A business that does not show a profit at least equal to its cost of capital is irresponsible; it wastes society’s resources. Economic profit performance is the base without which business cannot discharge any other responsibilities, cannot be a good employer, a good citizen, a good neighbor.
But economic performance is not the only responsibility of a business any more than education is the only responsibility of a school or health care the only responsibility of a hospital.
Every organisation must assume responsibility for its impact on employees, the environment, customers, and whoever and whatever it touches.
That is social responsibility. But we also know that society will increasingly look to major organizations, for-profit and non-profit alike, to tackle major social ills. And there we had better be watchful, because good intentions are not always socially responsible. It is irresponsible for an organisation to accept – let alone to pursue – responsibilities that would impede its capacity to perform its main task and mission, or to act where it has no competence.
Peter Drucker – Managing in a time of Great Change
A ‘system’ is an interconnected set of elements coherently organized in a way that achieves something. It is more than the sum of its parts: a body is more than an aggregate of individual cells; a university is not merely an agglomeration of individual students, professors, and buildings; an ecosystem is not just a set of individual plants and animals.
A defining property of human systems is complexity; because of the sheer number of relationships and feedback loops among their many elements, they cannot be reduced to simple chains of cause and effect. Think of a crowd on a city street, or a flock of starlings wheeling in the sky at dusk. Even with supercomputers, it is impossible to predict the movement of any given person or starling, but there is order; amazingly few collisions occur even on the most crowded streets.
In complex systems, change results from the interplay of many diverse or apparently unrelated factors. Those of us engaged in seeking change need to identify which elements are important and understand how they interact.
Unfortunately, the way we commonly think about change projects onto the future the neat narratives we draw from the past. Many of the mental models we use are linear plans – ‘if A, then B’ – with profound consequences in terms of failures, frustration, and missed opportunities [when the plan is thrown out by unexpected consequences within the plan, or by things that were never in it]. As Mike Tyson memorably said, ‘everyone has a plan ’til they get punched in the mouth.’
Let me illustrate with a metaphor. Baking a cake is a linear, ‘simple’ system. All I need to do is find a recipe, buy the ingredients, make sure the oven is working…
Baking a cake is also a fairly accurate metaphor for the approach of many governments, aid agencies, and activist organisations. They decide on a goal (the cake), pick a well-established method (the recipe), find some partners and allies (the ingredients), and off they go.
The trouble is that real life rarely bakes like a cake. Engaging in a complex system is more like raising a child. What fate would await your new baby if you decided to go linear and design a project plan setting out activities, assumptions, outputs, and outcomes for the next twenty years and then blindly followed it?
Deng Xiaoping said, “We will cross the river by feeling the stones under our feet, one by one.”Duncan Green – How Change Happens (amazon)
Speaking of networks, here’s a way into network theory – a few videos from Clay Shirky that make a good introduction:
Ten Truths About Social Media
And a couple of TED talks…
Shirky on Econtalk
And finally, go here interview on Econtalk from 2008.
The blurb says…
Clay Shirky, author of Here Comes Everybody: The Power of Organizing Without Organizations, talks about the economics of organizations with EconTalk host Russ Roberts. The conversation centers on Shirky’s book. Topics include Coase on the theory of the firm, the power of sharing information on the internet, the economics of altruism, and the creation of Wikipedia.
And Niall Ferguson on the Long Now
Video and audio here.
“This time is different.”
“The Net is net beneficial.”
Historian Niall Ferguson: “Globalization is in crisis. Populism is on the march. Authoritarian states are ascendant. Technology meanwhile marches inexorably ahead, threatening to render most human beings redundant or immortal or both. How do we make sense of all this?”
Ferguson analyzes the structure and prospects of “Cyberia” as yet another round in the endless battle between hierarchy and networks that has wrought spasms of innovation and chaos throughout history. He examines those previous rounds (including all that was set in motion by the printing press) in light of the current paradoxes of radical networking enabled by digital technology being the engine of massive hierarchical companies (Facebook, Amazon, Google, Twitter, and their equivalents in China) and exploited by populists and authoritarians around the world.
He puts the fundamental question this way: “Is our age likely to repeat the experience of the period after 1500, when the printing revolution unleashed wave after wave of revolution? Will the new networks liberate us from the shackles of the administrative state as the revolutionary networks of the sixteenth, seventeenth and eighteenth centuries freed our ancestors from the shackles of spiritual and temporal hierarchy? Or will the established hierarchies of our time succeed more quickly than their imperial predecessors in co-opting the networks, and enlist them in their ancient vice of waging war?”
The best – the only – way to prepare our kids for any future is by showing them a vision of a flourishing life, and by equipping them with the best tools we have to achieve it, and with the wisdom to use those tools well.Stu Patience / Driverlesscroc
“Our kids” can mean several things.
My biological children.
The children in my extended family.
The children of my friends.
The children of my neighbours, colleagues, fellow members of groups I belong to.
All the kids in my district, city, region, country.
All the kids. Everywhere.
Which kids are yours?