Balancing Arrogance and Humility in Business Strategy
Posted by Presidio Buzz January 15th, 2010 
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Some recent writings by Jay Ogilvy (not yet published) on the opposing styles of systems thinking provide an enlightening philosophical framework behind the evolution of strategy theory and the successes and failures of corporate strategy development processes. Fundamentally, strategy design is a systems thinking exercise and executives would do well to understand the basic approaches to systems theory. Then, optimal design would seem to require active awareness of the “oscillations” between arrogance and humility and strike an appropriate balance.
Why Humans Are Wired for Systems Thinking
Posted by Presidio Buzz December 10th, 2009 Comments
During a recent lecture at the Presidio Graduate School’s MBA program my professor gave us a taste of systems thinking. In a PowerPoint slide with text too small to read, he showed us a nest of boxes and arrows, stocks and flows describing just a few of the millions of complicated relationships between a company, it’s environment and the society in which it operates. Systems thinking, he explained, is about taking all of these complex interconnections into account–a daunting task for an oversimplified system that is too dense to read, let alone memorize or understand the implications of.
The Parallels of the Toyota Production System and Sustainability
Posted by Presidio Buzz December 4th, 2009 Comments
The Toyota Production System has garnered praise and accolades not only in the realm of automobile manufacturing, but in the realm of operational efficiency. Similar to how individuals interested in sustainable business focus on the the 3P’s, the triple or integrative bottom line of People, Planet, and Profits, the underlying elements of the Toyota Production System can be summarized in the 4P’s: Philosophy, Process, People & Partners, and Problem Solving. The 4P’s are at the heart of what Toyota wants to be culturally. Furthermore, there is much crossover in the fundamental framework of the Toyota Production System and Sustainability. On another note, the visible actions of Toyota are not the core of the Toyota Production System. As Stevens and Kent state, “Toyota does not consider any of the tools or practices – such as kanbans or andon cords, which so many outsiders have observed and copied – as fundamental to the Toyota Production System.” Rather, it’s the underlying cultural framework of the Toyota Production System that enables Toyota to outperform western production methods.
Marketing Green
Posted by Presidio Buzz November 11th, 2009 Comments
In the past decade, green products have infiltrated the mainstream consumer market, and I’d argue that the biggest splash has been in the “luxury green” market. When I first noticed this happening, I was appalled–I’m not a luxury brand buyer and I don’t want sustainability to be associated with “upscale and expensive.” Sustainability, after all, is supposed to be inclusive, not exclusive.
What About the People?
Posted by Presidio Buzz October 29th, 2009 Comments
Ecological economics is a transdisciplinary field of study that addresses the complex interconnectedness of human systems and natural ecosystems. Unlike neoclassical economics, which is preoccupied with the value-free idea of efficiency, ecological economics focuses on the economy as a subsystem of the ecosystem, and emphasizes the natural limits of our planet in relation to human social and economic systems.
It’s ironic that many of the environmental problems of today have been driven by social norms and cultural values and, yet, these factors are not central tenets of ecological economics.
Toward a “Green Ocean Strategy”
Posted by Presidio Buzz October 9th, 2009 Comments
Managers must start to recognize environmental improvement as an economic and competitive opportunity…it is time to build on the underlying economic logic that links the environment, resource productivity, innovation, and competitiveness. – Michael Porter
What do SUVs, genetically modified organisms, and fast food all have in common? They’re all antithetical to sustainability…and they’re all described as exemplary “blue ocean” strategies.
Marketing and the True Individual
Posted by Presidio Buzz September 17th, 2009 Comments
In neo-classical economics, the paradox of thrift describes an economic scenario in which the more people save their own money, the worse off the overall economic situation becomes. As a result, the paradox of thrift states that what may be good for the individual may not be good for society. The consumption paradox describes a situation in which an individual enjoys an increased quality of life from a material standpoint, yet is less satisfied and content with that life. The consumption paradox is specifically focused on both the “take-make-waste” model we’ve embraced as well as the role marketing, advertising and sales campaigns play in increasing the throughput of this model.
Garbage and Human Psychology: Don’t Ask, Don’t Smell
Posted by Presidio Buzz July 20th, 2009 Comments
Reading about throughput makes me wonder if we could approach solving product or service needs by starting at what we now call the “end” of the throughput process or “the dump.” Let’s say companies were incentivized to change how they solved consumer and social problems by a government tax or regulation that penalized or restricted companies based on the waste produced by their products. (An analogy would be the tax on cigarettes that is connected to medical costs to society of cigarette smoking, or a carbon tax.)
How Might the National Debt Be Related to Sustainability?
Posted by Presidio Buzz July 6th, 2009 Comments
Financial, social as well as ecological sustainability are important macro economic goals. We have believed up until this point that as long as our GDP grows, our financial, social and sustainability problems will also be solved. Hopefully the world is eventually coming to a realization that this is really not the case. This continuous and endless growth is also contributing to the world’s growing sustainability problems.
The US’s national debt is composed of two main facets: First, debt accumulates as the US government spends more than it produces. Second, the US external debt is also identified as what the American people owe to other nations. While the US government’s debt rises as the government runs a deficit, it also falls when it runs a surplus.
Peak Oil is the “Sustainability Spear”
Posted by Presidio Buzz June 30th, 2009 Comments
Ray Anderson was 60 and retired from the weight of making next quarter’s numbers when he was able to breathe, look around, and ask: “What’s next? What legacy to do I want to leave for my daughters?” That is when he got the sustainability “spear in the chest”. However, Ray’s case was pretty unique. While some other businesses like Wal-Mart, Ford and Xerox are making some moves towards sustainability, we are not likely to see a wave of businesses spontaneously adopt sustainability until something momentous happens. And what form will that momentous sustainability spear take? Climate change? Probably not.
The Sustainability Lens
Posted by Presidio Buzz June 22nd, 2009 Comments
“The most unrealistic person in the world is the cynic, not the dreamer. Hopefulness only makes sense when it doesn’t make sense to be hopeful. This is your century. Take it and run, as if your life depends on it.”
From Paul Hawken’s commencement address to the University of Portland Class of 2009
Let me begin by saying what a wonderful commencement address I think Mr. Hawken’s was, and thank Hunter Lovins for relaying it to the Presidio community. It reminds me of Mark Sower’s Presidio graduation address comment about how “we are faced with insurmountable opportunities.” Both hold the tension of that impossible task we must nevertheless do. The anchor is the impossible task, and the variable is our capacity to rise to it.
Ethonomics Explained
Posted by Presidio Buzz June 22nd, 2009 Comments
It can be said, beyond the shadow of a doubt, that our world is changing.
Our planet is warming, our population is growing, our water supply is under preassure, and our financial systems have suffered. We have a new president in office; a man who passionately describes a new, green economy. The traditional ways of conducting business are changing. Even the largest investment banks and motor companies are beginning to realize that the “status quo” of doing business, i.e. profit for profit’s sake, must be revolutionized.
Our economy must adapt to be faster, “greener” and more innovative. So what do we have when we combine traditional economics with environmental stewardship and social ethics? Ethonomics, of course.
Ethonomics has several definitions. The term was originally coined to describe the academic process of mapping value systems. Earlier this year, however, Fast Company magazine assigned a new meaning to the term Ethonomics: ethical economics.
Only as Strong as Your Weakest Link
Posted by Presidio Buzz June 10th, 2009 Comments
All economic production depends on our scarce natural resources and we can apply insights from physics and ecology to help us examine our economic system.1 As resources are depleted, waste is generated, and the continuous loop regenerates itself as long as 1) throughput is within capacity of the system and 2) the scale of the economy is relative to the size of the ecosystem. This “steady-state” economy strives for balance because, otherwise, growth beyond its limits will lead to instability and destruction of the very ecosystem that supports all economic production.
Community Organizing and the Free-Rider Problem
Posted by Presidio Buzz May 4th, 2009 Comments
As a community organizer, I am all too familiar with the free rider problem and with economically rational ways to circumvent it. Under the right conditions it’s not as daunting as it first appears.
I’ve seen two classical ways around the free rider problem. The first is democracy- everyone makes a decision to invest collectively and then contributions are mandatory (ie taxes.) The second involves punishment, in a multi-stage game free riders can be punished for their actions, creating a an incentive for everyone to chip in.
Welcome to the Presidio Buzz! Here you can catch up on the musings, thoughts, and revolutionary ideas being discussed by the students at The Presidio Graduate School.
Presidio is a higher-education institution dedicated to developing business and civic leaders with the competencies and courage to implement their ideas for a sustainable future. At Presidio the discourse is lively and frequent, and this blog highlights the most timely and interesting structured class conversations, as well as informal open dialogue in the Presidio community.
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