The Future of Business
Embracing the logic of life
We are living in turbulent and troubled times. These times of breakdown and breakthrough invoke fear and the desire to hunker-down, stick to the tried-and-tested, tweak the status-quo.
Yet, paradoxically, these volatile conditions provide an ideal breeding ground for the emergence of new ways of operating and organising.
Over the last few months I have engaged with a wide range of thought leaders like the living systems theorist Fritjof Capra, the leadership specialist Prof. Peter Hawkins and the values-based business guru Richard Barrett. I have also engaged with a variety of CEOs and senior managers from a wide range of businesses. I have been heartened to find that many are patently aware of the now desperate need for a radically different approach to how we strategise and organise.
The ‘new norm’ of business is unceasing transformation, hand-in-hand with increasing stakeholder complexity. Put simply, business-as-usual is no longer an option. In fact, business-as-usual is very much part of the problem.
This ‘new norm’ demands business-unusual. It demands we fundamentally redesign our leadership and organisational development approaches. And there is significant competitive advantage to be gained for organisations able to redesign their leadership logic while keeping the wheels on the road.
As the management guru Peter Drucker insightfully notes,
‘In times of turmoil the danger lies not in the turmoil but in facing it with yesterday’s logic.’
We now need to cultivate not just a different leadership logic, but also the learning systems that enable our leaders to embrace this new logic amid unceasing transformation and increasing day-to-day pressures.
The challenge we face is not simply about digitisation, collaborative ways of working or leaner operations. Something much deeper, much more fundamental, is being demanded of us. As the well-respected business futurist John Naisbitt points out,
‘The greatest breakthroughs of the 21st Century will not occur because of technology, but because of an expanding concept of what it means to be human.’
By example, when I asked the CEO of a global chemicals company what their most pressing challenge was, it was the need to transform the psyche of the company to one that embraces eco-systemic thinking where social and environmental drivers are ingrained into day-to-day decision making. For the CEO of a large professional services firm, it was transforming their world-of-work in a way that enables everyone to bring their ‘whole-selves’ to work so that the organisation becomes more purposeful, vibrant, connected and altogether more human. For the Head of Strategy of a global bank it was embedding a learning culture that is not just agile and responsive, but purposeful and all together more-human. For the CEO of a global consumer goods company it was to deepen their strategic intent to serve life.
More and more of our business leaders are waking up to the realisation that our organisations are actually living systems rather than machines. That these living systems are intimately entwined with the living systems of society and our more-than-human world. And for these living organisations to thrive in times of increasing uncertainty and volatility, they must learn to become regenerative.
What do we mean by ‘regenerative business’?
Regenerative business seeks to create the conditions conducive for life, by operating in ways that embody the natural logic of life.
The control-based characteristics of conventional business separate the work functions from the management functions, creating silo-mentality and hierarchic bureaucracy that relies on a control-and-predict ethos of managing remotely by numbers. The organisation is perceived as a self-maximising machine struggling for survival in a dog-eat-dog world. This hyper-competitive control-based logic is not actually how life is. Vibrant ecosystems flourish through diversity, distributed decision-making, local-attunement, and an evolutionary sense of purpose.
The emerging future of business encourages wholeness within ourselves, our systems, and our society. It’s a radical departure from the traditional scientific management theory still served-up in many of our leading business schools today. Yesterday’s logic is now failing us. Enter, living systems logic:
Adaptive teams are empowered to make change happen at the local level, to self-organise and locally-attune amid an ever changing environment. Leaders do not manage remotely through hierarchy but rather facilitate environments where learning, co-creativity and authenticity flourish. Decision-making is not hierarchic but distributed. The goal is to deliver upon the purpose of the organisation, in-so-doing a healthy profit follows. The organisation is viewed as a purpose-driven community intimately interwoven within the living systems of our wider world. Nothing is separate from anything else, everything is interconnected. This logic is the logic of how life really is. And it is simply good business sense, as hot-off-the-press research from The Global Lamp Index shows that organisations embracing this regenerative logic consistently out-perform their mechanistic counterparts.
Living systems logic informs us that we need a blend of ‘divergence’ and ‘convergence’ to thrive amid volatility:
‘Divergence’ through the inclusion of a diversity of perspectives from different people spanning silos within and beyond the organisational boundaries (facilitated through generative dialogue approaches); empowered self-organising teams adapting to their local terrain, freed from cumbersome bureaucracy and control-based hierarchy (facilitated through self-management team dynamics); bottom-up emergence nourished by a participatory and exploratory cultural mind-set (fostered by a blend of appreciative inquiry, action research, art-of-hosting, white space/swarm approaches, and heart-based communication methods).
- The global network of social-enterprise community centres, Impact Hub, has check-ins at the beginning and end of every meeting for people to centre themselves and share in authentic and purposeful ways.
- A North American waste company regularly holds stakeholder dialogue sessions with a diverse group of stakeholders to ensure customers, suppliers, local activists, indigenous people, and community leaders are all involved in generative discussions about the strategy of the organisation.
- A London supermarket, Thornton’s Budgens, holds sharing circles every few weeks for all employees, regardless of role, to openly share in an open-hearted and authentic way so that problems transform through empathy into improved ways of working. This helps the organisation deliver on its purpose of putting people and planet first, trusting that profit will follow, while creating a more vibrant work place for everyone involved.
‘Convergence’ through a life-affirming resonant sense of purpose and clear strategic intent that guides and governs the over-arching direction-of-travel; and, a soul-based culture that underpins and infuses the day-to-day meeting conventions, management protocols and behavioural values.
- The financial services provider Triodos makes money work for positive social, environmental and cultural change by investing in projects that enrich our world – all of Triodos’s investment projects are open to public scrutiny, with the social and environmental credentials of every investment available on-line.
- The chemicals company Pantheon Enterprises applies conscious chemistry to ensure all its products are biodegradable and non-toxic. It is committed to changing the chemical industry for the better through its conscious chemistry approach. As a culture, it encourages its people to become more empowered by engendering self-organised methods of management and decision-making.
- The legal services provider IACP’s boardroom considers the impact all its decisions have on the next generation, our children, ensuring services to corporate and domestic clients actually transform conflict into breakthrough resolutions.
The ‘divergence’ provides the vibrancy, creativity and effectiveness, while the ‘convergence’ provides the mission-driven intent and soulful purpose of the organisation. Both together provide the aliveness, agility and purposefulness for the living system to thrive amid volatility. This coherence within the organisation informs the way it relates with its eco-system of stakeholders including society and the environment.
Regenerative life-affirming business is not a utopian dream; it is how life really is. It is our prevalent practices that are a deluding aberration. The rising interest in the B-Corp movement is symptomatic of this shift happening across the world in our business mind-set. To become a B-Corp, companies voluntarily change their legal constitution away from a narrow focus on short-term returns for shareholders to creating value for all stakeholders including society and the environment.
The rising popularity of movements such as Conscious Capitalism, Teal, The Purpose Movement and B-Corps heralds the dawning of a new business logic; a deeper richer consciousness that expands not only our perception of organisations as living systems but also our perception of ourselves as purposeful human beings playing our part in an innately interconnected world.
Today’s businesses that embrace this living systems logic will be tomorrow’s success stories.
Speaker, adviser and author Giles Hutchins’ latest book Future Fit (2016) is available on Amazon and all good book shops. He blogs at www.thenatureofbusiness.org and is Chairman of The Future Fit Leadership Academy www.ffla.co