveness - LOW Effectiveness - LOW CEDAR FIRE High LOWt Fire Risk What changes happening in Carlsbad are not being detected or adapted to quickly enough by leadership? Southern California fire risk had been rising for years as fuel built up in East County. The common Santa Ana conditions in late October ‘03 heightened the risk. The compounding demand of other regional fires plus elements of fire services policy reduced their net firefighting effectiveness. The confluence of these conditions happened faster than the system of fire decision-makers could detect and adapt to effectively. Essentially, well meaning, policy bound, decision-makers could not deploy resources well enough to stop the fire while it was stoppable. City of Carlsbad City Council & Leadership Team Event #I November 20,2003 Human Beings Responding to Emergency Sunday10/26 Peutz Valley, an area of 15 square miles, ignited in under 10 minutes then burned for over 15 hours. Some people could not get out fast enough and were forced to stay. Among them were courageous neighbors who left the relative safety of their shelter in the fire to operate earth moving equipment in attempts for over 24 hours to save neighbor's homes and property. Monday 10/27 After the fire, those who returned to the rubble of their homes were in shock. For two days many people could be seen staring into the ashes. Others managed to stay focused on taking action to increase safety, and in any way they could, decrease the general suffering around them. What is this ability in people to take action in the face of real doubt of success? Courage. High Strain - LOW Strain - HIGH Effectiveness - HIGH I-' Effectiveness - HIGH ""4- Strain - LOW Effectiveness - Effectiveness - LOW Strain - HIGH "MARGINALS" "SHOCKED" I -1 hh, High Low Strain on Human Psyche How can you demonstrate courage that will inspire others to act in service to the community? As our neighbors gathered in the smoke and ash after the fire, we began hearing and sharing stories of courage. We began organizing to diminish suffering of those in need, we began the triage of moving people up the ladder from basic survival to healthy living. In the process, those in shock felt less strain and could act. Those marginal folks could cope. The coping were encouraged. The courageous led and served others. With the motto that "no one will be left behind" we bootstrapped ourselves into a community. City of Carlsbad City Council & Leadership Team Event #1 November 20, 2003 System Maps Mapping Ca use-Effect Relationships Participants were asked to review the list of trends that had been synthesized from interviews with them in the previous week. They considered which combinations of trends were responsible for vicious or virtuous cycles (reinforcing loops) that they had observed in Carlsbad and elsewhere. They also looked at which trends tended to slow or dampen the effect (balancing loops) of the vicious or virtuous cycles. The list of trends is below. SYNTHESIZED TRENDS 0 Density, development is rising Increase in service expectation is rising Transportation/traffic is rising National/state/regional economy - employment - is fluctuating Water resources are diminishing Business expenses - medical, workman's comp - are rising 0 Federal and state mandates - are rising without funding Energy costs are rising Population is aging Open space is diminishing SYNTHESIZED TRENDS Environmental pressures are rising 0 State fiscal behavior is becoming more 0 Requirements to collaborate regionally are Minority populations are rising 0 Technology and connectivity are playing 0 Less civic mindedness Effects of affluence (need for affordable Complexity of managing the city is rising irresponsible increasing greater and greater role housing, less business friendly environment) Limits to Growth Balancing Loop Slowing action & limiting condition Reinforcing Loop Vicious or virtuous spirals "The more X, the more Y" See the following pages for examples of limits to growth relationships at work in Carlsbad. By building these types of maps we move from arguing over how we think things should work to dialogue about our assumptions and beliefs about how they actually do work. It is from this foundation that we can build an understanding of the drivers behind the performance of our various organizations and institutions. With the drivers understood we can know where energies need to be applied to make desired changes. City of Carlsbad City Council & Leadership Team Event #1 November 20,2003 System Maps Key Relationships & Conditions Participants created systems maps in three broad categories Attractiveness of Carlsbad to citizens Attractiveness of Carlsbad to commercial interests Fiscal health of the City of Carlsbad government As you consider these maps, ask yourself What assumptions must be held for these maps to be accurate? Can I make a simple sentence or two that describe the dynamic in the map and does it Is the condition at the center of the diagram measurable and if so how? make sense to me? Attractive ness Fiscal Health To Commerce Infrastructure Traffic Attractiveness To Citizens = 0 Taxpayer willingness Policy 0 Fiscal behavior Resources m to spend Quality of Life Expectations ~~ City of Carlsbad City Council & Leadership Team Event #1 November 20,2003 System Maps - Quality of Life Expectations "Quality of Life Expectations" were explored as a critical driver of citizen relations with the City of Carlsbad organization. In the following cause-effect diagrams "Quality of Life Exoectations" is the condition that is being increased or decreased by other forces. Balanced Policy $ Resources Regulations Vacant Land City Standards & Laws Expectations Job Commute = Personal Income nn Affordability & Expectations = Access to Education Legal Constraints Quality of Life "No Cell Sites Cell Service Expectations - n My Backyard' City of Carlsbad City Council & Leadership Team Event #I November 20,2003 System Maps Balanced Land Use Plan L Quality of Life Expectations "Quality of Life Expectations" were explored as a critical driver of citizen relations with the City of Carlsbad organization. In the following cause-effect diagrams "Quality of Life Expectations" is the condition that is being increased or decreased by other forces. Healthy Land Use Plan l+ r Less Traffic Lower Quality Service Levels of Life II Job Loss Lower More attractiveness City Revenues To citizens City of Carlsbad City Council & Leadership Team Event #I November 20,2003 System Maps Attractiveness to Commerce "Attractiveness to Commerce" was explored as a critical driver of funding for city government to use in providing services to meet quality of life expectations. In the following cause-effect diagrams "Attractiveness to Commerce" is the condition that is being increased or decreased by other forces. Housing costs 1. Location 2. Development Unfriendly Business Regs standards equally applied Development costs 3. Infrastructure -,-a-mmm,-- Regional Impacts (airport) .Demographics Employee Costs .Retirement .Workman's Comp .Sala ries Workforce Housing .Roads .Airport .Trains -~ -3."--w Scarcity & Price of Land 4. Opportunities 5. Good Schools K-12 Universities HMP Energy costs Taxes City of Carlsbad City Council & Leadership Team Event #1 November 20,2003 System Maps Attractiveness to Corn merce ”Attractiveness to Commerce” was explored as a critical driver of funding for city government to use in providing services to meet quality of life expectations. In the following cause-effect diagrams “Attractiveness to Commerce” is the condition that is being increased or decreased by other forces. Example : Vi I lag e Redevelopment Area Parking Space Inventory Attractiveness Effort to TO Commerce Find Parking = 0 Resistance to Change 0 Economy Development Standards $$$ Attractiveness Regional TO Commerce Planning - Transportation Infrastructure ~~ ____~ ~~ ~ ~~ ~ City of Carlsbad City Council & Leadership Team Event #1 November 20,2003 System Maps Attractiveness to Commerce "Attractiveness to Commerce" was explored as a critical driver of funding for city government to use in providing services to meet quality of life expectations. In the following cause-effect diagrams "Attractiveness to Commerce" is the condition that is being increased or decreased by other forces. "- Example : Village Redevelopment Area Land Use Plan Development Attractiveness Standards Development standards equally applied High Level of Service Healthy Business Climate Business Regulations Business Costs Land Use Plan City of Carlsbad City Council & Leadership Team Event #1 November 20,2003 System Maps Fiscal Health "Fiscal Health" was explored as a critical driver enabling the city government to apply resources to manage and meet the Quality of Life expectations for individuals and commercial interests. In the following cause-effect diagrams "Fiscal Health" of the city government is the condition that is being increased or decreased by other forces. Fiscal Health Means: Balanced Revenue VS. Expenditures Services they want Quality of services Safe Community Cost of homes Traffic I Growth (more devel.) I m I I Connected ness Citizen Friendly Fiscal Health m COST Services Personnel Facilities/Bldg. Maint. Fiscal Restructure Unfunded Mandates + AMPLE REVENUE 0 Investments 0 "Govt. Theft" 0 Fees Devel. 0 Grants &Jobs Regulations Labor Costs I Housing Costs I ~~~~ City of Carlsbad City Council & Leadership Team Event #1 November 20,2003 State Fiscal Reform "State Fiscal Reform" was explored as a critical factor in the Carlsbad city government's ability to provide a friendly business climate. In the following cause-effect diagrams "State Fiscal Reform" is the condition that is being increased or decreased by other forces. I BUSINESS 3IAlt I -PPI, REG.S costs 0 Labor 0 Environmental $$ 0 Select Business Clusters 0 Time 0 Foster Impl. 0 GMP 0 Attractiveness 0 Mobility 0 Government Stability Focused Outreach 0 Chamber Connectedness l-StOpShOp City of Carlsbad City Council & Leadership Team Event #1 November 20,2003 Breaking Points Breaking Points For each of the relationships that were diagramed, there is a breaking or tipping point at which it no longer holds true. The relationship may degrade slowly or fall apart precipitously. It is at these moments that a small change may cause a cascade of unintended consequences. These may be beneficial or destructive - they may be breakthroughs or breakdowns. In the case of a breakthrough, opportunities may open up all of a sudden, ready for the taking if you can recognize, adapt to and seize the moment. In the case of breakdowns, threats may appear and become disasters if early minimal cues are not detected and responded to quickly, as in the case of the Cedar Fire. The following are lists of potential breakthroughs and breakdowns that the group exposed among the three key drivers to sustainable success of Carlsbad. One of the most important questions is: "How do we recognize the signals telling us that one of these breakthroughs or breakdowns is coming?" Attractiveness Commerce Breakthroughs Relook at Land Use to create commercial attractiveness and revenue uses (i.e. mall redesign, redevelopment area) Develop citywide indicators to gauge economic health 0 Redefine feasible levels of service (with citizens) Breakdowns 0 State 0 Citizen initiatives 0 Doing nothing Attractiveness To Citizens Breakthroughs 0 New revenue sources (Land Use change) New Partnerships for service (privatization) Increase efficiency Breakdowns State fiscal reform Construct more than we can afford to operate 0 Loss of hotels, auto lots Fiscal Health Breakthroughs Business Friendly (process, educate, connect, encourage) 0 Revenue Opportunities Standards Review Breakdowns Our employees 0 Our connection to the public (train, inform, connect with) Non-Responsiveness (no action, not taking responsibility ) City of Carlsbad City Council & Leadership Team Event #1 November 20,2003 Weak Signals Weak Signals In fighting fires, and coincidentally, in racing sailboats, one's ability to discern weak or faint signals foretelling a change in wind direction and strength can mean the difference between win or lose, safety or danger. Being able to sense, make meaning of, and act upon small, often unrelated, changes in the environment is the critical skill set. The best at these skills appear to be clairvoyant, seemingly always knowing how to move their organization into the right place at the right time to take the right steps. It looks so elegant from the outside. In disaster they don't fall down, they fall up. The worst can usually be found reacting to some dramatic force threatening their organization, taking them by surprise, again. The worst at these skills lead a life of struggle and are often out of touch with the flow of natural forces in their surroundings. To win one needs to appreciate the rate and impact of changes to take advantage of them at best, and stave off disaster at worst. Where do your issue lie? High Service Levels with Decreasing Revenues Backing off service levels is very unpopular, so it is avoided. Desire to maintain public favor creates pressure to give more than can be afforded. If this goes unattended the consequences are severe and cascading. Changing Land Use Plan Could have significant impacts on revenue and character of the community but changes will happen slowly. New revenue sources would emerge, but they would come online slowly. Savings b Revenues Like community expectations, savings and revenues are slow to build, and fast to erode. Changes in revenue streams occur slowly except in the case of State legislative changes. Not adding to savings is an early indicator of trouble. Withdrawing from savings is a slippery slope. Key Personnel Changes City Government consistency and predictability is a function of stability in the Council and City staff. New hires, elections, retirements, resignations, and deaths can change the make up and direction of the organization quickly. Quality of Life Expectation Slow to build, and fast to erode. Can become more impactful for good or bad depending on how well they are managed. Congruence between espoused values/priorities and actual performance makes the difference. Forecasts Forecasts of service levels and financial conditions change at a moderate rate. Costs are becoming more volatile and trending upward. Information needs to be presented in digestible visual chunks more frequently . Major State Restructure Can happen quickly and changes may be extremely bad or moderately good for Carlsbad. Very little can be done to influence this process, but it must be accounted for in local government preparations and may demand reconfiguring of priorities and service levels. Commercial Relocation A company may pull out without notice and eliminate or take jobs with it. Likewise, a company may request to move in, though this will occur more slowly. Recruitments can add significant jobs without notice. Council or City Mgr. Edict A Council or LT decision may be made very quickly and have significant and potentially unprecedented implications. If Council and or LT relationships breakdown the cumulative effect may manifest erratic decision-making. Trust on all fronts would be jeopardized. Slow Moderate & Accelerating Fast & Dramatic Rate of Change City of Carlsbad City Council & Leadership Team Event #I November 20,2003 Synthesis Decision-Maker Confidence & Service Delivery Carlsbad has grown and developed for five decades. The confidence in future wealth of Carlsbad's leaders has increased roughly in step with the growth of the region's economy. Service levels have increased at a comfortable rate reflecting the leadership values of a frugal generation that remembers life after the depression of the 1930's followed by WWII. Save, be fiscally conservative, work hard and eventually become comfortable is the underlying pattern. Subsequent generations haven't known as much hardship and consequently some don't display the same fiscal discipline, sense of duty, or community solidarity forged in collective struggle. They have credit cards and insatiable material desire. Since 1999, the national economy has come abruptly over the crest of a phenomenal growth cycle, and only after three years is demonstrating signs of recovery. The California state legislature's fiscal behavior, like that of many .com investors, has been irresponsible and increasingly erratic. The California state leadership and legislature has been overspending and taking money from local government to mask some of its problems. Now that the Governor has been recalled, restructuring at the state level is on the table and possible. This could have catastrophic implications for local coffers. The participants of this event arrived at the realization that their confidence in future wealth, for the next few years at least, had diminished in light of changes on the national, state, and local scene. For the first time in a long time, Carlsbad will have to consider making downward changes in standards, service levels, and cost structures. Carlsbad leaders must embrace the sobering challenge to do as much as possible with less than usual. Doing so will make it possible to maintain the longstanding "Fiscal Health" driving the fine services, infrastructure, and ambience that makes Carlsbad so attractive. To resolve this challenge city leaders must face a combination of questions: What are our priorities? What businesses are we in? And, how through a combination of revenue enhancements, productivity improvements, and service level adjustments do we cultivate fiscal health? City of Carlsbad City Council & Leadership Team Event #1 November 20,2003 Strategic Issues? Relationship of Trust: Citizen - Council - Staff The challenge of doing as much as possible with less than usual will put a strain on relationships all over the system of citizens-council-staff. Whenever individuals or groups sense that they are at risk of not getting what they want, or have become accustomed to, relationship dynamics shift. Whereas, under normal conditions the players may have achieved a cooperative or even synergistic pattern, increasing risk can drive otherwise amiable parties into power struggle. There may appear to be a degradation in relationships under these conditions as tensions rise. The concern is fundamentally one of trust. The question behind the tension is, "Will I get my way about the things I hold dear when I need it?" The way through the tension and back to cooperative relations is through dialogue. With understanding comes compassion. With compassion comes the energy to find creative win-win solutions. The bridge of trust, built over troubled waters of power struggle, leads through the land of cooperation and to the high ground of synergy. ~ ~ ~~ ~~ ~ City of Carlsbad City Council & Leadership Team Event #1 November 20,2003 Scenarios Scenarios: Are you ready for the future(s)? From The Art of the Lono View by Peter Schwartz, renown scenario planner and founder of Global Business Network: Every year, every decade, we are surprised by social or technological upheavals that appear suddenly, surprisingly. How can people, businesses, and institutions plan for the future when they do not know what tomorrow will bring? A deep and realistic confidence is build on insight into the possible outcomes of our choices. In this unpredictable context, freedom is the ability to act both with confidence and a full knowledge of uncertainty. To act with confidence, one must be willing to look ahead and consider uncertainties: "What challenges could the world present me? How might others respond to my actions?" Rather than asking such questions, too many people react to uncertainty with denial. They take an unconsciously deterministic view of events. They take it for granted that some things just can't and won't happen; for example, ['the World Trade Center and surrounding blocks are basically safe, no one could get a weapon into New York big enough to really damage them," or "San Diego county is basically safe from major fire, there are more than enough fire agencies to contain any fire that could start up.'q Not having tried to foresee surprising events, they are at a loss for ways to act when upheaval comes. They create blind spots for themselves. Scenarios are a tool for helping us to take a long view in a world of great uncertainty. Scenarios are stories about the way the world might turn out tomorrow, stories can help us recognize and adapt to changing aspects of our present environment. Scenario planning is about making choices today with an understanding of how they might turn out. In this context the precise definition of "scenario" is: a tool for ordering our perceptions about alternative future environments in which one's decisions might be played out. Alternatively: a set of organized ways for us to dream effectively about our own future. By examining the relationships between the most potent external variables and highest leverage internal actions, one can ask 'how much could the external conditions change?" and "what would we have to do to adapt and succeed no matter what?" By coupling a plausible external condition with a plausible internal action we can create a future scenario, a way to simulate a future. Based on Carlsbad's systems diagrams two external conditions hold the greatest power over the City's performance: State fiscal behavior and citizen quality of life expectation. The two most potent internal actions Carlsbad is taking are: land use planning and service delivery levels. Interestingly both of these external conditions are considered more volatile than the internal actions that could be taken to respond to them. To paraphrase Jack Welch, "If change on the outside is happening faster than change on the inside, the end is in sight." Changing Major State Land Use Plan Restructure Service Delivery Quality of Life Levels Expectation ~_____~~ ~~ ~~~~~ ~~ ~~ ~~~ ~ ~ City of Carlsbad City Council & Leadership Team Event #1 November 20,2003 Scenarios Scenario: Fiscal Fitness of Land-Use Plan vs. State Fiscal Restructure If we assume that State Fiscal Restructure is coming, and we don't know if it will inflict shallow or deep fiscal cuts on the local level, then we must prepare for all possibilities. If we fW#erasswneethat the land-use plan is the most potent and responsive way to fill in what may be taken by changes at the state level, then we can explore ways to balance the land- use plan toward more or less fiscal strength. By intersecting the two we can roughly create four different plausible worlds. Remember, the idea here is not to predict which way the external world will go, or even what the land-use plan is likely to be. The idea is to dispassionately explore, in advance, plausible, and DerhaDs even outraaeous, scenarios of the future. Having thought through the formation of these worlds, you can craft strategies in advance that will ensure survival under any circumstance. As conditions actually take shape, you will see which world is emerging and be able to take advantage of openings for success even in difficult conditions. I Shallow $$ Cut I Changes at state level I Changes at state level are have minimal imeact. and absorbed with little our vulnerabilities are not revealed impact locally 4 b Weak Plan Strona Plan SOFT LANDING Deep Cut & Strong plan Changes at state level force tough choices, I but we get through OK CRASH LANDING Deep Cut & Weak Plan Changes at state level overwhelm our ability to cover the loss I Deep $$ Cut City of Carlsbad City Council & Leadership Team Event #1 November 20,2003 Scenarios Scenario: Service Delivery Level Quality of Life Expectation vs. Another interesting combination is that of Service Delivery Level and Quality of Life Expectation. These two are more dependent upon one another than in the previous example. Again, by intersecting the two we can roughly create four different plausible worlds. Remember, the idea here is Il_efi to predict expectations for services in the future, or what levels of service Carlsbad will be delivering in the future. The idea is to dispassionately explore, in advance, plausible scenarios of the future. Having thought through the formation of these worlds in advance, as conditions actually take shape you will see which world is emerging and be able to respond successfully. City of Carlsbad City Council & Leadership Team Event #I November 20,2003 Next Steps Next Steps The next Council and LT event will be conducted Wednesday 12/17. Between now and then, review these materials, make notes, talk it over with your colleagues: System Diagrams: Can you make a simple sentence based on each one that makes sense to you? If you say it to someone does it make sense to them? What should be changed to make them more accurate statements of how the City actually works? We will edit the key diagrams at the next event. Scenarios: Do these couplings make sense? Are there other combinations that would be more powerful to explore? Can you flesh out a story that goes with each combination of variables? What are the implications for your strategic decision-making of these scenarios? We will be building scenarios at the next event. Sterling Insights, Inc. 1646 Peutz Valley Road Alpine, CA 91901 6 19-659- 1234 voice 619-615-2003 fax 3 oe@ Sterl i ng I nsig h ts. com www. SterlingInsights.com City of Carlsbad City Council & Leadership Team Event #1 November 20,2003