Michael Baker - Thesis - Problems in Longterm Forecasting and Planning
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Having realised that objective forecasting was not possible, I thought that it would be fruitful to look at the reasons why forecasts are made. In this chapter I shall give an introduction to planning and examine why it needs forecasts.
I shall start the chapter with a review of some other authors definitions of planning. I shall then describe a framework in which the planning process can be considered. Following this I shall consider the things which lead to planning and then give some examples of areas in which planning is performed. I shall end the chapter with some descriptions of the planning process and an examination of why planning needs forecasts.
As noted by Cross (1975, p8) in a paper on
Forecasting in Urban and Regional Planning: The literature on the idea of planning
as a means of social action is enormous.
[I] can do no more than provide a very brief general introduction to the
positions adopted and indicate how [I] have treated them. [Also] ... there is no generally
accepted concept of 'planning'.
However below are six definitions of the term "planning".
...planning is a process, a process of human thought and action based upon that thought - in point of fact, forethought, thought for the future - nothing more or less than this is planning, which is a very general human activity.(Chadwick 1978, p24)
...literal meaning of the term [planning] ... is an attempt at rationally calculated action to achieve a goal(Dahl and Lindblom 1953).
Planning has always meant taking intelligent, rational action. However, what constitutes intelligent action is the subject of much argument(Faludi 1973a, p35).A
...plan is distinguished from a set of projections or forecasts because it is constructed on the assumption that the behaviour of ... agents will not be the same as in the past nor will the changes in their behaviour be due only to measures already introduced. The plan shows the effects of future changes which have not yet been made but which will have to be made if it is to be achievedRobinson (1972b, p122).After giving 13 definitions of planning by other authors, (Dror 1963) gives the following definition.
Planning is the process of preparing a set of decisions for action in the future, directed at achieving goals by preferable means.
In one useful literal meaning of the term, planning is an attempt at rationally calculated action to achieve a goal. The attempt to achieve rational politico-economic action may therefore be described as economic planning whether the attempt employs the market or master mind. But economic planning thus conceived is so different from economic planning as ... [other writers] ... use the term that we shrink from what would otherwise be a convenient shorthand expression. Although we shall consequently use the term only when the risk of misinterpretation is at a minimum, the argument of the book may be thought of as an approach to a new concept of planning.
Elements which are common to most definitions of planning are that it is future orientated and that it is concerned with real choices. An element that appears in many definitions is that planning is orientated to action in the future. Implicit to definitions of planning is that it is (within the planners perception) about changing the system in question for the better.
When I started looking at planning I wanted to find a general description of the planning process.
One description which I found was Faludi's model of planning Faludi (1973a).
His model is based upon an analogy between how an individual perceives and acts upon his
environment and how an organisation does these things.
(Faludi 1973a) said of it that
it explains planning phenomena by showing how they form part of a coherent whole,
[and] it creates a language in which to converse about planning.
His model of planning agencies is based on an analogy between agencies and the human
mind engaged in operational (purposive) thinking.
I had intended to present Faludi's model at this point in my Thesis. However after considering Faludi's model there were several aspects about which I was not happy. In consequence I have developed my own model which is based upon Faludi's. I have also incorporated ideas from a model of the human mind developed by Powers (1974). As well as being a useful way of considering why planning needs forecasting, I think it could form a very useful framework for the analysis of planning systems. I shall say more about why planning needs forecasting later in this chapter. I shall say more about using the framework for analysing planning systems in the next chapter.
Some of the important elements in my model are that there is a hierarchy of control or decision units [1] . An example of a chain within the hierarchy of control over the building of a power station is shown in Figure 8.1. I shall start by describing how a unit within the hierarchy of levels could work. In practice it might be difficult to identify the components of a unit with things within the organisation being modelled. However it appears to me that my model will behave in similar ways to that in which organisations do. I am presenting the details of how the components within a unit could operate to give an idea of how units could work. I am not suggesting that this is how they do work. By giving these details I shall develop a vocabulary which will be useful later.
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Figure 8.1 Hierarchy of control over power station construction
In a simple unit within a control system there are three elements as illustrated in Figure 8.2. The first element is an input functiton. This converts inputs from the environment into a perceptual signal. The perceptual signal corresponds to that thing in the environment which the system is controlling. In a shower thermostat the input function generates a perceptual signal which corresponds to the temperature of the water coming out of the shower. The second element is a comparator which compares the perceptual signal with a reference signal. The output of the comparator is an error signal which is the difference between the reference and perceptual signals. For example in the thermostat if the reference level is 15°C and the actual temperature of the water coming out of the shower is 12°C the error signal will be -3°C. The third element of the control system is an output function which converts the error signal into an appropriate action. In the example of the shower thermostat, it could be set up so that a negative error signal would cause the output function to increase the proportion of water taken from the hot supply.
Figure 8.2 Elements of a unit within a control system
A fourth element can be added to the simple unit within the control system. This is memory. The action of memory is to record conditions which occur in the environment and the actions which led to zero error signals. The idea is that after a zero error condition has been achieved once it can be repeated. Figure 8.3 illustrates a possible location for memory within a unit of a control system. Memories are stored from the incoming signals (via the "storage" link). In this configuration the action of the output function is to send an address signal to the memory which then produces a reference signal (or signals) for units at lower levels within the system to act on.
Figure 8.3 Memory within a control system
By introducing two switches into the information flows with units at lower levels it is possible for the unit to act in any of four different modes. These are control, passive observation, automatic, and imagination modes and are illustrated in Figure 8.4. Each unit within a hierarchy can behave predominantly in one of these four basic modes.
Figure 8.4 Modes in which a level of a control system can operate
Within any control system there will usually be units at several levels. Each unit within the system will predominantly be in one or other of the four modes. As an example I will discuss a model of a Local Planning Authority. This model is illustrated in Figure 8.5. In this example the main controlling units are the Department of the Environment and the Planning Committee. Most of the information on what is happening in the environment comes from the Office of Population and Surveys and the Local Authority's Survey Unit. Both of these operate predominantly in passive observation mode. The Development Plan Section will work mainly in imagination mode but will also on occasion operate in automatic mode. That is within specific criteria a planning officer can decide upon planning applications without reference to higher levels within the hierarchy. Although each unit may predominantly operate in one mode, it will also operate in others. For example the survey unit will also operate in automatic mode when it conducts surveys. However the effect which conducting surveys has upon the environment is small. However on occasion (for major applications) the Development Control Section will operate in control mode.
Figure 8.5 Model of Local Planning Authority
One of the important things about control systems is that to be effective the reference signal at any level must change at a slower rate than that at which the perceptual signal can be altered by the control system.
As an example consider using the previously described shower thermostat. There are now two levels of control. These are the person taking the shower who has as a reference level a criterion of "comfort" and the thermostat which has as a reference level the output water temperature. Within this system there is a time lag due to the time it takes water to pass from the thermostat and emerge from the shower. Due to this time lag, the fastest that the person taking the shower can change the reference level of the thermostat and be certain that they have changed it to the required level, is once every time lag period. If they alter the thermostat setting at a faster rate than this they will not know if they have achieved their required temperatures for each setting of the thermostat.
This has an important implication for a control system in which all levels are in effective control of the lower levels. The lowest level will have the fastest response rate and the highest level will change the reference level at for the next level at the slowest rate.
Another aspect of control systems is that individual levels within a hierarchy can oscillate about their reference levels. The frequency of oscillation is closely related to the response rate of the next lower level within the hierarchy. Oscillation can occur when the response rate of the control system is near to that of the factor which is being controlled. For example, if the person taking the shower takes the same amount of time to decide that the water is too hot or cold, as it takes for the water to pass from the thermostat to shower nozzle, then oscillation may occur. This will happen if the person over corrects the thermostat setting each time the water is too hot or cold.
I will use Faludi's (1973a, p82) definition of
a problem as a state of tension between the ends pursued by a subject and his
image of the environment.
Planning is generally concerned with the development of programmes which when
effected will alter the environment and so reduce the state of tension between ends and image.
In this section I will look at some of the common causes of this state of tension.
One of the sources of tension can be due to the perception of alternative futures from which the subject has at least a limited choice. In this case the subject will be able to evaluate the future images against his goals and so decide that one or more futures are preferable to the others. The perception that some futures are better than others can lead to planning to ensure that the "better futures" come about.
A further cause of tension can be due to a desire for efficiency [2] or non arbitrary-ness [3] . There may be more than one way, or feasible programme, to achieve a goal. Some of these various programmes will be easier to implement than others. My perception is that there is a general tendency to desire an easier over a more difficult course of action to achieve a goal.
A third general source of tension is the existence of multiple goals. In many cases the attainment of one goal will conflict with the attainment of another. In this case a programme to achieve one goal will lead to an image of the future which is incompatible or conflicts with another goal.
There are several factors which lead to long term [4] planning. The first of these factors are long lead times, both internal and external. For example in the Electricity supply industry the planning of a new station from the point at which its necessity is perceived to the point at which it is ordered can take several years (internal time-lag) and its construction can take a further five to ten years (external time-lag).
Another factor which leads to long term planning is the long lifetime of infrastructure. For example there is usually a desire that a new road with a notional life of perhaps 30 years should represent an optimal use of resources not in its first year of use but over its whole life.
Other factors which can lead to long term planning are the perception of such things as finite resources and "limits to growth".
There are many areas in which planning takes place from the individual level upwards. However the activity is more formally developed in some organisations than others and it is these developed forms of planning which I shall describe.
The process of town planning is highly developed in the UK, being covered by statutory requirements. It originated in the 19th century public health legislation. Its basic components are a responsibility of local authorities to produce structure and local plans, and the control of development by planning permission.
The application of the above model to town planning by a local authority is illustrated in Figure 8.5.
Two areas in which transport planning occurs will be looked at. The first is at the conurbation level. One of the first conurbation wide transport planning exercises was conducted in Chicago in the early 1950's. Following the Buchanan Report, Traffic in Towns (Buchanan 1963), there were several such exercises in the 1960's in the UK. Examples were those conducted for Glasgow Tippets et al (1967) and London Greater London Council (1966). These large scale exercises have more recently given way to Transport Policies and Programmes which are prepared annually by local authorities as part of their bid for the Transport Supplementary Block Grant.
A second example of transport planning is that of motorways. In this case the planning is conducted at the national level by the Department of Transport as illustrated in Figure 8.6. However this illustration is incomplete since the information flowing into the Department of Transport comes from more sources than the DVLC.
Figure 8.6 Model of Motorway Planning
Most government functions involve planning and, apart from the previously mentioned transport and town planning, examples can be found in the fields of: the economy, education, housing, health, and defence.
Economic planning is taken as an illustration and is shown in figure 8.7. In this case the major source of information flowing into the Treasury is received from the several branches of the Government Statistical Service. For example it comes from information on wages and unemployment collected by the Department of Trade and upon information on the balance of payments collected by the Central Statistical Office. Possible programmes are developed within the Treasury (operating in imagination mode), and selection of programmes is made by the Cabinet. One way in which economic programmes can be effected is through taxation. This is illustrated by showing HM Customs and Excise and HM Inspector of Taxes. However this picture is incomplete since the Treasury also has other controls such as of government spending.
Figure 8.7 Model of Economic Planning
In business planning can range from that of the long term future of a large corporation to that of a sales drive or a days production in a factory.
In Planning Theory (Faludi 1973a) categorises descriptions of the planning process in three ways. These categories can be delineated by descriptions of processes which lie at the ends of continua. The three continua are:
In this section each continuum is described with some illustrations of
the corresponding processes.
Blueprint or Process mode of planning
The blue print mode of planning is ... an approach whereby a planning agency operates a
programme thought to attain its objectives with certainty
(Faludi 1973a, p131).
An example of blueprint planning is the design of a civil engineering project such as a large bridge.
In this case it is know that the goal, of providing a crossing over a river at a given point,
will be met by execution of a given programme, the building of the bridge.
The process mode of planning, on the other hand, is an approach whereby programmes
are adapted during their implementation as and when incoming information requires
such changes
(Faludi 1973a, p132).
Situations where there are firm images and complete control over the environment will
lead to Blueprint planning whereas uncertain images and incomplete control will tend to
lead to the process approach.
There are however constraints imposed by time-lags.
In Blueprint planning the complexity of preparing a programme will often lead to long
internal time-lags and the size or complexity of the programme will often lead to long
periods for implementation (external time-lag).
An example of both these time-lags is provided by power station construction.
In process planning there needs to be a reasonably rapid feed back from implementation of
a programme and the formation of a new image of the resultant changes in the environment.
This means that for process planning the time-lags must be short.
For example process planning would be very difficult for the planning of electricity
generating capacity (within the current structure of the UK industry) because of the
previously mentioned long lead times in power station design and construction.
Rational-comprehensive or Disjointed-incrementalist
There has been a long standing dispute between those who think the aim of planning should be "the synoptic ideal" and those who think that not only is the synoptic ideal unobtainable but that it is undesirable. The synoptic ideal can be summarised as:
However criticisms of the ideal have been made. These are that the ideal is:
These criticisms led Dahl and Lindblom (1953) to put forward a disjointed-incrementalist approach to planning as an ideal for which planning should aim.
Faludi (1973a, p155) gives the following definitions:
The rational-comprehensive mode of planning is ... that approach whereby the programmes put forward for evaluation cover the available action space and where the action space has itself been derived from an exhaustive definition of the problem to be solved.and
the disjoint-incrementalist mode of planning is
where the programmes considered by any one Planning agency are limited to a few which deliberately do not exhaust the available action space, and where that action space is itself ill-defined.
Despite the difference between these two approaches there is in both a
commitment to rationality.
For example, to ask why one values rational action is to demand an
almost redundant answer ... For by definition the more rational, efficient,
and economical action leads to more net goal achievement.
Dahl and Lindblom (1953, p40) continue:
... a commitment to rationality as a goal should not be taken as a
commitment to an emotionally thin, desiccated, calculated, and excessively cerebral
existence ... The most rational act is not necessarily the most carefully calculated one.
Dahl and Lindblom (1953, p38) give the following definition of
rationality.
An action is rational to the extent that it is 'correctly' designed to
maximize goal achievement, given the goal in question and the real world as it exists.
Given more than one goal (the usual human situation), an action is rational to the
extent that it is correctly designed to maximize net goal achievement.
When several actions are required to attain goals, rationality required
coordination; that is, the actions must be scheduled and dovetailed so that
net goal achievement is not diminished by avoidable conflicts among the actions.
They also say The more rational action is also the more efficient action.
The two terms can be used interchangeably.
Stripped of prejudicial inferences, efficiency is the ratio between valued input
and valued output.
(Dahl and Lindblom 1953, p53)
Cross (1975, p10) gives a summary of
Robinson's (1972a) description of the now
familiar and well established model of the rational planning process
.
(I have added emphasis for easy reference to my comments given below.)
"(1) Identify the problem or problems to be solved, the needs to be met, the opportunities to be seized upon, and the goals of the community to be pursued, and translate the broad goals into measurable operational criteria;
(2) Design alternative solutions or courses of action (plans, policies, programs) to solve the problems and/or fulfil the needs, opportunities, or goals, and predict the consequences and effectiveness of each alternative;
(3) Compare and evaluate the alternatives with each other and with the predicted consequences of unplanned development, and choose, or help the decision-maker or decision making body to choose, that alternative whose probable consequences would be preferable;
(4) Develop a plan of action for effectuating or implementing the alternative selected, including budgets, prjectg schedules, regulatory measures, and the like;
(5) Maintain the paln on a current and up-to-date, basis, based on feedback and review of information to adjust steps 1 through 4 above."
I have the following comments to make on the above description of the rational planning process:
Cross (1975) summarises the five necessary conditions for Webber's (1968 & 1969) 'Idea of Planning' as:
1. The statement of goals, objectives and targets for each sub-system under consideration.(Cross 1975, p71)
2. Continuing qualitative and quantitative forecasting of the future course of events which is outside control.
3. 'Continuing forecasting of the likely chains of consequences within and especially among sub-systems, that would result from each of a number of alternative hypothesised sets of planned actions'.
4. Investment costs and welfare pay offs for each forecast alternative are compared with objectives. If there is good agreement a strategy is devised composed of programmes of actin to target dates. These in turn are examined to find their pay off of welfare against investment costs and then expressed as budget items.
5. Continual monitoring of the performance of the system being planned to provide information on actual outcomes to correct errors in forecasting and to give early warning of dangers and opportunities.
Such a system of planning is, in Webber's words:- 'essentially an economising approach to the future, constantly appraising trade-offs among alternative investment strategies in search of desired welfare returns'.
The third way in which planning can be classified is by whether or not the goals
of a planning agency are questioned as part of the planning process.
Faludi (1973a, p175) draws a distinction between normative
planing in which goals and objectives defining, inter alia, the limits of
the action space of a planning agency, are themselves the objects of
rational choice, and [in which] that choice is reviewed as and when the need arises
,
and functional planning in which the goals and objectives
defining, inter alia, the limits of the action space are not questioned.
Some of the reasons why planning needs forecasts are given below.
One of the principal characteristics of planning is its orientation to the future. Davidoff and Reiner (1962) write:- 'Time is a valued and depletable resource consumed in effecting any end. Planning, an end-directed process, is therefore future oriented. Each of the ultimate objectives of planning implies a need in the present for information about the future. Estimates of future states are also important for what they imply for present behaviour; thus, points are identified where control is required if ends are to be achieved. Moreover, planning involves assigning costs to deferred goal satisfaction and to losses arising from proposed actions'(Cross 1975, p12)
If we are to postulate future actions, clearly we must be able to form some image of what the future is going to be like, and ordinarily we act in the anticipation that the future will be like the past has been, or largely so, or else we anticipate some change which is likely to occur and modify our image of the future to accord with this change(Chadwick 1978, p155)
It is possible to forecast without planning but it is not possible to plan without forecasting, even if the forecast and the plan are closely identified as a future end state based on present values. This intimate connection between forecasting and planning makes it difficult to write about forecasting in ... planning as a separate aspect of the larger whole. Because planning is necessarily future oriented forecasting is a recurrent theme in most aspects of the subject. An attempt to write about forecasting without placing it in the wider context of the planning process would therefore not only tend to be rather sterile but would tend to emphasize specific technical problems rather than an overview of principles and method. Nevertheless because forecasting in order to plan is essentially a practical activity some consideration of the nature of forecasting problems and methods in an operational situation is needed. A balance between these different requirements is necessaryCross (1975, p1).
In the terms of the framework developed in section 8.2 any unit in a control system which is working in imagination mode may make or use forecasts. It will need to make forecasts if it "thinks" that the environment will change by the time that actions take effect.
Planning is connected not only with 'objective' or positive forecasting of what is likely to happen if such and such courses of action are pursued but normative forecasting of what should happen ... In ... a general planning process, that identification of problems and the choice of goals etc. is essentially normative forecastingCross (1975, p12).
In this chapter I have given a framework within which planning processes can be considered. Further reference to this framework will be made in the next chapter. I gave examples of planning in different fields and also various ways in which planning can be classified and described. Finally I outlined the ways in which planning leads to forecasting.
[1] In my model the hierarchy of control will usually correspond to a hierarchy within and/or between organisations. However this correspondence between structure and function is not necessary for the function to operate.
[2] By efficiency I mean the best use of resources. That is the minimum expenditure of resources to achieve a given end. A process is efficient if it achieves its end with a minimum use of resources.
[3] An arbitrary act is one which is performed for no reason, so a non-arbitrary act is one which is performed for a reason, it is a purposive act.
[4] I take long term to be more than five to ten years.
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