1 00:00:04,420 --> 00:00:10,280 Warning: The video clip that you are about to watch may suggest that problem demarcation 2 00:00:10,280 --> 00:00:12,610 is as easy as child's play! 3 00:00:12,610 --> 00:00:18,020 The means-ends analysis presented here in a few minutes may take days in real life, 4 00:00:18,020 --> 00:00:24,250 because problem demarcation is an iterative process in close dialogue with your client. 5 00:00:24,250 --> 00:00:31,250 Hi! I'm glad that you're watching, as problem demarcation is a crucial step in policy analysis. 6 00:00:31,510 --> 00:00:35,620 In this short video clip, I will use a somewhat stylized case example 7 00:00:35,620 --> 00:00:41,400 to illustrate the techniques for problem demarcation I explained in the first video clip on this topic. 8 00:00:41,930 --> 00:00:48,140 Let me start with a quick recap: Problem demarcation is a crucial step for three reasons: 9 00:00:48,140 --> 00:00:54,920 (1) You help your client to establish what is the problem that is most relevant to analyze. 10 00:00:54,920 --> 00:01:00,750 (2) By focusing only on issues that matter, and at the right level of detail, you save 11 00:01:00,750 --> 00:01:02,510 time and effort. 12 00:01:02,510 --> 00:01:09,049 (3) And by explicitly defining the scope of your analysis, you and your client can reflect 13 00:01:09,049 --> 00:01:13,570 on how this will eventually limit the conclusions that you can draw, and the recommendations 14 00:01:13,570 --> 00:01:15,729 that you can make. 15 00:01:15,729 --> 00:01:20,590 As I explained in the first video, problem demarcation starts by choosing one issue that 16 00:01:20,590 --> 00:01:24,049 appears to be of immediate interest to your client. 17 00:01:24,049 --> 00:01:29,869 This issue becomes the starting point for means-ends analysis, which helps you to identify 18 00:01:29,869 --> 00:01:31,750 the related issues. 19 00:01:31,750 --> 00:01:36,859 You then develop alternative problem statements, and analyze these further so that you and 20 00:01:36,859 --> 00:01:40,009 your client can decide what problem to focus on. 21 00:01:40,009 --> 00:01:45,439 Let us again assume that your client is the Port of Rotterdam, and that in your first 22 00:01:45,439 --> 00:01:51,900 talks it appears that the Port is thinking about ways to reduce its emissions of carbon dioxide. 23 00:01:52,619 --> 00:01:57,039 This provides an excellent starting point for further analysis. 24 00:01:57,039 --> 00:02:03,539 Let me recall that the key concept in means-ends analysis is the means-ends, which we draw 25 00:02:03,539 --> 00:02:07,700 as a rectangle labelled with a single verb phrase. 26 00:02:07,700 --> 00:02:13,010 Using verb phrases is important because you want to make clear that a means-ends box not 27 00:02:13,010 --> 00:02:18,540 only represents something your client wants to achieve (an end), but also something your 28 00:02:18,540 --> 00:02:21,629 client can do (a means). 29 00:02:21,629 --> 00:02:26,269 You perform the means-ends analysis by repeatedly asking only these two questions: 30 00:02:26,269 --> 00:02:29,510 1. Why? Why do you want to achieve this? 31 00:02:29,510 --> 00:02:34,030 2. And How? How can you achieve this? 32 00:02:34,030 --> 00:02:40,099 The why questions help you identify your client's higher aims (also called "end objectives"); 33 00:02:40,099 --> 00:02:46,260 the How questions help you identify more and more concrete means for your client. 34 00:02:46,260 --> 00:02:48,739 So let's do it! 35 00:02:48,739 --> 00:02:53,989 Starting with the initial aim to reduce CO2 emissions, we ask Why? 36 00:02:53,989 --> 00:02:58,860 Why would the Port of Rotterdam seek to reduce its CO2 emissions? 37 00:02:58,860 --> 00:03:04,590 Well firstly, the Port wants to gain recognition as the world's "greenest" port. 38 00:03:04,590 --> 00:03:09,959 Becoming CO2-neutral is instrumental in obtaining this "eco-image". 39 00:03:09,959 --> 00:03:16,230 But at the same time, assuming that industries have to pay for their CO2-emissions, providing 40 00:03:16,230 --> 00:03:20,860 CO2-neutral services will also reduce the cost for new companies that consider making 41 00:03:20,860 --> 00:03:24,349 large capital investments the Port area. 42 00:03:24,349 --> 00:03:29,680 So why would the Port of Rotterdam want to improve its eco-image and reduce cost for 43 00:03:29,680 --> 00:03:34,620 investors? Simply: to attract more business to the Port of Rotterdam. 44 00:03:34,620 --> 00:03:38,310 That is, after all, their main concern. 45 00:03:38,310 --> 00:03:41,099 Now you can start asking 'How' questions. 46 00:03:41,099 --> 00:03:46,469 How can the Port of Rotterdam make itself more attractive, in addition to being the 47 00:03:46,469 --> 00:03:52,260 world's greenest port and offering the prospect of low CO2 emission costs? 48 00:03:52,260 --> 00:03:58,980 The Port then tells you that potential investors also want the prospect of ample space for 49 00:03:58,980 --> 00:04:00,549 expansion, 50 00:04:00,549 --> 00:04:05,900 and - of course - that the port can provide industrial services that meet the highest standards. 51 00:04:06,700 --> 00:04:11,159 To create space for future expansion, the port not only develops new areas, 52 00:04:11,159 --> 00:04:16,329 such as the second Maasvlakte, but may also consider redeveloping existing 53 00:04:16,329 --> 00:04:21,890 industrial sites that near the end of their economic life span. 54 00:04:21,890 --> 00:04:27,260 To improve its eco-image, the Port may also try to phase out polluting industries. 55 00:04:27,260 --> 00:04:32,460 To reduce costs for investors, the Port may also lower the rent and fees it asks from 56 00:04:32,460 --> 00:04:38,310 companies, or increase efficiency by investing in upgrading its infrastructures, such as 57 00:04:38,310 --> 00:04:41,440 quays, roads, and pipelines. 58 00:04:41,440 --> 00:04:47,280 You then observe that improving infrastructures will also improve the quality of service. 59 00:04:47,280 --> 00:04:53,800 But the Port will say that in addition to the "hardware" it also needs to improve logistic services. 60 00:04:54,130 --> 00:04:59,200 You can see that by asking many Why and How questions you have gained a much better understanding 61 00:04:59,200 --> 00:05:04,950 of the many ways in which the Port of Rotterdam strives to be Europe's preferred port. 62 00:05:04,950 --> 00:05:10,510 It puts the issue of reducing CO2 emissions in perspective, and it may lead to a change 63 00:05:10,510 --> 00:05:13,470 of focus for your analysis. 64 00:05:13,470 --> 00:05:20,470 But for this example, let's assume that the focus remains on reducing CO2 emissions. 65 00:05:20,630 --> 00:05:27,390 So you continue asking: How? The port could reduce CO2 emissions by creating 66 00:05:27,390 --> 00:05:33,310 facilities for carbon capture and storage, so that CO2 can be stored in, for example, 67 00:05:33,310 --> 00:05:35,870 depleted natural gas fields. 68 00:05:35,870 --> 00:05:40,910 The port could also increase the installed capacity for generating electricity from renewable 69 00:05:40,910 --> 00:05:44,150 sources, such as wind or biomass. 70 00:05:44,150 --> 00:05:51,150 Evidently, you can continue in this way to elaborate the means-ends diagram in more detail. 71 00:05:51,440 --> 00:05:56,720 As I mentioned at the start of this clip, constructing a means-ends diagram is in practice 72 00:05:56,720 --> 00:06:00,620 an iterative process of discussing with your client. 73 00:06:00,620 --> 00:06:04,320 In this process, you will make mistakes. 74 00:06:04,320 --> 00:06:08,980 Let me briefly point out three common mistakes for which you should check: 75 00:06:08,980 --> 00:06:15,410 First, you should check for causality: does your diagram contain "false arrows", 76 00:06:15,410 --> 00:06:22,900 that is, an arrow from box A to box B while the means A does not really help achieve end B. 77 00:06:23,100 --> 00:06:27,940 It may be that you placed A too high or too low in the diagram, and that you should link 78 00:06:27,940 --> 00:06:29,860 it with another box. 79 00:06:29,860 --> 00:06:36,410 Secondly, you should check whether your client can actually do what is stated in each box. 80 00:06:36,410 --> 00:06:41,180 A common pitfall of asking How is that you forget that the means should be in line with 81 00:06:41,180 --> 00:06:43,910 the capabilities of your client. 82 00:06:43,910 --> 00:06:49,810 Thirdly, you should check with your client that you did not overlook important issues. 83 00:06:49,810 --> 00:06:54,520 If you start asking How questions too soon, you start detailing sub-issues before you 84 00:06:54,520 --> 00:06:58,940 have understood the full scope of your client's situation. 85 00:06:58,940 --> 00:07:03,180 Once you and your client agree that you've got the whole picture, you start using the 86 00:07:03,180 --> 00:07:08,650 means-ends diagram to establish the proper focus for your analysis. 87 00:07:08,650 --> 00:07:14,200 You do this by making alternative problem statements for each means-ends box in the diagram: 88 00:07:14,200 --> 00:07:16,970 You select one box as your focal objective. 89 00:07:16,970 --> 00:07:21,280 You look at the means by which this objective can be reached. 90 00:07:21,280 --> 00:07:26,130 You ask yourself what may be undesirable side effects of these means 91 00:07:26,130 --> 00:07:31,280 And then formulate the problem as "How can the client achieve this focal objective with 92 00:07:31,280 --> 00:07:35,840 none, or only little, of these side effects?" 93 00:07:35,840 --> 00:07:40,780 If we start at the top of our diagram, the means to make the Port of Rotterdam more attractive 94 00:07:40,780 --> 00:07:45,660 are formulated only globally, but it is clear that they will require large 95 00:07:45,660 --> 00:07:51,300 investments, and investments in port infrastructure will also require approval from a range of authorities. 96 00:07:51,500 --> 00:07:55,990 A good problem formulation at this global level could be: 97 00:07:55,990 --> 00:08:01,900 "How can the Port of Rotterdam make itself more attractive without going bankrupt or 98 00:08:01,900 --> 00:08:04,310 breaking the law?" 99 00:08:04,310 --> 00:08:10,030 If we focus on ways to make Rotterdam the "greenest" main port of Europe, and consider 100 00:08:10,030 --> 00:08:15,630 the means we identified, the undesirable side effects of phasing out polluting industries 101 00:08:15,630 --> 00:08:21,400 could reduce the variety of port industry to the point of becoming obsolete, 102 00:08:21,400 --> 00:08:26,880 while measures to reduce CO2 emissions are costly. 103 00:08:26,880 --> 00:08:32,130 Demanding higher rent and fees to recover these costs could cause other industries to 104 00:08:32,130 --> 00:08:37,919 move out, so either way, the port runs the risk of losing money. 105 00:08:37,919 --> 00:08:43,069 If we move down one more level, we consider the undesirable side effects of carbon capture 106 00:08:43,069 --> 00:08:46,930 and storage, and of renewable energy sources. 107 00:08:46,930 --> 00:08:54,500 Capturing CO2 is costly, while storing CO2 underground is known to raise concerns from the public. 108 00:08:54,910 --> 00:09:00,139 The variability of wind and solar energy puts more strain on the transmission grid. 109 00:09:00,139 --> 00:09:04,660 The problem can therefore be summarized as "How can the Port of Rotterdam reduce its 110 00:09:04,660 --> 00:09:11,000 CO2 emissions without increasing costs for companies, losing public support, or decreasing 111 00:09:11,000 --> 00:09:15,500 the security of supply of energy?" 112 00:09:15,500 --> 00:09:21,740 If we move down in the diagram once more, we find that we cannot complete a problem 113 00:09:21,740 --> 00:09:26,839 formulation at this level without identifying additional means, in this case: means that 114 00:09:26,839 --> 00:09:30,589 facilitate CCS. 115 00:09:30,589 --> 00:09:35,149 This illustrates that in real life, you will find yourself often going back to your client 116 00:09:35,149 --> 00:09:40,569 with additional questions, and that more specialized people in your client's organization may get 117 00:09:40,569 --> 00:09:43,069 involved in the process. 118 00:09:43,069 --> 00:09:50,069 Let us assume that experts can clarify how the port could facilitate CCS. 119 00:09:51,360 --> 00:09:58,360 The port will not store CO2, but provide for its transport to underground storage areas. 120 00:09:58,410 --> 00:10:03,399 One means of transport would be a pipeline; an alternative means would be tanker ships. 121 00:10:03,399 --> 00:10:09,740 A pipeline would have high capacity, but takes long to build and is costly. 122 00:10:09,740 --> 00:10:14,129 Tanker ships are cheaper and more flexible, but have limited capacity. 123 00:10:14,129 --> 00:10:17,749 Both technologies would entail safety risks. 124 00:10:17,749 --> 00:10:20,490 The problem of the port at this level can be summarized as 125 00:10:20,490 --> 00:10:25,660 "how can the Port of Rotterdam facilitate carbon capture and storage without incurring 126 00:10:25,660 --> 00:10:32,660 losses, demand exceeding capacity, or increasing the risk of incidents?" 127 00:10:32,980 --> 00:10:37,449 As you have seen, I have traversed the means-ends diagram from top to bottom. 128 00:10:37,449 --> 00:10:43,920 In real life, I would have considered all means-ends as potential focal objectives. 129 00:10:43,920 --> 00:10:48,720 Let me quickly show how you would proceed once you have formulated a wide variety of 130 00:10:48,720 --> 00:10:50,329 problem statements. 131 00:10:50,329 --> 00:10:53,649 I will use the last problem statement as an example. 132 00:10:53,649 --> 00:10:59,600 The next step is to elicit the criteria that your client should use when deciding on this problem. 133 00:11:00,129 --> 00:11:05,749 You do this by making an objectives tree. 134 00:11:05,749 --> 00:11:10,120 The first objective follows from the first part of the problem statement: 135 00:11:10,120 --> 00:11:14,300 the port wants a large transport capacity for CO2. 136 00:11:14,300 --> 00:11:20,149 The without-part of the problem statement suggests three more objectives: low cost, 137 00:11:20,149 --> 00:11:24,499 sufficient transport capacity, and low safety risk. 138 00:11:24,499 --> 00:11:32,400 The overall objective that summarizes this could be formulated as "Efficient CCS facilities". 139 00:11:33,400 --> 00:11:38,670 You then make this summary of what your client wants even more precise by translating the 140 00:11:38,670 --> 00:11:41,980 objectives into measurable criteria. 141 00:11:41,980 --> 00:11:48,800 The transport capacity for CO2 should, for example, be at least one million ton per year, 142 00:11:48,800 --> 00:11:54,579 the marginal cost of transport should be less than two euro per ton, capacity should 143 00:11:54,579 --> 00:12:00,379 always be greater than demand, and the probability of a grave accident should be less than one 144 00:12:00,379 --> 00:12:03,449 in a hundred thousand year. 145 00:12:03,449 --> 00:12:10,500 The means for facilitating CCS, and the criteria to decide which one (if any) should be planned for, 146 00:12:10,500 --> 00:12:13,769 neatly demarcate this particular problem. 147 00:12:13,769 --> 00:12:17,329 Note that the initial focus shifted only a little bit: 148 00:12:17,329 --> 00:12:22,939 we started with the issue of reducing CO2 emissions, and now focus on one way of achieving this: 149 00:12:22,939 --> 00:12:25,040 carbon capture and storage. 150 00:12:25,040 --> 00:12:29,519 We might just as well have discovered that the issue of providing space for expansion 151 00:12:29,519 --> 00:12:36,519 was more urgent for the port, and that would have radically changed the focus of our analysis. 152 00:12:37,120 --> 00:12:42,439 Problem demarcation means thinking systematically about what to focus on. 153 00:12:42,439 --> 00:12:48,110 Together with your client, you iteratively scope out, and then zoom in again. 154 00:12:48,110 --> 00:12:52,670 It may seem a lot of work, but think: when you're going to spend several weeks of your 155 00:12:52,670 --> 00:12:58,589 time on investigating a problem, it is worth investing one or two days to find out what 156 00:12:58,589 --> 00:13:01,180 the real problem is. 157 00:13:01,180 --> 00:13:06,589 Problem demarcation is not child's play... Because real world problems matter!