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  • Susan Smudde

Organizations with a pulse: creating businesses that contribute to life

‘The greatest breakthroughs of the 21st Century won’t occur because of technology. They will occur because of an expanding concept of what it means to be human.’

John Naisbett

We live in a time marked by immense turmoil and change. Multiple and profound shifts affect the way we work and the purpose and meaning we bring to our organizations. Businesses are constantly transforming to deal with disruptive innovations, resource scarcity, new ways of working and increasing global systemic shocks like the climate crisis and mass migration.

Sadly enough, in today's world, only a few benefit at the expense of many. Over the years, we have created organizational systems – organizations-as-machines - which are dominated by hyper-competition, power-and-control hierarchies, and rising stress. Seeing the world as a complex machine, a view introduced long time ago by physician Newton, has profoundly transformed humanity in the last two centuries, bringing unprecedented levels of prosperity. Yet today, this merely rational-analytic view has resulted in a dog-eat-dog world and a reckless exploitation of the planet’s resources and ecosystems.

Fortunately, since two decades, a new paradigm is emerging. Some pioneers all over the world are creating the conditions for a new way of doing business, of leading and living. They are reconstructing systems and implementing new business practices that actually contribute to life rather than destroying it. Examples are Patagonia, Canon, Johnson & Johnson, Unilever and Westpac Banking who are redefining success, creating positive social, environmental, and economic impacts while fostering long-term sustainability.

“At Patagonia, making a profit is not the goal because the Zen master would say profits happen 'when you do everything else right'.”

— Yvon Chouinard – CEO Patagonia

In his most recent book, Giles Hutchins calls these organizations ‘regenerative’ and refers to this new approach as 'leading by nature’. These ‘future fit’ organizations are more akin to living-systems than machines. Like nature, they sense and respond to constant change while also learning to read the emerging future.

The organization-as-machine, on the other hand, with its top-down perspectives far removed from the customer and its time-consuming change-management projects, falls painfully short in future-proofing the business. According to global study, done by Joseph Bragdon, organizations that mimic life and nature consistently outperform their mechanistic counterparts, especially through volatile times. Between 1994 and 2019, the Global Living Asset Management Performance (LAMP) Index — a learning laboratory of sixty business pioneers in mimicking living systems, outperformed the FTSE-100 and S&P 100 by a factor of 74% and 56%. respectively.

Living-system organizations, through their interconnectedness with society and nature, possess the ability to learn and adapt at a faster and more intelligent pace. The strong connection between humans and nature fuels innovation and diversity. Furthermore, these organizations tap into the power of humaneness. Raises the question: how do these organizations foster sustainability, innovation, and progress in a complex and changing world?

Example of a living system organization – Canon:

Canon places a strong emphasis on sustainability and environmental responsibility, guided by its corporate 'Kyosei' philosophy: living and working together for the common good. The company sets targets for reducing CO2 emissions and water usage, promoting resource conservation through recycling and the use of recycled materials. Canon actively supports biodiversity conservation projects globally. By integrating sustainability into its operations, Canon contributes to a regenerative world. Canon's operating model revolves around innovation, quality, and customer-centricity, aiming to consistently deliver cutting-edge products and services that fulfill customer needs. Furthermore, Canon prioritizes the well-being of stakeholders and employees by cultivating a positive work environment and promoting social responsibility. It empowers employees to explore ideas that lead to eco-effective solutions, resulting in numerous innovative concepts. The company's culture fosters collaboration, integrity, and continuous improvement, creating an inclusive work environment that encourages personal growth and excellence.

Living system organizations: mastering the art of sustainability, innovation, and adaptation

Bragdon's research identifies three key characteristics of living-system organizations, as compared to traditional firms:

  • Life-serving purpose; putting people, planet, and purpose first

  • Empowered self-management; fostering a connected system of individuals, integrated with the ecosystem which they are part of

  • Growth mindset; valuing learning and experimentation and embracing complexity, adaptability and innovation

These characteristics enable future-fit organizations to constantly gather data, do small experiments, listen to feedback, and observe changes in their surroundings. This information is used to identify patterns, anticipate future needs, and develop the ability to sense and connect with emerging future possibilities. By nurturing these qualities, organizations can adapt and thrive in the face of uncertainty and change. It's like cultivating a garden - with the right ingredients and care, it can flourish and blossom.

Looking at organizations as living systems seems a very promising paradigm to address the needs of the wider societal shift that is demanding more meaning, purpose and creativity in the workplace. This paradigm asks for a new norm in leadership - human leadership. This approach requires a holistic awareness of oneself, as well as of the systems we're part of. Human leadership involves an understanding of emotions, biases, needs, and perspectives, both within ourselves and in interactions with others. This awareness is crucial for leading with empathy and authenticity, and driving positive change; the breeding ground for people to flourish.

Developmental psychologist Clare Graves made a groundbreaking discovery in his research on adult development: the rise of 'systems awareness'. He studied levels of awareness across thousands of adults and noticed a next stage of consciousness emerging in adults across business and society. This new consciousness allows individuals to perceive the interdependence of natural and human systems, enabling them to sense-in to emergence and respond to complex challenges.

“Know how nature functions and you know how to behave,”

Clare W. Graves.

This sparks optimism, however, developing this ability to sense-in to emergence doesn’t come by nature. The effort required to develop this capacity is like a workout routine for the mind. It takes regular practice, dedication, and a willingness to step outside of your comfort zone.

Upping your game: cultivating human leadership through self- and system awareness

Life and living organizations have a natural desire to learn and grow. Developing human leadership asks from leaders to deepen their self- and system awareness and to tame the needs and impulses of their ego. The call for leadership is to be more authentic and purposeful within ourselves and in the system we are part of.

The empirical research of leadership expert Barrett C. Brown gives us an idea about what human leadership entails. The key practices he found that more conscious leaders apply are:

  • Deep connection: These leaders are profoundly connected to their mission in life, to humanity, and all of life. They have profound personal meaning about their work, and consistently make decisions based upon it.

  • Conscious & courageous action: With deep trust in themselves, their team, and the process, these leaders are comfortable with intense ambiguity and dynamically steer, rapidly experiment, and shift leadership roles as needed.

  • Vision & outlook: These leaders draw upon both intuitive intelligence and sophisticated tools like integral theory, complexity theory and whole systems thinking to make sense of the world.

  • Self-transformation: Through vertical and horizontal learning, stopping subtle self-sabotage, and supporting their stakeholders to develop, these leaders take the reins of their own evolution.

To determine if we are leading as human leaders with a living system mindset, we can evaluate our language, behaviors, and decisions. The questions in the box below might help to identify some areas which are worth exploring more extensively.

Introspective questions to assess and enhance self- and system awareness

  • Deep connection: What is my mission in life? How do I align my work with that mission? How do I stay true to my values in difficult situations? How do I nurture positive relationships both within my organization and with the external environment?

  • Conscious & courageous action: How do I foster a culture of safety and trust? How do I embrace ambiguity and make decisions amidst uncertainty? How do I inspire others to take risks and innovate? How do I foster a culture of experimentation and learning?

  • Vision & outlook: How do I use intuition and sophisticated thinking to understand complex challenges? How do I stay open to new perspectives and insights? How do I synthesize diverse data points and create a compelling vision for the future?

  • Self-transformation: What are my areas of greatest growth potential? What challenges my current identity and worldview? How do I support others in their growth and development?

Transforming organizations into living systems presents a unique opportunity for courageous leaders to shape a positive and prosperous legacy. The resources to create a thriving future for humanity and nature already exist within us and around us. The challenge is to leverage our mindset development, empower others to do the same, and bring our full selves to co-creating a brighter tomorrow. Our legacy can be one of hope and prosperity for all, if we choose to embrace the challenges and opportunities before us.

“It is only with the heart that one can see rightly; what is essential is invisible to the eye.”

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