A home for the Conscious Business community in the UK

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Right or wrong?

I listened to an interesting talk by Paul Gilding at the RSA yesterday.

I often become defensive when I hear people strongly assert their views, so I liked it when later in the talk he disarmingly admits that actually he may be wrong. In fact, he says he’d be happy to be wrong.

I like that, because how can anybody know the future? The future hasn’t happened yet. And even if it is in some way pre-ordained, personally, I don’t believe it can be accurately predicted.

Gilding’s talk is based on his book, the Great Disruption. The message as I understand it is that the world is already at one and half times its carrying capacity. Our success means that what we consume already outstrips our planet’s ability to provide it, and we are only surviving because we are burning up our capital.

Anyone who has ever been involved in running a business understands how easy it is to burn through capital once expenditure exceeds income.

Economic and corporate growth have, so far, been mankind’s great, and only, solution to the problem of human development: so far defined as giving more people ever better standards of living.

The problem we now face is that the ratio of use compared to carrying capacity is going to grow rapidly as we apply that solution to the poorer people in the world. And from a humanitarian point of view, as well as politically, we just can’t avoid doing that.

Once we get to a point where the majority of the world’s population – already nearly 7 billion – has a reasonable standard of living, we will be at a much, much worse ratio. Somewhere around 3, 4 or even 5 times carrying capacity within the next 30 years or so.

So, according to Gilding, this is the end of our existing economic system – the one based on growth. That doesn’t mean it will be curtailed, or slowed down, or whatever; it simply means it won’t work. And it will end long before we reach 3, or 4, or 5 times carrying capacity.

Practically, and in the relatively short-term, food and oil prices will again rise dramatically – as our global oil and food production systems reach their natural limits. Political instability, oil and food prices, and climate are all inextricably linked: so we can expect even more unpredictable results. We’ve already seen the first signs of this: the need for a global financial bailout and even the recent Arab spring.

But “Mother Nature doesn’t do bailouts”. There is no “global government” that can throw additional resources at the problem. So whatever happens precisely, growth will stop. Clearly, an economic system based on growth doesn’t work when growth has stopped. And this will happen well before we reach the higher end of those use-to-capacity ratios.

Again, according to Gilding, fiddling around with population won’t help. Even if we could stop population growth today this ratio of use compared to carrying capacity will still grow massively as the standard of living of people already born rises.

Might technological advance, and, for example, limitless energy solve the problem? Possibly, but not for the next twenty years or so. We’re just not there yet technologically. Gilding’s prediction is that the current economic system will reach its limits well before we find technological solutions.

So, not a pretty vision. But ultimately he is mainly optimistic. For two main reasons.

Firstly, he believes that once we eventually notice that we are being boiled alive (like Charles Handy’s frog), then we will band together and deal with the crisis well.

Humanity, he says, is excellent at dealing with crises. It may be painful but we will do whatever it takes to solve the problems we have. A spirit similar to that of the second world war will emerge – community and mutual support will strengthen, and with a bit of luck we’ll get though it. Perhaps not as individuals. But at least as the human race.

And the other reason for hope is that as the current economic system collapses we’ll replace it with a much better one. A steady state economy which while it reduces that use/carrying capacity ratio to a sustainable level also has the huge benefit that it supports a much more holistic definition of wealth – where happiness, relationships, community, and mental and physical health sit alongside sufficient material prosperity.

All of the above is based on research done by some respected bodies and groups (such as the Millennium Ecosystem Assessment and the Global Footprint Network). I suppose there’s always a question with this kind of thing: who do I, as a relatively uninformed citizen, trust?

Personally, what worries me about some economists is that they seem locked in to a paradigmatic view of the world which assumes growth is the only model. Where many environmental scientists, perhaps because of their more systemic world view, seem to be prepared to challenge their own assumptions. Perhaps.

But does it really matter if Gilding is right or wrong? If I am right or wrong? Or if anyone is right or wrong about this kind of thing?

In one sense yes. Gilding downplays the terrible human consequences if he does turn out to be right.

But in another sense perhaps not. Not in the sense of what we should be doing about it.

What does it mean for Conscious Business if he is right?

Well, for me, it means that Conscious Business is an excellent idea – because anything that prepares people for a world where happiness, relationships, mental and physical health sit alongside sufficient material prosperity is a good thing. Making the transition to that world easier seems, to me, a good and useful thing to do.

And what does it mean for Conscious Business if he is wrong?

Well, for me, it means that Conscious Business is an excellent idea – for exactly the same reasons. Creating that kind of world is a good thing in its own right, for all of us.

So take your pick: right or wrong? And then get on with becoming more conscious, and bringing more consciousness into your business.

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Taking charge

A recent news piece on BP’s behaviour in the Gulf of Mexico made me wonder about the use of the word ‘systemic’.

I know it’s probably not what was meant. But when I read this article, “systemic” started, to me, to sound like an excuse. A reason why BP and others didn’t do what they could have. Should have.

The first time I heard that word in relation to a disaster, or a scandal of some sort, it seemed to be properly used. Indicating that there are features of the system that make a problem likely to reoccur. That the problems are deeply entrenched in the design of the system, and that these conditions ensure that individuals often behave in certain ways. That we need to reform the system. Not just scape-goat individuals.

But now, and maybe it is me, it begins to sound as if the word is trotted out whenever a major disaster or scandal occurs to absolve any individual of responsibility.

“It’s the system’s fault, I couldn’t do anything!” comes the plaintive cry.

But as Margaret Mead said:

“Never doubt that a small group of thoughtful, committed citizens can change the world.

Indeed, it is the only thing that ever has.”

And where does that small group of thoughtful, committed people start? It starts, of course, with the individual. One individual needs to take a risk, change their way of thinking, say something others daren’t.

An individual within a system is, I believe, the only thing that really can start to change a system. The individual is the catalyst for system-wide change. Somewhere, sometime, were there perhaps people in BP would could have said something and didn’t? Who went along with crowd-pressure and followed the herd mentality? When there was an opportunity to say or do something different?

What does this all have to do with you and your business?

Maybe you are in a business, running it or working at the front-line, and everyone blames everyone else? Maybe everyone is rubbish at their jobs. Maybe you don’t like the way the company is set-up or structured. Maybe your boss is an idiot. Maybe the reward systems are set-up to reward the wrong things. Maybe the company regularly does bad things, or allows poor quality work in the pursuit of short-term profit.

If any of those things is wrong with the system – please don’t blame others. Don’t blame “the system”. Take responsibility. Change yourself. Be the catalyst. Be the change.

Happy New Year.

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Live more simply…

Thanks to my friend Oliver, I just finished reading Ervin Laszlo’s 2006 book The Chaos Point. Probably the best book I have read since  the last amazing book I read. They seem to be coming thick and fast at the moment.

We are always busy so my wife asked me to summarise it in 30 seconds. Here goes:

  • The world is in a terrible state, and getting worse.
  • Doom is not, however, inevitable.
  • Changing our own consciousness – personally and as a group – is the answer.

This goes a long way to answering one of the major riddles I struggle with. If you believe the world is a complex system (as I do), and that we can’t predict outcomes with any certainty (even though scientific, economic. and political dogma suggest we can), why isn’t it OK just to live and let live?

It will all work out for the best won’t it? The trickle-down will work. Technology will fix the climate. Crisis will be averted, yet again. Everyone will be happy.

Laszlo’s point is that we humans are both the problem and the solution. We are destroying the planet and in danger of destroying ourselves. But we have the power to change our thinking. And changing our thinking allows us to change the framework by which we all live. Our future is not predetermined. It depends on that framework.

Our ingrained liberalism suggests live and let live. But we can, for example, choose a better morality, summarised by Ghandi’s “Live more simply, so that others can simply live”.

How do we change our morality, change our consciousness? Another riddle: it’s not easy, and yet it is. One clear way forward is to work on oneself. To try to understand oneself better, mind, body and soul.

My wife liked that bit. She’s an example to me. Someone who takes personal development very seriously. And I must go and read another book.

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Social business

I’ve been reading Muhammud Yunus’ 2007 book “Creating a World Without Poverty“. Plenty of stuff on the Grameen bank, but the bit that really interested me was the section on social business.

According to Professor Yunus there are social enterprises, and social businesses. Social enterprises include not-for-profit organisations, publicly funded organisations and so on. Social businesses are a type of social enterprise that use the tools and techniques of business.

Social businesses differ from ordinary businesses in that rather than having the primary objective of making a return to shareholders, the primary objective of a social business is solving social or environmental problems.

These objectives can be very varied. A social business can serve a particular community and solve any social or environmental problem. Social businesses may employ people from a particular disadvantaged community; but even where that isn’t the case, ownership is spread widely and democratically.

In Yunus’ definition a social business must also serve a disadvantaged community. Robert Owen’s co-operative movement doesn’t fit this definition, according to Yunus, because it isn’t “inherently oriented towards helping the poor or producing any other specific social benefit”.

I think I understand this, and I’d be interested to know what the co-operative movement think of that exclusion.

But what I do like about Yunus’ definition is the idea that a social business, unlike a charity, doesn’t have to divert energy to raising funds. And unlike a not-for-profit, profit isn’t minimised. It’s just used differently, being reinvested into the same or a different venture.

This recycling of profit creates the ability to achieve “lift-off” velocity and start solving social and environmental problems in new and exciting ways. It means surplus profit, once initial investors are paid back, can be used to invest in new companies, with new aims.

And I’d like to humbly suggest one bit of reframing.

In one sense, we are all disadvantaged. We’re disadvantaged by a crazy financial system that rewards the few to the detriment of the many. We’re disadvantaged by a political system that seems to be largely ignoring  the risks of climate change and environmental destruction. We’re disadvantaged by an economic system that prioritises conspicuous consumption over personal health and well-being.

Surely that creates an amazing opportunity? For the creation of social businesses which address the needs of not just one community, not just one particular group. Instead their purpose is change the system and to serve all of us, the whole of humanity.

That, to me, seems worth doing.

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Realising opportunities

Let’s get practical. If you’re convinced there’s a opportunity around sustainability, what do you do? One way forward is to come up with ideas. Here’s a great little book by James Young – A Technique for Producing Ideas. In brief, it suggests there are five important stages to developing ideas:

  • gather raw material;
  • digest that material;
  • let your subconscious go to work;
  • let ideas appear;
  • refine and filter.

Then what? Personally I believe in collaboration as the key to making anything worthwhile happen. Another great book is Organising Genius by Warren Bennis (the leadership guru). The book tells the story of some amazing collaborative projects, including those at Disney, PARC and the Manhattan Project, and draws out lessons on what made them successful (its subtitle is “the secrets of creative collaboration”).

I won’t list them all – but these are some I really agree with, partly based on my own experience in “great groups”. Great groups:

  • Know that talent is key – great groups quite simply contain great people.
  • Value and nurture leadership – great leaders grow great groups, but great groups grow great leaders too.
  • Have passion, and mission. They believe they are “on a mission from God”.
  • Are isolated, yet connected too. This is why, for me, the “skunk works” idea works so well.
  • Believe they are underdogs, and usually have an “enemy”. When I worked with BBC News Online the group demonised and respected CNN.
  • Are optimistic. I prefer to say realistic – along the lines of the Stockdale Paradox. But basically I agree with the great man Bennis.
  • Put people in the right role.
  • Enable people – people are given what they need and freed from what they don’t.
  • Are focussed on concrete results – practical outputs.
  • Value work as its own reward.

Easy really.

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I am feeling just a tiny, tiny bit smug today. As I watch oil and energy prices soar. And I revel in my new lawnmower.

The old flymo blew up a few weeks ago. We have a small lawn. I thought “Who needs electricity?”. “Who needs petrol?”. So I sought out a push mower.

Brill, I discovered, is the Rolls Royce of push lawn mowers.

Mine is simple and elegant. It’s well engineered and very well made. It packs up small. Cuts like a dream. Will last for ever (or so they say).

It uses no fuel. And it’s good exercise. Lord knows I need it.

I sincerely hope Brill practices low energy manufacturing. I wonder where they get the steel?

It’s made in Germany. So I guess it cost something in fuel and carbon terms to get it here. That troubles me.

Now there’s an opportunity. 25 million UK households. I wonder how many have a lawn?

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The power of leverage

Courtesy of my brother-in-law Alex, who lives in the US, I saw this interesting piece in the Atlantic magazine about Bill Clinton and what he is up to these days.

This blog is mainly about small business. Not every small business has access to Bill Clinton, and his incredible personality, address book, and no doubt relatively large personal wealth.

And not every small business wants to travel the world to solve global problems. But this is an inspiring tale anyway. Essentially it’s about how Clinton and one of his long time associates, Ira Magaziner, are taking on global challenges like climate change.

Buoyed up by their success with re-engineering the developing world market for AIDS drugs, Clinton and Magaziner, supported by a host of Harvard MBAs, are attempting to develop markets for a host of technologies and products that are very climate-change-friendly.

The idea is that through buyers clubs, for example, it’s possible to create a market pull for new products and thus stimulate a fall in price, and hence a wider and quicker spreading of these same products.

The author seems to draw a distinction between this and what is described as social entrepreneurship of the Grameen type. I am not sure I can see the distinction. Both use the profit motive and the methods of business to solve social problems. The only difference I can see is the breadth of ambition – Clinton and his colleagues aim to address one large and significant market after another. Is there another difference?

But whatever else, this tale illustrates well the power of leverage: the ability of a small number of people to make big changes, if they get the focus right. And that is one reason why small business is so interesting to me.


Why, why, why?

Why does this all matter? It’s a question that rattles around in the back of my mind a lot.

I am convinced by the urgency of doing something positive, and I can see that there is a huge opportunity waiting. But I really like the “why?” question. Was it Ricardo Semler – of Seven Day Weekend fame – who said his company’s strategy is to ask the question “Why?” repeatedly when faced by any new initiative or problem? I think he said it helps them prioritise, and ensure they only spend time on the things that give the most real benefits. That’s something I guess we would all aspire to.

And it’s such a simple technique.

So “why” do something about climate change? Why do something about poverty? Why try to seize the sustainability opportunity, when there are probably plenty of easier ways to make a living, and probably easier ways to make money, if that is your goal too.

I read a little piece by Rosie Boycott the other day in a very good book called “Do good lives have to cost the earth” by Andrew Simms and Joe Smith. I wouldn’t normally have much time for something written by a former editor of the Express newspaper. I can’t be bothered with newspapers at the best of times, let alone the Express. But she reminded me that the reason we need to do something in the UK about climate change is partly to show our leadership to the rest of the world. This in turn reminded me that we need to do the same about sustainability in general, even though the UK is a small country with relatively little impact on these global matters.

So one answer to the question “why?” is that we should do it because we can – we have the wealth and security. And we also should do it because we have a responsibillty and an opportunity to show leadership to business people all over the world.

If we in the developed world can’t make good sense and good lives out of the opportunities arising from sustainability, how can we expect others to do the same? And, with the size of the opportunities and the size of the problems, we really need these others to be part of the solution too.

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Solutions not problems

There are some excellent summaries of what the sustainability challenge is all about. Personally I am more interested in solutions than the problems.

But just to set the context, I guess if you have read this far, you’ll agree that actually it’s not that surprising that as the world population has grown from around 2 billion people to around 6 billion in the course of just my lifetime (I am 50 years old) that the world is creaking a little under the strain.

That’s a huge understatement of course. There’s a long list of problems we face: climate change, poverty, nuclear annihilation, terrorism, resource insecurity, and so on.

To me sustainability is the solution to all these – “to meet the needs of the present without compromising the ability of future generations to meet their own needs” (that’s the Bruntland Commission’s definition).

And it’s solutions I am much more interested in than discussing the problems. And specifically what small and medium-sized businesses can do.