MIT Sloan's Peter Senge, founder of SoL (the Society for Organizational Learning), shows how companies, right away, can stop adopting sustainability measures that do "less bad" and start doing "more good," both for the business and the world around it.
This article is adapted from “Sustainability: Not What you Think It Is” an interview published by MIT Sloan Management Review in June 2009. The complete interview is available here. © Massachusetts Institute of Technology, 2009. All rights reserved.]
Senior Lecturer in Behavioral and Policy Sciences at MIT Sloan School of Management, Peter Senge has lectured extensively throughout the world, translating the abstract ideas of systems theory into tools for better understanding of economic and organizational change. He is the founding chair of the Society for Organizational Learning (SoL), a global community of corporations, researchers, and consultants dedicated to the “interdependent development of people and their institutions.”
Your most recent book, The Necessary Revolution, details the way companies, often working collaboratively with NGOs, are embracing the challenges and opportunities around sustainability. What clicked for them?
Many different things. For some, it's becoming clearer that they need to think about what happens to stuff after you make it. In Europe today, you make a car, you have to take it back at the end of its lifetime. That’s the law. The same is true for a lot of consumer electronics. That’s a fundamental shift in a business model and a potentially boon for companies who start to think about designing cars to recover valued components and elements at the end of their lifetime. But for those behind, the new EU mandates will represent a significant cost of having to dispose of products when customers bring them back to them.
You found companies that went from thinking about how to be “less bad” to actually being “more good.” How does that shift happen?
If you look at the progression of companies, they almost always start off this journey with some combination of waste reduction and risk mitigation — in other words, there are a lot of aspects about our ways of doing things that we’re wasting money on now. Energy is the obvious one at the top of everybody’s mind. It used to be it was a trivial cost. Now it’s not so trivial. But a real shift occurs when you start to focus on real opportunities, new products and services and totally new ways to meet the genuine needs of the future. The industrial Age is ending, with its emphasis on extractive industries, fossil fuels, enormous amounts of waste and persisting huge inequities. It is not ending because of some ideological war, it is ending because its inner contradictions are coming home to roost. Climate change is the most obvious example and its mandate to dramatically accelerate the transition to low-carbon energy. But it is only an example. Today we use 1 1/3 Earths, if everyone lived like Americans it would be more like 6 Earths. This is obviously never going to happen. Companies who understand these deeper shifts will have fundamentally greater abilities to innovate than those who do not.
So some companies are really embracing the idea of sustainability?
Sustainability is a word that I’m not very fond of, but most of us in the field have accepted it as the lingua franca right now.
For me, sustainability means paying attention to the larger systems of commerce and fundamental shifts that will occur in how we meet our basic needs — food, water, energy, and social well being. As the world really becomes more and more of a village, there simply is no more “away” into which to casually discard the by- products of systems of these systems
But sustainability, in another sense, is a bad word. It’s technically what we would call a “negative vision.” If someone asked you how your marriage was going and you said it was “sustainable,” that would not be too inspiring. More to the point, if you try motivate change out of fear, bit only motivates for as long as people feel the issues are pressing on them. As soon as the fear recedes, so does the motivation.
What we’re talking about is arguably the greatest challenge to innovation that humankind has ever faced: reinventing our whole way of living. And every single example I know of where something meaningful has been achieved, where people have worked at something that’s taken five years, 10 years, 15 years to bring something really new into existence, like the LEED certification system that is redefining green building around the world. It’s people’s excitement toward something that really draws them. It’s aspirational.
You say, essentially, that business practitioners are going to respond based on the way one of the main issues — energy, food and water, waste and toxicity, gap between rich and poor — matters to them. Would you say that any one of these is particularly under-attended to by business?
They’re pretty much all under-attended to. If you step back and ask “What is the common picture here?” what’s common is that businesses don’t know how to see the systems they operate in. You ask people, “Where did what you make come from? Where did that component come from?” You trace it all the way back to the source in terms of something that’s being harvested or extracted from nature.
Then you ask them, “Where does it go?” They’ll say, “Well, we sell it, that’s it, it goes to our customers”. And you push them: No, what happens after that? You start to look at the whole life cycle of whatever you make.
If you’re talking to a business executive right now and he or she wants to respond, what do you tell them to do?
I tell them to start with what you can do in the short-term and build momentum through practical accomplishments. In a relatively short period, with a combination of internal process improvements, there’s a lot that can happen to get their acts together. Figure out where your energy goes. Very few manufacturing organizations are technically sophisticated in their use of energy, but plenty of good consultants can get you there pretty quickly. Find things that engage people’s spirit and energy, like working to become a zero-waste facility, healthy local food or tutoring local kids (Slumberger has an extraordinary global network to support science and math tutoring, on-line and in person that has literally thousands of company volunteer around the world — see http://www.seedslumberger.com). Remember the social and environmental problems are always interconnected.
What’s exciting is that we don’t have to leave this to the people at the top. Our book emphasizes a lot of stories where leadership started much more at operational levels, in the middle or lower ranks of organizations.
You’ve been working this field for a long time. How you think attitudes toward sustainability have changed within organizations?
In the last year or two, everything has changed. People are starting to suspect that these are really strategic issues that they will shape the future of our businesses. The specifics are all different depending on industry and context, but we’re in the beginning of an historic wakeup.
Undoubtedly, climate change has become the straw breaking the camel’s back. More and more people are starting to realize that it’s not going to be fixed by a few magic technologies that let us all continue with business as usual but as a byproduct of a real shift in how the whole industrial system operates. (See http://climateinteractive.org)