Successful Triple Bottom Line Sustainability Depends On Board of Directors’ Leadership

The notion of organizational leadership has traditionally been viewed in a top/down reductionist thinking fashion. At the pinnacle of the organization is the CEO, followed by the other C-Suite incumbents, then senior executives, then middle management and so on and so on. The idea that an organization’s board of directors has the ultimate leadership responsibility is either not typically considered, or the role of a CEO has become so dominant that no Chairman wants to fight that leadership battle anymore.

This is no trivial mater in regard to who should lead sustainability initiatives, and triple bottom line sustainability (tbls) in particular. It’s one thing to report good intentions through a Corporate Social Responsibility report, but another entirely to envision and lead the complex long-term business changes entailed in a tbls strategy, since this is one of the most systemic and challenging change-related journeys on which any organization may embark. The complexity of triple bottom line sustainability has been emphasized in previous blogs, and is further inferred from the following tbls definition adopted by The Leadership Alliance Inc: “Triple bottom line sustainability is the result of the activities of an organization, voluntary or governed by law, that demonstrate the ability of the organization to maintain viable its business operations (including financial viability as appropriate) whilst not negatively impacting any social or ecological systems.”

The board of directors in principle is ideally placed to envisage and lead this demanding journey, given that it has responsibility for the interests of all the stakeholders, not just shareholders, as its mandate. Without the board of directors’ interest, broad experience, vision, knowledge, and leadership, regarding a chosen sustainability variant, it is not likely that anyone else in the organization will pay much attention, other than for “window dressing”, and this has been born out through our research [1].

Furthermore, even a top management that is committed to sustainability does not last forever, and the responsibility for maintaining a change initiative falls back on the governance structure. If the board of directors does not understand the essence of an organizational change, the risk is that top management will be replaced with new managers who have new ideas of their own – organizations are replete with change-credibility “black holes” created when change sponsors have moved-on from much hyped initiatives without accomplishing their objectives.

As I look around at sustainability initiatives in progress, I see more and more evidence of the application of the traditional reductionist approach, whereby responsibility for sustainability is parceled out to individual organizational entities without regard for the need for a new and innovative organizational strategy plus an overarching planning process capable of addressing systemically the unpredictability and dynamic complexity in which today’s organizations operate. All too often innovation, the key to sustainability, is targeted to saving electricity, reducing waste, or preventing usage of non-biodegradable materials; of course such initiatives are important, but typically they are cherry picking, and no consideration is given to applying innovation to business planning that could lead to restructuring of the organization, and the optimal redesign of its strategy to eventuate in an organization truly designed for the tbl sustainability journey.

This kind of bold new thinking must come from the board of directors which has the power and the mandate to exercise leadership in setting organizational direction for the CEO and the C-suite … when will you directors heed the call? If someone in leadership is reading this blog and would like to know how we at The Leadership Alliance Inc. can assist an organization to set-off optimally on the tbl sustainability journey, please contact us, and as always your comments are of great interest to us.

 Reference:

[1] Smith, P.A.C., Sharicz, C., “The Shift Needed For Sustainability”, The Learning Organization, Vol. 18, No. 1, 2011

Identifying Stakeholder Representatives For Interactive Planning

One of the problems with attempting to include the input of all organizational stakeholders in planning and decision making relates to the shear size of the population, and the associated difficulty in reaching consensus on any given point or issue.  This challenge is particularly acute when Interactive Planning is undertaken because of its continuous planning ethos and its organization-wide relevance. This Blog demonstrates how legitimate stakeholder representatives may be identified and how, through these “opinion leaders”, stakeholder views may be presented and addressed. In addition, these representatives in turn help their constituents to understand and commit to plans developed through Interactive Planning e.g. for Triple Bottom Line (tbl) Sustainability.

Across an organization’s social fabric, individuals learn to trust each other and form groups capable of sense making and knowledge sharing. It’s not just ‘What you know’ (Human Capital) or even ‘Who you know’ (Relationship Capital) that ensures this inter-connectivity, it’s ‘Who you know well enough to trust for advice, or have confidence in to get things done efficiently and effectively’ (Social Capital).

Although there is no uniformly accepted definition of Social Capital (SC), its meaning in an organizational setting can be defined as “The resources, tangible or virtual, that accrue to a corporate player through the player’s social relationships, facilitating the attainment of goals.” Each individual’s relationships with other individuals in an organization form that individual’s SC for better or worse; close relationships enhance SC, whereas distrust and lack of openness cause low SC (sometimes termed Social Liability).

Some individuals in groups and communities achieve particularly elevated prestige or influence with their peers. They form core groups and their names come up time and again in their peers’ hearts and minds and stories, not so much because they have authority but rather because they have attained legitimacy. Individuals demonstrating such characteristics have accumulated considerable SC and are termed here “Opinion Leaders”. In a sense they assume archetypical characteristics within an organization through emergent stories and myths, or attain their status by matching existing ‘trust norms’. Opinion leaders are highly trusted as advisors by their colleagues for a variety of complex and often systemic reasons, e.g. personal attributes, expertise, knowledge, longevity, local deployment, power etc. They are frequently seen as removing risk from organizational situations by providing a positive evaluation of “local fit”.

Such influential individuals typically gain elevated SC by having well-developed meta-abilities such as excellent cognitive skills, self-knowledge, emotional resilience, and personal drive. The development of meta-abilities results in improved interpersonal influencing skills. This contributes to these individuals being more astute and insightful, able to make better judgments, and identify more alternative actions. This means that they can better navigate the typical complex and dynamic organizational reality and influence effectively within it. Opinion leaders usually have greater exposure to mass media, are more cosmopolitan, have more change agent contacts, have a higher socioeconomic status, participate more in their social system than their followers, and are especially important for interpersonal networks whose members differ in many aspects.

If an organization has identified its opinion leaders, these individuals may legitimately represent their constituent stakeholders regarding the stakeholders’ views, and contribute to Interactive Planning in their behalf. As noted above the opinion leaders have themselves personal characteristics that make them particularly well qualified to participate in planning activities.

Theory and means relevant to the identification of opinion leaders based on using Network Visualization Analysis (NVA) have been presented elsewhere. The identification method is very cost-effective and is highly recommended to represent appropriately the various stakeholders across an organization.

Hiring Strategy for Developing TBL Sustainability and Supply Chain Viability

In recent blogs I have underlined the radical changes in organizational thinking, design, and culture that are associated with developing Triple Bottom Line Sustainability. These changes are fundamental to the success of any plan for progressing toward TBL Sustainability. It is also evident from the extended discussion I have provided in a co-authored series of six bogs detailing the organizational conditions for addressing TBL Sustainability, that leadership and management characteristics are critically important for success. I have also explored the views on leadership of various generational cohorts in regard to emerging knowledge sharing (KS) organizations. It is clear from these data that for organizations embarking on, or already pursuing, TBL Sustainability and/or KS, the roles, thinking, and behaviors of leaders and managers will need to be re-tailored drastically to satisfy the demands of these increasingly popular strategies.

Whether existing leadership and management cadres have mindsets consistent with undergoing development to cultivate these appropriate new capabilities is a big question. Furthermore, conventional wisdom may work against the hiring of new individuals with appropriate skill sets since organizations typically seek to hire individuals who display capabilities consistent with those displayed by incumbents who have been successful in the past. This is a sourcing process that has worked well historically, but one that is a recipe for disaster when there is a change of era such as seems to be the case now.

There are a number of reasons to believe that we are indeed either transiting such a change of era, or are already immersed in the early phases of the new one. Just as water power facilitated the emergence of the industrial era, so the ubiquitous penetration of digitization into all aspects of business and social life is facilitating emergence of a new social-networked era.  The focus of the industrial era was profit; the emerging focus of this new era is stewardship and TBL Sustainability. Resourcing for any management level of an organization must take into account not only in-depth familiarity with all of the digital platforms and their properties, but in addition the impact of their usage on organizational design and social interaction. This is a difficult problem when filling senior levels of an organization, since this typically entails hiring cohorts of individuals over 30 years of age, and such cohorts exhibit less and less familiarity and understanding of the current digital and social know-how with advancing age.

A further question relates to inter-organizational collaboration and regard. For instance, in a previous blog I explored the need for promotion of socialization both within and between the members of supply-chains. How will such relationships be affected by the leadership and workforce capabilities explored in previous paragraphs? Will a sophisticated organization following a TBL Sustainability and/or KS strategy be willing to include in its supply chain an organization backward in any of the respects discussed above? And if it did, what would its stakeholders have to say about it, and would its governance be influenced?

We are in a business era that moves at breakneck speed, and it is not too soon for forward-looking organizations to think about the notions touched on here. Indeed, if these notions indicate a fundamental change in hiring and development to provide longer-term tenure for young people to mature their leadership and management capabilities to match their already significant digital and social acumen, then the sooner an organization starts to address this issue, the better off it will be.

Triple Bottom Line (TBL) Sustainability Via Interactive Planning

In a previous Blog, it was noted that organizations critically need new ways of thinking and organizing if they are to do more with less, and ensure ongoing growth and renewal in today’s business “Perfect Storm” – A Perfect Storm is the term that describes the situation some organizations and programs are experiencing today. This situation is a product of an exceptionally new and rare combination of unforeseen circumstances. Circumstances that produce severe business turbulence that drastically aggravate an already perilous situation. Sound familiar?.

How successful your organization becomes at acquiring and retaining a leading position in your niche marketplace in this Perfect Storm depends critically on how you position your business relative to other businesses. In that Blog, why the concept of gaining Sustainable Competitive Advantage (SCA) over “competitors” was outmoded was also discussed, as well as why it has been replaced by Organizational Sustainable Advantage™ (OSA™). In OSA™, strategy and implementation are based on the win-win collaboration of all parties, and on plans that are ethical, and without negative impact on relevant ecological, sociological or environmental systems (Triple Bottom Line Sustainability).

Genuine OSA™ demands a decentralized organization founded on independency and interdependency of all major components of organizational processes. Stakeholders at all levels must be epi-central to the co-evolution and co-maintenance of strategy, structure, processes, and rewards. This human-centric style organization will include stakeholders in most of the organization’s responsibilities and decision-making, ensuring incremental investment by each member in the rigors and rewards of a profitable company.

To deal with the overwhelming complexity that an organization faces when it begins to navigate the transition from SCA to triple bottom line OSA™, The Leadership Alliance Inc. [TLAINC] recommends a design process that utilizes the stakeholder-centric Interactive Planning Methodology first introduced by Dr. Russell Ackoff (1981; 1999; 2006); this planning methodology  addresses planning on any scale from local to global.  Interactive Planning is highly relevant to successful design of an organization seeking OSA™ since, as mentioned above, the organizational climate will be characterized by the need for inclusion and alignment of all stakeholders in the planning process in conditions of increasing rate of change, complexity, and uncertainty – conditions that make it very hard to plan for the future using typical non-idealized planning methodologies.

Interactive Planning Methodology is guided by three operating principles:

1. The participative principle which implies that no one can plan effectively for someone else. Professional planners and planning units should provide whatever motivation, information, knowledge, understanding, wisdom and imagination required by others to plan effectively for themselves.  Indeed, participating in interactive planning promotes the development of the members of an organization. Development, as opposed to growth, is defined by an increase in competency and one’s desire and ability to satisfy one’s own desires and those of others. Interactive Planning enables members to acquire an understanding of the organization, making it possible for them to serve organizational ends more effectively.
2. The principle of continuity which is important because plans, no matter how carefully prepared, need to be continuously reviewed and, if necessary, modified as there are events that cannot be foreseen, especially in conditions of complexity. Changes in facts also alter the value we place on such plans. Interactive Planning is a system that allows continuous monitoring, evaluation, and modification of plans.
3. The holistic principle that illustrates the importance of planning simultaneously and interdependently across all levels of the organization and all parts of a system. This principle has two parts, coordination and integration, each focusing on a different dimension of the organization. The principle of coordination implies that all units at the same level should be planned for simultaneously and interdependently. A threat or an opportunity that appears in one unit may best be treated in another unit or in several units simultaneously. For example, a marketing problem may best be solved by a change in production or sales or vice versa. The principle of integration asserts that planning done independently at any level of a system cannot be as effective as planning carried out interdependently at all levels. Conflicts between and within levels of organization can be avoided if planning is done in a coordinated and integrated fashion, as everyone is aware of the effects of what one level or unit does on other levels or units.

Interactive Planners believe that the future can be created and is dependent upon what one does between now and then. In planning, it is not the plan, but the process and the associated learning that are the most important products. Interactive Planning participants first dissolve a problem by changing the nature of either the entity that has it, or altering the environment in order to eliminate the problem entirely. They idealize by designing a desirable future and inventing ways to bring it about. The methodology aims for the participants to collaboratively and collectively design an ideal-seeking system based on the fundamental premise that the “system (with the problem) was destroyed last night.” The purpose of this is to free the participants from the trap of just improving the limitations of the current system – clearly a demoralizing proposition when transiting from SCA to OSA™. Rather, they are encouraged to be as creative as possible in coming up with out-of-the-box ideas that lead to innovation. The only constraints are that the new idealized system should be technologically feasible, operationally viable, and have the capacity to learn and adapt quickly.

If you are serious about having your organization achieve Triple Bottom Line Sustainability by navigating the transition from SCA to triple bottom line OSA™, TLAINC is the consultancy to help you make it a reality – why not give us a call?

References:

• Russell L. Ackoff, Jason Magidson, and Herbert J. Addison. Idealized Design: How to Dissolve Tomorrow’s Crisis…Today, Upper Saddle River, New Jersey: Wharton School Publishing, 2006
• Ackoff, R.L. Re-creating the corporation – A design of organizations for the 21^st century. New York, NY: oxford university press, 1999.
• Ackoff, R.L. Creating the corporate future – plan or be planned for. New York, NY: John  Wiley & sons, 1981

The Why, What & How of Organizational Sustainable Advantage™

This blog is condensed from a six part blog that was published beginning October 2010 co-authored with Tia Carr-Williams.

In 2011, business as usual is not an option – organizations need new ways of thinking and organizing if they are to do more with less, and ensure ongoing business growth and renewal. How successful your organization becomes at acquiring and retaining a leading position in your niche marketplace depends critically on how you position your business relative to other businesses. In the past this involved gaining Sustainable Competitive Advantage (SCA) over “competitors”; we recommend replacing this outmoded concept with Organizational Sustainable Advantage™ (OSA™).

OSA™ differs significantly from the familiar SCA. Both OSA™  and SCA involve introducing the right products and/or services at the right time in the right contexts with the right supply chains, and then continually updating, optimizing, and retiring them as necessary; however. SCA pits both employees and organizations against one another in a never ending competitive “survival of the fittest” which is out of date in this era of open innovation and collaborative stakeholders. OSA™ strategy and implementation are based on the win-win collaboration of all parties, and on plans that are ethical, and without negative impact on relevant ecological, sociological or environmental systems. In other words, SCA tries to push change into being – yeah, just like pushing on a rope – whereas OSA™ pulls change into being and at the same time adds the desirable Triple Bottom Line (TBL) elements as a significant component of sense making and decision making.

Implementation of OSA™ mandates an engaged workforce as a necessary component of its culture. This employee-centric culture then becomes as much the organization’s foundational differentiation as the products or services it provides. Having significant differentiation continuously proposed from an engaged workforce provides a formidable distinctive resource for promoting and maintaining marketplace uniqueness.

Genuine OSA™ demands a decentralized organization with a polyarchic approach, providing both independency and interdependency of all major components of organizational processes. People at all levels must be epi-central to the co-evolution and co-maintenance of strategy, structure, processes, and rewards. This human-centric style organization will include employees in most of the organization’s responsibilities and decision-making, ensuring incremental investment by each member in the rigors and rewards of a profitable company.

So how is OSA™ introduced into an organization?  To ensure and encourage the necessary organizational climate of innovation and TBL focus, monitoring, and reporting, when an organization begins to navigate the transition from SCA to triple bottom line OSA™, The Leadership Alliance Inc. [TLAINC] has led the way in creating an easily understood seamless performance-based process. This process is one that an organization may readily morph into. It reduces the organizational complexity typically involved in such a large scale change; promotes formation of a fractal organization; fosters common OSA™ understanding and values across all organizational levels; nurtures a culture with innovation at its heart; encourages collegial, participative, open business systems; promotes and leverages networks and social interaction; and provides systems to measure and report progress continuously.

In order to easily understand and rapidly adopt TLAINC’s seamless performance-based process to navigate the transition from SCA to triple bottom line OSA™, organizations need to cultivate a culture having sustainable business principles, learning and innovation at their heart. There must be a motivational visionary strategy allied with a deep human context structure; workforce integration systems of high efficiency, capability and efficacy; a synergistic co-operative culture that fosters thinking on how everything can be improved and costs reduced; and there must be task agility for optimal productivity.

This is a tall order, but to achieve these ends, TLAINC supports its clients in undertaking two processes concurrently. One process involves creation of an organizational “attractor” – a central core of strategic business concepts, business processes, and social norms to be refined and used by employee networks at all levels to mutually shape the organization in a dynamic manner; the second process is cultural, and involves creation of a socialized environment based on trust, true dialogue, and the lessening of the power struggles that exist in organizations.

These interventions may be optimally achieved based on TLAINC’s transformative approach. This involves forging a unique ‘solidarity network’ that is inclusive of all the important organizational networks. In this approach representatives of all the various key organizational and governance networks, including the Board and CXO’s, hold dialogs together for the good of all the stakeholders. TLAINC has the proven capabilities to identify the representatives of the key organizational networks, and the real-life organizational experience to assist formation of the solidarity networks.

These solidarity networks re-design and re-develop the systemic organizational structure, business processes, roles, and tools, to specifically develop an environment where learning and adaption will be essential to successfully carrying out the work of every employee. In this pursuit, new structures and ways of working to adjust to, and to continue adjusting for, a changing set of conditions are created by the continuous dynamic process of co-evolution with a changing environment that is underpinned by learning. This approach leverages a distinctive characteristic of complex systems which is their ability to create new order; that is, a different way of working, thinking and relating —  OSA™ is this continuous process of co-evolution. It is neither a one-off change which remains static, nor a reversion or adherence to the status quo. This means understanding and working with (not constraining) the characteristics of organizations as complex social systems.

The measurement, monitoring, and reporting of the above pivotal features are critical to success. TLAINC will collaborate with a client to provide a customized version of TLAINC’s Sustainability Scorecard™ to truly reveal the advances that indicate improvements are being realized, and to highlight next steps. If you are serious about having your organization navigate the transition from SCA to triple bottom line OSA™, TLAINC is the consultancy to help you make it a reality – why not give us a call?

Corporate Sustainability – Board, Management, Market, and Stakeholders

I am carrying out research on the adoption of Triple Bottom Line Sustainability (TBLS) in business companies, and I am pondering the question “Is it all about financial return?” In this regard I am interested in tapping into the wisdom of readers of this Blog.

I define TBLS as the outcome of the activities of an organization, voluntary or governed by law, that demonstrate the ability of the organization to ethically maintain its business operations (including financial viability) whilst not negatively impacting any social or ecological systems.

As I understand it, the Board of Directors of a company is responsible to the shareholders for optimizing shareholder value, making sure profit compares favorably with businesses in comparable industries, being competitive relative to challengers, and guiding the company’s strategic management by controlling and monitoring the activities of the company’s management. The CEO and management team in theory only design and run the company to satisfy the Board. This looks to me like a directive tailored for ‘Financial’ not ‘TBL’ Sustainability.

The Board and/or the CEO and the management team may be wise enough to envisage enhanced profits and market position by taking advantage of the uniqueness of products and services tailored to TBLS; however, this approach is still financially, rather than ethically, motivated.

It would be encouraging to see large numbers of companies embracing TBLS for ethical reasons, but that may not be realistic given the Board mandate highlighted above. It seems to me that the ethically driven leverage for introduction of TBLS comes from the marketplace, the shareholders and the stakeholders – we the people!! In other words, if enough consumers, shareholders and stakeholders are sensitive to ethical concerns and place pressure on companies to operate in a TBLS manner or else risk earning lower company profits and reducing shareholder value, then the relevant Boards have a responsibility to make appropriate changes to introduce and sustain TBLS, and must ensure the changes take place (or risk the corporate consequences). Indeed under these circumstances the CEOs and management strategists ought also to be pressing for change based on strategic imperatives. However, even if corporate action is based on the ethical concerns of “we the people”, the outcome is still based on a Board’s financial obligations.

The only other option for introduction of TBLS that I see is by Government intervention through a change in Corporation law – not likely to happen I think.

Your thoughts and comments on the general thrust of this Bog would be most welcome and thanks in advance for taking time to consider the thoughts expressed here …

Successfully Developing Triple Bottom Line Sustainability: #6

This is the last of six Blogs dealing with TBL Sustainability. All six Blogs have been co-developed with my colleague and TLA Associate Tia Carr Williams.

“Give a man a fish, you have fed him for today.  When a man learns to fish, he will feed himself for a lifetime.” – Author unknown

In earlier Blogs of this series, we noted that both Sustainable Advantage (SA) and Sustainable Competitive Advantage (SCA) are based on achieving superior market position. We also noted that SCA is toxic in that it pits both employees and organizations against one another in a never ending competitive “survival of the fittest”, whereas SA strategy and implementation are based on a much more desirable win-win collaboration of all parties. In other words, SCA tries to push on the rope of change whereas SA pulls change into being. Organizational Sustainable Advantage™ (OSA™) was introduced and defined in Blog #4 of this series, and is an improvement on SA since the OSA™ approach certifies that strategy and implementation plans are based not only on a profitable win-win collaboration of all parties, but that they are ethical, and without negative impact on relevant ecological and sociological systems. In other words, OSA™ is still pulling change into being, but it goes to a new level by adding the essential triple bottom line elements (social, ecological, financial) as a significant component of sense making and decision making.

To ensure and encourage the necessary organizational climate of innovation and TBL focus, monitoring, and reporting, when an organization begins to navigate the transition from SCA or SA to triple bottom line OSA™, The Leadership Alliance Inc. [TLAINC] has led the way in creating an easily understood seamless performance-based process. This process is one that an organization can readily morph into. It reduces the organizational complexity typically involved in such a large scale change; promotes formation of a fractal organization; fosters common TBL OSA™ understanding and values across all organizational levels; nurtures a culture with innovation at its heart; encourages collegial, participative, open business systems; promotes and leverages networks and social interaction; and provides systems to measure and report progress continuously.

In order to easily understand and rapidly adopt TLAINC’s seamless performance-based process to navigate the transition from SCA or SA to triple bottom line OSA™, organizations must cultivate a culture having sustainable business principles, learning and innovation at its heart. There must be a motivational visionary strategy allied with a deep human context structure; workforce integration systems of high efficiency, capability and efficacy; a synergistic co-operative culture that fosters thinking on how everything can be improved and costs reduced; and there must be task agility for optimal productivity.

This is a tall order, but to achieve these ends, TLAINC supports its clients in undertaking two processes concurrently. One process involves creation of an organizational “attractor” – a central core of strategic business concepts, business processes, and social norms to be refined and used by employee networks at all levels to mutually shape the organization in a dynamic manner; the second process is cultural, and involves creation of a socialized environment based on trust, true dialogue, and the lessening of the power struggles that exist in organizations.

These interventions may be optimally achieved based on TLAINC’s transformative approach. This involves forging a unique ‘solidarity network’ that is inclusive of all the important organizational networks. In this approach representatives of all the various key organizational and governance networks, including the CEO, hold dialogs together for the good of all the stakeholders. TLAINC has the proven capabilities to identify the representatives of the key organizational networks, and the real-life organizational experience to assist formation of the solidarity networks.

These solidarity networks re-design and re-develop the systemic organizational structure, business processes, roles, and tools, to specifically develop an environment where learning and adaption will be essential to successfully carrying out the work of every employee. In this pursuit, new structures and ways of working to adjust to, and to continue adjusting for, a changing set of conditions are created by the continuous dynamic process of co-evolution with a changing environment that is underpinned by learning. This approach leverages a distinctive characteristic of complex systems which is their ability to create new order; that is, a different way of working, thinking and relating. OSA™ is this continuous process of co-evolution. It is neither a one-off change which remains static, nor a reversion or adherence to the status quo. This means understanding and working with (not constraining) the characteristics of organizations as complex social systems.

In promoting organizational learning and adaption, TLAINC through its Associates can accommodate the integration of peer and supervisory coaching, where required, with a highly experienced team of coaches with proven track records. This ensures adaption to a specific strategic or tactical behavioral assessment that obviates hierarchical appraisal in favor of self appraisal procedures. Milestones are configured from qualitative and quantitative measurements aggregated from contributions and co-operative peer review.

The corporate-structure model for the decentralized enterprise described in earlier Blogs in this series demands strategic leadership, corporate identity, capabilities distribution and access, low-cost capital access, and enterprise-wide control. Implementation must be based on socialization, knowledge management, and coherence. The measurement, monitoring, and reporting of these pivotal features are critical to success. TLAINC will collaborate with a client to provide a customized version of TLAINC’s Sustainability Scorecard™ to truly reveal the advances that indicate improvements are being realized, and to highlight next steps.

If you are serious about having your organization navigate the transition from SCA or SA to triple bottom line OSA™, TLAINC is the consultancy to help you make it a reality – why not give us a call?

Successfully Developing Triple Bottom Line Sustainability: #5

This is the fifth of six Blogs dealing with TBL Sustainability to be published over the next few weeks. All these Blogs are being co-developed with my colleague and TLA Associate Tia Carr Williams.

“In our every deliberation, we must consider the impact of our decisions on the next seven generations” – The Great Law of The Iroquois Confederacy

Organizational Sustainable Advantage™ (OSA™) was introduced and defined in Blog #4 of this series. OSA™ results from following a Right for Market™ (R4M™) approach. R4M™ is an improvement on the Right to Market™ (R2M™) approach associated with Sustainable Advantage (SA) that was discussed in an earlier blog, and which involves the more basic method of introducing the right products and/or services at the right time in the right contexts with the right supply chains, and then continually updating, optimizing, and retiring them as necessary. An R4M™ approach makes sure that R2M™ strategy and implementation plans are based not only on profitable win-win collaboration of all parties, but on strategy and implementation plans that are ethical, and without negative impact on relevant ecological and sociological systems. In other words, OSA™ is still pulling change into being, but it goes to a new level by adding the triple bottom line elements (social, ecological, financial) as a significant component of sense making and decision making.

The difference between SA and  OSA™ is particularly important because in our contemporary social-media savvy culture, how a corporate entity performs in environmental, social and economic dimensions has begun to have significant impact, either positively or negatively with respect to the judgments of all stakeholders, including shareholders, consumers, customers, and clients. Whilst there is a clear understanding that businesses are about making profit, firms may no longer profit at the expense of populations or resources at risk. Such a profligate mindset alienates an increasingly aware market-base that is continuously making choices based on their sophisticated understanding and informed awareness of today’s corporate activities. Their perceptions are globally relevant, acute, timely and dynamic, gratis of the Web and the popular groundswell of interest in, and concern for, social and ecological issues.

To further facilitate tracking the impact of commercial activities, the triple bottom line (TBL) monitoring regime has been introduced into the business world. The TBL is sometimes known as ‘people, planet, profit’, and is a commercial measurement and reporting approach that is intended to capture a new set of values and criteria for measuring organizational success in social, ecological and financial parameters. TBL monitoring is directly related to OSA™, and is more rigorous and inclusive re: people, planet and profit than has so far been achieved via Corporate Social Responsibility (CSR) reporting.

In essence, the triple bottom line expands the traditional accounting framework to truly include and give equal weight to the new ecological compliances and social responsibilities, as well as traditional financial performance. In the past, in the private sector, a commitment to CSR has only incurred commitment to some form of ecological and financial reporting; however, research has shown that CSR has typically been used as a smoke screen behind which companies carried out “business as usual”. TBL measurement and reporting are intended to provide more rigorous and robust monitoring of a corporation’s demonstrated desire for accountability and transparency in regard to people, planet and profit, and its progress toward attaining OSA™.

To ensure and encourage the necessary organizational climate of innovation and TBL focus, monitoring and reporting, The Leadership Alliance Inc. [TLAINC] has led the way in creating an easily understood seamless performance-based process that an organization can morph into as it begins to navigate the transition from Sustainable Competitive Advantage to the triple bottom line driven OSA™.

This process reduces the organizational complexity typically involved in such a large scale change; promotes formation of a fractal organization; fosters common TBL OSA™ understanding and values across all organizational levels; nurtures a culture with innovation at its heart; encourages collegial, participative, open business systems; promotes and leverages networks and social interaction; and provides systems to measure and report progress continuously. We will expand on this process in Blog # 6 of this series.

In the upcoming sixth and final Blog of this series, practical processes will be described that are used by The Leadership Alliance Inc. and its partners to assist client organizations develop triple bottom line OSA™ capability.

Successfully Developing Triple Bottom Line Sustainability: #4

This is the fourth of six Blogs dealing with TBL Sustainability to be published over the next few weeks. All these Blogs are being co-developed with my colleague and TLA Associate Tia Carr Williams.

“Prosperity is the best protector of principle.” – Mark Twain

Right to Market™ (R2M™) involves introducing the right products and/or services at the right time in the right contexts with the right supply chains, and then continually updating, optimizing, and retiring them as necessary. In Blog #2 of this series, we noted that both Sustainable Advantage (SA) and Sustainable Competitive Advantage (SCA) are based on achieving R2M. We also noted that SCA pits both employees and organizations against one another in a never ending competitive “survival of the fittest”, whereas SA strategy and implementation are based on a much more desirable win-win collaboration of all parties. In other words, SCA tries to push change into being – yeah, just like pushing on a rope – while SA pulls change into being. Now however it’s time to pull a different rope!

Given the growing business sensitivity to ecological and social concerns it is apparent that R2M™ has become outmoded, and that SA will be less and less persuasive in the future. This is because innovations must now combine economic and social knowledge with technological and scientific knowledge to ensure that an organization’s products, services and activities are meaningful and sustainable in a triple bottom line (TBL) sense i.e. in an economic, social, and ecological harmony we call Organizational Sustainable Advantage™ (OSA™).

OSA™ results from following a Right for Market™ (R4M™) approach. R4M™ is an innovation on the R2M™ approach, whereby an organization makes sure that its R2M™ strategy and implementation plans are based not only on a win-win collaboration of all parties, but on strategy and implementation plans that are ethical, and without negative impact on relevant ecological, sociological or environmental systems. In other words, OSA™ is still pulling change into being, but it goes to a new level by adding the TBL elements as a significant component of sense making and decision making. This must be achieved whilst still emphasizing the culture value-set that enfranchises, to the greatest extent feasible, employee participation through informal learning and the social technologies that act as stimulus for positive behavioral drivers.

OSA plays a powerful role in transitioning an organization to the polyarchic structure highlighted in earlier blogs. This structure accords the degree of distributed influence requisite to shaping a new culture, and shaping occurs from the bottom up as well as from top down to effectuate a gradual acclimation to new processes that form the necessary foundations. Drucker noted that: “Every enterprise is composed of people with different skills and knowledge doing many different kinds of work. It must be built on communication and on individual responsibility. All members need to think through what they aim to accomplish-and make sure that their associates know and understand that aim. All have to think through what they owe to others-and make sure that others understand. All have to think through what they in turn need from others-and make sure that others know what is expected of them”. OSA incorporates key Network Visualization Analysis capabilities that help to acknowledge which and where key personnel are contributing, and acts to direct the organization to incentivize appropriately.

Sustainability models derive conceptually from natural self-organizing structures that build colonies of knowledge aggregation and mobilization that effortlessly optimize ‘the best solution’ –  a process greatly hindered in standard top down cultures. The natural state of every sustainable system moves toward balance that is fluid and freely adaptive to necessary improvements.  Responsiveness to critical knowledge is a core exemplar of OSA functionality.  The capacity to observe, address and respond in a timely manner to key issues affords the agile organization the capability to stay ahead of the marketplace by authoring and acting in anticipation of, not only reacting to, marketplace demands.

In the upcoming fifth Blog of this series, the triple bottom line approach to sustainability plus its monitoring and reporting are discussed in more practical detail.

Successfully Developing Triple Bottom Line Sustainability: #3

This is the third of six contiguous Blogs dealing with TBL Sustainability to be published over the next few weeks. All these Blogs are being co-developed with my colleague and TLA Associate Tia Carr Williams. In this third Blog further cultural implications of Sustainable Advantage (SA) are explored.

“It is not who is influential that counts but who acts as a catalyst for conversation” – Keith O’Brien

Sustainable Advantage (SA) has been discussed in Blogs #1 & 2 of this series dealing with TBL Sustainability. It is clear that change is fundamental to SA, and change is a constant continuum – a flowing circadian dynamic that yearns to be harnessed. The ability to purpose the momentum of change is colored by an organization’s prior experience of change. When starting to contemplate SA as an organizational change opportunity, and how it might be managed, it is useful initially to spend time reviewing and learning from previous change-related experience, and re-assessing the organization’s culture and design.

Change takes root best in a culture of innovation that incorporates an inclusive collaborative mindset, and that embraces change as an organic evolutionary process of co-production. As emphasized in Blog #1 of this series, a decentralized organization has distinct market advantages over a wholly centralized organization. In particular, the sense of incorporation from many perspectives in a decentralized organization creates a balance and an harmonious relationship with change, rarely the case in current or previous models of ‘change management’.

How well or badly churn has been integrated into the daily work flow is also an indicator of sustainability potential. Churn is typically viewed as deleterious from an organizational harmony viewpoint, but for a decentralized organization focusing on SA, churn is integral to its change momentum, and new and existing incumbents can champion innovation from a place of congruence, comprehensively cognizant of choices and challenges.

An organization seeking SA must cultivate a culture enfranchising sustainable principles and innovation at its foundation. There must be a synergistic co-operative culture that fosters thinking on how everything can be improved. Management must seek a balance between financial viability and strategies to gain and maintain market uniqueness through environmentally sustainable practices, including product and process innovation, as well as the development of sustainable supply chain management. There must be a motivational visionary strategy allied with a deep human context structure, and workforce integration systems of high efficiency, capability and efficacy. Costs must be reduced, and there must be task agility for optimal productivity. Leadership is at the heart of a healthy organization, but it must beat with the ring of authenticity – people will follow where their heart is engaged.

This kind of strong organizational culture confers a fundamental and unique advantage. If building and sustaining an innovation culture focused on commitment to the organization’s goals remains central to all activities, the potential for sustainable success is increased immeasurably. To promote creativity the organization’s leaders must pull the culture into being by giving the right incentives to key people, encouraging them to think creatively, and with every achievement, giving them the confidence to think ‘out of the box”. This can only be accomplished where the environment supports such activities. ‘Soft spaces’ within the formality of the corporate environment nurture such engagement to great effect; it is no surprise that the factors that most strongly predict rapid change, adaptation, and innovation introduction, are related to collegial, participative and open organizational systems, and cultures that permit joint problem solving without boundary interference. These are the kinds of decentralized organizations where individuals have the freedom to take risks and develop new ideas, be creative, and challenge existing organizational norms.

In the upcoming fourth Blog of this series, the implications a Triple Bottom Line approach to SA will be explored.