Onto A New Growth Approach, part II

Profound societal changes that will stimulate new ways of thinking, decision-making and doing are taking place. These will have severe consequences for the solution of complex problems like climate change and to find the answers to questions like: Do we have to hold our horses and kill economic growth, or do we change our behavior and lean a bit more on God and the engineers to take care of innovation, technological progress and enlightenment?

Before we go on with the subject of Measuring Quality, we want to share a few new insights, c.q. concepts that will change currently predominant ways of thinking, decision-making and actions.

1. Before we can Win, we’ll have to Lose

The former director of Greenpeace International, Paul Gilding has also written a book: The Great Disruption. ‘It’s too late now,’ Gilding argues. Now it’s the turn of Mother Earth to be nasty. Electrical cars and low-energy light-bulbs won’t safe humans from Nature’s anger. If ten or twenty big cities run out of water and millions of people lose their houses because of tsunami’s and tornado’s, if journalists report about food-wars and bikers suffer from exhaust fumes, then people will show spirit. Then at last we will use all social and technological capabilities to create a new world order. There will be an eruption of innovation. ‘The biggest problem at this moment is not that we can’t handle developments like climate change,’ the former activist says, ‘the problem is that we don’t do anything substantial until we really feel the urgency to act.’ In the meantime we in the West keep on living the good life we used to live.

2. Business Kids

Sometimes it seems that the Environment and Social Affairs are orphans picked up and raised by Government. In fact they are fathered by big business. Business men however don’t accept any responsibility. They pay tax as a general contribution to the community and they pay lip-service to corporate social responsibility. That’s all. And the multitude of citizens & consumers doesn’t appreciate it. The legendary business guru Michael Porter concludes that ‘the capitalist system is under siege’. Porter: ‘In recent years business increasingly has been viewed as a major cause of social, environmental and economic problems. Companies are widely perceived to be prospering at the expense of the broader community. Even worse, the more business has begun to embrace corporate responsibility, the more it has been blamed for society’s failures. The legitimacy of business has fallen to levels not seen in recent history. This diminished trust in business leads political leaders to set policies that undermine competitiveness and sap economic growth.’

A big part of the problem lies with companies themselves, Porter states, so they must be so gentle to take the lead in bringing business and society back together. A strategy with a clear pay off for both business and society. The secret sounds like easy listening music: companies can create economic value by creating societal value. Porter and his fellow author Mark Kramer open up their toolkits. There are three distinct ways to realize this , they explain: by reconceiving products and markets, redefining productivity in the value chain, and building supportive industry clusters at the companyʼs locations. Each of these is part of the virtuous circle of shared value; improving value in one area gives rise to opportunities in the others.

The first pages of their Harvard Business Review story is pretty abstract, but in the end both consultans deliver a full fledged concept, that resembles our own concept of Only Winners and the reasoning behind it. Shared Value is the name of their game and the rules of the game are very simple. Porter c.s.: ‘Societyʼs needs are huge—health, better housing, improved nutrition, help for the aging, greater financial security, less environmental damage. Arguably, they are the greatest unmet needs in the global economy.’

In advanced economies, demand for products and services that meet societal needs is rapidly growing. Food companies that traditionally concentrated on taste and quantity to drive more and more consumption are refocusing on the fundamental need for better nutrition. Intel and IBM are both devising ways to help utilities harness digital intelligence in order to economize on power usage. Wells Fargo has developed a line of products and tools that help customers budget, manage credit, and pay down debt. Sales of GEʼs Ecomagination products reached $18 billion in 2009—the size of a Fortune 150 company. GE now predicts that revenues of Ecomagination products will grow at twice the rate of total company revenues over the next five years.

In these and many other ways, whole new avenues for innovation open up, and shared value is created. Societyʼs gains are even greater, because businesses will often be far more effective than governments and nonprofits are at marketing that motivates customers to embrace products and services that create societal benefits, like healthier food or environmentally friendly products.

Equal or greater opportunities arise from serving disadvantaged communities and developing countries. Though societal needs are even more pressing there, these communities have not been recognized as viable markets. Today attention is riveted on India, China, and increasingly, Brazil, which offer firms the prospect of reaching billions of new customers at the bottom of the pyramid. Yet these countries have always had huge needs, as do many developing countries Similar opportunities await in nontraditional communities in advanced countries.

Lots of opportunities are waiting in the side wing for their discovery. If there is one idea that Porter, Gilding and John Elkington share, it is the idea that the best way out of the crisis is via the front door. Investors, innovators and explorers that follow this road are in good company. Zeronauts are making the scene here! ‘The Zeronauts,’ the inventor of Triple P, John Elkington, teaches, ‘are a new breed of innovator, determined to drive problems such as carbon, waste, toxics, and poverty to zero.’

3. Zeronauts

Three scenarios are presented: breakdown, change as usual, and breakthrough. Coached by Elkington we dig into five key domains (the 5Cs) where innovation is taking place: citizens, corporations, cities, countries, and, ultimately, our civilization. The power of zero has been trumpeted in various areas of business, notably in relation to zero defects. Here we look at lessons learned in the field of total quality management. Elkington, who earlier wrote the bestseller Cannibals with Forks, introduces a five-stage ‘Pathways to Zero’ model. Introducing the emerging discipline of Zeronautics, we move through the five stages (the 5Es): Eureka!, experimentation, enterprise, ecosystems, and economy.

Zeronauts are innovating in an astonishing range of areas, tackling diverse economic, social, environmental, and governance challenges. To give a sense of progress to date, we zero in on five key challenges (the 5Ps): population growth, pandemics, poverty, pollution, and WMD proliferation. In order to move from incremental to transformative change, we must embrace wider framings, deeper insights, higher targets, and longer time scales. We – along with Elkington & Kramer – investigate some ways in which leading Zeronauts are pushing change in relevant directions, with cases drawn from a spectrum of human activity – from water profligacy to human genital mutilation. Elkinnton & ramer: ‘If we learn from these pioneers, the twenty-first century could be our best yet.’

4. Personification

The role an individual plays in society is getting more important every day. People are more conscious about their knowledge and personal capabilities than say twenty years ago and they don’t accept directives from so-called authorities anymore when these are based on mere hierarchy. Hierarchies are loosing ground to individual persons, cities are loosing power to neighborhoods and regions are giving in to cities. We are talking here about one specific hierarchy, that of environmental planning. In this ‘system of nested systems’ the person is the smallest unit.  ‘So long as the smaller systems are enclosed within the larger, and so long as all are connected by complex patterns of interdependence,’ the American writer Wendell Berry writes in Standing by Words, ‘as we know they are, then whatever affects one system will affect the others.

‘It seems that this system of systems is safe so long as each system is controlled by the next larger one. If at any point the hierarchy is reversed, and the smaller begins to control the larger, then the destruction of the entire system of systems begins.’[1] If a system of system collapses the result is chaos. This is exactly what is happening in today’s world.

Uncertainty, complexity and chaos characterize the new age that started with the rise of the social networks: facebook, twitter, MSN, Skype, YouTube, texting… They transfer more power to the individual. One person armed with a laptop and connected with unlimited knowledge and contacts via the Internet can start a revolution. Or as the authors of Small Acts of Resistance conclude: ‘A defiant spirit can make the invincible crack, the unchangeable change’. And Václav Havel (preface, same book): ‘Today, millions around the world live in circumstances where it might seem that nothing will ever change. But they must remember that the rebellions that took place all across eastern Europe in 1989 were the result of a series of individual actions by ordinary people which together made change inevitable.’[2] A same kind of movement took North African dictators by surprise on the edge of 2010/2011. No position is set in stone.

The message is clear: every one of us has the potential and the power to overthrow governments. We just have to act at the right time and attract the attention of the media, traditional media (tv, radio, newspapers) and social networks (twitter, facebook).

Dominant worldviews are challenged by this shift in power. One of them is the more than two hundred years old Newtonian linear worldview on the relation between cause and effect. Other ones concern Western concepts about representative democracy and Adam Smith’s ‘invisible hand’. These three worldviews form the roadmaps for politicians, managers, policymakers and other decision-makers to navigate through the minefields of People, Planet and Profit. If the new approach is non-linear and characterized by uncertainty, complexity and chaos, what is left to steer for all those managers and policymakers sitting behind desks in tall skyscrapers from where they think they can oversee and control the world?

The answer is to be found in different ways of steering and governing. Modern thinkers like Peter Senge, Hans Jeekel and Frank Geels wrote down new roadmaps for governance.

5. Letting go, Letting come.

Peter Senge and three other scientists with totally different backgrounds have made a journey from the present to an unknown future. They present a whole new holistic way of thinking, decision-making and doing, which is characterized by Senge c.s. goes like this: ‘In a sense, there is no decision-making. What to do just becomes obvious. You can’t rush it. Much of it depends on where you’re coming from and who you are as a person. All you can do is position yourself according to your unfolding vision of what is coming. A totally different set of rules applies. You need to “feel out” what to do. You hang back, you observe. You’re more like a surfer or a really good racecar driver. You don’t act out of deduction, you act out of an inner feel, making sense as you go. You’re not even thinking. You’re at one with the situation.’[3]

The process entails three major stages:

Sensing à Presencing à Realizing

Sensing = observe, observe, observe – becoming one with the world.

Presencing = Retreat and Reflect – allow inner knowing to emerge.

Realizing = Act swiftly, with a natural flow.[4]

The path to the Only Winners plateau we call ‘Ecolution’. It’s a new name with a new meaning that in our approach takes the place of the hackneyed concept ‘sustainable development’.

In order to find the path we use the Matrix as a navigation instrument. An application that tracks our present position and shows us the way ahead. To bridge the gap between theory and practice, we’ll have to construct a model. The Only Winners Planning Model is proposed to help regional policymakers in the public domain to find the right concepts by using the matrix along the ecolution path uphill, beyond the dark woods, where Uncertainty, Complexity and Chaos rule a World on the edge of Destruction, in the direction of a light that shines for everyone who wants to see it, even for the blind.

6.The ONLY WINNERS Planning Model

The concepts in the Only Winners Matrix give content and meaning to rather new notions like ‘Ecolution’,  ‘Deconstruction’ and ‘Only Winners’. The Only Winners Model can be used to put theory into practice. It has to be tested in the development of new programs and in case analysis. The model consists of three phases:

  1. Analysis of the context in which the change has to happen and of the instruments that can be used to give change agents a helping hand: behavior change, new technologies and innovative ways of making and taking decisions. Besides, during this phase program goals are established in line with policy objectives of the regional government.
  2. Checking the corresponding factors that determine our present and future position in the Matrix. These are predisposing factors (i.e. motivation), enabling factors (i.e. facilitate change) and reinforcing factors (providing feedback, review policy).

C.  Selection of the concept(s) that influence the relevant determinants of ecolution most.

To a large extent the motivation of people predetermines if a certain policy makes sense or not. Motivated, progressive people usually try harder and perform better than those who act in conformity. For sustainable big changes (transitions) however the backing of the crowd is a must. So, the avant garde has to convince the mainstream on what is right and what is wrong. When we are talking about technological solutions and the efficiency of processes the mainstream is easy to get on the side of change. A change in behavior however is much harder to realize.

Human behavior, psychology teaches us, is a complex phenomenon. People cause their own behavior, although nobody really knows how it works. It is a product of factors both internal (attitudes, preferences, values, habits and personal norms) and external to the individual (fiscal and regulatory incentives, institutional constraints and social practices). We’re waiting for science here. Until now almost nothing is known about the interdependencies between internal and external factors. But practice cannot wait. The show has to go on!

The behavior of the mainstream and the motivation to make a change, determine the possibility of steering. If there is consensus about which way to go, management by directives and tell & sell will work out nicely. If there’s no consensus however and if the context is complex, the mainstream of citizens is uncertain and afraid and the whole process is one big

chaos, taking another steering perspective – one that focuses on what’s attainable – is wise.

7. Transition Management

We distinguish two different ways of steering in the direction of a goal or moving target. Transition management is a steering approach focusing on a huge system change. ‘On paper this approach looks impressive,’ Hans Jeekel, who works for the Dutch central government in The Hague, writes in his thesis about the Cardependent Society, ‘there are however not so many clear results and the starting points have been criticized.’ ‘Transition management,’ Jeekel continues, ‘is rooted in the tradition of systemthinking. It assumes that concerned intervention, focused on specific sustainability targets, is possible and can be effective.’ At first sight transition management is more goal-orientated than for instance networksteering, but ‘where are the organizations and institutions that prove to be capable to turn over the actual regime?’ For understanding the basics of transition management, three notions are crucial: regime, landscape and niche.

A regime is the overriding system of rules, agreements and institutions.

Landscape can be defined as the aspects of the context – the environment outside us – that has more influence on the whole system than the regime-actors. Changes in the landscape work out as a pressure on the actual regime.

Niches are protected spaces that allow nurturing and experimentation.

Radical change may occur as a result of distinct selection criteria operating in a niche. Developments may start with one or a few projects, carried by local networks of actors, who are interested in innovations for idiosyncratic or local reasons. Local projects form test beds for diffuse ideas and spaces. Niches shape the micro-level from where radical novelties emerge. The socio-technical regime builds the meso-level, which accounts for the stability of existing large-scale systems (in transport, energy, etc). The macro-level is shaped by the socio-actors (e.g. macro-economics, deep cultural patterns, macro-political developments). Changes on landscape level usually take place slowly, in the order of decades.[1]

8. Networksteering

Networksteering is like turning the wheel in the sand during Paris-Dakar. This metaphor indicates a non-linear world, in which it is not easy to navigate. Networksteering is: following your senses. It is the art taking time before choosing a direction, in order to feed the dialogue between countervailing insights, which has to lead to passable roads (practicable ways). Networksteering is about walking or driving down unfamiliar roads without prejudice.[2]

Acknowledging that a more structural management of wicked problems is not possible. Smart interventions are the highest possible result. Every opportunity, every chance has to be taken to dance with the systems, supposing that the dancers have enough guts and energy for some twist and shout. Typical for this line of thinking, deciding and acting is the experimentation in several development rounds. After each round the results are monitored, evaluated and reviewed, in order to get at least learning results.

In this steering model nobody tries to mature people quickly into more or less defined change outlines. A big difference with the other steering perspectives is that the goal is not fixed in advance. It emerges during the process. In this perspective no one believes in top-down steering.

Living in a society that can be characterized more and more as a global network commonalty with different layers, loyalties and endless streams of information sharing between numerous people, the networksteering model seems to be the most adequate way for decision-makers, politicians and managers to cope with reality and try to initiate change. Because how: relevant is a neat hierarchy to a world characterized by complexity and chaos? Self-organization in business relies on intelligence that exists in every part of a complex adaptive system (in the mind of every employee) and makes it possible to tap this resource and release its formidable potential. That capacity, in turn, allows companies to seize opportunities and solve problems when they arise. Self-organization and emergence are the twin engines of adaptive work.

Another question that badly needs an answer: To what extent can change be managed? The dominant Newtonian worldview underlies much of the thinking in this field: a common feature is an implied predictability – if management does this, then that will follow. Complexity theory offers a different insight: We can never direct a living system. We can only disturb it.

To a generation of managers brought up on ‘making it happen’, ‘letting it happen’ may prove to be an unsettling alternative.[1]

9. What Well-Being Really Means

Based on academic research and a number of concrete initiatives developed around the world, a commission chaired by Nobel Prize-winning economists Joseph E. Stiglitz and Amartya Sen has identified the following key dimensions that should be taken into account. At least in principle, these dimensions should be considered simultaneously:

  1. Material living standards (income, consumption, and wealth);
  2. Health;
  3. Education;
  4. Personal activities including work;
  5. Political voice and governance;
  6. Social connections and relationships;
  7. Environment (present and future conditions);
  8. Insecurity, of an economic as well as a physical nature.[2]

All these dimensions shape people’s well-being, and yet many of them are missed by conventional income measures. How do you measure such a difference in the quality of life?

‘Quality of life depends on people’s objective conditions and capabilities,’ the Commission on the Measurement of Economic Performance and Social Progress writes. Health and Education are indisputable. Subjective measures have always been part of the traditional tool-kit of economists, as mayfeatures of our economies and societies are measured through people’s responses to a standard set of questions.[3]

10. The crucial role of the Change Agent

One person is missing, the one that binds all the parts together, makes them whole and operates as a catalyst, an accelerator, that makes things already in the making, happen faster. A change agent is someone who alters human capability or organizational systems to achieve higher degrees of output or self-actualization. The role of the change-agent is to make changes that stick. He or she enables people to do more or to find a new and better perspective of life. Anyway, anyhow the change agent completes the jigsaw puzzle.

‘How does it feel to be a change agent?’ Someone on the Internet wants to know. Four characterizations follow:

  1. A change agent lives in the future, not the present.
  2. A change agent is fuelled by passion and inspires passion in others.
  3. A change agent has a strong ability to self-motivate.
  4. A change agent must understand people.

To support the change agent as well as decision-makers, managers, but also individuals who try to shape their environments into a sustainable developing world, the above mentioned Matrix can be of assistance.

Take a profound look at the situation you are in or the issue that needs to be resolved. Feel it, try to make sense of it and sense it, like Peter Senge proposes. Color a spot on the Matrix as to in what phase the development is in each cluster: behavior, technology/process, decision-making. Maybe the behavior is in the destructive phase, whereas the technology can be in a constructive stage. Then think of the concepts at your disposal – like People, Planet, Profit – or find new, inspiring concepts. The concepts you choose form a framework, a discours, from them you can derive the principles as to how to act. The matrix allows people to dance with systems, move in the desired direction and monitor. It is a holistic and dynamic approach.

We will work this out in the essays further on that will deal with the different projects of the Power programme: Timber, ITACA, E-Mob, SILCS and TrIsCo.

This method using the Matrix and different concepts is chosen because it fits the way the European Union operates. The EU is more than a federation of nation states or a steering of regions, it is a grass root movement where development from the bottom up is stimulated. Regions where the grass doesn’t grow fast, get help. The European Union is one big money transfer body. A living machine. Regions that get money from abroad spend it for 70% inside the EU, for a considerable part as investment for sake of a better future.

The EU behaves like the parent of many children, trying to educate all of them as individuals and at the same time stimulate them on acting together. People – regions – who work together, know each other and feel interdependent and emphatic towards one another form an alliance. Friends don’t fight. Quite the contrary. They help each other to do better.

Europe wants/needs to be a team of co-operating (regional) governments and individuals in order to move into the sustainable development direction and to maintain peace on the continent. From the website: ‘The EU actively promotes human rights and democracy and has the most ambitious emission reduction targets for fighting climate change in the world. Thanks to the abolition of border controls between EU countries, it is now possible for people to travel freely within most of the EU. It has also become much easier to live and work in another EU country.’

Last but not least: that change agent we talked about, can be you or me, he or she, but one thing is for sure: it is a person, a wise person. ‘Reacting to the world,’ philosopher of science Paul Feyerabend wrote in one of his last books, The Tyranny of Science, ‘is a personal (family, group) matter that cannot be replaced by even the most enchanting worldview.’[4] Reality is not systematically organized according to a worldview from someone up on the hill. A systematic worldview removes ideas from the ground that made them grow and arranges them in an artificial pattern. That’s not authentic, neither true.

With that conclusion we are back at the beginning. The circle is round. To quote Presence: ‘As complexity increases, the need for wisdom grows, even if our wisdom atrophies.’ According to Peter Senge c.s. we have two basic options. One is to somehow stop or limit the expansion of technology and its application through global economic growth. The other is to strengthen our fundamental response – to find ways that lead to increasing reliance on enhancing human development and wisdom.[5] The first option conflicts with human nature. People want to grow. And to grow they need more of this and more of that. If you put all the wishes and needs and expectations together, the conclusion is that option 1 is an illusion. Rests option number 2, to develop ourselves and operate wisely. As human beings we’ll have to be less materialistic, less spoilt, more sensible and last but not least: more empathic.

Vught, May 27, 2012

P.S. I want to do further research on the measurement of quality, the measurement of well-being, the tensions between destruction and construction, between thesis and anti-thesis, between linear and non-linear, chaos and transparency.

I’m looking for like minded and not-like minded people who want to help me with their thoughts, insights, good humor and money. A research project like this needs a budget and some help from universities all over the world. An opportunity for Business to meet Society, for Scolars to meet Business. Somewhere, Somehow, in Summertime.

Dr. Frank van Empel

frank @ nonfixe.nl

[1] Business Leadership Review, Vol 4 issue 3, July 2007.1

[2] Joseph E. Stiglitz, Amartya Sen, Mis-Measuring our Lives, The New Press, New York, London, 2010, p.15

[3] Mis-Measuring our Lives, p. 64

[4] Paul Feyerabend, The tyranny of science, Polity Press, Cambridge, England, 2011, p 12.

[5] Presence p 209.

[1] This paragraph leans on The Dynamics of Sustainable Innovation Journeys, edited by Frank W. Geels, Marko P. Hekkert and Staffan Jacobsson, Routledge, 2011,  pp 17-35.

[2] For the Networksteering perspective we leaned on and have lended  from Hans Jeekel, De Auto-Afhankelijke Samenleving, Eburon, 2011, pp 256-265.

[1] Wendell Berry, Standing by Words, Counterpoint, Berkeley 1983, p 46. Berry actually used the following hierarchy, from the person out: person, family, community, agriculture, nature.

[2] Steve Crawshaw & John Jackson, Small Acts of Resistance, How Courage, Tenacity, and Ingenuity Can Change the World, Union Square Press, 2010.

[3] Peter Senge c.s., Presence, Exploring profound change in people, organizations and society, Nicholas Brealy Publishing, London, 2005, pp. 84/85.

[4] Presence, pp. 88.

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