In fact, such an event did occur in Sweden in 1992, when the OK Petroleum company successfully lobbied for an increase in the country’s tax on leaded gasoline. This surprising action stemmed from OK’s development of a high-octane (98) lead-free automobile fuel, which burned cleaner than other fuels while still maintaining high performance. The Swedish government agreed to the tax because it was in alignment with its own clean air policies and with international conventions that it supported. Since OK had the only lead-free product on the market, the gas tax gave the company a significant price advantage at the pumps. “The competition was forced to follow suit,” explained OK’s Per Wadstein, leading to cleaner air for all of Sweden.

Economy vs. Ecology

Economy and ecology arc often pitted against each other in the “profitability versus environment” debate. There is a perception that companies can either prosper financially or take care of the earth, but not both. However, as OK Petroleum showed, these pursuits do not have to be mutually exclusive. In fact, ecology and economy derive from the same Greek root, eco, meaning house. (Ecoloqy stands for “study of the house,” and economy means “management of the house.”) This etymology suggests that the two concepts are not contradictory, but actually part of the same larger idea. I low, then, can we study and manage our “house” (the earth) in ways that benefit both industry and society over the long term?

The “Systems ‘Thinking for a Sustainable Future” initiative, based at the MIT Center for Organizational Learning, provides a set of principles, practices, and processes that recognize and reinforce the synergistic link between long-term economic and ecological development. It seeks to provide industrial decision-makers with both a conceptual, framework stud practical tools for building financially healthy companies that arc also ecologically sustainable. In addition, the initiative attempts to foster learning environments in which various stakeholders can grapple with the larger issues of the day. The hope is that within these settings, the participants will create presently unimaginable solutions to some of the world’s most intractable problems.

Sustainabillty

What do we mean by “sustainable”? A sustainable society is one that is self-perpetuating over the long term—meaning that it uses resources at a rare that does not exceed the rare at which they can be replenished, and that it produces waste materials at a pace that does not exceed the rare at which they can be reabsorbed by the environment. Within this framework, a sustainable organization can be described as a company that provides customers with goods and services for living a satisfying life, while maintaining both a healthy balance sheet and a healthy balance with the natural world.

Creating environmentally sustain-able business practices used to be considered a choice for businesses—an optional activity for those companies that had the time, energy, and interest. But now it is becoming a more mainstream concern, due to several trends:

• The marketplace is demanding “greener” products that reflect environmentally responsible management. Supermarket aisles are filled with products that proclaim their eco-friendliness—from phosphate-free detergent and acid-free paper to recycled cardboard and “dolphin-safe” tuna.
• Material resources are becoming more scarce, resulting in a rise in production costs in many industries. For example, integrated steel producers virtually disappeared in the U.S. during the 1980s because the costs of mining iron ore grew financially prohibitive as the availability of that resource decreased.
• Regulatory compliance is becoming an increasingly costly concern. One petroleum company’s environmental compliance costs topped $1 billion in 1994—a figure that exceeded the company’s net profit for the year.

How can business managers think systemically about a sustainable future? How can they balance needs for economic prosperity and ecological survival? To address these challenges, companies need to expand their current strategic thinking to include economic and ecological concerns—creating what W. Edward Stead and Jean Garner Stead call “sustainability strategies.”

A Conceptual Framework

The Natural Step movement. which originated in Sweden, offers clear conceptual framework for creating such sustainability strategies. Lei Dr. Karl-Henrik Robert. The Natural Step has proven to be one the most effective sustainability movements in the world, aligning diverse social business and ecological interests around fundamental scientific principles of natural systems. The Natural step process has been studies: and practiced by corporate managers, urban community members, youth at risk, and schoolchildren; it has been shared via books, audiotape, board game, or CD-ROM with every household in Sweden. It is an approach that does not blame any one sector of society for our current problems, but rather encourages all of us to find ways to contribute CO effective solutions.

The guiding principles of The Natural Step, known as the “four systems conditions,” are derived from the basic hews of thermodynamics: matter cannot disappear, and matter tends to dispense (see “The Four Systems Conditions”). By using the four systems conditions to evaluate whether their products and services are economically and ecologically sustainable, some of Sweden’s largest corporations have produced significant changes in their business strategies.

For example, the ICA supermarket chain in Sweden was asked frequently by its customers whether its refrigerators and freezers emitted CFCs, which are linked to ozone layer damage. After familiarizing themselves with the four systems conditions, ICA’s leadership engaged in a conversation with Electrolux (Eureka in the U.S.), their primary vendor of refrigeration products. Aware that CFCs, a non-biodegradable, unnatural compound, violated systems condition 2, ICA’s leaders asked Electrolux what it would cost to eliminate this compound from their existing inventory. After some technical hedging, Electrolux designers answered that it would take 1 billion Swedish crowns (approximately $140 million) to convert to soft freons—another persistent and unnatural compound, but one that is thought to be less damaging than CFCs. The CEO’s response was, “You want me to invest 1 billion crowns in a product, of which the only thing I know for sure is that it is doomed to failure?! Please come up with a more suitable alternative.”

Electrolux, which had not previously encountered The Natural Step, subsequently phoned Dr. Robert and asked him to come “talk about your damned systems conditions.” A short time later, the Electrolux team announced the development of an interim compound that does not harm the ozone and that is now successfully being manufactured and marketed as a “green” refrigerant. The company is also well on its way to producing a refrigerant that is biologically harmless. As a result of its work with Dr. Robert and his colleagues, Electrolux has begun employing The Natural Step method throughout the company, and is now using the four systems conditions as a framework for its strategic planning process.

Integrating Sustainability Strategies and Organizational Learning

While the four systems conditions offer a basic conceptual framework for creating sustainable business strategies, they do not provide a specific process whereby those principles can be used to develop and implement such strategies. This is where the disciplines and tools of organizational learning can help. For example, the tools and methodology of systems thinking provide a means to test the long-term implications of policy decisions on the wider environmental system.

Systems thinking can also provide an overarching framework for understanding the industrial, governmental, and environmental interactions that play a role in sustainable development (see “The Sustainability Challenge”). An overall increase in industrial productivity (such as the U.S. has experienced for most of the 20th century) leads to a reinforcing cycle of economic growth and profitability (R1), but it can also lead to an accumulation of industrial wastes in the environment. In the U.S., this has led to heightened regulatory pressures designed to reduced waste.

At the same time, increased consumer awareness of the environmental impact of production is leading to emerging new market opportunities in terms of “clean” technologies (B3), which, for those companies that invest in them, can lead to profitable alternatives to unsustainable production techniques (R4). However, the subsequent increase in regulatory compliance costs can constrain profits (B2), which can potentially limit industry’s ability to invest in “clean” technologies (R4).

The disciplines of team learning and mental models also have much to offer in that they can help generate more informed, productive conversations. In the ecology/economy debate, dialogue skills of genuine inquiry, deep listening, displaying one’s own line of reasoning, and respect for other view-points are critical, as are the ability to surface our mental models and to inquire into those of other people (see “The Power of Mental Models”). Through the use of dialogue and role-playing, we can gain deeper understanding of diverse points of view and bring out new ideas and solutions that a single point of view might not have produced.

In a recent learning laboratory at a petroleum company, for example, role-reversal, dialogue, and consensus-building tools were used to develop a new framework for environmental leadership. As part of the workshop, employees from the environmental engineering division took turns role-playing the traditional contestants in the environmental debate: “Government Bureaucrats,” “Tree-Hugging Environmentalists,” and “Big Bad Business.” By humorously taking on their worst perceptions of each other, participants were able to see beyond the stereotypes that they had placed on their professional adversaries.

The Sustainability Challenge

Heightened consumer awareness of accumulated industrial wastes has led to heightened regulatory pressures designed to reduce waste. However, the subsequent increase In regulatory compliance costs can constrain profits (B2) which can potentially limit Industry’s Investment in “clean” technologies (R4).

In the dialogue that followed, the engineers gained insights into the motivation, logic, and humanity of the various stakeholders, and were better able to understand the validity and utility of each point of view, even if the perspective challenged their own position. The engineers found that their subsequent meetings with EPA representatives on a difficult Clean Air Act project were significantly enhanced in terms of quality of communications, creativity of thinking, and efficacy of solution generated—all as a result of their experience in the workshop.

Organizational Learning for a Sustainable Future Integrating sustainability strategies and organizational learning—one approach focused on content (where we need to. go) and the other focused on process (how we’ll get there)—may hold unprecedented potential for producing sustainable ecological and economic development. We have termed this synergy Sustainable Organizational Learning (SOL). Although the development of SOL is only in its initial stages, we can imagine a variety of learning practices through which SOL practitioners will work toward long-term economic and ecological sustainability:

• Aligning industrial cycles and natural systems. Conversations around strategy and future planning will include the question, “What business activities should we engage in that will be aligned with the systems conditions for sustainability?” The answers to this question will strongly influence investment decisions with respect to new products and services. In this way, SOL practitioners will begin to align their company’s industrial cycles with natural systems.
• Building cross-company consortiums. By building consortiums of companies engaged in a similar inquiry, sustainable learning organizations will participate in company-to-company conversations that will enable them to learn from each other’s challenges and successes in the pursuit of sustainability strategies.
• Engaging in ongoing practice. By studying and practicing the disciplines of SOL, practitioners will foster new learning in themselves, their compa

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Defining Sustainability

Before sharing what I found, let me define what sustainability means. Our current economic system is fundamentally linear in nature. It focuses on producing products and delivering them to the customer in the fastest and cheapest way possible. We extract resources from the Earth’s surface, turn them into goods, and then discharge back into nature the byproducts of this process as massive amounts of often highly toxic waste (which we call air, water, and soil pollution) or as solid, industrial, and hazardous waste (which we dispose of in landfills or burn in incinerators). After 200 years, this so-called “cradle to grave” production system has become firmly embedded in our psyches as the dominant paradigm.

However, there is an underlying problem with this model: It turns out that the Earth’s air, forests, oceans, soils, plants, and animals do not have the capacity to endlessly supply increasing amounts of resources, nor can nature absorb all of society’s pollution and waste. The field of sustainable development has emerged in response to the mounting ecological and social challenges stemming from the traditional economic paradigm. At its core, this new approach fundamentally transforms the linear model into a circular one — what design experts Bill McDonough and Michael Braungart call a “cradle to cradle” production scheme.

This revolutionary economic paradigm eliminates the concept of waste entirely, because goods and services are designed from the outset as feedstocks for future beneficial use. To achieve this outcome, companies harvest energy and raw materials without damaging nature or communities. Then, as McDonough and Braungart say in their book Cradle to Cradle: Remaking the Way We Make Things (North Point Press, 2002), “Products can either be composed of materials that biodegrade and become food for biological cycles, or of technical (sometimes toxic) materials that stay in closed-loop technical cycles, where they continually circulate as valuable nutrients for industry.”

Organizations such as Herman Miller Inc., an international producer of office furniture and services; Inter face Inc., one of the largest manufacturers of commercial floor coverings; and Henkel, a German company that makes a broad range of industrial, commercial, and consumer chemical products are adopting this “cradle to cradle” model. As a result, they are realizing major cost savings, reduced risks, and increased competitive advantage, along with significant social and environmental benefits. But unfortunately, few executives in other businesses grasp the fundamental paradigm shift that sustainable development requires. Blinded by long-held mental models, they fail to fundamentally alter the ways in which their organizations produce goods and services. They believe that sustainability simply involves better controls, marginal improvements, or other “efficiencies” within their existing, linear business model. These managers cling to the fallacy that traditional, hierarchical organizations can manage closed-loop, cradle-to-cradle systems.

Seven Sustainability Blunders

Thus, most organizations seeking to improve their management of environmental and socio-economic issues inevitably fall prey to one or more of seven key “sustainability blunders.” Becoming aware of how these blunders can undermine an organization’s efforts to mitigate its impact on the environment is the first step in creating a sustainable enterprise.

Blunder 1: Patriarchal Thinking That Leads to a False Sense of Security Organizations that struggle to adopt a more sustainable path invariably employ a patriarchal approach to governance. Employees do only what management orders, and the organization strictly follows government mandates. Employees and the organization as a whole seldom, if ever, go beyond the requirements of their “superiors.” No one meaningfully challenges the linear economic paradigm or mechanical organizational designs that control thinking. This is the most serious of the seven blunders, because it creates an addiction to the directives of higher authorities and an abdication of personal responsibility.

Blunder 2: A “Silo” Approach to Environmental and Socio-Economic Issues In most organizations, different functions, such as environmental and labor relations, are usually assigned to separate units. Executives see sustainability as yet another special program and don’t understand how it affects design, purchasing, production, and all other units. Because no single unit can identify all of the ways in which processes or products affect the environment or social welfare, the status quo is perpetuated.

Blunder 3: No Clear Vision of Sustainability

Organizations struggling to adopt a sustainable path usually lack clarity about what they are striving to achieve. Without a clear vision, they often assume that being in compliance with the law is the sole purpose of their policies. But compliance is a backward-oriented, negative vision focused on what not to do. It depresses human motivation. Sustainability is a forward-looking vision that excites people and elicits their full commitment and energy.

Blunder 4: Confusion over Cause and Effect

The prevailing mental models held by most executives lead them to focus on the symptoms, not the true sources, of sustainability challenges. Organizations spend millions to mitigate emissions and discharges, never recognizing that these are the results, not the causes, of their problems. Emissions and discharges stem from the ways processes and products are designed and the kinds of toxic materials, chemicals, and energy used to make them. Pollution controls temporarily mask these problems and keep organizations focused on managing effects rather than on designing out root causes.

Blunder 5: Lack of Information

People need a tremendous amount of clear and easily understood information to comprehend the downsides of the linear production paradigm and the benefits of the circular cradle-to-cradle approach. However, most organizations fail to communicate effectively about the need for and the purpose, strategies, and expected outcomes of their sustainability efforts. Trainings, sign postings, and a few scattered events are insufficient to convey what a commitment to sustainable development involves or why employees should participate.

Blunder 6: Insufficient Mechanisms for Learning

When employees are given limited opportunities to test new ideas, and when they receive few rewards for doing so, not much learning occurs. Organizations struggling to become sustainable rarely institute mechanisms that allow workers to continually test new ideas, expand their knowledge base, and learn how to overcome barriers to change.

Blunder 7: Failure to Institutionalize Sustainability

The ultimate success of a change initiative occurs when sustainability-based thinking, perspectives, and behaviors are embedded in everyday operating procedures, policies, and culture; for example, when an organization links bonuses, promotions, new hiring, and succession planning to performance on sustainability. However, few organizations have incorporated sustainability in their core policies and procedures. Until they do so, employees will remain unconvinced of their employers’ commitment to this crucial issue.

The Wheel of Change

Although one or more of the blunders occur in most organizations, a small but growing number of early adopters are leading the way toward sustainability by successfully changing their traditional production and organizational paradigms. Their leaders grasp that deep-rooted cultural transformation is necessary to overcome the resistance inherent to the profound changes necessary to achieve true sustainability. Here are the interventions that successful change leaders use to resolve each of the seven sustainability blunders:

Intervention 1: Change the Dominant Mindset Through the Imperative of Achieving Sustainability

The false sense of security that people feel when they are in compliance with regulations must be undermined before employees will open themselves to circular cradle-to-cradle thinking and action. Disrupting an organization’s controlling mental models is the first — and most important — step toward the development of new ways of operating. Little change will occur if this step is unsuccessful.

An enlightened leader in a small organization can sometimes alter the controlling mindset by simply talking with senior executives, employees, and stakeholders. Tom Kelly, president of Neil Kelly Co., Portland, Oregon’s largest home remodeling firm, introduced sustainability principles to his employees and asked if they would like to apply them in their work. The workers said “yes.” The firm went on to manufacture the first interior cabinets certified by the Forest Stewardship Council and received the first LEED construction certification in the Northwest from the U. S. Green Building Council for its new showroom.

However, most organizations seem to require a major crisis to spur action. Senior executives at IKEA, a global furniture manufacturer, became committed to sustainability only after the company experienced a series of high-profile environmental and labor crises. Ray Anderson, chairman and former CEO of Interface, one of the world’s largest producers of commercial floor covering, became a convert after customers began to ask about the firm’s environmental policies. In the vast majority of cases, a relentless and compelling message from senior executives is required to make the case that safety from legal challenges, social protest, financial losses, customer defection, or environmental crisis can be achieved only by adopting a new business model based on sustainability.

Intervention 2: Rearrange the Parts by Organizing Transition Teams

Once business-as-usual thinking has been shattered, the next step is to rearrange the parts of the current system. Doing so requires the involvement of people from every function, department, and level of the organization — and key external stakeholders — in analysis, planning, and implementation. This “shake-up” is important because planners and decision-makers often surround themselves with likeminded people, do not trust the unknown, or may feel threatened by change. Consequently, they handle problems in the same way time after time. Changing the composition of groups brings fresh perspectives and ideas to the table. New people can see problems that the old guard couldn’t. They can also suggest different solutions because they are unconstrained by the dominant cultural paradigms.

The leading sustainability organizations shake up the status quo by organizing sustainability “transition teams” that develop new goals, strategies, and implementation plans. Over time, the composition and nature of the teams will change as people go deep into the organization to flesh out problems, break old thought patterns and perspectives, and align practices with sustainability. For example, the initial team may assess company policies and procedures and complete an audit of overall environmental and social impacts. Subsequent teams may be organized to apply the new approach within each unit and function. The most important step each team must take is to get clear about what it is striving to achieve, the role each person will play, and the rules they will follow to accomplish their mission.

Herman Miller Inc. established the Environmental Quality Action Team (EQAT) to “help the corporation through the muddy waters of environmentalism.” Once the EQAT was clear on its mission, it formed nine subcommittees, including the Design for the Environment team, which focused on formulating sustainable products. This team produced the Ergon 3 office chair, which is made with 60-percent recycled content. Ninety-five percent of the materials in the chair can be recycled or reused. Other subcommittees have identified reductions in energy use and packaging that have saved the company millions of dollars.

Intervention 3: Change Goals by Crafting an Ideal Vision and Guiding Sustainability Principles

The third key leverage point for cultural change toward sustainability is to alter the organization’s goals. Change the goals, and different kinds of decisions and outcomes will result. Doing so requires a clear depiction of the new ends the organization seeks to achieve and guidelines for how decisions should be made to achieve them.

The leading organizations use “ends-planning” (sometimes called “backcasting”) to craft an exciting vision of how they will look and operate when they are a sustainable enterprise. Compelling visions are felt in the heart and understood in the mind. Organizations can then adopt principles that support the vision and provide a roadmap for decision-making; for example, by deciding to use materials that are extracted from nature in ways that do not degrade the surrounding ecosystem.

Herman Miller’s vision is “to become a sustainable business: manufacturing products without reducing the capacity of the environment to provide for future generations.” The company uses The Natural Step and Bill McDonough’s “Eco-effectiveness” principles (www.mcdonough.com) as the guiding frameworks for its sustainability initiative. Scandic Hotels adopted a vision of achieving environmental sustainability by “moving from resource wasting to resource caring.” This vision led them to realize that ecological sustainability is not a cost but a source of profits and competitive advantage.

Intervention 4: Restructure the Rules of Engagement by Adopting New Strategies

After the organization has adopted new purposes and goals, the next intervention involves altering the rules that determine how work gets done. Doing so involves developing new strategies, tactics, and implementation plans. The organization should come up with both operational and governance strategies in this process. The enterprise as a whole must answer four questions: (1) How sustainable are we now? To respond, you need baseline data describing where and how the organization’s processes and products currently affect the environment and social welfare. (2) How sustainable do we want to be in the future? Adopt clear goals and targets that clarify when the organization expects to achieve certain milestones. (3) How do we get there? Design operational and governance change strategies for achieving the goals and targets. (4) How do we measure progress? Adopt credible sustainability indicators and measurement systems to quantify progress toward goals and facilitate adjustments.

In the early 1990s, the Xerox Corporation adopted the vision of becoming “Waste Free.” The vision catalyzed profound changes in operations all the way back to the initial designs of major product lines. The strategies required decentralized decision-making, which helped to dramatically increase employee morale and commitment. By the end of 2001, the initiative had led to the reuse or recycling of the equivalent of 1.8 million printers and copiers. It also resulted in several billion dollars of cost savings, as well as dramatic improvements in all environmental areas.

Intervention 5: Shift Information Flows by Tirelessly Communicating the Need, Vision, and Strategies for Achieving Sustainability

Even when all other interventions have been successful, progress will stall without the consistent exchange of clear information about the need for the sustainability initiative and its purpose, strategies, and benefits. Effective communication engages people at an emotional level. Sustainability visions and strategies become internalized as people ponder what these changes will mean to them personally. Transparent communication opens the door to honest understanding and sharing.

The leaders at Interface instituted a comprehensive information and communication program to engage employees and stakeholders in sustainability efforts. Now, environmental issues are discussed at almost every staff meeting, in executive retreats, and via internal communications. Board chairman Ray Anderson says, “Sustainability has become the language of the company.”

Intervention 6: Correct Feedback Loops by Encouraging and Rewarding Learning and Innovation

Even with excellent strategies, obstacles will surface. To overcome the barriers to change, the organization must alter its feedback and learning mechanisms so that employees and stakeholders are continually expanding their skills, knowledge, and understanding. The adoption of new learning mechanisms leads to wholesale changes of traditional feedback systems that are oriented toward maintaining the status quo.

The leading organizations provide accurate feedback on progress and setbacks, and rewards for those willing to experiment and learn. Henkel adopted a strategy to differentiate itself from its competitors based on its ecological and social performance. The company believes that “Innovation is the key to sustainability.” To encourage innovation, the company gives out “Henkel Innovation Awards” to employees who develop sustainable new products. The award includes public recognition via press releases and in company newspapers. Henkel also keeps a database of successful ideas generated by employees that is available to its workers worldwide.

Intervention 7: Adjust the Parameters by Aligning Systems and Structures with Sustainability

Because internal systems, structures, policies, and procedures should not be altered until the right kind of thinking and behaviors have been identified and implemented, changing these parameters is the last step in the change process. At the same time, the effort never actually ends at this stage. Change toward sustainability is iterative. The “wheel of change” must continually roll forward. As new knowledge is generated and employees gain increased know-how and skills, the organization needs to continually incorporate new ways of thinking and acting into how it does business.

Patagonia, the U. S. retailer of outdoor gear and clothing, explicitly seeks to create a culture that values protection of the environment and of communities. Raises, bonuses, promotions, and succession planning all depend on the level of contribution employees make to the firm’s core values of environmental protection and social equity. IKEA has followed a similar course. Says Thomas Bergmark, Social Responsibility Manager, “No one has been promoted to the senior management level who does not have a strong commitment to these issues. Before we engaged in sustainability, there were managers who did not take environmental and social issues to heart. These managers are no longer at IKEA. We take great care to get the right people promoted.”

The “Wheel of Change Toward Sustainability” shows how the seven interventions interact to form a continuous reinforcing process of transformation toward sustainability.

Sustainable Governance

Many leaders have found that changes in governance provide the greatest overall leverage for facilitating the successful introduction of the interventions outlined above. What is governance? The Journal of Management and Governance says, “Governance . . . includes the modes of allocating decisions, control, and rewarding rights within and between economic organizations.” In other words, governance systems shape the way information is gathered and shared, decisions are made and enforced, and resources and wealth are distributed. These factors guide how people perceive the world around them, how they are motivated, and how they exercise their power and authority (see “Sustainable Governance Systems”).

The organizations leading the way toward sustainability tend to view all of the people that are affected by their operations — internal members as well as external stakeholders — as important parts of an interdependent system. Their leaders understand that every component of the system must be fully engaged and must function effectively for the whole to succeed. In order for this to be possible, power and authority must be skillfully distributed among employees and stakeholders through effective information-sharing, decision-making, and resource allocation mechanisms.

This model of governance is much more sustainable over time than a patriarchal approach, because as a natural output of the process, employees and other stakeholders have a high level of commitment and involvement. With the proper purpose, vision, and guiding principles, a new production model and organizational paradigm evolves that works to eliminate environmental and socio-economic problems and create business opportunities.

Sustainable governance systems have five dominate characteristics:

1. They follow a vision and an inviolate set of principles focused on conserving the environment and enhancing socioeconomic well-being. Every system has a purpose that is the property of the whole and not of any particular part or person. Sustainability holds equal — or greater — footing with the goals of profitability or shareholder value.

2. They continually produce and widely distribute information necessary for expanding the knowledge base and for measuring progress toward the core purposes. A system of feedback mechanisms produces and widely disseminates timely and credible environmental, social, and financial data to provide the information needed for continued learning and improvement.

3. They engage all those affected by the activities of the organization. Sustainable governance systems involve in planning and decision-making all those affected by the organization, including employees from all units and functions, as well as key stakeholders such as suppliers, investors, distributors, and community, environmental, and labor organizations.

4. They equitably share the resources and wealth generated by the organization. By spreading the return on investment among employees and stakeholders and by equitably distributing resources such as staff, time, and capital to internal units, leaders ensure that all participants give the enterprise their full engagement and support.

5. They provide people with the freedom and authority to act within an agreed-upon framework. Clearly defined, mutually agreed-upon goals, rules, roles, and responsibilities result in clear strategies and implementation plans. Power and authority are decentralized, and people have both the freedom and the responsibility to act.

None of the leading organizations I reviewed can be considered truly sustainable yet. Each is plagued by inconsistencies between their ideal vision and current practices. The early adopters acknowledge that they have just begun the journey to sustainability. But they have all implemented most, if not all, of these principles of governance. The organizations all describe and apply the principles in their own unique ways. But no matter how they are articulated or employed, these tenants provide the governance structure necessary for the long journey to sustainability.

In addition to the focus on governance, leading organizations are blessed with — or take explicit steps to develop — exemplary leadership at the top and throughout the enterprise. It is not possible to initiate or sustain the tremendous transformation required to become more sustainable without exceptional leadership. Thus, good governance and leadership are the two hallmarks of successful change toward sustainability.

Organizations that apply these interventions and make the transition to cradle-to-cradle production and systems-oriented organizational paradigms are certain to be the big winners in the future. Pressure will only increase from consumers, civic groups, and the financial markets for improved environmental and social performance. Executives who believe that these demands will fade or be deflated by shifts in environmental, public health, or labor laws may experience short-term relief from these pressures. In the long run, however, recalcitrant organizations will experience a backlash that may threaten their very existence. The successful leaders of the future will be those who have adopted a more sustainable model of conducting business.

Bob Doppelt is executive director of the Center for Watershed and Community Health, a sustainability research and technical assistance program affiliated with the Institute for a Sustainable Environment at the University of Oregon. Doppelt is also a principal with Factor 10 Inc., a sustainability change management consulting firm.

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Any informed student of systems thinking recognizes that such strategies eventually fail because they merely treat symptoms. They do not cure root causes. On the contrary, in time, these actions may actually worsen our underlying social and environmental problems. For instance, the availability of recycling may boost consumerism. Indeed, our problems will not go away until we discover that unlimited growth cannot be the primary goal of economic activity and act on this discovery. Society must learn to run an economy that enhances human well-being while ensuring that all life on Earth, both human and non-human, flourishes indefinitely.

Our problems will not go away until society discovers that unlimited growth cannot be the primary goal of economic activity.

To develop an economy that benefits Earth and its inhabitants, we need

• a good understanding of the state of our current economic system,
• a clear vision of the sustainability that must become the goal of our future economic system, and
• a willingness to take small steps to identify and remove the obstacles we encounter on the path to get us from our current economic system to the future system.

To achieve these goals presupposes that we identify the assumptions about reality that underlie our thinking. It also requires that we understand how we got to where we are today. Understanding how we arrived at this point allows us to make informed decisions about our economic activity and proceed wisely to develop a sustainable future.

Like performers in a jazz group, we have no full-blown score that shows us precisely what comes next. We do, however, have the ability to examine the past, consider the present, and create a viable path to a sustainable future.

The Origin of Belief in Economic Growth

How can we get to the core of the challenges that face us? How do we begin to make a significant difference? One place to start is by understanding and thinking carefully about the underlying assumptions that gave us economic growth as a viable business strategy in the first place. Adam Smith and the first generation of classical economists originally proposed the capitalist economic system as an answer to the question, “What is the best way to conduct economic activity so as to increase ‘the wealth of nations’?” Their concern was how to secure national wealth. Their focus was on providing an alternative to the 17th- and early 18th-century mercantilist nations’ efforts to amass precious metal reserves through conquest and one-sided trade surpluses. Early classical economists advocated gaining national wealth instead by encouraging industrial employment through the manufacture of and trade in products and commodities. In other words, they saw a nation’s economic strength in its productive employment and trade, not in vaults filled with dubiously acquired stores of gold and silver.

These economists put less emphasis on growth per se than on the social and legal conditions they saw as prerequisites to innovation, risk-taking, and investment. Thus, Smith and his peers argued that market exchange was superior to feudal custom as a basis for conducting economic activity. They also believed that manufacturers and traders should privately own the property and equipment they used in their enterprises. In this way, capital that had previously been locked up in the “commons” on the feudal manor would reach entrepreneurs eager to invest it in novel ways.

Only long after Adam Smith did economists shift their attention to, among other things, growth in the human economy. To some extent, this shift was a response to the unprecedented expansion of the human population that began after the onset of the fossil fuel–enabled industrial era in the early 18th century. Along with that growth came cycles of boom, depression, inflation, deflation, unemployment, and financial instability. These events prompted European and American economists by the first half of the 20th century to develop so called macroeconomic models to explain patterns of economic activity in the aggregate, as opposed to the microeconomic models of market and price behavior of individual consumers and firms that had been the chief concern of economists in the previous two centuries.

After the 1930s, government policy makers were using macroeconomic models and tools developed by John Maynard Keynes and other economists to deal with economic cycles, price-level fluctuations, and employment instability. Although the success of these models seemed to be confirmed by the long period of sustained economic growth in the Western democracies from the 1940s to the end of the 20th century — a welcome change after the long depression of the 1930s—it no doubt contributed to the environmental problems we now face, giving rise to the dilemma of today’s policy makers to come up with ways to achieve “prosperity without growth” (Tim Jackson, Prosperity Without Growth? Sustainable Development Commission, U. K., 2009).

By the late 20th century, then, the relatively small-scale and competitive industrial economy had been transformed into the vastly larger-scale, more centralized, and more monopolistic global economy. At the same time, the question of how to increase a nation’s wealth was replaced by an answer: transform resources into an ever-growing stream of goods and services for human consumption, without limit.

The Impact of Newtonian Thinking

The way modern humans have thought about the economy derived mainly from Western religious and scientific cosmology passed on through educational, religious, and social institutions from the 18th century to the present day. Particularly important in shaping economic thought has been the mechanistic view of reality articulated by that most admired of Western 18th-century intellectuals, Isaac Newton.

By the late 20th century, the relatively small-scale and competitive industrial economy had been transformed into the vastly larger-scale, more centralized, and more monopolistic global economy.

Central to Newton’s cosmology is the idea that reality in this universe is material “stuff” consisting of independent objects that connect only through external force. This force is of course known as “gravity.” Economists after Adam Smith’s time adopted the idea that the independent behavior ascribed by Newton to material non-human systems in the universe applied equally to all human, social, and living systems on Earth. Thus, homo economicus is an autonomous being motivated solely by his or her desire to maximize self-interest through winner-take-all competition and accumulation of material wealth. A social setting in which humans work, such as a business, achieves results that presumably can be measured as a linear sum of its parts. Holding the human economy together in a coherent way is an external force resembling gravity. Borrowing on Newton’s ideas, Adam Smith described that force as “an invisible hand” that produces the “greatest good for the greatest number” when all individuals independently pursue their self-interest through economic exchanges based entirely on prices set in free markets.

Growth was not a feature of Newton’s universe, but it became an inevitable part of modern economic thought as people increasingly viewed the goal of market exchange to be the accumulation of material “stuff” measured with abstract financial quantities. Having shifted the goal of economic activity from real, tangible things to abstract financial quantities, the race to grow without limit was on. After the early 19th century, more and more people began to take for granted what they presumed were limitless sources of power delivered by coal furnaces, internal combustion engines, and coal-generated electricity. They rushed to use such power to strip forests, mine minerals, produce steel rails and high-rise girders, travel great distances, and till millions of acres. They believed that inexhaustible resources would give them the necessary means to achieve unending growth. The adverse environmental impact of this growth was, for the most part, out of sight — either not yet readily visible or located far from major population centers.

Eco-philosopher Thomas Berry powerfully described this devastating transition in human history:

In our times . . . human cunning has mastered the deep mysteries of the earth at a level far beyond the capacities of earlier peoples. We can break the mountains apart; we can drain the rivers and flood the valleys. We can turn the most luxuriant forests into throwaway paper products. We can tear apart the great grass cover of the western plains and pour toxic chemicals into the soil and pesticides onto the fields until the soil is dead and blows away in the wind. We can pollute the air with acids, the rivers with sewage, the seas with oil — all this in a kind of intoxication with our power for devastation at an order of magnitude beyond all reckoning. We can invent computers capable of processing ten million calculations per second. And why? To increase the volume and the speed with which we move natural resources through the consumer economy to the junk pile or the waste heap. Our managerial skills are measured by the competence manifested in accelerating this process. If in these activities the topography of the planet is damaged, if the environment is made inhospitable for a multitude of living species, then so be it. We are, supposedly, creating a technological wonderworld (Thomas Berry, The Dream of the Earth, Sierra Club Books, 1988).

A New Cosmology

Ironically, the Newtonian cosmology that legitimated this “wonderworld” in modern economic thought underwent a radical transformation in the late 19th and early 20th centuries, just as the social and environmental costs of sustained economic growth were beginning to appear on the horizon. This new cosmology embodies a view of reality that itself has the potential to help answer the question of how to run a sustainable economy. According to this worldview, sometimes referred to as “the universe story,” our universe originated 13.75 billion years ago in an infinitely dense, small, and hot singularity — the “big bang” — containing the source of all the matter and energy that ever will exist. Since the “big bang,” the universe expanded continuously and thereby became host to an evolving array of increasingly complex forms such as sub-atomic particles, galactic clouds of hydrogen and helium atoms, stars, elements of the periodic table, molecules of water and amino acids, planets circling stars, Earth, and Earth’s life forms — ranging from prokaryotic microbes to human beings.

Consider the view of reality inherent in this cosmology. First, reality is not “stuff” put here all at one time in its present form. Instead, it is a continuously evolving process, or system, that itself produces all the forms we perceive around us. Moreover, that process embodies a small number of patterns that connect all matter and energy in relationships from which everything emerges.

Three features seem to permeate the universe:

1. Everything is connected to everything else. Nothing is independent. “The universe,” Thomas Berry remarked, “is a communion of interconnected subjects, not a collection of independent objects.”
2. Every form that has ever emerged from the evolutionary process is imbued with a unique self-identity, or “inwardness,” that embodies the form and enables it to multiply and expand its influence.
3. The universal system of interconnected, self-defining forms sustains itself and flourishes indefinitely by continuously generating increasing diversity, or differentiation, and thereby preventing any one form’s growth from extinguishing other forms (see Brian Swimme and Thomas Berry, The Universe Story, Harper Collins Publishers, 1992; Joel Primack and Nancy Abrams, The Journey to the Center of the Universe, Riverhead Books, 2006).

For nearly 14 billion years, relying on these three features, the universe has evolved, using an unchanging budget of matter and energy. All the increased complexity and differentiation intrinsic to the evolution of the universe has been accomplished with the same quantity of stuff — or, as an economist might say, “at zero marginal cost.” The universe is sustained by the continuous generation of newness, using a fixed amount of matter and energy to do so.

We humans have posed the first threat to this sustainability by using our unique powers of technology to consume from Earth’s fixed supply of resources and create waste faster than Earth can regenerate the waste, thus depriving resources to other life forms. This consequence of modern economic growth would not occur, however, were the human economy able to achieve prosperity and sustainability simultaneously, by consuming Earth’s resources at a steady rate that does not threaten the ability of other life forms to thrive. How to achieve that goal is the most important question of our time, perhaps the most important question humans have ever faced.

As revealed by modern science, the behavior of the universe suggests the best way to run an economy intended to support human well-being while ensuring that all life on Earth, both human and nonhuman, flourishes. When we acknowledge the interconnectedness of all life on Earth and when we grasp the current state of our life-denying global economic system, we are poised to identify constructive actions that will lead to a viable future state.

Economic Growth and Nature’s Systems

Anthropologist and systems thinker Gregory Bateson once commented, “The major problems in the world are the result of the difference between the way nature works and the way man thinks” (as quoted by Bill Devall and George Sessions in Deep Ecology: Living as if Nature Mattered, Peregrine Smith Books, 1985). A viable future state requires that we see that nature works through a series of interconnected feedback loops that prevent any species from growing without limit, ensuring that life can flourish indefinitely, despite Earth’s fixed supply of resources. Were it not for such checks on growth, population booms would lead to crowding and mass extinctions, thus reducing the number, diversity, and resilience of the planet’s flora and fauna.

By contrast, “the way man thinks” is to assume that Earth can supply all the resources to sustain endless expansion of the human economy. In past centuries, when humans grew steadily in number, we did not seriously threaten the health of the planet. Since the Industrial Revolution, however, and especially today, the human economy has consumed Earth’s resources at a pace that is causing environmental distress and the extinction of other species to a degree unprecedented since the extinction of the dinosaurs some 65 million years ago. When humans use our unique powers of language and technology to circumvent nature’s ways of constraining growth, and when we engage in unlimited consumption of Earth’s fixed, finite resources, our behavior compromises Earth’s capacity to sustain life. If this unchecked growth continues, we may be jeopardizing the sustainability of our own species.

Conditions for Growth

The dedication to growth is rooted in two conditions that profoundly shaped the course of the industrial economy for the past two centuries. One condition is the discovery and ever-increasing use of fossil fuels — coal since the late-eighteenth century; oil since the mid-nineteenth century; and natural gas since the late-nineteenth century. Without these fuels, the massive extraction and transformation of Earth’s resources into products for human consumption that has characterized the modern industrial economy would have been inconceivable. But helping drive that enormous consumption of resources was a second condition: the development and nearly universal use in the past century of abstract financial concepts to describe, explain, and direct economic activity.

When we view economic activity through the lens of financial numbers such as profit, cost, income, and GDP, it becomes a quantitative abstraction, completely separated from the concrete activities that produce such numbers. Indeed, corporations are seldom held accountable for the true social and environmental costs of their actions, including polluted air and rivers, toxic food, scarred landscapes, scarce or tainted water, discarded human lives and communities. Seen in this light, it is hardly an exaggeration to say that the modern industrial economy has been growing itself to death.

The rate of economic growth, especially in Western capitalist economies after the late 19th century, was also greatly accelerated by the use in limited-liability corporations of long-term debt and equity instruments. With access to large amounts of financial capital, companies produced — and consumers consumed — at higher rates than would otherwise have been possible. Since the early 20th century, financial capital has grown faster than physical capital (John B. Cobb, Jr., “Landing the Plane in the World of Finance,” Process Studies, Vol. 38.1, Spring-Summer 2009). This discrepancy gave global financial corporations the monetary wealth with which to acquire and control large industrial corporations.

As a result, a small number of individuals in the financial sector came to own and control an increasingly large share of the economy’s monetary wealth. To a much greater degree than ever before, inequality in the distribution of wealth increased rapidly. The predictable rise of political influence exercised by those at the upper end of the wealth distribution is now enabling political power in Western society to shift from popular democratic majorities to plutocratic minorities.

A Piecemeal Approach

Reinforcing this shift in power is our tendency to accept the growth of enormous corporations and to delegate virtually all of our economic decisions and fulfillment of our physical needs to them. As the writer, agrarian, and land steward Wendell Berry has said, “Most people in the ‘developed’ world have given proxies to the corporations to produce and provide all of their food, clothing, and shelter [and] . . . to corporations or governments to provide entertainment, education, child care, care of the sick and the elderly, and many other kinds of ‘service’ that once were carried on informally and inexpensively by individuals or households or communities” (Wendell Berry, “The Total Economy,” in What Matters?: Economics for a Renewed Commonwealth, Counterpoint, 2010). Large corporations and governments thus capture vast financial wealth and political power while providing, on their terms, almost all the goods, services, and jobs that shape our lives.

Given the hardships and inequities that this growth has created, it is surprising that popular public opinion about national and global economic policies supports the relentless economic growth that financially benefits a select few. Presumably, this paradox derives in part from the influence that large business and government institutions wield over education and the public media. Also, the public’s dependence on products, services and jobs created by those institutions—and our seemingly unending appetite for consumer items — helps make us complicit in the global growth strategy.

Thus, in response to our deepening environmental crisis, rather than reining in large growth-oriented institutions, most of our strategies have focused on piecemeal approaches such as recycling waste, buying plug-in electric and hybrid automobiles, installing solar panels on rooftops, creating vegetable gardens in abandoned urban spaces, and grinding worn-out running shoes into material for making playgrounds. While environmentally friendly practices are commendable in their own right, they address symptoms, not the fundamental problem of inexorable economic growth.

If we should continue to pursue unlimited economic growth, the unanticipated consequences may exceed our most fearful imaginings.

A Positive Future Economy

The following steps suggest ways we might solve our economic problems and repair the current destructive global economy that is based on “the way man thinks.” These steps propose a positive future economy based on “the way nature works.”

1. Take back what Wendell Berry calls the “proxies” we have given over the years to corporations and governments to fulfill all our physical and economic needs. This implies consuming less of everything and having each community become more self-sufficient and less dependent on outside institutions for necessities such as food, clothing, shelter, recreation, education, and healthcare. In short, take back global by going local.
2. Produce and trade more of what we consume locally and import less from the outside world by carefully planned programs to promote import substitution. This creates more local jobs and more local opportunities to invest local savings.
3. Delegate to outside corporations and to regional and national governments only those economic activities that cannot be provided effectively in the local community. Then initiate programs to steadily improve the local community’s ability to provide those activities.
4. Markets do well at defining prices for reproducible, homogeneous, fungible commodities but not for defining values of heterogeneous, nonrenewable, unique species. Most economists after Adam Smith and David Ricardo ignored this fact. Thus, modern economists take for granted that markets will set prices for land and labor as though they were fungible commodities. They increasingly regard Earth’s natural resources, human labor, and life itself as commodities to trade. This idea must end.
5. Modern science tells us that reality is relationships and process, not “stuff” to mechanically collect, assemble, and accumulate. But humans have yet to learn that their well-being requires them to emulate in their social, business, and economic organizations the patterns of relationships found in nature, not the mechanistic patterns so pervasive in present-day financial management. To that end, people managing economic processes in the workplace must recognize that “cost” is a function of how they design human relationships in those processes, not a financial quantity that they control by changing the scale of those processes and the speed at which the processes transform inputs into output.
6. Endless growth in the human economy makes it impossible for Earth’s remarkable life system to flourish over the long run. However, almost all present-day programs to promote “sustainability” or “sustainable development” fail to question the assumption that growth is a necessary condition of human economic activity. Thus, they do no more than treat symptoms of the underlying disease; they do nothing to prevent the disease itself. And by simply alleviating, temporarily, some of the adverse consequences of growth, they avoid tackling the fundamental problem, which is to produce a condition of long-term sustainability in a context of no growth.
7. Do not look to universities or academic researchers for answers to the social and environmental problems that we now face. Academic institutions are firmly entrenched in the status quo.

Undoubtedly no one seriously believes that the defining feature of the human economy should be the destruction of life. And yet today our economic activity is destroying Earth’s capacity to support life. To alter this condition, we must thoughtfully scrutinize our reasons for advocating continuous growth in production and consumption. If we should continue to pursue unlimited economic growth, the unanticipated consequences may exceed our most fearful imaginings.

H. Thomas Johnson is professor of business at Portland State University and Distinguished Consulting Professor of Sustainable Business at Bainbridge Graduate Institute. In 1997, Harvard Business Review named his book Relevance Lost one of the most influential management books of the 20th century, and in 2003, Harvard Business School Press listed Tom among today’s 200 leading management thinkers. In 2001, Tom’s book Profit Beyond Measure received the Shingo Prize for Excellence in Manufacturing Research, and in 2007, the American Society for Quality awarded him its prestigious Deming Award. You can contact him at johnsoht@pdx.edu.

The post A Global System Growing Itself to Death—and What We Can Do About It appeared first on The Systems Thinker.

Our first reaction is to blame others for these problems, be they greedy Wall Street bankers, rapacious corporations, or dishonest politicians of either the conservative or liberal persuasion.

But here’s some news for you. Playing the blame game is merely an ingenious avoidance technique. It allows us to place the focus outside of ourselves and steer clear of having to look at our own contribution to today’s troubling situations. Don’t get me wrong. I know some people and organizations do bad things. But we often project onto others the very things we need to examine in ourselves.

The economic, social, and environmental ills we face today are of our own making. They are the outcomes of how we see and respond to the world. Unethical corporations and disreputable politicians might seem to cause the most egregious harm, but they are merely taking today’s dominant cultural perspectives to the extreme. The challenges our society faces today illuminate the changes we each need to make in ourselves.

To resolve a problem, you first need to understand its cause. The roots of our troubles are simple, yet for most of us completely hidden from view. We have been living in a dream world, controlled by false perceptions and beliefs. Our personal lives, as well as the activities of the organizations with which we are involved and society at large, have been guided by fundamental misjudgments about how our planet functions and what it means to live a good and decent life.

The most harmful illusion is that each of us exists on Earth as an independent, separate entity. This belief, now dominant in Western culture, has produced an extreme form of individualism. Most of us today believe in the “sacredness” of the individual. Anything that threatens our ability to do whatever we want, whenever we want, is seen as a danger to our economy, personal freedom, and way of life.

The belief in separation leads us to accept the notion that self-interest is the dominant driver of human behavior. This is false. A selfless concern for the welfare of others is also encoded in our genes. It is a powerful form of feedback that keeps the self-interested aspects of our personalities in check. By emphasizing only our selfish traits and denying our selfless qualities, we have denied our capacity for self-restraint and promoted behaviors that undermine the health of the planet and put billions of people in peril, including you and me.

The economic, social, and environmental ills we face today are of our own making.

Our belief in separation and the extreme individualism it has spawned is a fantasy – with startling consequences. It prevents us from seeing that we humans exist only due to the complex web of interlocking ecological and social systems that exist on Earth. Because we have failed to restrain our activities to conserve those systems, the Earth’s surface temperatures are on a trajectory to rise by around 2°C, and possibly much more this century. If this occurs, the consequences will be disastrous. Temperatures might climb gradually, in fits and starts, for a while. But then sudden shocking changes that no computer model could ever predict are likely to occur. Rapid and chaotic climatic shifts will trigger destructive heat waves or long-term drought, followed by food shortages, resources wars, and maybe the destruction of a major city or two by rising sea levels or horrific storms. Without a swift, dramatic change in direction, the coming decades will be a wild and turbulent ride.

To navigate the troubled waters that lie ahead and eventually emerge in a healthier condition, we must overcome the erroneous perspectives that have led to this predicament. At the most fundamental level, this involves a shift from responding to the world exclusively through the perspective of extreme individualism – the lens of “Me,” which includes our personal, family, and organizational goals and desires – to meeting our needs by renewing and caring for an expansive “We” – the many people, organisms, and interconnections we are part of that make life possible and worthwhile.

As opposed to “first-order change,” which slightly improves the efficiency of a system without fundamentally changing its goals, structures, or ultimate outcomes – which is what most so-called sustainability initiatives focus on – the shift from “Me” to “We” constitutes a “second-order change,” which establishes altogether new and truly sustainable objectives, designs, and results. As we make this transformational shift, our personal awareness will increase and the fear and emptiness that pervade us will diminish. We can once again find promise, meaning, and inspiration in our lives.

Five powerful commitments can help you make the conversion from focusing exclusively on “Me” to consistently accounting for the many people, organisms, and interdependencies involved with an emphasis on “We.” None of the commitments is actually new. On the contrary, throughout human history, sages have proclaimed them to be universal truths. They are often discussed today in a disjointed way, and at times you might practice one or more of them.

Although not particularly complicated, these five commitments are profoundly important because they are based on “natural laws” of sustainability. These are universal truths about how humans must interact with the Earth’s ecological systems and with each other if we are to successfully transition through the rocky times ahead and emerge in a better condition.

Each of the commitments can be applied immediately. You don’t need to wait for other people or institutions to change. You and your organization only need to change your own thinking and behavior.

Each time you put the commitments into practice, the myths that have such a powerful hold on you will be weakened. You and the groups you engage with will then be better equipped to do your part to resolve the systemic breakdowns that threaten us all.

As you make the shift from “Me” to “We” that is at the heart of sustainable thinking and action, an extraordinary inner journey will begin that will radically change your life. Your optimism about the future and your self-confidence will grow. Hope and inspiration will be your hallmarks. You will become a beacon of light for others to follow.

The First Commitment: See the Systems You Are Part Of

How do you see the world? Does your image include all of the things that actually exist on the planet, or is your vision narrowly focused on your personal, family, or organizational needs and wants?

Most of us are not so self-centered as to say that we completely ignore the natural environment or other people. Nor will most people or organizations say they are always selfless and think only of others. But if your focus is mostly limited to your personal or organizational desires, then time and again you will think about little else and fail to see how your activities affect other people, the natural environment, or even yourself.

The difference between an expansive view of the world and a restricted perspective can be understood by looking up for a moment and taking several deep breaths. Feel the air as it fills your lungs. Can you explain what just happened?

Oxygen entered your body and sustained your life. Oxygen supports a process called cell respiration that turns food into energy. Oxygen also detoxifies your blood, strengthens your immune system, and rebuilds your body. Do you know how this oxygen came to be? About three-quarters of it was produced during photosynthesis in single-celled green algae and bacteria in marine environments. The remainder came from the same process in forests and other vegetation. Complex interactions occurring all around you created the oxygen that makes your life possible.

How conscious are you of these elaborate relationships? If you fail to consider the intricate web of interactions unfolding all around the planet, you will often act in ways that impair those life-giving forces. You will also create significant distress for other people – and, ultimately, for yourself.

We humans live in systems. You are a complex system yourself. Think of your heart, lungs, and the many other organs that work together seamlessly to keep your body running. You are also a member of numerous social systems, such as your family, place of work, community, professional societies, and fellow humans around the globe. Additionally, as the oxygen you just inhaled demonstrates, you are a part of the larger complex living system that is planet Earth.

The reality is that everything on the planet is created and sustained by something else. There is nothing that actually exists by itself. This is the Law of Interdependence. It is the most fundamental of all the natural laws of sustainability. It says that each of us exists in this world only as part of a complex web of interlocking systems. There is no truly separate “Me.” Each person is created and sustained by interconnected networks of ecological and social systems – a collective “We.”

Understanding the context in which you exist is essential for progress toward true sustainability. The first and most important commitment you and the organizations you are involved with must make to realize the shift from “Me” to “We” is to see the systems you are part of.

What you see in the world is in large part shaped by your assumptions and beliefs. Your thinking, in turn, influences how you interact with everything around you. If you, and the organizations you participate in, desire to begin the journey from “Me” to “We” and thrive in the difficult times ahead, you must abandon your fictional belief in separateness and make a commitment to see the integrated nature of the systems you are embedded within. You must become aware of the context in which you exist.

Systems can be difficult to quantify. But you can map them. Drawing maps of the social, economic, and ecological systems you are part of can be a fun and helpful way to expand your awareness of systems.

Seeing the systems you are part of is only a first step in the transition from “Me” to “We.” You must now look deeper and understand how to think about the consequences of your outdated thinking and behavior on those systems.

The Second Commitment: Be Accountable for All the Consequences of Your Actions

“We reap what we sow.” This timeless proverb means we determine our future by what we do in the present. There is no way to avoid this natural law. We cannot plant seeds of one kind and expect to reap fruits of a different type. Wise people throughout the ages have told us that this is so.

Science has described this principle as well. Newton’s Third Law of Motion says that, “For every action there is an opposite and equal reaction.” If we toss a stone into the air, it will fall to Earth every time. When we push over the first of a row of dominoes, it will fall on the next, which will tumble onto the next and, eventually, cause the entire chain to collapse. Our planet is composed of interlocking webs of systems, so almost everything we do today has a consequence of some type, somewhere, at some point in time. This is the Law of Cause and Effect.

The natural Law of Cause and Effect is closely connected to the Law of Interdependence. In fact, it is the flip side of that first law of sustainability because it describes the consequences that naturally occur when we fail to see and care for the Earth’s social and ecological systems.

Most people know that cause and effect exists. Yet those of us who grew up in Western nations were raised in societies that promote the notion of separation and extreme individualism. Personally and organizationally, we tend to focus almost exclusively on our own needs and wants – on “Me” – and deny, discount, or ignore the many ways in which our actions might affect the many systems we are part of – the broader “We” that makes life possible and worthwhile.

The second commitment you and the organizations you are involved with must make to realize the shift from “Me” to “We” is to be accountable for all of the consequences of your actions.

As with systems, cause and effect relationships can be difficult to quantify. But they can be mapped. Tools such as “Fishbone” diagrams can help you understand the possible consequences of your actions.

Awareness is everything. The more mindful you become of the potential effects of your actions, the greater your awareness will become. Like the other commitments involved with the shift from “Me” to “We,” as other people and organizations make a similar commitment, our society will increase its understanding of the implications of our past and current practices, and take another step toward true sustainability.

The Third Commitment: Abide by Society’s Most Deeply Held Universal Principles of Morality and Justice

Imagine, for a moment, that a genie suddenly whisks you away from your everyday life and makes you the world’s most powerful decision maker. At your fingertips is the most up-to-date information about the planet’s economic, social, and environmental conditions. You can use that data to make any type of decision you want about how resources and wealth should be allocated and how things should function.

But, there is a catch. The genie has also given you amnesia. You cannot remember your social status, nationality, gender, ethnicity, religious affiliation, how much money you have, or even who your parents or family are. Consequently, you don’t know what the effects of your decisions will be on you or your loved ones because you don’t know who you are or where you live. (This exercise is a slight variation of the “veil of ignorance” described by John Rawls in A Theory of Justice, Belknap Press, 1971.)

Under these conditions, would you make decisions? Would you use as much energy, consume as many resources, or generate as much solid waste and greenhouse gas emissions as you do today? Would you seek to accumulate as much personal wealth or power?

Not likely. Instead, you would undoubtedly adopt a decision-making process similar to the universal moral principle known as the “Golden Rule” that says: “Treat others as you would like them to treat you.” In other words, you would no longer focus only on your own wants and needs but instead consciously choose to see things through the eyes of people all over the world because those “others” might include you! You would shift your perspective from “Me” to “We.”

As far-fetched as this scenario seems, it describes the reality of the world we live in today. Although you might never have omnipotent power, no matter who you are or where you live, you can be negatively affected by the actions of anyone on the planet at any time. Similarly, your activities, and those of the organizations you are a member of, can affect people around the globe as well as all future generations in surprising ways. To ensure your own well-being, you must therefore make decisions that enhance the well-being of everyone else.

Committing to seeing the social and ecological systems you are part of, and accounting for all of the ways your activities are likely to affect those systems, are necessary conditions for the shift from “Me” to “We.” But this is only a start. You must now decide on the moral principles that will guide your response to those consequences. What moral standards will you hold yourself to as you respond to the breakdown of the climate and biosphere and the social and economic distress they trigger? What principles of morality and justice will your organization base its activities on?

The natural laws of sustainability and associated commitments are the fundamentals of the shift from “Me” to “We” embodied in sustainable thinking and action.

In today’s over-crowded, over-consumed, over-polluted, and over-heating world, morally just behavior is more essential than ever before. That’s because moral action is not based on philosophy or good intentions. It is based on real-world consequences. This is the Law of Moral Justice. This natural law of sustainability says that morally just behavior is imperative now because at this moment in history, our survival requires exemplary levels of human self-control, cooperation, and principled action. Without it, everyone will suffer, including you and me.

Although instinctual drives and the capacity to reason shape human behavior, the moral precepts we hold ourselves to determine how those processes play out. The third commitment you and the organizations you are involved with must make to realize the shift from “Me” to “We” is to abide by society’s most deeply held universal principles of morality and justice. The most widely held moral precept is to always strive to “do no harm” to the social and ecological systems we are part of.

If you commit to practicing moral justice by striving to do no harm, you can make the tough choices required to help society transition to true sustainability.

The Fourth Commitment: Acknowledge Your Trustee Obligations and Take Responsibility for the Continuation of All Life

In 1972, the Apollo 17 astronauts took the first and most complete picture humanity had ever seen of our planet – our home – as a whole. Referred to as “the Blue Marble,” the picture shows that there are no discharge pipes allowing us to dump our toxic substances, solid waste, and greenhouse gases into space. Everything we humans make – toxic and otherwise – accumulates somewhere in the land, waters, or atmosphere of our planet. There are no intake pipelines that allow us to import additional resources from other planets. When we deplete non-renewable resources, they will vanish forever. When we push the Earth’s climate and ecological systems beyond their limits, they are likely to flip into permanently degraded and, from a human perspective, unwanted conditions.

The cumulative effects of human activities on the Earth – especially those of the past 50–100 years – have led a number of scientists to proclaim that we have entered a new geological era called the “Anthropocene.” This term refers to the fact that, for the first time, humankind’s influence on the environment is so overwhelming that our activities, rather than natural processes, will now determine the fate of the Earth.

It is a universal moral principle that the more power one has over another, the greater is the duty to use that power benevolently. If human behaviors now determine the fate of the planet, individually and collectively, we have a responsibility to do what is necessary to sustain it. This is the Law of Trusteeship. This natural law of sustainability says that no one living today actually owns anything. We are merely trustees with a responsibility to administer the planet’s assets to ensure that they are sustained in a healthy condition into perpetuity.

Acknowledging that we are now trustees of all there is in the world is a difficult task for most people and most organizations. Our belief in extreme individualism, derived from the mistaken idea that we exist independently from all other organisms and processes on Earth, leads us to think that we have no responsibilities for anything beyond our organizations, our families, and ourselves. This belief is erroneous. The fourth commitment you and the organizations you are involved with must make to realize the shift from “Me” to “We” is to acknowledge your trustee obligations and take responsibility for the continuation of all life.

The commitment to acknowledge our trustee obligations and take responsibility for the continuation of all life emphasizes our selfless, cooperative, and caring instincts. It thus operationalizes the second of humanity’s most deeply held universal moral principles, which is to “do good.” The Golden Rule succinctly describes this commitment: “Treat others as you would like them to treat you.”

The Fifth Commitment: Choose Your Own Destiny

The natural laws of sustainability and associated commitments are the fundamentals of the shift from “Me” to “We” embodied in sustainable thinking and action. In summary, these laws state that our survival and the survival of all other life forms on Earth is possible only because we are enmeshed within a complex web of interdependent climatic, ecological, and social systems. Given the deteriorating conditions of the planet today, almost every action we take affects those systems somewhere, at some point in time. Our response to these consequences will be shaped by the moral principles we adopt to guide our thinking, behavior, and policies. Because human actions now determine the fate of the Earth, like it or not, each of us is a trustee with the responsibility to care for all life on Earth.

But there is one additional natural law that you must follow to make a successful shift from “Me” to “We.” This law is the key to your ability to abide by all of the others. It is the Law of Free Will. This law states that even though your perceptions and behaviors are strongly influenced by your upbringing, today’s dominant cultural worldview, and the physical, political, and economic infrastructure they produced, you have the capacity to change your thinking and practices at any time.

Humans are capable of self-awareness and independent thought. You have a natural ability to reveal, examine, and alter the core assumptions and beliefs that shape your life. This means that at any time, you can choose to abandon views that do not serve you well, keep those that do, and adopt new ways of seeing and responding to the world that produce substantially better outcomes. The fifth and final commitment you and the organizations you are involved with must make to realize the shift from “Me” to “We” is to choose your own destiny.

If you choose to make the shift from “Me” to “We,” you can start by acknowledging the natural laws of sustainability and decide to abide by the commitments here. Likewise, the organizations you are involved with can choose to create a culture of accountability for sustainability organized around the five commitments (see “The Five Commitments”).

All social change happens one person at a time. This means there is only one way to alter the trajectory of the troubling conditions the world faces today, and that is for you to make the shift from “Me” to “We.” You must see for yourself the truths inherent in the natural laws of sustainability and the power of the five commitments. As more people see the world in new ways, social contagion will occur. If you focus on the broader “We” that makes all life possible, and think and act sustainably, great peace and happiness will be yours. You will also become a role model that others will follow.

Bob Doppelt is executive director of The Resource Innovation Group (TRIG), a non-partisan social science-based sustainability and global climate change education, research, and technical assistance organization affiliated with the Center for Sustainable Communities at Willamette University, where he is also a senior fellow. In addition, Bob is an adjunct faculty member in the Department of Planning, Public Policy, and Management at the University of Oregon. He is the author of Me to We: Five Commitments That Can Save The Planet and Change Your Life (Greenleaf Publishing, 2012).

The post From Me to We: The Five Transformational Commitments Required to Rescue the Planet, Your Organization, and Your Life appeared first on The Systems Thinker.

Dr. Donella H. Meadows was one of the most influential environmental thinkers of the 20th century. As principal author of Limits to Growth (Universe Books, 1972), which sold more than nine million copies in 26 languages, she and her colleagues applied the then relatively new tools of system dynamics to global problems. She went on to write eight other books and a weekly syndicated column.

Donella founded Sustainability Institute in 1996 to apply systems thinking, system dynamics, and organizational learning to environmental and social challenges. Three qualities that she combined brilliantly were dedication to scientific rigor, deeply grounded optimism, and the ability to communicate well. Donella’s use of systems tools enabled her to see clearly the root causes of seemingly intractable problems — poverty, war, environmental degradation — and her deep affection for people and the earth gave her a unique power to reach others.

The Donella Meadows Leadership Fellows Program honors and builds on Donella’s legacy by empowering a new generation of sustainability leaders to use whole-systems thinking in their work and life. The Fellowship integrates rigorous systems analysis with skills in articulating feelings, values, and vision. To support more women in becoming leaders of sustainability, the selection process ensures that at least two-thirds of the participants are female.

The recently graduated 2003–2004 Fellows work in the nonprofit, government, business, tribal, university, and philanthropic sectors. They hailed from major cities, university towns, and rural communities in 14 states. One Fellow came from Brazil, and several others have significant experience working in international settings with a range of colleagues and stakeholders. Through their ongoing work with their organizations, the Fellows interact with conservation activists, farmers, industry executives, legislators, citizen boards, and government officials. Their work represents diverse sectors, bioregions, and ecosystems.

The Curriculum

The Fellows Program is organized in two-year cycles, encompassing four 4day workshops at Sustainability Institute’s affiliated Cobb Hill cohousing community in Vermont, homework, and personalized coaching to apply the workshop teachings to Fellows’ current work. Staff at the Sustainability Institute, and guest speakers Peter Senge (author of The Fifth Discipline), Nancy Jack Todd (Ocean Arks International and editor of Annals of Earth), John Sterman (Jay W. Forrester Professor of Management and director of the MIT System Dynamics Group), and Sara Schley (SEED Systems and the SoL Sustainability Consortium), taught the recent Fellows to:

• Build skills in systems thinking, organizational learning, reflective conversation, mental models, and personal mastery
• Apply systems principles to complex environmental and social problems in their work
• Develop their professional and personal capabilities to serve as leaders for sustainability

Specifically, Fellows:

• Learn to draw causal loop maps that reveal system drivers and leverage points for creating change
• Practice stock and flow diagrams and “Action to Outcome” mapping
• Uncover mental models that drive policy and populations of people to accept or reject new initiatives
• Develop and lead strategies for environmental and social sustainability
• Create new collaborations among other Fellows and with Sustainability Institute staff
• Communicate more effectively, facilitate new understanding, and inspire hope
• Increase their personal mastery and articulate a vision for long-term sustainability in several issue areas

A fundamental thrust of both the Fellows program and Sustainability Institute’s work is to address the systemic roots of social and environmental problems rather than focus on their many symptoms. When Fellows learn to recognize and, most importantly, direct their strategies toward the drivers of complex systems, they greatly enhance their effectiveness. The tools of systems thinking foster connection and understanding as well as win/win dynamics.

By committing to apply the teachings of the Fellowship to their current work challenges, Fellows both use the tools of systems thinking and expose others to them. They also form a learning network representing many regions, issue areas, and professional contacts that amplifies the impact of the training for each participant.

Applying the Learnings

The 2003–2004 Fellows stated that their ability to broaden their perspective in addressing larger-scale environmental and social problems, analyze the root causes of these problems, look for leverage points to make change, and implement solutions have all increased through the program. Angela Park, from the Environmental Leadership Program, says, “The Fellowship has given me very specific tools for thinking strategically about some truly vexing, complicated projects.” Fellows apply these tools to engage multiple stakeholders in complex environmental and social issues in the U. S. and international settings. For example:

• Julia Novy-Hildesley, director of the Lemelson Foundation, has applied a range of tools she learned and practiced through the Fellows Program. She has used an adapted visioning exercise to help her executive board envision the desired results from a program they are initiating. In addition, Julia developed a stock and flow and casual loop map to articulate her foundation’s plan for increasing the rate of invention and innovation toward social ends in the developing world. The stock and flow map outlines the development of ideas to inventions to products actually in use, while the feedback loops show the ways that the foundation’s three strategies — mentoring, recognition, and dissemination — trigger reinforcing cycles that could lead to improved results over time.
• Christina Page of the Rocky Mountain Institute has applied systems thinking tools toward overcoming the barriers that prevent corporations from working together to purchase and use environmentally benign material on a massive scale. The effort pulls together Fortune 500 corporations to radically increase the demand for alternatives to hexavalent chrome, conventional leather, and other products. Christina, a facilitator and catalyst to the effort, has been using causal mapping tools to diagram the various hurdles that the project faces, for example, the building of a critical mass of participants, the potential for too many participants, and competitive pressures. She reports, “It was a luxury to talk about the project in terms of systems and mindsets rather than just budgets and immediate deadlines.”
• Tim Brown, director of the Delta Institute, works to prevent biological pollution in the Great Lakes. Such a seemingly intractable problem involves several major groups — ports, vessel owners, shippers, and the public. By incorporating systems thinking into his work of developing an Environmental Management System (EMS), Tim made it clear to his team (five people from five different organizations) that they would have to engage all stakeholders in crafting a solution that served all of their needs. Tim used a systems map he created with the help of his Sustainability Institute coach and other Fellows to provide strategic orientation to his team. His use of systems thinking on this issue was particularly significant because he is a team member, not a project leader.
• Amália Souza, Global Green grants, Brazil, is using both systems and inquiry tools in the development of a new Brazilian foundation to support grassroots environmental non-governmental organizations (NGOs). She says about the Fellows Program, “Learning to ‘think’ in systems terms is a challenge unlike most so far. And it is an amazing exercise to force my mind to see the whole picture. These tools are proving quite efficient in my work, since I can see things now that would have escaped my perception completely before. I have still a long ways to go in mastering these tools, but I can see why I should persevere. This Fellowship, in many ways, is revealing a new and much more interesting world to me.”
• Ellen Wolfe of Tabors Caramanis & Associates, focuses on electric utility restructuring activities. She works with electrical system operators, policy makers, regulators, and market participants to effect change in market structures. Ellen’s work over the past few years has been in the context of the California energy crises; she seeks further thinking on how to put in place effective and efficient market structures in an environment of short-run political and business cycles. She comments, “The Fellowship has shown me the value of good communication; how great it felt to hear and be heard, to give and receive good coaching, and how little relative impact it has to ‘convince’ someone of something rather than let them arrive at insights themselves. It has encouraged new ways of being for me in my work. Also, in doing so, it has given me a higher level of confidence in stepping up and taking on a leadership role in areas for which I do not necessarily have a demonstrated area of competency.”

Donella Meadows once said, “We humans are smart enough to have created complex systems and amazing productivity; surely we are also smart enough to make sure that everyone shares our bounty, and surely we are smart enough to sustainably steward the natural world upon which we all depend.” The 2003–2004 Fellows are working with multiple stakeholders in a cross-section of issue areas to do just this, giving us inspiration and hope as we build on Donella’s legacy to shift the tide to global sustainability.

Edie Farwell is program director for the Donella Meadows Leadership Fellows Program of the Sustainability Institute. Previously, she was director of the Association for Progressive Communications.

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As with many neighboring countries, rural poverty and chronic hunger are extensive in Ethiopia. Over 60 million people (more than 80 percent of the population) live below a poverty line of $2.00 a day. Of those, 24 million live on less than half a dollar a day. Each year around 10 million people are at risk of starvation.

I had the opportunity recently to travel in Ethiopia with colleagues from partner organizations involved in a project within the Sustainable Food Lab called New Business Models for Sustainable Trading Relationships. Through the New Business Models project, we are focusing on improving five food supply chains in different parts of Africa. In Ethiopia, we are working to improve and expand trading opportunities for farmers growing white pea beans (navy beans) in areas that are vulnerable to chronic hunger.

Why Pea Beans?

White pea beans are grown in Ethiopia during two seasons — the short rainy season in the spring and the longer rainy season in the summer. It is not a locally consumed crop; 90 percent of the harvest is sold for export. Over 40,000 farmers were engaged in this export crop during 2007, and participation is expanding rapidly due the recent increase in prices.

Ethiopia’s climate, while very dry and vulnerable to extended droughts, is relatively good for pea beans. This and other pulse crops (beans, lentils, and peas) are considered “pro poor.” They dry well, can be stored easily, and require less fertilizer than grains such as teff. These qualities make them attractive to farmers with poor access to reliable transportation and little cash for fertilizers.

A Good Market for the Farmers

Prices Ethiopian farmers receive for white pea beans have been sharply increasing — more than 300 percent over the last four years. Before 2005, prices were at or below the cost of production. Currently, farmers expect prices to continue rising and, as a result, are rapidly expanding production areas. Land in Ethiopia is not privately owned; individuals have “use rights” to land as long as they live there. Farmers in Ethiopia typically have use rights to about two hectares, with half planted for food crops and half for market crops. As prices have increased, farmers have moved more of the market area to pea bean production.

Farmers sell their pea beans to traders, and the ability to set prices (market power) is currently in the hands of the farmers. The profit margins for traders and distributors are staying constant, suggesting a rare situation where they don’t have as much market power. New exporters, including farmer-owned cooperatives, are rapidly entering the market. With pea bean prices high and rising, the current market is working well for farmers including those in some of the traditionally most food-insecure areas.

Dilemmas of a Boom Market

With market power in their hands, farmers in Ethiopia are not engaging with the exporters in any long-term contracts for white pea beans. Instead, many are banking on the prices increasing even more. Farmers see no reason for building long-term relationships with buyers while the market is booming. Some are even breaking contracts with exporters, in hopes of receiving the latest high price.

But markets tend to correct quickly when demand is short and prices are high, and only slowly when prices are low and supply is too high. There is a real possibility that the white pea bean price will overshoot and collapse. A dramatic “market correction” could mean a rapid drop in prices and incomes in these areas of high poverty and food insecurity. We talked with farmers who were doubling their planting area in beans for 2008, and because they are expecting prices to keep increasing, they are holding all sales to the end of the harvest season in hopes of capturing the highest price. If the harvest overshoots the demand, or the local price shoots past the international market causing the exporters to leave, the farmers may find a very rapid drop in price at the end of the season. For many families, the cash from sales at harvest time is critical to their ability to get through the year. When we see this boom market, some of the questions my colleagues and I ask include:

1. What are the limits of price increases? How would farmers know if they were in danger of overshooting the market?
2. If there is danger of overshooting the market, should (and can) we encourage the farmers to be in longer term contracts?
3. With farmers who are so new to business planning, what does it take for them to think about a five-year plan or to think about contracting as a form of risk management and market stability?

Potential Ingredients of New Business Models

Our conversations with actors all along the supply chain — from farmers to exporters — revealed a number of places where market problems could potentially be addressed through better business models developed in partnership with all the businesses involved.

Seeds. The current variety of pea beans grown in Ethiopia has been in use for over 40 years, but yields are relatively low and variability quite high. Several exporters want to introduce new white pea bean varieties to increase both the average size and consistency of size of the beans. NGOs have been looking at introducing new varieties as a way to increase yields and boost production.

When times are good, Ethiopian farmers traditionally keep a portion of the harvest as seed for the next season’s planting. But when farmers need cash, they will sell the pea beans they have saved for seed. Then at the next planting season they will have to take seeds as a loan from traders. This is a problem for introducing new varieties because as soon as the farmer sells all the beans back to the trader, they are mixed in with the existing varieties and the purity of the new strain is lost. Catholic Relief Services, one of the partners in the New Business Models project, has been supporting farm groups to adopt a new pea bean variety and develop seed businesses. But growing white pea beans for seed is a different kind of business from growing for sale into the food supply chain. Farmers need to hold the seed after harvest and sell to other farmers at the next planting time. Without shifts in business understanding and a level of economic security, many farmers growing seed may fall back on selling the harvest as food when they need money rather than holding it and working the longer-term seed business.

Quality. New pea bean varieties that increase the quality of the crop can also pose challenges when selling into a system of small-scale traders. One new variety promoted for its increased size, higher yield, and drought resistance has brought lower prices to farmers than the old variety. The difficulty lies in finding the right buyer in the very complex system of local traders.

A trader who buys the new, larger-sized pea beans will need to have access to (or create) a separate supply channel that pays a higher price. But traders have not been profiting from the rising prices of pea beans, and have little margin for creating new systems. So, the new variety simply gets mixed with the rest of the pea bean harvest.

The current system — where individual farmers sell to small traders who sell to brokers who sell to exporters — has little incentive for better quality. There is no way for a price signal or even information on better management practices to get through the chain. Neither farmers nor traders are rewarded with higher prices for producing or buying pea beans of uniform size or high nutritional quality.

Contracts. Large buyers like to establish contracts in the beginning of the growing season for supplying seed and buying the grain grown from that seed. But in this time of rising prices, the farmer cooperatives and unions sometimes break contracts and ask for the new higher market price, refusing to deliver at the contract price. These farmer groups do not value the risk-sharing aspect of contracts — that they won’t capture all the price increase if prices go up, but they are protected from large losses if prices go down.

Market Information. Though everyone on the production side is very excited and expects prices to continue to increase, the farmers, traders, and cooperative managers say little about the international market in which they all compete. They don’t talk about the possibility of shooting past a competitive price point and crashing the market. Better systems of market price information through the chain need to be developed.

There are real opportunities to help set up good systems of price signals and clear communication of quality needs and supporting practices in the Ethiopian communities that grow, buy, process, and export white pea beans. Our goal is to move from short-term thinking where either the farmers maximize price (leading to overshoot and collapse of the market) or the exporters minimize price (leaving the farmer with no profit to invest in farm, family, and community) to developing business models that link the longer-term goals and knowledge of the exporters and farmers. We hope to create a more stable and profitable market for all involved and build the base for sustainable livelihoods in rural Ethiopia.

Don Seville is co-director of the Sustainable Food Laboratory, a multi-stakeholder project with the mission of innovating ways to increase the sustainability of the mainstream food system. In addition, he is a facilitator and systems modeler with the Sustainability Institute. For the past 10 years, Don has worked in a number of public policy and corporate strategy arenas, including sustainable agriculture, diabetes and obesity, energy utility strategy, and forestry. This article originally appeared in the Sustainability Institute’s Spring 2008 Letter from SI, Volume 2 Issue 1. 

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Contrary to popular opinion, real change happens in small disruptive shifts, not through overarching change management programs. A top-down, systemic, structured approach can be useful for implementing a specific initiative. However, lasting and sustainable culture change can only take place through the impetus of people from within the organizational ranks.

“Creative disruption” is the initiation of small movements, the opening up of new avenues of consideration and perspective. This path is qualitatively different from a structured change approach. It creates the foundation for the acceleration and more efficient execution of formal organization change. At the same time, it nourishes the innate human capacity for discovery, curiosity, and reinvention.

Intersection with Change Management

Not all changes are created equal. Some may focus on a significant shift in behavior or skill. Others target the amorphous organizational culture, with all its inherent complexities and challenges. While admittedly an oversimplification, large-scale organizational change typically involves both of these elements. Nevertheless, most initiatives are attached to a specific project implementation, such as a restructuring or enterprise software implementation. Rarely does one find a CEO willing to support, financially or otherwise, a stand-alone project specifically and explicitly designed as a “culture change.”

Creative disruption addresses both the technical and human elements of change by building an organization-wide capability in inquiry, listening, and collaborative problem solving.

A large-scale change that fails to adequately consider both technical and human elements is destined for the trash heap. The technical elements are those that involve the tangible aspects of the change—the “what.” Within a restructuring project, for example, these would include reporting relationships, business processes, and technological requirements. The human elements are the things people need to do differently—the “how.” These typically include skills, behaviors, and attitudes.

Creative disruption addresses both the technical and human elements of change by building an organization-wide capability in inquiry, listening, and collaborative problem solving. It is not about doing; it is about being. It’s a willingness to let go, if only temporarily, of preconceived assumptions and beliefs about how your organization operates. It’s the courage to inquire about others’ beliefs and assumptions, particularly those that get in the way of real change. It’s the skill in asking questions about possibility and change, and the patience in listening to the response. It’s the initiative to take action within the momentum generated from an inquiry into the possibility. Finally, it’s a cycle of continuous reflection and learning.

This new perspective starts with each individual making a choice to participate. Once ignited among a core group of people, the stance of creative disruption becomes part of the organizational fabric. Change becomes intentional and implementation of technical changes becomes a creative challenge rather than a reaction to a problem.

This process is not one of disruption for the sake of disruption. It is not a reactionary approach, based on misguided intentions and a myopic view of growth. The path of creative disruption starts with the conviction of creation. What can we collectively bring forth that is currently not here? What are the possibilities we haven’t yet explored for creating more powerful results? These questions are framed with the larger context of the organizational vision or serve as the starting point for creating one.

The Power of Inquiry

Inquiry lies at the heart of creative disruption. Through asking probing questions, people and teams can intentionally and creatively disturb and improve the systems in which they work. The focus is not to unearth problems that need to be resolved but to explore new possibilities. Why do we do things this way? Are we getting the results we aspire to with this process? What are we trying to create?

Within the larger context of change, inquiry helps people become aware of how their own belief systems are affecting their individual and organizational results. But there’s a danger—it is extremely difficult to attempt to shift how someone views the world. Using inquiry as a tool to expose others and somehow make them aware of their own shortcomings is, at best, ineffective. A more effective approach involves initiating divergent conversations around a vision for creative change and possibility. As people within the organization practice this capability, they become aware of the possibilities inherent in their own natural curiosity and creativity.

Listening for Possibility

There’s little value in building an organizational capability around inquiry unless you listen to the collective responses. Heartfelt and earnest listening is both immensely important and extraordinarily difficult. When myriad distractions are vying for our already strained attention, the value of listening can be elusive.

The single biggest challenge to genuine listening is the ongoing stream of internal conversation that invigorates our beliefs and assumptions. That internal conversation consists of experiences, biases, assumptions, and distractions. The essential first step in listening is learning to become aware of that internal conversation. Once aware, we can begin to quiet the noise that keeps us from listening for new ideas and perspectives.

Disrupting the system requires an ability to listen to what’s happening within that system. Listening opens doors to possibilities that may otherwise stay hidden. Targeted inquiry is an important element in the path of creative disruption, and it only comes about through the diligence of listening.

Being Purposeful and Deliberate

Learning requires practice, reflection, and a “slowing down.” Too often, we jump from one problem to the next, one conversation to the next, one idea to the next, without ever stopping to deepen our understanding. We lose out by not having the space (literally and figuratively) to reflect, ask questions, listen, and learn. In the quickening pace of our world, we must make being purposeful and deliberate a discipline in support of generative conversation.

Cutting a Path

So what can you do today? Starting with yourself, begin to cut a path of creative disruption. Inquiry and listening, done with integrity, are contagious. Practice them with a passion and intensity that will ignite a creative movement forward across your organization.

Here are some strategies to consider in cutting a path:

• Start with You. Check your own assumptions and beliefs about change. What’s getting in the way of your creating the results that matter for you and the organization? Shift your orientation from one of constant reaction to problems to one of creative possibilities. Ask yourself, “What can I create from where I am today?”
• Look for Opportunities to Disrupt. Too often a dysfunctional process or system stays that way simply because nobody steps forward to ask targeted questions. Ask questions, and listen with good intention. Create space for others to ask questions, and listen when examining existing processes and systems. Sometimes all it takes for change to take hold is for one person to initiate a creative process of exploration.
• Build the Capability for Powerful Conversations. Design and deliver learning experiences based on inquiry, listening, and other tools that facilitate the disruption of systems. These sessions should focus on increasing knowledge and awareness of how our beliefs and assumptions can impact the results of our conversations and, hence, our organizational results. Create experiences that let people practice these new skills in a safe environment.
• Create Space. Interrupt the cycle of reaction. Create space (literally and figuratively) for people to begin to have conversations about things that they care about and are important to the organization. Integrate times for reflective conversation within an existing leadership development or other learning program. Build cross-functional “disruption” teams to ask targeted questions about existing processes and cultural norms.
• Integrate the Tools of Creative Disruption into Existing Change Programs. Ensure that key players involved in any large-scale change are well versed in the skills and tools of creative disruption. Whether it’s a shift in a technical process or an initiative targeted at the human side, inquiry will enhance the successful implementation of the change and build organizational capability for the long term.

Mark Dillard (mdillard@bucknell.edu) has over 15 years of experience in the area of learning and organizational development. In his current role at Bucknell University, he has responsibility for designing and delivering learning programs and consulting services to the campus community. Prior to moving to higher education, Mark was an Organization Effectiveness Manager with the Coca-Cola Company in Atlanta, GA. He has a master’s in Industrial/Organizational Psychology from Valdosta State University.

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Nevertheless, despite the progress illustrated by these and other cases, the forces of unsustainable growth and resource exploitation have continued to compound. So the release of Limits to Growth: The 30-Year Update (Chelsea Green, 2004) by Donella Meadows, Jorgen Randers, and Dennis Meadows comes at an important time. For newcomers to the systems approach, the 30-Year Update presents the logic of overshoot and collapse and emphasizes the urgent need for sustainability without dwelling too much on the mechanics of the methodology (see “Key Terms”). At the same time, those already inclined to see things from a systems perspective not only have their mental models reinforced and refined, but also have a series of cogent examples to draw upon when spreading the gospel of sustainable development.

Systems and Growth

Three themes emerge in the book: background on systems and the mechanics of growth; the introduction of a formal computer model, known as World3, and some of the scenarios that it produces; and implications and recommendations (see “The World3 Model” on p. 9). Throughout the volume, but particularly in the first three chapters, the authors explain the basic laws of system structure and behavior with a lucidity that comes from decades devoted to the dissemination of these concepts.

Though usually considered “best practice,” it is not common to come across computer modelers who clearly communicate the purpose of their model and its associated boundaries; that is, the question the model was intended to address and those for which it loses its ability to provide meaningful insight. So it is a treat (for modeling geeks, anyway) to have the authors devote several pages to just these concerns in the course of their introduction to the World3 model. The central question they mean to address is: Faced with the possibility of global collapse, what actions can we take that will make a difference and lead to a sustainable future? It is clear that this is a model whose primary purpose is to help us think, not to provide the answer. In the course of laying out their model’s purpose, the authors make one of the best cases for “modeling for learning” that I have come across.

The authors introduce a variety of potential actions into the World3 model, at first, one-by-one, then in logically consistent groups. Each run, or scenario, provides insight into how that potential action or group of actions might affect the course of future events. In this way, Meadows, Randers, and Meadows are able to prioritize potential actions in order to come up with the set that offers the greatest opportunity for avoiding the worst consequences of collapse.

Recommendations for Action

In the end, World3 does provide an answer. Of the various assumptions tested and given the boundary conditions of the model, we can still make a transition to a sustainable global society if people around the world immediately take the following actions:

1. Stabilize the population
2. Stabilize industrial output per person
3. Add technologies to:
   • Abate pollution
   • Conserve resources
   • Increase land yield
   • Protect agricultural land

The bad news is that we have already begun to experience symptoms of overshoot—water tables are dropping rapidly in some areas and incidents of coral bleaching have risen but two of the most urgent signals. The good news is that, as the authors’ account of the ozone story demonstrates, once the global community sees the clear need for change, change can come about quickly.

According to the authors, people respond to signals that a system has overshot its limit in one of three ways:

1. Deny, disguise, or confuse the signal that the system is sending
2. Relax the limits through technological or economic action
3. Change the system structure Certain elements of society are

stuck in response 1, regardless of the growing mountain of evidence calling for action. We see this mindset in the refusal by some politicians to acknowledge the science behind global warming. Others place their faith solely in the market and/or technology, even though the price would be extremely high if the market system and new technologies fail to save the day. The only truly effective response is to change the system structure, the sooner the better.

This was the core message of the original Limits to Growth. And while that message became a part of society’s broad environmental consciousness, the warning went largely unheeded. The result is that the party’s nearly over, and we need to figure out how to minimize the hangover.

Restructuring Society

Because structure determines behavior, the highest-leverage approach to these problems is to change the underlying structures that have created them, such as farming techniques, forest management policy, end-user attitudes toward consumption, recycling, and reuse, and legislation regulating pollution. So how do we go about restructuring the global system? The authors share the tools they have found to be useful: rational analysis, data gathering, systems thinking, computer modeling, and clear communication.

Notice that these tools really have more to do with making the case for change than they do with enacting change that has been agreed upon. That is, they are exceptionally useful for helping lawmakers understand the need for change and explaining to corporate decision makers the logic behind a shift. These tools can even guide the overall implementation of a change effort. But once the case has been made, the day-to-day activities can look somewhat like business as usual: rewriting laws, redesigning products and processes, reorganizing departments, and so forth. The difference is that the guidance offered by these tools means the change is less like rearranging deck chairs on the Titanic and more like fixing the hole in the ship.

The 30-Year Update is compelling: We have already overshot the planet’s carrying capacity on numerous vital resources. Whether humanity is successful in avoiding the most disastrous effects of collapse will be determined in part by the actions taken by people across our society and planet. Unfortunately, politicians and other leaders often seem to be linear and “black-and-white” thinkers. Navigating the turbulence ahead will require decision making that appreciates non-linearities and shades of grey. The 30-Year Update will bring some to the sustainability camp. But more important, it will inspire others—those with the necessary perspective—to take action. There’s no time to waste.

Gregory Hennessy is honored to have worked with Dennis Meadows on several occasions and to have met the late Dana Meadows once.

The post Scenarios of the Future: The Urgent Case for Sustainability appeared first on The Systems Thinker.

It was going well—on average, each family and business was using less water. But one day I received a letter from an environmental activist:, “Dear Mr. Jones, you are making things worse!” he wrote. He acknowledged the improvements in efficiency, but asked us to look at the effects on rivers and aquifers, where total withdrawals had actually gone up. Our programs had helped people be more efficient, so something else was going on, but what? The writer argued that population in the area was growing, and that we were helping to drive the boom.

Consider how things worked in a desert city like Tucson before water efficiency improvements. What was the main limit to population growth? Water. So after the water-efficiency programs helped people and local businesses use less water, developers were able to build more houses. Growth in population wasn’t just an external force over which city officials and environmentalists had no control; it was something that we were helping to spur. So, as the letter writer said, our efforts didn’t bring any improvements in rivers and aquifers.

It didn’t stop there. The writer argued that when people and businesses are inefficient in their use of water and a drought occurs, they can cut back on their water use to make up for the lack of rainfall—shorter showers, less lawn watering, and so on. But in a high–efficiency setting, that kind of buffer doesn’t exist anymore. During a drought, the city makes up for the shortfall by taking water from rivers and aquifers. Nature carries the extra load, not the old buffer of wasted water (see “How the System Actually Behaved”). Ouch! At best, we didn’t help much. At worst, we hurt this system. What was going on?

MY MENTAL MODEL

My vision of how to keep more water in rivers and aquifers involved promoting conservation efforts such as water-saving toilets and showerheads. But this linear approach failed to take into consideration the system’s interconnections.

As preservationist John Muir said, “When we try to pick out anything by itself, we find it hitched to everything else in the Universe.” This story of increasing water efficiency is an example of an approach to change that goes back 3,000 years.

Reductionist View

We can trace the reductionist view back to around 500 B. C., when the Greek philosopher, Parmenides, made the case that the universe is composed of divisible parts. Flash forward to Newton and Descartes in 1700s and 1800s, describing the universe as a collection of separate, distinct parts that all fit together like a big, orderly clock. This kind of thinking served us just fine in many ways. And yet at some level, it has led us to think of our world as unconnected, so, for example, we spew untested toxins into the atmosphere to the point where mother’s milk contains dozens of unnatural chemical compounds. Our blindness to such interconnections reminds me of a Buddhist saying:, “The illusion of separateness is the source of all suffering.”

Systems View

Back 3,000 years ago, a second line of thinking was also at work: a systems view, consisting of ideas that didn’t fit within the reductionist paradigm. Roughly contemporary to Parmenides was the Greek philosopher, Heraclitus. Heraclitus said that everything was transformation and change. One of his metaphors was that people and all living creatures are like flames—the transformation of matter from one state to another. From this perspective, we are never the same or static, contradicting Parmenides’ assertion.

Biology seems to support Heraclitus. Consider that the matter in our skin exchanges itself with the rest of the world every month. Our liver, every six weeks. Our brain, every year. The cells in our body transform into air and earthworms and dogwoods and plankton and tigers and the woman standing next to us in the check-out line. As Lily Tomlin said:, “We all timeshare the same atoms.” We are a pattern through which matter passes.

HOW THE SYSTEM ACTUALLY BEHAVED

After water-efficiency programs helped people and businesses use less water, developers were able to build more houses, which boosted overall water usage. The shift toward low-flow toilets and other forms of conservation meant that, when a drought occurred, water users couldn’t cut back their usage any further, and the city had to make up for the shortfall by taking water from rivers and aquifers.

The ideas of Heraclitus and others have evolved through the centuries, sustained by thinkers such as Goethe. Since the 1940s, the field of systems understanding has blossomed with the work of Ludwig von Bertalanffy, Norbert Wiener, Jay Forrester, and others. At the heart of it, this perspective focuses on the interaction of the parts rather than the individual elements. For example, ecologists focus on how a tree interacts with soil, microbes, fungi, air, water, and animals. Therapists don’t focus just on an individual’s troubles, but also on his or her relationship with parents, siblings, children, and friends. Holistic doctors and healers, seeing a person as the interaction of mind, body, and spirit, look beyond symptoms to examine the underlying causes. Policymakers and business leaders consider multiple interactions as they design strategy.

What We Do

So, how would we think and act if we knew that we were truly interdependent? First, we wouldn’t see ourselves as victims of some unconnected external source. We see our actions and others’ as interdependent in what some Buddhist writers call “mutual co-arising.”

The viability of a life-sustaining society depends on our ability to experience now the longterm effects of our actions and to innovate with new behaviors and new tools.

With this new systems lens, if someone were to propose widening a bridge to alleviate traffic congestion, we could predict that the flow of cars would increase to fill the new capacity. Traffic and congestion mutually co-arise. As Winston Churchill said, “We shape our buildings; thereafter, our buildings shape us.” In the same way, we shape the world; thereafter, the world shapes us.

Second, acknowledging our interconnectedness means recognizing that the CO2 that came out of my tailpipe as I drove this morning will warm the Earth, causing drought in Africa, producing floods in India, and intensifying hurricanes. The shirt I’m wearing was made in China, where I have no idea about the condition of the workers. How do we deal ethically with such a level of interdependence?

The viability of a life-sustaining society depends on our ability to experience now the long-term effects of our actions and to innovate with new behaviors and new tools. Our actions are in close connection with the world of reactions. This is what Martin Luther King, Jr., referred to as the “inescapable network of mutuality.”

These realizations open opportunities for us: gratitude and appreciation for the abundance of life, chances to respond to the pain of the world with effective action, and, in this unprecedented time when we live in each other’s backyards, we can pay attention to outcomes we are creating in the world.

It boils down to this: declaring each of us to be an intimate part of something—the holy, the universe, the web of all existence—anything greater than ourselves and then taking appropriate action. That is our work.

Andrew Jones (apjones@sustainer.org) is a Program Director for the Sustainability Institute. He consults with organizations, teaches system dynamics modeling and systems thinking, coaches leaders in organizational learning through the Donella Meadows Fellows Program, delivers public addresses, and writes columns and articles. Currently his primary efforts are creating system dynamics simulations on climate change strategy and with the CDC on chronic disease strategy.

Excerpted from a service delivered at the Unitarian Universalist Church of Asheville, North Carolina, June 24, 2007. The full service is available at www.sustainabilityinstitute.org/SIinfo/ AJones.html.

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For three decades, Lester Brown has been dedicated to researching and communicating the major trends in the world’s use of resources, the health of our ecosystems, and the state of our society. His hope has been that by understanding the patterns of behavior of our economic system and its impact on the environment, all of us—individuals, businesses, nations would commit ourselves to halting destructive activities. But despite the many efforts that Brown’s work has inspired, he says they’re not enough.

Linking Economics with Environment

In the long run, if we do not create an economy aligned with the Earth, then we will erode the natural systems on which life depends.

In his latest book, Eco-Economy: Building an Economy for the Earth (Earth Policy Institute, 2001), Brown urges us to recognize that our economy does not function separately from the natural world. While we may be able to ignore the effects of our economic activity on the environment in the short run, in the long run, if we do not create an economy aligned with the Earth, then we will erode the natural systems on which life depends. Brown argues that “the economic policies that have yielded the extraordinary growth in the world economy are the same ones that are destroying its support systems.” He cites statistics that show how worldwide mismanagement has been eroding forests, range lands, fisheries, and croplands ecosystems that provide both raw materials and food.

Brown offers us three challenges: We need to understand how our current economic system and population growth are incompatible with the way that natural systems function; we need to create a positive, hopeful vision of an economy that works in harmony with ecology; and we need to change the structure of our current economic system to fulfill that vision. This last challenge in particular caught our interest as systems thinkers. The central premise of systems thinking is that a system’s underlying structure drives its behavior. As such, before we make changes, we should first understand that structure—that is, look at things such as information flows, rewards, and incentives to understand why people and physical systems act the way they do. Then we need to change the structure in ways that harness the energy of the system to push itself in a needed direction and don’t require constant effort and energy to sustain progress (see “Non-Structural vs. Structural Interventions”).

For our economy to support the natural systems on which all life depends, Brown says we need to create incentives that guide behavior naturally in positive directions. In the first section of Eco-Economy, he concisely summarizes the ecological trends that are motivating the need for change, from global climate instability to regional water-supply issues to species loss. In the next section, he moves quickly from the bad news into an ambitious, inspiring vision for a more sustainable economy. This vision includes a hydrogen-based energy system, a closed material product economy, and a redesign of cities. In the final section, Brown explores ways in which we could rewrite some of the rules of our economy to support the necessary changes.

Harnessing the Power of the Market

Brown’s approach in these last chapters feels refreshingly practical; he describes how various existing public policy tools could harness the power of the market to improve our economy by including both better information and truer costs. The theory is that the market provides a powerful system of product self-selection through supply and demand—in other words, how people spend money is what determines whether products and services are successful or not. So if ecological goals were better incorporated into the market signals (through costs and information), then the market could help nudge the world into alignment with natural systems. Some of his ideas include:

Eco-labeling. Consumers ultimately drive the success of products and businesses. Currently, many commodity products compete primarily on cost, and companies are forced to continually reduce their costs. This emphasis generally takes away from efforts to reduce the impact of products on the environment. Brown believes that when product labels provide information about superior environmental practices, such as farming organically, recycling fibers in paper, and designing for energy efficiency, consumers will reward the companies that are committed to developing more sustainable solutions.

NON-STRUCTURAL VS. STRUCTURALINTERVENTIONS

One of the most interesting contributions of Brown’s book is his focus on changing the structure of the market economy to make it more consistent with the ecological world. As shown in these examples, well-designed structural changes are changes in physical structure, information flows, or rewards and incentives that align the implicit goals of local decision-makers (such as individual consumers or investors) with the desired change in the overall system’s behavior.

Tax shifting. What we tax sends a powerful signal throughout the economy. For example, high taxes on wages limit the number of people we hire and the pay increases we offer. Conversely, low taxes on pollution and resource usage encourage us, as Brown writes, “to exploit our natural resources as rapidly and competitively as possible.” To align taxation with a more robust environment, Brown proposes “tax shifting”—changing not the level but the composition of taxes. To do so, we could decrease taxes on salaries and raise taxes on undesirable things, such as toxic waste and emission. He outlines actions that people in the U. S. can take similar to what many European countries have already done.

Subsidy shifting. Government subsidies also produce economic incentives that damage our ecosystems. Brown quotes a recent report that identified over $700 billion of environmentally destructive subsidies that encourage the overuse of water, fossil fuels, pesticides, and fishery resources. Many of these subsidies initially helped sectors such as farmers and fishing companies that were struggling with high costs, but, eventually, the subsidies led those same sectors to ignore signals of resource scarcity. Brown asks us to see this problem in the positive: What if we subsidized environmentally constructive activities? What would the impact of $700 billion be?

Eco-Economy’s focus on moving from understanding the trends to integrating our economic systems with the ecological world is appealing to systems thinkers—it helps us understand both the physical system at work and the rewards and incentives that encourage our decision making. While no single book can answer the question of what the sustainable economy is, Eco-Economy reminds us that we have practical policy tools that can guide the economy in a better direction and inspires us to try again to do so.

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