In a volatile business climate, companies can gain advantage by learning from natural rules
Since the industrial revolution, we have achieved great feats of economic, social and technological advancement for which we can be proud. However, these are volatile times and new challenges now face our businesses, economies and societies, relating to resource scarcity, environmental destruction and ever-increasing population pressures.
Our current business paradigm has exacerbated the imbalances, tensions and volatility we face today. Albert Einstein observed:
“We cannot solve the problems in the world with the same level of thinking that brought them about in the first place.”
To operate in the world we now live in we need fresh approaches to businesses that are fit for the present and future.
Good business is fundamentally about seeking out opportunities for value creation, not about trying to get something for nothing. As our social, economic and environmental landscapes become ever more volatile, business approaches need to adapt and evolve to optimise the opportunities for value creation.
And, in the words of environmentalist Paul Hawken:
“business and industry is the only institution that is large enough, pervasive enough and powerful enough to lead humankind out of this mess”.
Therefore, the re-evaluation and transformation of our business paradigm is fundamental to the successful evolution not only of business, but of our species as a whole.
In times of pressing challenges, in this “perfect storm” of social, economic and environmental volatility, it requires great courage to break rank from a paradigm that is ingrained in our business mindset. Transformational times call for transformational change.
To succeed in business we must be agile, creative, alert, spontaneous and responsive – often operating in completely new ways. Today’s rapidly changing business environment calls for businesses that thrive in rapidly changing environments: businesses more akin to living systems.
These “firms of the future” can learn and adapt; they are not structured and siloed, which stifles learning and agility. These firms are bottom-up, decentralised, interdependent, multifunctional, emergent, self-organising units – not the centralised, top-down, hierarchically-managed monoliths of the 20th century. Put simply, the business models and management approaches that served us well in the past are no longer fit for purpose in a business context where dynamic change is the new norm.
The years to 2020 will see organisations that “get it” adapting and evolving, and those that do not perishing or being acquired. Bold firms of the future do not try to tightly manage change, they empower a culture of collaboration to unlock the creative potential of their own workforce, their partners and the communities they serve, initiating virtuous cycles of collaboration, innovation and value creation for all stakeholders. The result: more value, bigger margins and higher well-being.
Dawn Vance, director of global logistics at Nike, says:
“Organisations have three options: hit the wall; optimise and delay hitting the wall; or, redesign for resilience – simultaneously optimising existing networks whilst creating disruptive innovations and working collaboratively with partners.”
It is this “redesigning for resilience” that drives the transformation to a firm of the future. The firm of the future is one that:
- Drives transformation through values-based leadership and stakeholder empowerment using the catalysts of education, innovation, inspiration and collaboration.
- Encourages synergies across its business ecosystem, engaging with multiple stakeholders in an open, transparent way; where common values create connections enabling mutualism.
- Harnesses the power of social networks and the “pull” media; uses crowd sourcing, co-creation, open source collaboration platforms and transparent branding for differentiation.
- Evolves ecological thinking for innovating and new ways of operating and generating value for every stakeholder within the community it serves; where waste equals food and nature inspires people, processes, products and places.
The pressure for change is increasing all the time. Well publicised forward-thinking companies are already making headway on their transformational journey – Unilever, Puma, InterfaceFlor, GE, Patagonia, Nike and Marks & Spencer, to name a few.
Visionary business leaders of today are already making bold steps on this transformational, emergent path for themselves and their businesses. And it is a journey rather than a destination. Transforming towards a firm of the future is not about designing the right business model and implementing it, it is about understanding the ethos, ethics and environment that will allow the organisation, individuals and wider stakeholder community to flourish, adapt and evolve.
The good news is that inspiration for the current pressing challenges is all around us in nature. Nature has been dealing with dynamic change for more than 3.8bn years, and the more we explore and connect with nature’s ways, the more we find inspiration for operating in a dynamically changing business environment.
Our understanding of nature has evolved over the past few decades, from viewing nature as a battle ground of competition to one of dynamic non-equilibrium, where an order within chaos prevails due to unwritten natural patterns, feedback loops, behavioural qualities, interdependencies, and collaboration within and throughout ecosystems. Nature adapts within limits and creates conditions conducive to life. Recent discoveries in microbiology and quantum mechanics uncover the importance of cellular membranes in the adaptation and evolution of organisms. Likewise, the perceptions and beliefs of the individual, organisation and ecosystem can affect their ability to sense, respond, adapt and evolve to volatility in their environment.
Biomimicry for Creative Innovation, a collaboration of specialists applying ecological thinking for business transformation, has developed a set of business principles for the firm of the future, developed from the “life principles” created by the Biomimicry Institute. These business principles are inspired by nature.
Build resilience: It’s more effective to build resilience than to correct poor risk-based decisions that were made with partial information. A business inspired by nature builds resilience by:
- Using change and disturbance as opportunities rather than fearing them as threats.
- Decentralising, distributing and diversifying knowledge, resources, decision making and actions.
- Fostering diversity in people, relationships, ideas and approaches.
Optimise: Optimising delivers better results than maximising or minimising. A business inspired by nature does this by:
- Creating forms that fit functions, not the other way around.
- Embedding multiplicity into both functions and responses.
- Creating complexity and diversity using simple components and patterns.
Adapt: Being adaptive pays back better than staying on a fixed course. A business inspired by nature adapts by:
- Creating feedback loops to sense and respond at all levels of the system.
- Anticipating and integrating cyclic processes.
- Being resourceful and opportunistic when resource availability changes.
Integrate systems: With limited resources and a changing environment, it’s better to be systems-based rather than independent. A business inspired by nature works with whole systems by:
- Fostering synergies within communities.
- Fostering synergies within energy, information and communication networks.
- Creating extended systems to continuously recycle wastes into resources.
Navigate by values: In uncertain times, it’s better to be based on a compass of values than a fixed destination point or set of predefined metrics. A business inspired by nature reflects values by:
- Knowing what’s really important to the communities it operates in, interacts with, and impacts on.
- Using values as the core driver towards positive outcomes.
- Measuring what is valued rather than valuing what is measured.
Support life: In the long run, it takes less effort and fewer resources to support life-building activities than to be damaging or toxic and pick up the cost later. A business inspired by nature supports life-building activity by:
- Leveraging information and innovation rather than energy and materials.
- Creating support for individual components that can support the whole ecosystem; supporting the ecosystem so that it can support the individual.
- Making products water-based, renewable, bio-based, and biodegradable.
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