Sorting through my thoughts about Detroit's bankruptcy (or whatever it turns out to be)
Different ideas about how companies can be organized and run are floating around. What resonates with me are institutions that support communities: "communities" of employees, of local citizens, of people interacting with the natural environment. Too often, though, companies barely acknowledge the importance of these communities while they bend over backwards to better meet the needs (make that wants) of investors.
Many people reflexively respond that the main (or only) purpose of a company is to make money, and that companies must be organized to serve the needs of the "community" of investors. (They don't). Of course, investors may have no connection to a company at all -- they don't work there, don't live in the towns where their investments are put to work, they may not even like the products the company makes. Yet to business traditionalists -- but not to me -- investors' desire for making money trumps everything else.
I would like to think that when it comes to a real community -- I'm thinking of Detroit -- that we wouldn't even need to question whose rights should be considered ahead of all others: the rights of those who call the community home. Other discussions about social issues can take on a moralistic dimension: deficits somehow correlate with lack of character (though empirical evidence indicates it is appropriate to stimulate a stalled economy); poor people don't deserve to eat; ill-supported (and often mean spirited) advice like that.
But when it comes to a city -- a place where people live, raise kids, and shape our future -- moralizing or scolding make even less sense. Police, firemen, and other pensioners contributed to the city for years -- some for decades. State law says their pensions cannot be reduced. Those not owed pensions are owed essential services, including timely responses by police and fire fighters, working schools, and working street lights. They did not cause Detroit's decline, but they have suffered greatly from a transformed auto industry and corporations' decisions to decamp to the 'burbs, taking with them their tax dollars.
With change, comes the opportunity to reflect upon new ways of doing business. Shifts in population growth and in spending have made companies aware of new markets in the developing world, if not yet in as dramatic a way at the bottom of the economic pyramid. Similarly, in the next several decades, large-scale transfers of corporate ownership provide an opening for a dramatic shift towards inclusive corporations.
And now Detroit is facing bankruptcy. This grim circumstance creates an opening, too. What kind of city does Detroit deserve to be? Most essentially, for Detroit to "work," people must work. And there is work to be done. With more than a quarter of Detroit's 140 square miles abandoned, projects to raze and re-purpose these properties are being undertaken. Detroit Blight Authority is taking a lead, appealing for federal funds. This is a perfect opportunity for the government to release funds, contingent upon the training and hiring of Detroit's idle workforce. What's more, Detroit can follow the lead of other downtrodden communities, including the South Bronx, to create a green, energy-saving, and even energy-creating city.
Detroit's schools are the next (if not the first) obvious place to make changes. Detroit Public School's newly appointed emergency manager can help foster an environment that couples academic rigor with real-life relevance. If you've followed this blog, you know how high I am on the Network for Teaching Entrepreneurship">, a model that creates life-changing educational experiences for low-income students.
Even with ObamaCare, negotiating the healthcare maze will be daunting. Programs like Rebecca Onie's Health Leads demonstrate how non-traditional health care workers can help cut through red tape to ease the problems faced by the ill, poor, and elderly. Where Health Leads relies on college students to fill "prescriptions" for food, clothing, housing, etc., Onie suggests that local community members themselves can staff similar positions. Such staffing (jobs!) can avoid expensive emergency room visits and head off long term health problems. Suitably structured and financed (possibly with social impact bonds), hospitals can serve more patients, more effectively, and save money.
As Governor Snyder has been saying, Detroit's problems did not just occur; they've been unfolding over decades, caused in large part by a dis-investment in the city. Now at the point of crisis, we can begin to point Detroit in a new direction. Detroit's resurrection will take time, as did its decline. It will take investment, but investment in, and of, the community. Not investment aimed at making investors wealthy ahead of the needs of the city.
The city that helped more than any other in winning World War II; the city that created a modern society through the automobile industry and industrial efficiency -- this city needs our compassion and support. This does not mean our charity: for by re-making a working, well-educated, healthier Detroit, we set the country on a stronger course.
Consider: We just re-elected a Democrat President who will need to work with a Republican House and Democrat Senate. Or viewed differently: the people have said that they want a divided government (as Speaker Boehner suggested), not an unimpeded move towards a more progressive agenda.
Or did they?
The Presidency is the only national office that we vote for. Even so, it's hard to imagine that the popular vote would have been same if, say, states like Vermont (67 percent Obama) or Utah (73% Romney) got the same attention as Ohio.
The House results were even more affected by artifacts of our electoral system. With all 435 House seats contested, Democrats received almost half a million more votes, but the Republicans won a majority of the seats. Why? Because of the way congressional districts are drawn, which itself is strongly influenced by which party is in power in the states. As the Washington Post pointed out, in states where Republicans controlled redistricting, Democrats almost uniformly performed far worse in elections for the House than for the Presidency. Examples: in Ohio, Obama won 51% of the vote, but Democrats won only 25% of House seats; or South Carolina, where Obama won 45% of the vote, but Democrats won 14% of house seats.
In the Senate this year, 23 of the 33 seats being contested were held by Democrats, making it difficult for Democrats to hold on to their 53-47 (those numbers again!) margin, if the nation were voting in a party-neutral, 50-50 ways. Yet, rather than losing 6.5 seats net and losing Control of the Senate, as statistics would suggest, Democrats gained two seats, by winning 25 of the 33 contests, while winning the popular vote across these Senate races by nearly 13 million votes.
The divided political situation we now face results from an electoral chemistry that combines any number of influences, from Article II of the Constitution, which created the Electoral College (originally conceived to produce results in elections dictated neither by political parties nor by national campaigning); to the most recent census and its influence on congressional re-districting; to someone with a cell phone recording Mitt Romney's "private" thoughts; among many, many others.
Together, these influences produce an "emergent" picture of a national electorate. Emergence is a characteristic of a system where what is apparent outwardly arises from any number of smaller features that may be hard to detect and whose interaction looks little like these features in isolation.
So, is John Boehner right in saying that there "is a mandate for both parties to find common ground and take steps together to help our economy grow and create jobs, which is critical to solving our debt"?
My position is that to figure out what is on the nation's mind, it is best to look at outcomes most reflective of overall, versus local, views. Or: look at the popular vote for President, the House, and the Senate. Democrats won each of these races, by margins of 3 million, half a million, and 13 million votes respectively. To paraphrase the cognitive scientist Douglas Hofstadter: Although a green fence is made up of atoms and atomic particles, none of them is green. To see the color of the fence, just open your eyes.
The popular vote for the Presidency, the House, or the Senate are not perfect indicators of our national desires. But they suggest that the people want the country to go in a direction Democrats have suggested: investmenting in education, health, infrastructure, a greener planet.
I have much to be thankful for -- certainly my family, friends, and the opportunity to do what I love -- but let me single out a city that I'm thankful to see on the rise.
Forbes recently listed the places where youngpeople are happiest. By grading cities on economic factors like compensation and benefits as well as non-economic factors like work-life balance, they gave each city a kind of overall "grade point average." The cities grading out the highest were Redmond, WA (been there), Ft. Lauderdale (done that, a long time ago), and Orlando (been and done more recently -- but with my wife and kids).
But another top-ten city made me smile: Detroit, at #6. It's a happier place to live than Chicago, San Francisco, and LA.
Why am I gratified to see Detroit included among the winners?
Teaching at the Ross School of Business, University of Michigan, in Ann Arbor, forty miles away from Detroit, I've seen a parade of talented students come to town, get their education, and take their skills and training elsewhere. Students are inspired by the "change the world through business" courses I teach, but when it comes to applying what they've learned in the real world, they've preferred jobs in India, Africa, or Latin America.
That appears to be changing.
Entrepreneurial efforts are harnessing the city's energy. An organization that I've worked with, Ascension Health, the largest nonprofit healthcare system in the country, has launched Enterprising Health, a business-development organization aimed at identifying, supporting, and launching "bottom-up" enterprises that improve the health and lives of urban dwellers.
Among the social enterprises being supported: businesses that use games or sports to encourage and educate about health; a fresh food "dollar store"; and an activity that delivers health services to the poor where they naturally congregate, thus encouraging health care among a group that is often excluded from, and suspicious of, traditional health care delivery.
Visionary thinkers like Josh Linkner, Dan Gilbert, Brian Hermelin, and Earvin (Magic) Johnson have a larger scale vision to reclaim, re-define, and re-brand the city. Though not everything they touch turns to gold (Gilbert owns the Cleveland Cavaliers), the new-age venture capital firm they've formed, Detroit Venture Partners, plans to hit a homerun in Detroit (yes, a metaphorical non sequitur -- maybe because I've got half an ear on a soccer game on TV in the other room).
DVP's culture includes its Big 11, with "passion" topping the list:
1. PASSION FIRST
Build something larger than yourself
Stay close to your purpose and "why"
Drive social change
The energy of change and the opportunity to re-create a city (and create a great life) have not been lost on students.
In a class I'm teaching to undergrad business students, Base of the Pyramid: Business Innovation for Solving Society's Problems, students work on addressing real, vexing societal problems. In previous years, the kinds of problems students have clamored to work on have mainly been in the developing world, and this year, too, students are working on problems in settings including Haiti, Liberia, and Honduras.
But fully half of the students this year chose instead to work on problems affecting Detroit: health care, education, business and economic development, and food deserts. (Watch this space as the Impact / Call to Action videos they're creating are completed.)
At the graduate school level, the Revitalization and Business Club at the University of Michigan is planning its second annual conference on using business as a force for positive societal change. The club recognizes the overlapping desires of graduate students of all stripes -- business, policy, urban planning, and other disciplines -- to explore how innovation and entrepreneurship can create a vibrant, inclusive city.
The jury on Detroit's growth and revitalization is still out. Richard Florida, the urban scholar and commentator, contends growth will come from increased productivity of the population rather than strategic contraction.
Economic development today is about literally hundreds and thousands of little things that you do slowly and cumulatively at the neighborhood and community level. Building partnerships involving universities, building clusters, many, many small things that accumulate, that create some economic viability. ... That's what Detroit has to do and [it] all the assets ... It has spectacular universities like Wayne State, it has the Cranbrook Academy, the center of modern design, industrial design, and furniture design. It has two of the greatest research universities on the planet, very close by at Ann Arbor and Lansing, the University of Michigan and Michigan State. And it has a fabulous design/architecture community, creative energy in its low income communities, a tremendous, really resilient African-American community, a phenomenal Arabic community that will do anything to save and pitch in... [and] it has this legacy of musical talent that is just incredible and it continues to propulsively create new musical styles.
All of those things add up to a kind of creativity and innovation being in Detroit's DNA. But [sustainable growth is] not going to come from a federal bail-out from the auto industry, it's not going to come from a big casino and convention and stadium project, it's going to come from really the small-scale efforts when people are empowered, where neighborhoods are empowered.
And that, it seems to me, is what we are seeing beginning to take hold.
Building blocks. I'm fascinated by building blocks. Without them, complexity is impossible. But recently, I've been toying with the idea of "unbuilding blocks" -- elements or processes that can help disassemble entrenched activities, processes, or institutions that are causing the world difficulty.
An arch depends on its keystone for its strength and stability. Similarly, activities, processes, and institutions -- with all their function and dysfunction -- might be altered for societal benefit by removing key building blocks, even if we desire fundamental change. How do we remove the building blocks that are producing climatic disaster? That have created so many "have nots"? That leave parts of the world centuries behind others?
It's 5 a.m., I've walked our dog, made some coffee, and am easing into the day (too early! can't sleep!) with email. Something drew me to a message showing my LinkedIn Updates, the kind of thing I usually trash without reading, but today I looked at the Updates and saw a post by someone I've met once and don't actively follow (thanks Lev Gonick) -- a link for a crowd-sourced film.
A 4-minute video, a trailer for the longer (still short) film, Connected, begins with an explanation:
On the 4th of July, 2011,
we posted a request online
to #participate in a short film
Video makers and artists around the world submitted work to illustrate ideas in the film's script. Online voting determined which snippets made it. The trailer is being crowd-translated into 100 languages. So, who made this film? A bunch of crowdsourcing strangers.
The film has not hit Ann Arbor, where I live, and I didn't make it to Cannes this year. (Of course, I've never made it to Cannes.) So I am guessing based the film's website and various online reviews what it's about. I'm also guessing I'll like it. A lot.
Fast Company describes this film by Tiffany Shlain as illustrating
"the power of digital connectivity and access to knowledge ... [and the] connectedness between major issues like the environment, consumption, technology, human rights, and the global economy [and] a personal journey of discovery about connections in [Shlain's] own life. The film shows the beauty and tragedy of human endeavor and champions personal connection and how the "power of one" has become digitally exponential."
"Digitally exponential" sounds to me like The Onion describing how to approach a difficult math problem; but never mind, I think I get the drift: That somehow the right email found me this morning as I'm thinking about how to teach fifty odd students (fifty odd means "approximately fifty") to create change through video. In our (my) wildest dreams, we'll go viral. I've never done anything like this before, and neither have they.
The unexpected email, on a topic precisely relevant to my needs, even directing me to a film when I'm wondering what a film about changing the world might look like suggests that our new "connecting technologies" create serendipitous events like these, and far more often than ever before. And as they do, our interdependence can create something bigger than any of us is even remotely capable of as an individuals. People are smart. Groups, especially when diverse, are crowd-smart.
Connecting with others can create communal actions in the Arab world powerful enough to topple regimes, so what else might it do? Might it change what what we buy (and so what is produced), what we tolerate and what we won't (to force legislators' hands), how we live our lives (with the impact that has on others around the globe)? Can connecting dismantle building blocks?
Our progress as a civilization has come from creating an elaborate technological and social edifice, based on simple building blocks at first such as wheels and chieftans, and now involving highly sophisticated building blocks like computer chips and multinational corporations.
At heart, we are social animals who want, even need, to communicate. With our family, our tribe, our community -- even as our community includes crowds that we've never met in person. Through our communications, we might begin to remove building blocks.
Can we create some new unbuilding blocks to create a world that is not racing towards a cliff? Maybe Tiffany Shlain's movie will provide some answers when I see it. It's certainly gotten my day going at an early hour.
I will occasionally publish articles by others that illustrate central ideas in my book. In this essay, Michelle Lin, a former student in my course on “Solving Society’s Problems through Innovation and Enterprise,” writes about Growing Power, a revolutionary nonprofit urban farm.
The essay illustrate how Growing Power embraces Big Picture Design by ensuring that it considers all aspects of its operations, not just farming. It exhibits an ability to Make It Appropriate by recognizing, and even taking advantage of, its urban location. It helps Make It Stick by familiarizing local citizens and others with its activities and involving them when it is possible. Finally, Growing Power is Making it Bigger through partnerships, education campaigns, and even technology it has developed, all of which can help others around the country and the world participate in the “Good Food Revolution.”
Towering at 6’7” and resembling a retired linebacker, Will Allen is the last person you would expect to be an urban farmer. After a brief stint as a professional basketball player, followed by a successful career as a salesperson for Kentucky Fried Chicken and Procter & Gamble, Allen returned to his family roots, farming on a full-time basis. What began as a desire to reconnect with a childhood surrounded by food and farming is today driven by Allen’s motivation to provide equitable access to healthy food.
Allen started Growing Power in 1993 on a two-acre plot of land situated less than one-half mile from a public-housing project. Today, Growing Power produces at $200,000 per acre and feeds 10,000 people each year. It is the only zoned farmland in Milwaukee and arguably the nation’s leading urban agricultural project. In a space smaller than the average supermarket, it boasts 20,000 plants and vegetables, thousands of tilapia and perch, a thriving livestock of chickens, goats, ducks, turkeys, and rabbits, an apiary, and thousands of red wiggler worms.
Allen’s path to creating Growing Power was almost accidental—or directed by a higher power depending on your perspective. While still at P&G and living about 20 minutes outside Milwaukee, Allen was developing plans to sell produce throughout the city. He happened upon a greenhouse that had been repossessed by the city. Competing against a religious group intending to build a mega-church, Allen wrote a proposal to keep the greenhouse in use and added in a youth education component. The alderman reviewing the proposal was a former priest and felt Allen’s proposal was “religion in itself”. However, it was a youth group that approached Allen for help with gardening and selling produce that truly inspired what Growing Power is today.
Big Picture Design
While Growing Power’s urban farm is impressive on its own merits, its mission to provide equal access to affordable, safe, and healthy food is fueled by big, difficult, institutional challenges that range from lack of availability to unaffordable healthy foods. The public housing by Growing Power, the largest in the state, is more than three miles away from the nearest grocery store chain, an inconvenience for anyone without car. McDonald’s and Popeye’s are both a 5-minute walk away. This is all too common a problem in inner cities. In Detroit, as another example, there is not one single national grocery chain, although the city’s area is larger than Manhattan, San Francisco, and Boston combined.
On a national scale, this translates into “food deserts” in lower-income areas, where healthy food is almost non-existent and if it is available, is likely too expensive to have on a regular basis. This perpetuates poor eating habits in lower-income populations, limited exposure to non-processed foods, long-term health problems, and lack of understanding of nutrition and how to prepare nutrient-rich meals.
What makes Growing Power’s approach powerful is that it is not just an urban farm. Rather, it has a big picture goal of impacting a “social, ecological and economic bottom line” which is achieved by an ecosystem of programming that includes sustainable growing practices, education, training, community outreach, and advocacy. Furthermore, Allen is not just focused on Milwaukee, but is also demonstrating that Growing Power’s approach can be adopted anywhere, in cities across the US and even abroad.
Making it Appropriate
As we know from shopping at places like Whole Foods, Sparrow Market, and the weekly Ann Arbor farmer’s market, there is a price premium to buying local, organic food and produce. To achieve Growing Power’s commitment to creating local food systems and equitable access to healthy food, Allen has experimented and innovated to develop low-cost, closed-loop growing techniques.
At Growing Power, plants are densely packed and vertically grown, bringing in $5 to $30 per square foot. Farming at this level of intensity requires rich nutrients, which is enabled by thousands of highly productive worms that create 10 million pounds of castings (worm poop). This waste product is also diverted from landfills. Since compost generates a lot of heat, Growing Power has identified ways to leverage this heat source. Compost heaps, which reach temperatures of 150 degrees Celsius, sit within the greenhouses to keep them warm. Plant beds also sit on top of compost heaps. These methods allow Growing Power to reduce their costs, grow year-round, and increase their revenue streams.
Allen’s greatest innovation is the aquaponics system he developed, a symbiotic process for growing fish and plants. The waste in fish tanks is filtered by natural means and converted into plant nutrients as the water in the tanks is routed to the plant bedswhere crops grow, and ultimately returned to the fish tanks to complete a circuit. Allen’s system cost a mere $5,000 to build, compared to a $100,000 commercial system.
Much like his approach to experimenting with growing techniques, Allen pays close attention to needs of those he is working with and adapts Growing Power’s programs to meet those needs. When Allen first started working with kids, he noticed they had trouble reading and writing, so he instituted a reading and writing program closely tied to the work they did at Growing Power. To combat drug dealers who hung out in empty lots, Allen worked with kids to create “flower explosions”, drawing unwanted attention that discouraged drug dealers away from the lots. These kids not only got paid and learned about healthy foods, but also gained valuable life skills.
Making it Stick
A primary goal of Growing Power is to educate others on sustainable growing practices that can then be brought back to individual communities and contribute to the creation of localized food systems. Without demonstrations and education, Growing Power’s effectiveness would stop at its own borders. Therefore, the farm works with youth and adults alike to spread the knowledge that it has evolved for the past 15 years.
Every day, Growing Power offers 1:30 hour tours, whose admission price of $10 is funneled back into the farm. The true impact of the tours is for visitors to see the farm and all its various components in action and become inspired by achievable possibilities for themselves and their communities.
After school and job training programs, as well as paid internships, are available to kids and students. Allen often works alongside youth, acting as a role model and further instilling a strong work ethic. Kids can take what they are learning with their hands into the classroom and vice versa, making connections between what they study in class and what they experience on the farm. The knowledge and skills gained as a youth are carried throughout adulthood, into a future in which Allen believes urban agricultural skills will become increasingly important.
For adults, Growing Power provides workshops and conducts outreach programs with other organizations to create their own localized food systems. Growing Power also participates in events across the US, including a recent two-day workshop in Detroit on building hoophouses that included a lecture by Allen.
Outside of educational programs, the farm’s onsite retail store is a powerful expression of what local agriculture is capable of. While retail supermarkets often stay away from poor neighborhoods, Growing Power’s retail shop is often packed to the brim on Saturdays, demonstrating that demand for healthy food exists regardless of socioeconomic standing.
At its core, all of Growing Power’s programming and outreach efforts are community- and relationship-building activities. To truly embed healthy foods into daily life and practice, Growing Power is breaking down the barriers that limit healthy food to just those who can afford it and pioneering urban farming practices. Urban farming happens in public places and feeds an entire community, whether it is a school, workplace, neighborhood, or city. As a shared resource that is visible and accessible to all, an urban farm creates pride and a sense of communal ownership that ultimately contributes to “making it stick.”
Making it Bigger
Growing Power’s mission to localize food systems drives it to purposefully develop simple, cost-efficient, and effective methods that are accessible to all. Though Growing Power was borne through supporting neighborhood youth, it has since expanded to include adults, churches, companies, cities, governments, foundations, and even Michelle Obama’s “Let’s Move” campaign. Beyond Growing Power’s original site, it is working on over 100 acres of land throughout the greater Milwaukee and Chicago areas and has partnered with numerous organizations on outreach projects.
Allen’s innovative techniques have led to notable awards and recognitions, including the MacArthur Fellowship and Time Magazine’s 100 Most Influential People. In 2009, Allen became a member of the Clinton Global Initiative, through which he is raising $2M to strengthen food security in South Africa and Zimbabwe. All of this gives Allen the platform to advance the methods he has pioneered on a much grander scale and allow Growing Power to immensely scale up its impact.
The greatest compliment to Allen’s work is when others steal shamelessly from Growing Power. Sweet Water Organics, an urban aquaponics company launched in 2008, is the first commercial extension of Allen’s home-made aquaponics system. Sweet Water started with a $50,000 investment and in less than two years has garnered $1M in funding. It is currently discussing a whopping $30M concept for Sweetwater villages which would be supported by commercial-scale aquaponics. Who would have imagined that a home-made $5,000 system could turn into multi-million dollar commercial projects?
Allen himself is still experimenting and pushing urban agriculture to new applications. Growing Power is proposing to build a carbon neutral, solar-powered 5-story vertical farm. In line with Growing Power’s focus on community-building and educational activities, the facility is complete with classrooms, a demonstration kitchen, meeting spaces, and a retail shop. This $8-$10M vertical farm is currently under review by the Milwaukee’s zoning and development commission and may be the first facility to test the capabilities and viability of vertical farming. The success of this project would re-imagine how food is produced and transform the agricultural industry in the US and beyond.
Even with all that Growing Power tackles through its programming, Allen believes that all the important stakeholders involved in making good food accessible to everyone are never at the same table. September 2010 marked the first Growing Power Conference, which brought together 1,500 attendees and over 100 speakers to help eliminate fragmentation amongst the proponents of localized, equitable, and accessible food.
The embodiment of a multi-disciplinary approach, the conference’s participants included farmers, government officials, academics, doctors, nutritionists, people in fitness and renewable energy, environmental specialists, recyclers, and youth to name a small sample. Why does this diversity matter? In order to build a new food system, the input of all those involved is critical to designing a successful system that is capable of providing equitable access to healthy food. The conference provides a means to forge connections, inspire new ideas, and create momentum around building sustainable communities.
Through all of its initiatives, Growing Power is not simply making itself and its own reach bigger, but is enabling others to participate in what Allen calls the “good food revolution” and make the future of localized, equitable, and healthy food systems a reality. Growing Power is not out to do it alone, but rather wants its methods to be improved upon and scaled up, shamelessly copied, and successfully deployed all over the world.
Can something be in two places at the same time?
The answer from advanced physics is a clear (if
Can you create something from nothing?
We all know that you can’t — except scientists explain that
you can, by taking a vacuum (nothing)
and blasting it into its dense, complementary matter - anti-matter components
(lots of something).
Can these esoteric observations help us address societal
problems - problems operating on the scale of billions of people, not the sub-atomic
level of quantum physics?
As metaphors and guiding questions, yes.
Let’s start with money. As a physical medium, if I’ve got a $5 bill in my wallet, it
can’t be in yours at the same time. But, as a representation of financial value, my five dollars can be many places at once. If I deposit it in a bank, it’s mine, even if the bank considers it theirs and then uses it to
make five $1 loans (meaning “my” five dollars is now in seven places at once).
A loan is the most basic financial derivative, a building
block that, in effect, creates money and puts it into the hands of those who
need it and can use it to create value. (This is not to overlook derivative’s frightening power and potential destructiveness. Derivatives too numerous and too complicated to describe account for more than twenty times the amount of money in the world’s annual economy, and those tied
to housing values brought financial chaos to the world when they imploded.)
But let’s not forget the fundamental lesson: loans let us store the same medium of value in several places at the
same time. And these loans need
not be money. For instance, Impact
Everyday is creating a credit card that lets you loan it the “points” your card
earns, whose cash value is then used to fund renewable energy projects. Where do your points
“live?” With you, with the card
company, or with the solar farm you’re supporting? It’s not a stretch to say they live each of those
places at once.
Or consider your time.We know that we can’t get it back, but we can come awfully close when we
bank it. Time banks create non-monetary markets, often in
income-strapped communities, where a unit of effort I perform (say, an hour’s
worth of computer programming) is banked until I redeem it (maybe for an hour’s
worth of repairs on my car). In
obvious ways, this non-cash economy creates a powerful means for putting idle
time to productive use and bootstrapping economic activity.
Lent time, as with lent money (credit card points, or other
items of tangible value), unlocks value.In different ways, each transforms potential into value that can help
people and communities right now. Dare
we say, being in two places at once creates something from nothing?
I consider these examples of Big Picture Design. A principle of Big Picture Design is never
to let a good idea go to waste. Good ideas are everywhere, often requiring nothing more than imagination
to be applied in a new context. If
you can lend money, why not credit card points, time, airline miles, equipment,
Big Picture Design also teaches us to consider everything in developing a solution to a
societal problem. By considering everything, not
just features that first come to mind, solutions are more comprehensive—and better.
Wal-Mart, poster child for much that needs changing
(especially in the area of labor rights), has also jumped to the forefront of
the environmental movement by (finally) considering everything involved in its
products’ manufacture and delivery. A company that values low costs over everything else discovered it had
ignored waste. Once it recognized
this oversight, it eliminated the water in its gallon-sized laundry detergent,
producing a much smaller container that eliminated three-fourths of the
packaging, weight, shipping costs, and shelf space associated with the
product. Customers got a less
expensive, more convenient product that cleaned
clothes equally well. Wal-Mart made more money.
From 2005 to 2008, Wal-Mart shifted its entire detergent inventory
to small-size containers, pulling the industry’s production (one billion units)
along with it. During this period,
Wal-Mart’s actions alone caused 95 million fewer pounds of resin from petroleum to be used, 400 million fewer gallons of water, and more than 60,000 fewer tons of
cardboard. The reduction in weight
resulted in less fuel being consumed by its fleet of trucks, saving the company
money and keeping 11 million pounds of CO2 out of the atmosphere
Wal-Mart also learned that, while it had believed it had
nothing in common with soft-headed environmentalists, they both wanted the same
outcome. Whether driven by lower
costs (Wal-Mart) or a sustainable planet (environmentalists), finding common
cause was the best way forward.
To both, waste was the enemy. While it may have appeared that nothing could be gained from
Wal-Mart and environmentalists joining forces, this nothing became something. A big, profitable, sustainable
How can we make sense of all the changes taking place around
us?More importantly, how can we
create the change necessary to attack our most pressing societal problems?
Short answer:building blocks.I will
return to this theme again and again in other posts.But for now: a preview.
Eric Beinhocker's Origin
of Wealth leans on the theory of complex systems to show how, little by
little, a small thing like a wheel gets incorporated into increasingly complex
components and systems.First we
see carts, then bikes, then the Audobon.More building blocks mean more
complex combinations built from them.And these combinations give rise to greater variety, greater
sophistication, and greater wealth.
Brian Arthur's The
Nature of Technology provides a related account, up to a point, but emphasizes
how change is not always gradual and continuous.For instance, piston-powered propeller airplanes began as
rather simple machines and performed well for short flights.But when these planes began to fly at
higher speeds at higher altitudes, their limitations became evident.To address them, engineers began making
a series of increasingly complicated modifications until, finally, an entirely
new means of powering a plane appeared:the first jet-engine.This invention was not further evolution of
the piston-propeller arrangement but, instead, was based on entirely different
principles.It was much simpler
too, the original prototype of the jet engine having just one moving part!
In my book, Design
Your Life, Change the World: Your Path as a Social Entrepreneur, I have
examined how similar ideas apply to social enterprises.Often, social enterprises evolve
gradually, becoming increasingly effective as they become ever more
complex.As an illustration:Once, local banks were as much fixtures
of communities as mom and pop grocery stores (been to one of those recently?).Over time, they began to add remote branches
and, as regulation allowed, expanded their reach to increasingly distant
locales.These changes were
intended to create more efficiency, more competition, and more choice.
Overseas, a similar evolution began to include poorer and
poorer customers as first, nonprofit organizations and later, for-profit banks
began to offer microcredit and other microfinance offerings.Still, microfinance excludes ten times
as many customers as it serves.Poor clients are expensive to serve, even more so when they are at a
distance.Branches are too
expensive in many parts of the world.
Yet in Kenya, an invention
has dramatically changed the situation.Much like the jet-engine, which overcame the deficiencies of propeller
planes by incorporating a completely new principle, M-Pesa overcame financial
exclusion, especially created by distance, by creating an alternative form of
money.Kenyans buy this currency,
which is installed on their cell phones.This e-currency can then be
safely, conveniently, and affordably transferred to someone else by sending a
financially secure text message.Urban workers can remit money to relatives in the countryside.Micro-entrepreneurs can buy trinkets or
agricultural products to resell without the insecurity of relying on bus
drivers to transport their payments or the inconvenience of taking the bus to
make payments themselves.
How successful is M-Pesa?Over half of all Kenyans use it, nearly three times as many
as have bank accounts.M-Pesa has created
similar services in Tanzania, Afghanistan, and South Africa.It recently created a partnership with
Western Union that allows funds transfers to Kenyan M-Pesa customers from 45
Is this a "one-off," relevant only to citizens without ready
access to banking services?Not at
all.Mobile wallets (as they are
known) are moving "up market" to the United States and the rest of the
developed world.Tech stalwarts
(Apple, Google, and others), mobile carriers (including Deutsche Telecom, China
Unicom, Verizon), and financial institutions and credit card companies (among
them Chase and Visa) are all exploring how they can capture this huge,
What was created by the invention of alternative currency
has begun to evolve.
Let's consider this illustration from an evolutionary
The banking system changed in ways that resemble biological
evolution.New variations (say, bank branches) are tested for their performance (would
people use them?) and, when successful, they proliferate.
Producing societal-level change isn't under the control of any
single organization.Consider the environment. No company or
government, of course, "controls" efforts to address climate change.Yet there are many ways organizations play
roles in striving to stem our environmental problems.
How can we stack the odds so that they are successful?
By encouraging variation, creating fair and effective tests,
and ensuring that winning ideas truly proliferate.These are not abstract ideas without application.For instance, the tests performed in
the marketplace (profit, sales) give distorted results that fail to account for
the adage goes, you get what you measure, and we are measuring the wrong
can come from replication, but exposing winning ideas to others provides
another means to increase their scale.
But we must be cognizant, too, that invention is sometimes necessary
to spark progress when we are at an impasse.Methods like recycling, just like propeller-powered planes, can't
evolve far enough to achieve our environmental ambitions.Recycling is better than tossing, but as
a practice it still fails to promote better, inherently green methods of creating
products in the first place.That
is where invention becomes critical, to create "jumps" in evolution rather
smooth, gradual refinements.Markets in carbon avoidance, for instance, are built on the premise that
you can buy the benefits of others' good behavior.From this new premise various ways to create and operate
these markets emerge, themselves subject to variation, testing, and proliferation.Invention begets evolution.
These two forms of change - gradual, continuous; and
radical; discontinuous - operate by creating and re-organizing building
blocks.We can think of building
blocks as fundamental elements that underlie the process of creating
change.To be architects of change,
we must learn to recognize and harness them.I intend this blog entry itself to be a conceptual building
block which we return to, and build on, as we understand how to improve
My daughter graduated from Oberlin College on Memorial Day.The ceremony took place in a park with
little shade on a crystal clear day, the kind you get in the Midwest when the
temperature spikes 40 degrees in twenty-four hours.It was sweltering.
But the true intensity came from the anticipation of what lies
ahead, measured in people to be helped, a planet to be saved, lives to be changed.
Of course, the template for graduation speeches is to remind
students to remember friends and institution; follow their dreams; and give
back to others.
But Oberlin is different.A liberal arts college and music conservatory founded in
1833 in Oberlin, Ohio, it admitted women from the beginning, and granted women the
first bachelor's degrees in the country in 1841.In 1835, it became the first college to adopt a policy to
admit students regardless of race.
The town has long had progressive roots as well.It was a pivotal stop on the
Underground Railroad that ushered slaves to freedom in the north.Residents' of Oberlin and the
neighboring town of Wellington efforts in helping a fugitive slave flee to
Canada reportedly sparked the Civil War.
Today, Oberlin and its environmental visionary, Professor
David Orr, are in the early stages of creating a carbon-neutral, economically
vibrant community that brings together town and gown, farm and city, today's
needs and tomorrow's demands.The
Oberlin Project is a beacon pointing to the kind of world we can create if we
So, there was a rich and storied context as Oberlin's commencement
speaker, Dr. Helene D Gayle, spoke about changing the world.
Dr. Gayle had planned to be a pediatrician but had an
epiphany at her brother's college graduation, where an epidemiologist described
a successful campaign to eradicate smallpox.The speech allowed Gayle to see how her own skills in
medicine could be more broadly applied in a career in public health, providing her
the opportunity to address interlinked problems of poverty, lack of affordable health
care, and a broad set of inequities throughout the world.
Thus was launched her remarkable career, first with the
Centers for Disease Control and Prevention where her efforts focused on
HIV/AIDS; then at the Gates Foundation, where she directed the foundation's
HIV, TB and Reproductive Health program; and now at CARE (one of the best known
organizations in the world devoted to fighting poverty, supporting women, and bringing
about social justice), where she has been President and CEO since 2006.
All because she was moved by a commencement address.
Some Oberlin graduates undoubtedly were moved by Dr. Gayle's
remarks, their futures shifted in positive ways that will be revealed over the
course of their lifetimes.And yet
others - including those who want to make a difference in the world - are still
searching, despite the glimpse of all things sustainable, equitable, and right
about the world that four years at Oberlin exposed them to.I know, because I asked.And because I teach students who are
also looking to create meaning in their lives.
As a professor at the Ross School of Business I teach
courses with titles that are a bit too long, like Solving Societal Problems
through Innovation and Enterprise.In these courses, I want my students to see that innovation can propel
for-profit and nonprofit organizations to tackle some of the world's chief
challenges: poverty, health care, education, the environment.And taking these problems on can be
done from a sense of opportunity, not just responsibility.
We discuss ways to dramatically improve health care with
cell phones, discarded medicines, and video games.We consider improving education for children in India with
"educational Karaoke," teenagers in the worst Bronx schools by training them as
entrepreneurs, and college-ready students in Arica who cannot afford tuition by
providing free, world-class college curricula.We discuss charities run as for-profits, multinational
corporations working in full-partnership with slum dwellers, alliances between
environmental NGOs and huge retailers who intimately depend on each other for
their mutual success through saving the rainforests, and powerful means of
harnessing the power of collective action to identify, solve, and accelerate
solutions to the world's most pressing challenges.
Why do students flock to these courses?Because they hunger to combine their
intellect and their hearts.They crave
the sense of meaning that comes from creating, especially when they find work
that provides them with a means of support and a vehicle to have huge impact.And mostly because they see the world
with fresh eyes, free from the cynicism that that can come from thinking that
anything that can be tried, has been tried.
The companies and organizations that are forging a better
world need fresh eyes, too.The
practices that have gotten where we are - a physical planet in perilous shape
and a socio-economic planet where the distribution of wealth and access to
life's necessities (let alone luxuries) is more skewed than ever before in
history in favor of the "haves" - are not the same practices that can lead us
to a planet capable of sustaining us physically or providing a secure, healthy world
that truly creates opportunity for all.
Graduation is both an end and a beginning.It is a time to reflect, give thanks,
and seek renewal.
To my daughter Hannah I say,
"Congratulations on completing
your degree. I'm so proud of you.As you take your Oberlin degree into the world, I know we are lucky to
have you joining the fight for a more sustainable world.Lead, take action, and become a
life-long student."(The word
"student," derived from Latin, suggests study, scholarship, and learning - not
necessarily formal education, you know.)
And to students everywhere - whether you're enrolled in a
degree program; striking out on your own as a (social) entrepreneur; working in
an organization; or possibly running one - I say,
"There's never been a time
we've more urgently needed new ways of addressing the societal issues in front
of us.There are innovative ways
for business to seek opportunity to serve, rather than acting purely with
greed, frustrating progress, or withholding their formidable talents that could
be used to create immeasurable benefits.It's time to see the world with fresh eyes and create a better world.It's time for us to graduate from old
ways, which no longer serve us, and look at the world anew."
I have had the privilege to teach and learn from "students" of
all stripes who want a more just society: those enrolled in my classes of course; but also those who
I've worked with and supported on the ground in inner cities and the farthest
corners of the planet; officials of organizations devoted to a more equitable
society, whether they occupy corner offices or cramped quarters in an
attic; and like-minded do-ers seeking to make inroads against injustice through the provision of clean water, access to microfinance, more sustainable food systems, the elimination of homelessness, to name a few areas.
I invite you to join me in exploring a new world where we
solve societal problems through innovation and enterprise.Let us learn together.