You have to deal with hazards before they're a problem
Situational awareness means actively training your eyes, ears, and brain to pay attention to the world around you. As an example, while on the 405 recently, I encountered a piece of a 2x4 on the double yellow line between the fast lane and the carpool lane, but because I was looking far ahead, I saw it well in advance, and safely passed it. My instinctual reaction was that the object was a hazard, and I began to run through how I would handle that obstacle if it were in my path. Could I go around it? Over it? Could I stop in time? A decision like this is made in mere hundredths of a second, so every millisecond you gain from identifying a hazard earlier has a huge impact on your ability to effectively manage the situation.
Ask yourself this: When was the last time you turned your head a full 100 degrees to the right to look over your shoulder before changing lanes in your car? How many times do you check your mirrors in four seconds?
Especially if you're commuting or riding in urban areas densely packed with motorists, pedestrians, and bicyclists, knowing when to prepare yourself to brake immediately or slow down to avoid a potential hazard can save your life. You just have to look around and be actively engaged with everything that surrounds you.