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II - Shell Scenarios – A History, 1965-2013

Published online by Cambridge University Press:  16 February 2021

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Summary

Experimentation and Emergence, 1965-1981

In retrospect the 1950s should probably be seen as the ‘golden era’ of oil, the time of rapid expansion but without really damaging competition.

– History and Strategy in Shell, Internal Report 1985

Clearly something had to be done to replace the ‘God-given’ view of the future in use at that time.

– Jimmy Davidson, Head of Group Planning, 1967-76

On arrival in London in 1965, I was placed in a little cubicle on the 18th floor and told to think about the future with no real indications of what was required of me. This was the typical Shell laissez-faire approach. Afterwards, I found out what was really happening, and this is where the story really begins.

– Ted Newland, Manager, Long-Term Studies, 1965-71; Scenario Team Leader, 1980-81

Details cannot be seen from 33 years away. Even the real prophets of our times, the science fiction writers, have blundered when attempting such long sighted view.

– James Lovelock, Author

It was only perhaps after six years or more that the concrete linking of scenarios and strategy took place, so that you could at least use scenarios to start a strategy process.

– Gareth Price, Energy Team Leader, 1981-83

The official Shell scenario history begins in 1965 with the appointment of Ted Newland to start up a new activity called Long Term Studies within the Strategic Studies Division. Two years later, he was joined by Jimmy Davidson, who was appointed as the head of Group Planning, with responsibility for several divisions, including Strategic Studies. Newland and Davidson had arrived at Shell in the middle of the twenty-five golden years of the oil industry that followed World War II. Global demand for oil was booming both in the OECD countries and in many developing economies. Oil was not only fueling the motorization of world transportation, but it was also gaining market share from coal in power generation and industrial markets.

The great enabler of this prosperity was the abundance of cheap oil, particularly from the Middle East. The seven big oil companies – ‘the Seven Sisters’ – had developed the entire supply chain, from the massive production facilities through the refineries (typically built in consuming countries) to the marketing facilities of depots and filling stations.

Type
Chapter
Information
Essence of Scenarios
Learning from the Shell Experience
, pp. 25 - 74
Publisher: Amsterdam University Press
Print publication year: 2014

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