- Read Time: 11 min
A few words from the father of system dynamics on organizational decision making, human frailty and the reasons that managers trying to solve problems so often just make them worse.
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Sustainability is the idea that systems — including natural and human ones — need to be regenerative and balanced in order to last. We believe that that means all kinds of systems: economic, environmental, societal, and personal. The sustainability question is: How can we design and build a world in which the Earth thrives and people can pursue flourishing lives?
In an increasingly environmentally conscious and cost-conscious world, suppliers can make their business both more sustainable and more profitable by focusing on services that extend the efficiency and value of their products.
Meeting the sustainability challenge will require the kind of cross-sector collaboration for which there is still no real precedent. It must be co-created by various stakeholders by interweaving work in three realms: the conceptual, the relational and the action-driven.
Many companies now offer slick “sustainability reports” along with their annual reports as indicators of their performance. The problem is that none of this espoused benevolence creates true sustainability. The root of this problem is neither business’s misunderstanding of what’s at stake nor corporate cynicism about the sustainability cause (though these may be contributing factors). The problem really stems from management’s failure to see unsustainability as a deep-seated systems failure.
Green marketing hasn’t fulfilled its initial promise, but companies can be more effective with it if they realize that a one-size-fits-all strategy doesn’t exist. Consumers swear that they want green products, but in checkout aisles, most revert to more common requirements — convenience, availability, price, quality and performance. The authors show how companies today can choose among several different green strategies targeted to specific customer segments.
Managers should consider three economies — consumer, emerging, and survival —when evaluating new business opportunities.
Every decade or two, a big idea in management thinking takes hold and becomes widely accepted. The next big idea must enable businesses to improve the hit rate of strategic initiatives and attain the level of renewal necessary for successful execution. Scientific research on complex adaptive systems has identified principles that apply to living things, from amoebae to organizations. Four principles relevant to strategic work at Royal Dutch/Shell are outlined.
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