Citation:

Deasy Venty Christin, Yos Sunitiyoso, Ahmad Yuniarto. "Inductive Scenario Planning Approach for Testing Corporate Strategy in Energy Transition Era. Study Case: Coal Mining Company in Indonesia" International Research Journal of Economics and Management Studies, Vol. 4, No. 4, pp. 69-85, 2025.

Abstract:

The global energy transition in shifting to clean energy resources has delivered significant challenges for coal mining industry in Indonesia. The study explores the plausible futures of Indonesia’s coal mining industry in the next 10 years and tests the company’s long-term strategies against plausible scenarios amidst the energy transition era. Using a qualitative inductive approach, this study applies Garvin & Levesque’s scenario planning framework, integrated with the Oxford Scenario Planning Approach (OSPA) and TAIDA method for cross-impact and causal analysis. Primary data was collected through semi-structured interviews, questionnaires, and focus group discussions with 13 key industry stakeholders. The research identified 24 key driving forces shaping the coal mining industry, leading to three plausible scenarios: The Rise of the Phoenix, where coal remains dominant with strong downstream development; The Fray of Dragons, depicting a chaotic energy transition with policy instability; and The Struggling Giant, where aggressive renewable energy policies drive a rapid shift away from coal. The analysis reveals that 75% of LBG’s current strategy is relevant in at least two scenarios; however, adjustments are needed to address the gaps, particularly in the business model and process strategies. Adjusted strategic recommendations include diversifying the portfolio into green and critical minerals, investing in clean coal technologies and exploring partnerships in renewable energy and downstream industries. This study contributes to both academia and industry practice by demonstrating how scenario planning can serve as a tool to test strategy resilience in the coal mining sector.

References:

[1] IEA, “Coal 2024 Analysis and Forecast to 2027,” 2024.
[2] G. Kuo, “When Fossil Fuels Run Out, What Then?,” Millennium Alliance for Humanity and the Biosphere, Standford.
[3] IEA, “World Energy Outlook 2023,” International Energy Agency, Jul. 27, 2023.
[4] IESR, “Study Launch: Just Transition in Coal-Producing Regions in Indonesia Case Study of Muara Enim Regency and Paser Regency,” Jakarta, Sep. 2023.
[5] E. C. JRC, “GHG emissions of all world countries,” Luxembourg, 2024. doi: doi:10.2760/4002897.
[6] K. Calvin et al., “IPCC, 2023: Climate Change 2023: Synthesis Report, Summary for Policymakers. Contribution of Working Groups I, II and III to the Sixth Assessment Report of the Intergovernmental Panel on Climate Change [Core Writing Team, H. Lee and J. Romero (eds.)]. IPCC, Geneva, Switzerland.,” Jul. 2023. doi: 10.59327/IPCC/AR6-9789291691647.001.
[7] MEMR, Handbook of Energy and Economic Statistics of Indonesia 2022. Jakarta: Ministry of Energy and Mineral Resources Republic of Indonesia, 2023.
[8] F. Roubelat, “Scenario Planning as a Networking Process,” Technol Forecast Soc Change, vol. 65, no. 1, pp. 99–112, Sep. 2000, doi: 10.1016/S0040-1625(99)00125-0.
[9] P. J. H. Schoemaker, “Scenario Planning: A Tool for Strategic Thinking,” Sloan Management Review; Winter 1995; 36, 2; ABI/INFORM Global, pp. 25–40, Jan. 1995.
[10] R. Ramírez and A. Wilkinson, Strategic Reframing: The Oxford Scenario Planning Approach. Oxford University Press, 2016. doi: 10.1093/acprof:oso/9780198745693.001.0001.
[11] R. C. M. Hardam, “Scenario planning in the context of small and medium enterprises,” Eindhoven University of Technology, Eindhoven, 2012.
[12] T. J. Chermack, “Improving decision-making with scenario planning,” Futures, vol. 36, no. 3, pp. 295–309, Apr. 2004, doi: 10.1016/S0016-3287(03)00156-3.
[13] D. A. Garvin and L. C. Levesque, “A Note on Scenario Planning,” Nov. 2005, Harvard Business Review Press, Boston, MA.
[14] R. Alizadeh, P. D. Lund, A. Beynaghi, M. Abolghasemi, and R. Maknoon, “An integrated scenario-based robust planning approach for foresight and strategic management with application to energy industry,” Technol Forecast Soc Change, vol. 104, pp. 162–171, Mar. 2016, doi: 10.1016/j.techfore.2015.11.030.
[15] A. Curry, G. Ringland, and L. Young, “Using scenarios to improve marketing,” Strategy & Leadership, vol. 34, no. 6, pp. 30–37, Nov. 2006, doi: 10.1108/10878570610711251.
[16] A. D. Hamdan, Y. Sunitiyoso, and A. Yuniarto, “Indonesia’s Mining Downstream Industry in 2045: Applying Scenario Planning for Testing Corporate Diversification Strategy-Study Case of an Indonesian Mining Company,” International Research Journal of Economics and Management Studies, vol. 3, no. 11, pp. 90–106, Nov. 2024.
[17] T. J. Chermack, K. Lindsey, C. Grant, and V. A. Barber, “Effects of Scenario Planning on Perceptions of Organizational Agility,” Journal of Futures Studies, vol. 24, no. 1, pp. 15–28, Sep. 2019.
[18] O. Mungkasa, “Perencanaan Skenario (Scenario Planning). Konsep Dasar, Pembelajaran, dan Agenda Strategis,” Jakarta, Apr. 2023.
[19] A. Kahane, Transformative Scenario Planning Working Together to Change the Future, 1st ed. San Francisco, California: Berrett-Koehler Publishers, Inc., 2012.
[20] P. Schwartz, The Art of The Long View, 1st ed. New York: Doubleday, Dell Publishing Group, Inc., 1991.
[21] G. D. Peterson, G. S. Cumming, and S. R. Carpenter, “Scenario Planning: a Tool for Conservation in an Uncertain World,” Conservation Biology, vol. 17, no. 2, pp. 358–366, Apr. 2003, doi: 10.1046/j.1523-1739.2003.01491.x.
[22] T. R. Carter, M. Hulme, and M. Lal, “Guidelines on the Use of Scenario Data for Climate Impact and Adaptation Assessment,” 1999.
[23] M. Lindgren and H. Bandhold, Scenario Planning: The link between future and strategy, First. PALGRAVE MACMILLAN , 2003.
[24] K. A. Johnson et al., “Using Participatory Scenarios to Stimulate Social Learning for Collaborative Sustainable Development,” Ecology and Society, vol. 17, no. 2, p. art9, 2012, doi: 10.5751/ES-04780-170209.
[25] B. Hervé, “Scenario planning: Managing uncertain futures,” British Journal of Health Care Management, vol. 17, no. 11, pp. 516–521, 2011, doi: 10.12968/bjhc.2011.17.11.516.
[26] P. Goodwin and G. Wright, “Enhancing strategy evaluation in scenario planning: A role for decision analysis,” Journal of Management Studies, vol. 38, no. 1, pp. 1–16, 2001, doi: 10.1111/1467-6486.00225.
[27] B. A. Benedict, “Benefits of Scenario Planning Applied to Energy Development,” in Energy Procedia, 2017, pp. 304–308. doi: 10.1016/j.egypro.2016.12.157.
[28] N. Ohlendorf, M. Jakob, and J. C. Steckel, “The political economy of coal phase-out: Exploring the actors, objectives, and contextual factors shaping policies in eight major coal countries,” Energy Res Soc Sci, vol. 90, p. 102590, Aug. 2022, doi: 10.1016/J.ERSS.2022.102590.
[29] D. P. Turner, “Sampling Methods in Research Design,” Headache: The Journal of Head and Face Pain, vol. 60, no. 1, pp. 8–12, Jan. 2020, doi: 10.1111/head.13707.
[30] S. E. Paris et al., “Inclusive Approaches for Measuring Demographics of Underrepresented Populations in STEM and Biomedical Research Training Programs,” The Journal of STEM Outreach, vol. 7, no. 2, Feb. 2024, doi: 10.15695/jstem/v7i2.10.
[31] M. A. Hitt, R. D. Ireland, and R. E. Hoskisson, Strategic Management: Competitiveness & Globalization: Concepts and Cases, 13th Edition, 13th ed. Boston, MA: Cengage Learning, Inc., 2019.
[32] HumasMinerba, “BUKA MINERBA EXPO 2024, MENTERI ESDM: PNBP SEKTOR MINERBA TERUS BERTUMBUH HINGGA 170 TRILIUN,” Direktorat Jenderal Mineral dan Batubara.
[33] Morgan Stanley, “Environmental and Social Policy Statement,” Sep. 2024.
[34] O. Alexander and P. Gassmann, “Financing the Net Zero Transition,” Bloomberg Media Studios.
[35] N. Suryani, Armansyah, and H. Yetti, “Dampak Pertambangan Batu Bara Terhadap Kondisi Sosial Ekonomi Masyarakat Lokal di Kota Jambi,” UNES LAW REVIEW, vol. 7, no. 1, pp. 345–353, Sep. 2024.
[36] R. Ishardanti, “Social impact analysis on environmental conflict dynamics at coal fired steam power plant,” Interaction, Community Engagement, and Social Environment, vol. 1, no. 1, Jul. 2023, doi: 10.61511/icese.v1i1.2023.187.
[37] S. Widya Yudha, B. Tjahjono, and A. Kolios, “A PESTLE Policy Mapping and Stakeholder Analysis of Indonesia’s Fossil Fuel Energy Industry,” Energies (Basel), vol. 11, no. 5, p. 1272, May 2018, doi: 10.3390/en11051272.
[38] H. Almanasir and O. Freihat, “Green Hydrogen: Solution for Zero Emission,” in 2023 AEE World Energy Conference and Expo, 2023.
[39] D. Braide, C. Panaritis, G. Patience, and D. C. Boffito, “Gas to liquids (GTL) microrefinery technologies: A review and perspective on socio-economic implications,” Fuel, vol. 375, 2024, doi: 10.1016/j.fuel.2024.132385.
[40] M. V. Kathe, A. Empfield, J. Na, E. Blair, and L.-S. Fan, “Hydrogen production from natural gas using an iron-based chemical looping technology: Thermodynamic simulations and process system analysis,” Appl Energy, vol. 165, pp. 183–201, 2016, doi: 10.1016/j.apenergy.2015.11.047.
[41] Direktorat Jenderal Mineral dan Batubara, “Grand Strategy Mineral dan Batubara,” Jul. 2021.
[42] BRIN, “Mengulas Pro Kontra Pemberian Izin Usaha Tambang untuk Ormas Keagamaan,” Badan Riset dan Inovasi Nasional.
[43] H. Segah, A. Afentina, F. Fatkhurohman, Y. Aguswan, and N. Takayama, “Deforestation Characteristic during a Period 2006 - 2020 over Tropical Forest in Central Kalimantan, Indonesia,” Sep. 19, 2023. doi: 10.20944/preprints202309.1263.v1.
[44] MoEF, “The State of Indonesia’s Forests 2024,” Jakarta, Jul. 2024.
[45] WEF, “The Global Risks Report 2024, 19th Edition,” Jan. 2024.
[46] JATAM, “Hungry Coal: Pertambangan Batubara dan Dampaknya terhadap Ketahanan Pangan Indonesia,” May 2017.
[47] M. Schaffernicht, “Causal loop diagrams between structure and behaviour: A critical analysis of the relationship between polarity, behaviour and events,” Syst Res Behav Sci, vol. 27, no. 6, pp. 653–666, 2010, doi: 10.1002/sres.1018.
[48] J. Verity, “Scenario planning as a strategy technique,” European Business Journal , pp. 185–195, 2003.

Keywords:

Coal, Energy Sector, Mining Industry, Testing Strategy, Scenario Planning, Energy Transition.