Category Archives: Social Innovation

Are We Doing Social Innovation Wrong?

Are We Doing Social Innovation Wrong?

GUEST POST from Geoffrey A. Moore

The Volume Operations business model kicks in when you have hundreds of thousands of users and goes up from there. 100,000, for those of us who are not math majors, is 10 to the power of 5. Uber-successful volume ops businesses operate at 10 to the power of 9 and up—millions of users or customers. But if you are a start-up, you are looking at 10 or maybe 100. How do you get from here to there?

The key thought to keep in mind is the old chestnut “what got you here won’t get you there.” That is, whatever operating model you have, keep in mind it can scale to two exponents but never to three. That means for every two exponents you have to change operating models, which likely means you have to change executive leadership in order to go forward.

To illustrate this idea, I’d like to focus on the non-profit sector and ask the question, what would it take to really solve for any widespread social problem? Homelessness was the first one that came to mind, but hunger is another obvious one, drug addiction a second, street crime a third. They are all seemingly intractable issues that, despite the best intentions of a whole raft of people, and regardless of how much funding is supplied, stubbornly resist any sustainable improvement.

The question I want to address is not what programs would work—because I actually think a whole lot of programs would work—but rather, how could we organize to deploy these programs successfully at scale.

Following our principle of what got you here won’t get you there, we need a ladder of operating models that can take us, exponent by exponent, from 10 to the power of 1 to, say, 10 to the power of 7. What might that look like?

Scaling Social Innovation

Consider this a straw man, a place to start, something to edit. It conveys a key lesson from the high-tech sector, namely that the fastest way to kill a disruptive innovation is to race to scale by skipping over one or more of these “exponential steps.” It just doesn’t work. There are too many emergent factors at each new level you must learn to cope with in order to succeed. The only reliable way to scale is to ratchet your way up this staircase, adapting your systems and operations as you go.

Unfortunately, that’s not what politicians do. They want to make a big impact right away. That means they start everything on one of the upper stairs. Driven by impatience, they ignore the dynamics of adoption and demand mass deployment from the get-go. They think the problem is simply one of getting enough funding. It’s not. It’s one of operational innovation. Scaling prematurely simply wastes the funding. And then when programs do flounder, as they inevitably will, they blame it on execution when in reality they simply did not do the hard, time-consuming work of building up their foundation step by step from below.

One of the implications of this framework is that social services should be incubated in the private sector where freedom from regulatory constraints supports agile innovation. But as they scale, the importance of regulatory oversight increases and more communal engagement is required. The goal should be to keep this oversight as local as possible as long as possible, doing as much as we can to empower the people delivering the service itself. Once that operating model solidifies, then, and only then, is there a proper foundation for scaling to state and federal programs.

Today, we do not lack the empathy to support social services. Nor do we lack the funding. But we are failing nonetheless. We can do better. We need to do better.

That’s what I think. What do you think?

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Why Greedflation Must End and How Consumers Can Make It So

Why Greedflation Must End and How Consumers Can Make It So

GUEST POST from Art Inteligencia

Greedflation — an insidious blend of greed and inflation — has silently been eroding the purchasing power of consumers, escalating economic inequalities, and tarnishing the trust we place in markets and institutions. This practice, where companies exploit inflationary trends to excessively hike prices, detaches from economic principles and delves into unethical opportunism. While inflation in itself, when moderate, plays a functional role in the economy, greedflation skews the balance, enriching the few at the expense of many. Here’s why this must end and how consumers can play a pivotal role in its demise.

Why Greedflation Must End

  1. Economic Inequity: Greedflation exacerbates economic disparities, widening the gap between the rich and the poor. While executives and shareholders prosper, average citizens struggle more to afford basic commodities. This vicious cycle traps lower-income families in a relentless financial squeeze, robbing them of opportunities for upward mobility.
  2. Erosion of Trust: Trust is the bedrock of a functional economy. When consumers perceive that companies are exploiting inflationary pressures to rake in excess profits, trust in those companies and the broader market erodes. This lack of trust can lead to decreased consumer spending, hampering economic growth and stability.
  3. Reduced Consumer Purchasing Power: As prices soar disproportionately, the real purchasing power of consumers dwindles. Households find themselves paying more for the same goods and services, which can lead to indebtedness and reduced quality of life. This reduction in purchasing power compounds the already significant challenges faced by middle and lower-income families.
  4. Market Distortion: Greedflation distorts market dynamics by creating artificial price structures that don’t accurately reflect demand and supply. This conflation of legitimate inflationary factors with opportunistic price hikes undermines true market efficiency and the ability to allocate resources effectively.
  5. Social Unrest: When people feel unfairly squeezed by relentless price hikes, social tension can build. Such unrest not only affects social harmony but can also lead to broader economic and political consequences. It’s a recipe for instability that we can ill afford in a complex global environment.

Identifying specific companies definitively engaging in “greedflation” can be complex, as it often involves nuanced economic analyses and data that may not always be readily available or clear-cut. However, certain sectors and companies have faced accusations and scrutiny over seemingly disproportionate price hikes, especially during periods of broader economic instability. Here are five examples based on public scrutiny and anecdotal evidence:

  1. Amazon: During the COVID-19 pandemic, Amazon faced criticism for significant price increases on essential items such as hand sanitizers, masks, and other health-related products. While some of these price hikes were attributed to third-party sellers on the platform, the company was scrutinized for not doing enough to regulate prices during a global crisis.
  2. Pharmaceutical Companies (e.g., Martin Shkreli’s Turing Pharmaceuticals): One of the most notorious cases of alleged greedflation in the pharmaceutical industry involved Turing Pharmaceuticals, where the price of Daraprim, a life-saving medication, was increased by over 5,000% overnight under the leadership of Martin Shkreli. This incident highlighted how companies could exploit patent protections and market monopolies to drastically inflate prices unethically.
  3. Oil Companies (e.g., ExxonMobil, Chevron): Oil giants like ExxonMobil and Chevron have been accused of leveraging geopolitical tensions and supply chain disruptions to raise gas prices disproportionately, thereby generating record profits during periods when consumers are already struggling with inflationary pressures.
  4. Grocery Retailers (e.g., Kroger, Albertsons): Major grocery chains like Kroger and Albertsons have faced allegations of increasing food prices beyond what could be justified by supply chain issues and general inflation. With essential goods being a critical part of everyday life, such actions appear particularly exploitative.
  5. Telecom Companies (e.g., Comcast, AT&T): Telecom giants such as Comcast and AT&T have been criticized for raising prices on internet and cable services, despite relatively stable or reduced operational costs due to advancements in technology. Consumers often feel trapped because of limited competition in many areas.

While these examples showcase sectors and companies that have faced scrutiny, it’s important to note that conclusive evidence of greedflation can be difficult to establish due to the complexity of market forces and individual company strategies. This underscores the need for informed consumer activism to hold companies accountable.

How Consumers Can Help End Greedflation

  1. Shop Smarter: Consumers wield significant power through their purchasing decisions. By being more discerning and opting for alternatives when prices seem unjustifiably high, we can signal to corporations that unethical pricing won’t be rewarded. Supporting smaller, local businesses and cooperatives can also help counterbalance big players who may indulge in greedflation.
  2. Promote Transparency: Demand greater transparency from companies about their pricing strategies. When transparency becomes a social norm, it’s harder for businesses to hide behind inflated prices. Use social media and other platforms to press for clarity and accountability.
  3. Support Policies for Market Oversight: Advocate for stronger regulatory frameworks and more stringent oversight bodies that can analyze and address unethical pricing practices. By supporting politicians and policies that prioritize consumer protection and market fairness, individuals can influence systemic change.
  4. Educate and Mobilize: Consumer education is crucial. Share knowledge and resources about how to spot and combat greedflation. Community groups, educational institutions, and social networks can serve as platforms for educating others about prudent consumer practices.
  5. Leverage Collective Bargaining Power: Form or join consumer advocacy groups that can collectively negotiate for fair prices and better market practices. Unified consumer voices can be a powerful force for change, pushing corporations to rethink their pricing strategies.

Conclusion

The end of greedflation is not just an economic imperative but a moral one. It’s about creating a fairer society where prosperity is shared more equitably, trust is maintained, and economic stability is preserved. Consumers hold immense power as the primary drivers of market forces. By making informed, conscious choices and demanding greater accountability, we can collectively put an end to greedflation and forge a more just economic future.

As an independent thinker and human-centered innovation and transformation thought leader, I firmly believe in the power of consumers to act as agents of change. Together, let’s take that necessary step to ensure markets function with integrity, fairness, and a sense of shared prosperity.

#EndGreedflation #ConsumerPower #EconomicJustice

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An Innovation Lesson From The Rolling Stones

An Innovation Lesson From The Rolling Stones

GUEST POST from Robyn Bolton

If you’re like most people, you’ve faced disappointment. Maybe the love of your life didn’t return your affection, you didn’t get into your dream college, or you were passed over for promotion.  It hurts.  And sometimes, that hurt lingers for a long time.

Until one day, something happens, and you realize your disappointment was a gift.  You meet the true love of your life while attending college at your fallback school, and years later, when you get passed over for promotion, the two of you quit your jobs, pursue your dreams, and live happily ever after. Or something like that.

We all experience disappointment.  We also all get to choose whether we stay there, lamenting the loss of what coulda shoulda woulda been, or we can persevere, putting one foot in front of the other and playing The Rolling Stones on repeat:

“You can’t always get what you want

But if you try sometimes, well, you might just find

You get what you need”

That’s life.

That’s also innovation.

As innovators, especially leaders of innovators, we rarely get what we want.  But we always get what we need (whether we like it or not)

We want to know. 
We need to be comfortable not knowing.

Most of us want to know the answer because if we know the answer, there is no risk. There is no chance of being wrong, embarrassed, judged, or punished.  But if there is no risk, there is no growth, expansion, or discovery.

Innovation is something new that creates value. If you know everything, you can’t innovate.

As innovators, we need to be comfortable not knowing.  When we admit to ourselves that we don’t know something, we open our minds to new information, new perspectives, and new opportunities. When we say we don’t know, we give others permission to be curious, learn, and create. 

We want the creative genius and billion-dollar idea. 
We need the team and the steady stream of big ideas.

We want to believe that one person blessed with sufficient time, money, and genius can change the world.  Some people like to believe they are that person, and most of us think we can hire that person, and when we do find that person and give them the resources they need, they will give us the billion-dollar idea that transforms our company, disrupts the industry, and change the world.

Innovation isn’t magic.  Innovation is team work.

We need other people to help us see what we can’t and do what we struggle to do.  The idea-person needs the optimizer to bring her idea to life, and the optimizer needs the idea-person so he has a starting point.  We need lots of ideas because most won’t work, but we don’t know which ones those are, so we prototype, experiment, assess, and refine our way to the ones that will succeed.   

We want to be special.
We need to be equal.

We want to work on the latest and most cutting-edge technology and discuss it using terms that no one outside of Innovation understands. We want our work to be on stage, oohed and aahed over on analyst calls, and talked about with envy and reverence in every meeting. We want to be the cool kids, strutting around our super hip offices in our hoodies and flip-flops or calling into the meeting from Burning Man. 

Innovation isn’t about you.  It’s about serving others.

As innovators, we create value by solving problems.  But we can’t do it alone.  We need experienced operators who can quickly spot design flaws and propose modifications.  We need accountants and attorneys who instantly see risks and help you navigate around them.  We need people to help us bring our ideas to life, but that won’t happen if we act like we’re different or better.  Just as we work in service to our customers, we must also work in service to our colleagues by working with them, listening, compromising, and offering help.

What about you?
What do you want?
What are you learning you need?

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3 Ways to View Your Innovation Basket

(including one that makes Radical Innovation easy)

3 Ways to View Your Innovation Basket

GUEST POST from Robyn Bolton

You are a rolling stone, and that means you gather no moss!  You read the September issue of HBR (and maybe last week’s article), tossed out your innovation portfolio, and wove yourself an innovation basket to “differentiate the concept from finance and avoid the mistake of treating projects like financial securities, where the goal is usually to maximize returns through diversification [and instead] remember that innovation projects are creative acts.”   

Then you explained this to your CFO and received side-eye so devastating it would make Sophie Loren proud.

The reality is that the innovation projects you’re working on are investments, and because they’re risky, diversification is the best way to maximize the returns your company needs.

But it’s not the only way we should communicate, evaluate, and treat them.

Different innovation basket views for different customers

When compiling an innovation basket, the highest priority is having a single source of truth.  If people in the organization disagree on what is in and out of the basket, how you measure and manage the portfolio doesn’t matter.

But a single source of truth doesn’t mean you can’t look at that truth from multiple angles.

Having multiple views showing the whole basket while being customized to address each of your internal customer’s Jobs to be Done will turbocharge your ability to get support and resources.

The CFO: What returns will we get and when?

The classic core/adjacent/transformational portfolio is your answer.  By examining each project based on where to play (markets and customers) and how to win (offerings, profit models, key resources and activities), you can quickly assess each project’s relative riskiness, potential return, time to ROI, and resource requirements.

The CEO: How does this support and accelerate our strategic priorities?

This is where the new innovation basket is most helpful.  By starting with the company’s strategic goals and asking, “What needs to change to achieve our strategy?” leadership teams immediately align innovation goals with corporate strategic priorities.  When projects and investments are placed at the intersection of the goal they support, and the mechanism of value creation (e.g., product, process, brand), the CEO can quickly see how investments align with strategic priorities and actively engage in reallocation decisions.

You: Will any of these ever see the light of day?

As much as you hope the answer is “Yes!”, you know the answer is “Some.  Maybe.  Hopefully.”  You also know that the “some” that survive might not be the biggest or the best of the basket.  They’ll be the most palatable.

Ignoring that fact won’t make it untrue. Instead, acknowledge it and use it to expand stakeholders’ palates.

Start by articulating your organization’s identity, the answers to “who we are” and “what we do.” 

Then place each innovation in one of three buckets based on its fit with the organization’s identity:

  • Identity-enhancing innovations that enhance or strengthen the identity
  • Identity-stretching innovations that “do not fit with the core of an organization’s identity, but are related enough that if the scope of organizational identity were expanded, the innovation would fit.”
  • Identity-challenging innovations that are “in direct conflict with the existing organizational identity.”

It probably won’t surprise you that identity-enhancing innovations are far more likely to receive internal support than identity-challenging innovations.  But what may surprise you is that core, adjacent, and transformational innovations can all be identity-enhancing.

For example, Luxxotica and Bausch & Lomb are both in the vision correction industry (eyeglasses and contact lenses, respectively) but have very different identities.  Luxxotica views itself as “an eyewear company,” while Bausch & Lomb sees itself as an “eye health company” (apologies for the puns). 

When laser-vision correction surgery became widely available, Bausch & Lomb was an early investor because, while the technology would be considered a breakthrough innovation, it was also identity-enhancing.  A decade later, Bausch & Lomb’s surgical solutions and ophthalmic pharmaceuticals businesses account for 38% of the company’s revenue and one-third of the growth.

One basket.  Multiple Views.  All the Answers.

Words are powerful, and using a new one, especially in writing,  can change your behavior and brain. But calling a portfolio a basket won’t change the results of your innovation efforts.  To do that, you need to understand why you have a basket and look at it in all the ways required to maximize creativity, measure results, and avoid stakeholder side-eye.

Image Credit: Pixabay

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Why You Should Care About Service Design

Why You Should Care About Service Design

GUEST POST from Robyn Bolton

What if a tool had the power to delight your customers, cut your costs, increase your bottom line, and maybe double your stock price? You’d use it, right?

That’s precisely the power and impact of Service Design and service blueprints. Yet very few people, especially in the US, know, understand, or use them. Including me.

Thankfully, Leala Abbott, a strategist and researcher at the intersection of experience, innovation, and digital transformation and a lecturer at Parsons School of Design, clued me in.

What is Service Design?

RB: Hi, Leala, thanks for taking the time to talk with me today.

LA: My pleasure! I’m excited about this topic. I’ve managed teams with service designers, and I’ve always been impressed by the magical way they brought together experience strategy, UX, and operations.

RB: I felt the same way after you explained it to me. Before we get too geeked up about the topic, let’s go back to the beginning and define “service.”

LA: Service is something that helps someone accomplish a goal. As a result, every business needs service design because every business is in the service industry.

RB: I’ll be honest, I got a little agitated when I read that because that’s how I define “solution.” But then I saw your illustration explaining that service design moves us from seeing and problem-solving isolated moments to seeing an integrated process. And that’s when it clicked.

LA:  That illustration is from Lou Downe’s talk Design in Government Impact for All . Service Design helps us identify what customers want and how to deliver those services effectively by bringing together all the pieces within the organization. It moves us away from fragmented experiences created by different departments and teams within the same company to an integrated process that enables customers to achieve their goals.

Why You Need It

RB: It seems so obvious when you say it. Yet so often, the innovation team spends all their time focused on the customer only to develop the perfect solution that, when they toss it over the wall for colleagues to make, they’re told it’s not possible, and everything stops. Why aren’t we always considering both sides?

LA: One reason, I think, is people don’t want to add one more person to the team. Over the past two decades, the number of individuals required to build something has grown exponentially. It used to be that one person could build your whole website, but now you need user experience designers, researchers, product managers, and more. I think it’s just overwhelming for people to add another individual to the mix. We believe we have all the tools to fix the problem, so we don’t want to add another voice, even if that voice explains the huge disconnect between everything built and their operational failures.

RB: Speaking of operational failures, one of the most surprising things about Service Design is that it almost always results in cost savings. That’s not something most people think about when they hear “design.”

LA: The significant impact on the bottom line is one of the most persuasive aspects of service design. It shifts the focus from pretty pictures to the actual cost implications. Bringing in the operational side of the business is crucial. Building a great customer journey and experience is important, but it’s also important to tie it back to lost revenue and increased cost to serve

Proof It Works 

LA: One of the most compelling cases I recently read was about Autodesk’s transition to SaaS, they brought in a service design company called Future Proof. Autodesk wanted to transition from a software licensing model to a software-as-a-service model. It’s a significant transition not just in terms of the business model and pricing but also in how it affects customers.

If you’re a customer of Autodesk, you used to pay a one-time fee for your software, but now you are paying based on users and services. Budgeting becomes messy. The costs are no longer simple and predictable. Plus, it raises lots of questions about the transition, cost predictability, control over access, managing subscriptions, and flexibility. Notice that these issues are about people managing their money and increasing costs. These are the areas where service design can truly help. 

Future Proof conducted customer interviews, analyzed each stage of the customer journey, looked at pricing models and renewal protocols, and performed usability studies. When they audited support ticket data for the top five common customer issues, they realized that if Autodesk didn’t change their model, the cost of running software for every customer would increase by 40%, and profit margins would decrease by 15% to 20%.

Autodesk made the change, revenue increased significantly, and their stock price doubled. Service design allows for this kind of analysis and consideration of operational costs.

How to Learn More

RB: Wow, not many things can deliver better service, happier customers, and doubling a stock price. Solid proof that companies, and innovation teams in particular, need to get smart on service design. We’ve talked a lot about the What and Why of Service Design. How can people learn more about the How?

LA: Lou Downe’s book is a great place to start Good Services: How to Design Services That Work. So is Woo, Wow, and Win: Service Design, Strategy, and the Art of Customer Delight by Thomas A Stewart and Patricia O’Connell.  I also recommend people check out The Service Design Network for tools and case studies and TheyDo, which helps companies visualize and manage their service design.

Image Credit: Pixabay

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Leaders Avoid Doing This One Thing

Leaders Avoid Doing This One Thing

GUEST POST from Robyn Bolton


Being a leader isn’t easy. You must BE accountable, compassionate, confident, curious, empathetic, focused, service-driven, and many other things. You must DO many things, including build relationships, communicate clearly, constantly learn, create accountability, develop people, inspire hope and trust, provide stability, and think critically. But if you’re not doing this one thing, none of the other things matter.

Show up.

It seems obvious, but you’ll be surprised how many “leaders” struggle with this. 

Especially when they’re tasked with managing both operations and innovation.

It’s easy to show up to lead operations.

When you have experience and confidence, know likely cause and effect, and can predict with relative certainty what will happen next, it’s easy to show up. You’re less likely to be wrong, which means you face less risk to your reputation, current role, and career prospects.

When it’s time to be a leader in the core business, you don’t think twice about showing up. It’s your job. If you don’t, the business, your career, and your reputation suffer. So, you show up, make decisions, and lead the team out of the unexpected.

It’s hard to show up to lead innovation.

When you are doing something new, facing more unknowns than knowns, and can’t guarantee an outcome, let alone success, showing up is scary. No one will blame you if you’re not there because you’re focused on the core business and its known risks and rewards. If you “lead from the back” (i.e., abdicate your responsibility to lead), you can claim that the team, your peers, or the company are not ready to do what it takes.

When it’s time to be a leader in innovation, there is always something in the core business that is more urgent, more important, and more demanding of your time and attention. Innovation may be your job, but the company rewards you for delivering the core business, so of course, you think twice.

Show up anyway

There’s a reason people use the term “incubation” to describe the early days of the innovation process. To incubate means to “cause or aid the development of” but that’s the 2nd definition. The 1st definition is “to sit on so as to hatch by the warmth of the body.”

You can’t incubate if you don’t show up.

Show up to the meeting or call, even if something else feels more urgent. Nine times out of ten, it can wait half an hour. If it can’t, reschedule the meeting to the next day (or the first day after the crisis) and tell your team why. Don’t say, “I don’t have time,” own your choice and explain, “This isn’t a priority at the moment because….”

Show up when the team is actively learning and learn along with them. Attend a customer interview, join the read-out at the end of an ideation session, and observe people using your (or competitive) solutions. Ask questions, engage in experiments, and welcome the experiences that will inform your decisions.

Show up when people question what the innovation team is doing and why. Especially when they complain that those resources could be put to better use in the core business. Explain that the innovation resources are investments in the company’s future, paving the way for success in an industry and market that is changing faster than ever.

You can’t lead if you don’t show up.

Early in my career, a boss said, “A leader without followers is just a person wandering lost.” Your followers can’t follow you if they can’t find you.

After all, “80% of success is showing up.”

Image credit: Pixabay

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How to Make Navigating Ambiguity a Super Power

How to Make Navigating Ambiguity a Super Power

GUEST POST from Robyn Bolton

You are a leader. The boss. The person in charge.

That means you know the answer to every question, make the right decision when faced with every choice, and act confidently when others are uncertain. Right?

(Insert uproarious laughter here).

Of course not. But you act like you do because you’re the leader, the boss, the person in charge.

You are not alone. We’re all doing it.

We act like we have the answers because we’ve been told that’s what leaders do. We act like we made the right decision because that’s what leaders do in a volatile, uncertain, complex, and ambiguous (VUCA) world where we must work quickly and flexibly while doing more with less.

But what if we didn’t? 

What if we stopped pretending to have the answer or know the right choice? What if we acknowledged the ambiguity of a situation, explored its options and interpretations for just a short while, and then decided?

We’d make more informed choices. We’d be more creative and innovative. We’d inspire others.

So why do we keep pretending?

Ambiguity: Yea! Meh. Have you lost your mind?!?

Stanford’s d.School calls the ability to navigate ambiguity “the super ability” because it’s necessary for problem-finding and problem-solving. Ambiguity “involves recognizing and stewing in the discomfort of not knowing, leveraging and embracing parallel possibilities, and resolving or emerging from ambiguity as needed.”

Navigating ambiguity is essential in a VUCA world, but not all want to. They found that people tend to do one of three things when faced with ambiguity:

  • Endure ambiguity as “a moment of time that comes before a solution and is antagonistic to the objective – it must be conquered to reach the goal.”
  • Engage ambiguity as “an off-road adventure; an alternate path to a goal. It might be rewarding and helpful or dangerous and detrimental. Its value is a chosen gamble. Exhilaration and exhaustion are equally expected.”
  • Embrace ambiguity as “oceanic and ever-present. Exploration is a challenge and an opportunity. The longer you spend in it, the more likely you are to discover something new. Every direction is a possibility. Navigation isn’t simple. It requires practice and patience.

Students tend to enter the program with a resignation that ambiguity must be endured. They leave embracing it because they learn how to navigate it.

You can too.

In fact, as a leader in a VUCA world, you and your team need to.

How to Embrace (or at least Engage) Ambiguity

When you want to learn something new, the library is one of the best places to start. In this case, the Library of Ambiguity  – an incredible collection of the resources, tools, and activities that professors at Stanford’s d.School use to help their students build this super ability.

It’s easy to get overwhelmed by the number of resources, so here are three that I recommend:

Design Project Scoping Guide

  • What it is: A guide for selecting, framing, and communicating the intentions of a design project
  • When to use it: When you are defining an innovation project and need to align on scope, goals, and priorities
  • Why I like it: The guide offers excellent examples of helpful and unhelpful scoping documents.

Learning Zone Reflection Tool

  • What it is: A tool to help individuals better understand the tolerance of ambiguity, especially their comfort, learning, and panic zones
  • When to use it: Stanford used this as a reflection tool at the end of an introductory course, BUT I would use it at the start of the project as a leadership alignment and team-building tool:
    • Leadership alignment – Ask individual decision-makers to identify their comfort, learning, and panic zones for each element of the Project Scoping Guide (problem to be solved, target customer, context, goals, and priorities), then synthesize the results. As a group, highlight areas of agreement and resolve areas of difference.
    • Team-building – At the start of the project, ask individual team members to complete the worksheet as it applies to both the project scope and the process. Individuals share their worksheets and, as a group, identify areas of shared comfort and develop ways to help each other through areas of learning or panic.
  • Why I like it: Very similar to the Project Playground concept I use with project teams to define the scope and set constraints, it can be used individually to build empathy and support amongst team members.

Team Dashboards

  • What it is: A tool to build trust and confidence amongst a team working through an ambiguous effort
  • When to use it: At regular pre-defined intervals during a project (e.g., every team check-in, at the end of each Sprint, once a month)
  • What I like about it:
    • Individuals complete it BEFORE the meeting, so the session focuses on discussing the dashboard, not completing it
    • The dashboard focuses on the usual business things (progress against responsibilities, the biggest challenge, next steps) and the “softer” elements that tend to have the most significant impact on team experience and productivity (mood, biggest accomplishment, team balance between talking and doing)

Learn It. Do It.

The world isn’t going to get simpler, clearer, or slower. It’s on you as a leader to learn how to deal with it. When to slow it down and explore and when to speed it up and act. No one is born knowing. We all learn along the way. The Library will help. No ambiguity about that!

Image credit: Pexels

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Just Because We Can, Doesn’t Mean That We Should!

Just Because We Can, Doesn’t Mean That We Should!

GUEST POST from Pete Foley

An article on innovation from the BBC caught my eye this week. https://www.bbc.com/news/science-environment-64814781. After extensive research and experimentation, a group in Spain has worked out how to farm octopus. It’s clever innovation, but also comes with some ethical questions. The solution involves forcing highly intelligent, sentient animals together in unnatural environments, and then killing them in a slow, likely highly stressful way. And that triggers something that I believe we need to always keep front and center in innovation: Just Because We Can, Doesn’t Mean That We Should!

Pandora’s Box

It’s a conundrum for many innovations. Change opens Pandora’s Box, and with new possibilities come unknowns, new questions, new risks and sometimes, new moral dilemmas. And because our modern world is so complex, interdependent, and evolves so quickly, we can rarely fully anticipate all of these consequences at conception.

Scenario Planning

In most fields we routinely try and anticipate technical challenges, and run all sorts of stress, stability and consumer tests in an effort to anticipate potential problems. We often still miss stuff, especially when it’s difficult to place prototypes into realistic situations. Phones still catch fire, Hyundai’s can be surprisingly easy to steal, and airbags sometimes do more harm than good. But experienced innovators, while not perfect, tend to be pretty good at catching many of the worst technical issues.

Another Innovators Dilemma

Octopus farming doesn’t, as far as I know, have technical issues, but it does raise serious ethical questions. And these can sometimes be hard to spot, especially if we are very focused on technical challenges. I doubt that the innovators involved in octopus farming are intrinsically bad people intent on imposing suffering on innocent animals. But innovation requires passion, focus and ownership. Love is Blind, and innovators who’ve invested themselves into a project are inevitably biased, and often struggle to objectively view the downsides of their invention.

And this of course has far broader implications than octopus farming. The moral dilemma of innovation and unintended consequences has of course been brought into sharp focus with recent advances in AI.  In this case the stakes are much higher. Stephen Hawking and many others expressed concerns that while AI has the potential to provide incalculable benefits, it also has the potential to end the human race. While I personally don’t see CHATgpt as Armageddon, it is certainly evidence that Pandora’s Box is open, and none of us really knows how it will evolve, for better or worse.

What are our Solutions

So what can we do to try and avoid doing more harm than good? Do we need an innovator’s equivalent of the Hippocratic Oath? Should we as a community commit to do no harm, and somehow hold ourselves accountable? Not a bad idea in theory, but how could we practically do that? Innovation and risk go hand in hand, and in reality we often don’t know how an innovation will operate in the real world, and often don’t fully recognize the killer application associated with a new technology. And if we were to eliminate most risk from innovation, we’d also eliminate most progress. This said, I do believe how we balance progress and risk is something we need to discuss more, especially in light of the extraordinary rate of technological innovation we are experiencing, the potential size of its impact, and the increasing challenges associated with predicting outcomes as the pace of change accelerates.

Can We Ever Go Back?

Another issue is that often the choice is not simply ‘do we do it or not’, but instead ‘who does it first’? Frequently it’s not so much our ‘brilliance’ that creates innovation. Instead, it’s simply that all the pieces have just fallen into place and are waiting for someone to see the pattern. From calculus onwards, the history of innovation is replete with examples of parallel discovery, where independent groups draw the same conclusions from emerging data at about the same time.

So parallel to the question of ‘should we do it’ is ‘can we afford not to?’ Perhaps the most dramatic example of this was the nuclear bomb. For the team working the Manhattan Project it must have been ethically agonizing to create something that could cause so much human suffering. But context matters, and the Allies at the time were in a tight race with the Nazi’s to create the first nuclear bomb, the path to which was already sketched out by discoveries in physics earlier that century. The potential consequences of not succeeding were even more horrific than those of winning the race. An ethical dilemma of brutal proportions.

Today, as the pace of change accelerates, we face a raft of rapidly evolving technologies with potential for enormous good or catastrophic damage, and where Pandoras Box is already cracked open. Of course AI is one, but there are so many others. On the technical side we have bio-engineering, gene manipulation, ecological manipulation, blockchain and even space innovation. All of these have potential to do both great good and great harm. And to add to the conundrum, even if we were to decide to shut down risky avenues of innovation, there is zero guarantee that others would not pursue them. On the contrary, as bad players are more likely to pursue ethically dubious avenues of research.

Behavioral Science

And this conundrum is not limited to technical innovations. We are also making huge strides in understanding how people think and make decisions. This is superficially more subtle than AI or bio-manipulation, but as a field I’m close to, it’s also deeply concerning, and carries similar potential to do both great good or cause great harm. Public opinion is one of the few tools we have to help curb mis-use of technology, especially in democracies. But Behavioral Science gives us increasingly effective ways to influence and nudge human choices, often without people being aware they are being nudged. In parallel, technology has given us unprecedented capability to leverage that knowledge, via the internet and social media. There has always been a potential moral dilemma associated with manipulating human behavior, especially below the threshold of consciousness. It’s been a concern since the idea of subliminal advertising emerged in the 1950’s. But technical innovation has created a potentially far more influential infrastructure than the 1950’s movie theater.   We now spend a significant portion of our lives on line, and techniques such as memes, framing, managed choice architecture and leveraging mere exposure provide the potential to manipulate opinions and emotional engagement more profoundly than ever before. And the stakes have gotten higher, with political advertising, at least in the USA, often eclipsing more traditional consumer goods marketing in sheer volume.   It’s one thing to nudge someone between Coke and Pepsi, but quite another to use unconscious manipulation to drive preference in narrowly contested political races that have significant socio-political implications. There is no doubt we can use behavioral science for good, whether it’s helping people eat better, save better for retirement, drive more carefully or many other situations where the benefit/paternalism equation is pretty clear. But especially in socio-political contexts, where do we draw the line, and who decides where that line is? In our increasingly polarized society, without some oversight, it’s all too easy for well intentioned and passionate people to go too far, and in the worst case flirt with propaganda, and thus potentially enable damaging or even dangerous policy.

What Can or Should We Do?

We spend a great deal of energy and money trying to find better ways to research and anticipate both the effectiveness and potential unintended consequences of new technology. But with a few exceptions, we tend to spend less time discussing the moral implications of what we do. As the pace of innovations accelerates, does the innovation community need to adopt some form of ‘do no harm’ Hippocratic Oath? Or do we need to think more about educating, training, and putting processes in place to try and anticipate the ethical downsides of technology?

Of course, we’ll never anticipate everything. We didn’t have the background knowledge to anticipate that the invention of the internal combustion engine would seriously impact the world’s climate. Instead we were mostly just relieved that projections of cities buried under horse poop would no longer come to fruition.

But other innovations brought issues we might have seen coming with a bit more scenario-planning? Air bags initially increased deaths of children in automobile accidents, while prohibition in the US increased both crime and alcoholism. Hindsight is of course very clear, but could a little more foresight have anticipated these? Perhaps my favorite example unintended consequences is the ‘Cobra Effect’. The British in India were worried about the number of venomous cobra snakes, and so introduced a bounty for every dead cobra. Initially successful, this ultimately led to the breeding of cobras for bounty payments. On learning this, the Brits scrapped the reward. Cobra breeders then set the now-worthless snakes free. The result was more cobras than the original start-point. It’s amusing now, but it also illustrates the often significant gap between foresight and hindsight.

I certainly don’t have the answers. But as we start to stack up world changing technologies in increasingly complex, dynamic and unpredictable contexts, and as financial rewards often favor speed over caution, do we as an innovation community need to start thinking more about societal and moral risk? And if so, how could, or should we go about it?

I’d love to hear the opinions of the innovation community!

Image credit: Pixabay

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The Triple Bottom Line Framework

The Triple Bottom Line Framework

GUEST POST from Dainora Jociute

Money, money, money. It wasn’t so long ago that it was always sunny in the rich man’s world. But today, things just aren’t that easy, and talking about money isn’t enough.

Businesses cannot thrive and survive in a competitive environment with only one bottom line – profit.

United Nations Global Compact report points out that such issues as poverty, an uneducated workforce, and resource scarcity will, and already is, causing issues for business growth. In addition, both investors and potential talents are looking deeper than just the company’s financial success before they commit. So, next to Profit, business’s effect on People and the Planet are just as crucial measurement indicators.

“Poverty, conflict, an uneducated workforce, and resource scarcity for example, are also strategic issues for business success and viability.”
– UN Global Compact

And what do you get once you combine all three? Planet, People, and Profit are often referred to as the three pillars of sustainability. However, for a business to define sustainability, to have clear and reachable goals, and in return to have a fitting strategy to reach those goals can be challenging.

This is where the need and benefits of the triple bottom line framework become most evident.

What is the Triple Bottom Line Framework?

The term triple bottom line (TBL) was coined by John Elkington, corporate environmentalist, and author back in 1994. It isn’t exactly a new concept and we had plenty of time to see it being tried on by different companies like Patagonia, Unilever, Novo Nordisk and so many more. It is evident that the triple bottom line approach works.

So, what exactly is TBL?

Many like to argue that it is just another accounting tool. Yet in Elkington’s own words, it is a sustainability framework that examines an organization’s social, environmental, and economic impact. It measures a business’s environmental efforts (“planet account”), social well-being (“people account”), and a fair economy. It can be implemented by a business, a non-profit organization, or a governmental institution. It is flexible and adaptable.

Decades before the triple bottom line, the dominant belief was that the only responsibility a business has is to generate profit. It was set in place by economist Milton Friedman and his shareholder theory. With TBL, Elkington challenged the status quo by proposing accountability to all stakeholders and not just shareholders.

In addition to helping with planning sustainable growth, the triple bottom line can act as a reporting tool, thus, it focuses on long-term results and not just one-off campaigns to gain some publicity – can an organization sustain a just economy, environmental resources, and human capital?

Once we shift our attention from quarterly reports to a span of multiple years,

sustainability is no longer just a “to-do” list, but an opportunity that will rejuvenate business in an economy that does not exploit natural resources and social systems.

Triple Bottom Line 3 Areas

The Three Pillars of Sustainability

The triple bottom line goes hand in hand with the 1987’s Brundtland Report and the three key areas of development established by it: environmental conservation (Planet), economic development (Profit), and social sustainability (People).

Yet the definition of sustainability is a little bit more complex than that.

It is natural, that once you think of sustainability, your mind might wander to emissions, deforestation, climate change, and other related issues. For the longest, environmental changes have been the most reported and the most talked about topic. And for a good reason. The environmental pillar or Planet is considered to be the most important component of sustainability as it contains the social and economic systems within it.

But just like there wouldn’t be people without a planet, there wouldn’t be a business without people, and there wouldn’t be prosperity without business. All three areas are tightly interconnected and initiatives to address one often overlap with the other area, and naturally, when everything is so tightly knit, trade-offs are inevitable.

Sometimes decisions must be made to accommodate people at the cost of the environment OR decisions must be made to solve one environmental issue at the cost of another. A good example here would be an effort to reduce the consumption of single-use plastic bags by offering paper bags instead. Paper bags are easier to recycle and even if they do end up in a landfill, the lifespan of paper is drastically shorter than plastics. However, paper bag production is resource-heavy, consuming “four times more energy than plastic bags”.

Trade-offs make it impossible to talk about sustainability without considering all the pillars equally. Implementing the triple bottom line helps a business to form a holistic view of it.

Sustainability strives for:

  • Viable environmental-economic impact: business is executed with the environment and resources in mind, when possible, looking for green solutions or giving back, i.e., reforestation work.
    Trade-off: green business solutions can be intrusive and negatively affect private property (i.e., wind turbines in neighboring lands).
  • Bearable socio-environmental impact: education and awareness allow people to make environmentally conscious decisions, curb consumption and develop healthy habits that directly impact the environment.
    Trade-off: minimal consumption and complete protection of the land stalls economic growth.
  • Equitable socio-economic impact: people have an opportunity to work and earn a fair wage, and business strives to increase the general welfare of the people and increase the standard of living. This generates economic opportunity for both businesses and individuals. Corporate taxes also play a crucial role here – it is thanks to taxes that an organization contributes to supporting various societal programs.
    Trade-off: new business ventures can create more jobs but increase consumption of nonrenewable materials.

Planet

Planet bottom line focuses on an organization’s environmental impact, both positive and negative. Sustainable innovation (or on the environmental scale – eco-innovation), helps an organization to place its focus on the environment, by improving its production, manufacturing, marketing, and also all the in-house functions.

Impact on the planet can be created by such efforts as choosing natural and/or locally sourced materials, upcycling waste, using recyclable components, reducing unnecessary travel time, or saving energy usage.

Positive environmental impact can seem grandiose and nearly impossible to achieve. Not every organization is equally equipped to take drastic measures and pursue such efforts as reforestation, ocean clean-up, or full refurbishment of manufacturing facilities. Thus, while many regulations and recommendations exist, there is no one-size-fits-all approach to sustainability. Reporting and measurement really depend on such variables as the organization’s industry, location, size, and financial capabilities.

In addition, pursuing this bottom line can put the business in limbo, forcing it to decide between faster or more sustainable goods delivery; lower-costing or ethically sourced materials, and so on. These and similar initiatives can seem costly and counterproductive to what a business should be doing – generating profit. Yet like with most things in life, sustainability is not just black or white and it would not be a prevailing topic if there wasn’t true profit to be gained.

Benefits of The Planet Bottom Line

Besides the obvious emotional benefits of saving the earth, just feeling good while doing good, and complying with regulations there are practical reasons why you should pursue Planet bottom line:

  1. Satisfying consumer demand: GreenPrint’s 2022 Business of Sustainability Index indicates that demand for sustainable services and products is growing with 69% of respondents saying that “a product’s environmental friendliness is important to their purchasing decision” and 78% agreeing that they are interested in buying from environmentally friendly businesses.
  2. New business opportunities: a shift towards net zero is creating demand for new green solutions. A recent report by McKinsey indicates that reaching net zero by 2050 requires “investments amount to $9.2 trillion per year, of which $6.5 trillion annually would go into low-emissions assets and enabling infrastructure”.
  3. Cost reduction: in another report McKinsey notes that environmentally focused initiatives can “improve operating profits by up to 60%”, by reducing unnecessary waste as well as the usage of water or raw materials, that due to growing scarcity, are becoming more and more expensive.
  4. Improved brand image: knowing that consumers are seeking environmentally friendly products and services, it makes sense to invest in and report on sustainability initiatives. It improves the brand’s image which can lead to increased sales. In addition, nowadays, stakeholders can easily hold an organization accountable for action or inaction, thanks to the speed at which information spreads on social media. Even the smallest misstep by a brand can be rapidly broadcast to millions, causing damage, and leading to lost revenue.
  5. Minimizing regulatory risks: Staying within safe lines of regulations keeps your organization from fines and penalties. Plus, it’s typically easier and less expensive to take such measures proactively, than it is to do so when your hand is forced.
  6. Competitive edge: by excelling at and advocating for an environmental cause, an organization can put pressure on its competitors and use the achievement as a competitive advantage.

Initiatives to Consider

As mentioned earlier, pursuing The Planet bottom line does not necessarily mean making big and drastic changes. Environmentally positive impact-creating initiatives that you can consider are:

  • Recycling opportunity in-house and limited use of materials (i.e., unnecessary printing).
  • Reducing travel, remote work opportunities, and/or public transportation benefits.
  • Partnerships with green businesses and buying locally manufactured goods.
  • Optimizing and reducing energy consumption.
  • Seasonal company-wide green initiatives (i.e., day to collect trash or volunteer).
  • Becoming an ambassador of an environmental cause and advocating for it.
  • Creating an option for customers and employees to donate instead of receiving material gifts.
  • Workshops and training to educate and bring awareness on environmental issues and how the organization can positively impact it.
  • Find innovative ways to be more effective or efficient in your operations by involving employees.

The bigger picture will always be comprised of smaller bits and pieces and while the above-mentioned initiatives might seem small, put together they can make an impact. That’s why giving your employees a voice and engaging the whole organization is so important. While it might sound like a big and complex feat, right tools, such as Viima can simplify the process allowing you to run idea challenges on sustainable innovation and development topics.

Reporting

Now, while environmental initiatives are important on many different levels, from a business point of view, they should contribute to profit generation. Thus, once your Planet bottom line initiatives are in place and running, it is crucial to report on them either on your website, or in your annual business or sustainability report.

The Non-Financial Reporting Directive (NFRD) came into effect back in 2018 requiring public interest companies with more than 500 employees to report on how they are dealing with sustainability matters. In 2024 we will see an additional directive on Corporate Sustainability Reporting which will apply to large companies that meet 2 of the following 3 criteria: more than 250 employees; more than €40 million net turnover; more than €20 million on the statement of financial position.

But reporting should be considered by small organizations too as talking about your achievements beyond the mandatory reporting will positively affect your brand image, it will increase transparency, and improve your reputation.

Reporting and measurement of positive impact can be quite difficult, especially if it is a voluntary initiative and is not based on any regulation-implied requirements. Below is a list of KPIs to consider:

  • Information on electricity consumption.
  • Information on fossil fuel consumption.
  • Information on waste management.
  • Change in land use/land cover.
  • Reduction in greenhouse gas emission.
  • Amount of waste generated and, when relevant – amount recycled.
  • Amount of ethically sourced materials.
  • Information on volunteering or charitable work done.
  • Information on new local, sustainable partnerships.

People and the Triple Bottom Line Pexels

People

People of the triple bottom line encompasses all the people included in or affected by a business.

It goes far beyond just the small circle of shareholders. This category includes (but is not limited to) employees, suppliers, wholesalers, customers, local or global communities within which the business operates, and future generations. Some people like to emphasize the future generations by separating it into the fourth sphere and adjusting the framework’s name to quadruple the bottom line. Yet in J. Elkington’s views, the future generations are simply an inseparable part of society, and it fits just perfectly in the People category.

There are certain aspects of this bottom line that might be regulated by local or regional governing bodies. For example, local labor law might indicate a specific number of working hours per week, how long lunch breaks your employees are eligible to take or what kind of health insurance the company must provide. However, as with all things sustainability, social responsibility extends beyond the bare minimum – it is a business’ voluntary and proactive way of recognizing its impacts on stakeholders.

The People aspect is an organization’s social impact or social responsibility. And as earlier cited UN Global Compact states, “social responsibility should be a critical part of any business because it affects the quality of a business relationship with stakeholders”.

Benefits of The People Bottom Line

Social initiatives might not be seen as profitable in the short run, but on a bigger scale, doing what is right and doing good positively affects the company’s standing amongst its competitors. For example, such initiatives can positively affect the following:

  1. Employee retention: Companies that invest in their employees’ satisfaction end up saving resources in the longer run. Time and money spent searching, hiring, and training employees can be invested in different opportunities. In addition, people that want to stick around in a company indicate good organizational health and improve brand image.
  2. Attraction of top talents: More and more routine work is being automated, and value is starting to be increasingly created by fewer people of higher talent creating systems, processes, and technology (=innovations) that drive value. Thus, attracting these top talents is increasingly important, but more and more of these people are these days motivated by factors such as the purpose and mission of the organization beyond just compensation, career growth, etc. more traditional factors.
  3. Customer loyalty: Companies willing to walk that extra mile, give to societies or contribute to positive impact will reap the benefits of a better brand image, and in line with their customers’ social values they will naturally have a chance to retain old and attract new customers.
  4. Raising capital: Socially responsible investing is constantly growing and the opportunity to attract investors depends on the organization’s sustainability achievements, the social aspect and how your organization treats people are always on the list of things to be evaluated.
  5. Avoiding risk: Strong commitment to social initiatives will eliminate work-disrupting and reputation-damaging risks. Any mistreatment of an employee or other community member can cause a severe backlash that will affect the organization’s profitability. In addition, the business’s focus on social responsibility in return creates supply chain security.
  6. Expanding the market: If most people can’t afford to buy your services, the size of your market dramatically increases if you are able to a) lower the prices of your products by decreasing costs, and/or b) by helping improve the income of said people. Combining both can be a powerful way to grow the business and create a more positive impact all around you.
  7. Source for innovation: As mentioned in our earlier article social issues need to be addressed and this in return can create business opportunities – “more than 80% of economic growth comes from innovation and application of new knowledge.” People-centric innovation (social innovation) enables the business to tap into that growth and reap benefits.

Initiatives to Consider

There are a lot of organizations that go far beyond the basic in-house social needs and are willing (and are financially capable) to give back to communities with charity work, donations, education grants, and various volunteering and community engagement initiatives.

However, not every company is capable of running such initiatives. Smaller-scale improvements like supporting your employees in setting up home offices with recycled or new equipment can be a great morale boost. In return, it creates comfort for people to work from home, reducing time spent commuting and/or using cars, leaning toward the Planet bottom line. With sustainability, every small effort counts.

  • Paid internships for students.
  • Organizing educational projects for externals (i.e., coding academy for students, job searching training).
  • Skill training and learning opportunities for employees.
  • Internal anti-racist training.
  • Employee surveys or feedback to keep everyone in the loop.
  • Salary transparency.
  • Employee stock plan.
  • Volunteering work within the nearest communities.

Reporting

Topics to report on and how your organization’s initiatives affected them can be:

  • Demographics of your employees and partners (i.e., working with small or minority-owned businesses).
  • Vacation days collected and used to see whether employees are rested and not overworked.
  • The average difference between wages and finances needed for minimum living standards in the area.
  • Average commuting time.
  • Average employee benefits.
  • Information on diversity of employees.
  • Job safety KPIs (i.e., reported incidents, corrective actions taken).
  • The number of new jobs created.
  • Hours spent on employee or external communities’ training.
  • Information on second-tier suppliers (i.e., where and how your first-tier suppliers are sourcing materials).

Dubai Skyline Unsplash

Profit

Profit by default seems to be the most analyzed and the best-understood segment of all the three covered in this article. By definition, profit means “money that is earned in trade or business after paying the costs of producing and selling goods and services”.

TBL is not meant to discount profit in any way – rather incorporate it into the other two legs of sustainability: investment in social initiatives or environmental projects relies directly on profit and a company that does not do well financially cannot contribute to the other areas – social and environmental impact.

Profit refers to the influence that the organization is creating on the whole environment within which it operates: ethical means to earn a profit; cooperating with and supporting ethical partners; fair wages and full taxes paid.

Profit as a component of TBL is pretty straightforward, yet there are certain aspects that might be confusing. And it seems to arise from a two-sided view of Profit: the philanthropic take with emphasis to give back to society as a charity, and pure profit to satisfy shareholders.

However, when talking about sustainability and the triple bottom line, these two sides are inseparable. The company can stay in business and drive value for the People and the Planet only if it makes a profit.

The triple bottom line’s Profit is a cycle: a business that makes a profit can then invest in innovation, creating a positive impact on the Planet and the People; can then pay taxes that in return will be used for social good; can then grow to create jobs for People and so on.

Key Points

Conclusion

The triple bottom line like other sustainability-oriented initiatives can seem quite idealistic in a world still strongly focused on profit.

But as McKinsey report over the past 5 years, investment into sustainable funds has been on a rise and even if current environmental, social, and governance (ESG) frameworks are far from perfect, ESG considerations are becoming more important in companies decision making. In addition, investing in sustainable innovation does result in stronger economies, higher living standards, and more opportunities for individuals.

There are no better words, to sum up this article than John Elkington’s words:

“To truly shift the needle, however, we need a new wave of TBL innovation and deployment. None of these sustainability frameworks will be enough, as long as they lack the suitable pace and scale — the necessary radical intent — needed to stop us all overshooting our planetary boundaries.”

The challenge here is that businesses still must satisfy shareholders and to deliver the value they have to make tradeoffs. There’s no one golden rule on how to satisfy all three areas of TBL equally, it is a continuous, balancing act, and decision-making should be based on long-term goals. But the fact is, that decisions must be made, and it is the best time to go beyond planning and start implementing.

This article was previously published in Viima’s blog.

Image Credits: Unsplash, Viima, Pexels

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Measuring the Impact of Social and Environmental Innovation

Measuring the Impact of Social and Environmental Innovation

GUEST POST from Chateau G Pato

As we advance into an era of conscientious capitalism, the role of social and environmental innovation has become more critical than ever. Organizations are increasingly measured not just on their financial performance, but on their ability to generate positive social and environmental outcomes. However, to truly recognize the value of these innovations, we must develop robust methods for measuring their impact.

In this article, we’ll explore key strategies for evaluating the impact of social and environmental innovation, supported by two illustrative case studies.

Importance of Measuring Impact

Measuring impact is vital for several reasons. It provides accountability, guiding companies to deliver on their promises. It also helps in securing funding and support from stakeholders and enhances decision-making by providing insights into what works and what doesn’t. Moreover, clear metrics can foster increased transparency and trust between an organization and its stakeholders.

Approaches to Measuring Impact

While there is no one-size-fits-all approach, several methodologies can be used to measure impact:

  • Social Return on Investment (SROI): This method quantifies the social, environmental, and economic value created by an organization relative to the resources invested.
  • Triple Bottom Line (TBL): Focuses on people, planet, and profit, evaluating social and environmental performance alongside financial outcomes.
  • Key Performance Indicators (KPIs): Specific metrics tailored to a project’s goals, offering a direct line to assessing impact.

Case Study 1: Interface, Inc.

Background

Interface, Inc., one of the largest global manufacturers of modular carpet, embarked on a transformative mission to become a fully sustainable enterprise. Their initiative, Mission Zero, aimed to eliminate any negative impact the company had on the environment by 2020.

Measuring Impact

Interface used a comprehensive approach to measure its environmental innovations — they tracked metrics such as carbon emissions, water usage, and waste reduction. They also calculated their progress toward Mission Zero goals, establishing clear KPIs and regularly publishing sustainability reports.

Results

By the end of 2020, Interface had managed to reduce its greenhouse gas emissions by 96% and waste to landfills by 91% from a 1996 baseline, all while increasing their recycled and bio-based content across products.

Case Study 2: The MicroLoan Foundation

Background

The MicroLoan Foundation provides small loans, business training, and mentorship to women in sub-Saharan Africa, aiming to lift communities out of poverty through female entrepreneurship.

Measuring Impact

This organization uses a Social Return on Investment (SROI) framework to evaluate the socioeconomic impact of its programs. They assess metrics such as income increase, business success rate, and improvements in quality of life. Moreover, they track the ripple effect within communities, measuring how these microloans improve education and healthcare access.

Results

Women supported by the MicroLoan Foundation reported a 96% success rate in their businesses with significant improvements in household income and education access for their children, demonstrating a substantial SROI.

Moving Forward

As businesses aim to achieve sustainable and inclusive growth, the ability to precisely measure social and environmental impact becomes a vital asset. By leveraging diverse measurement strategies, companies can ensure they are not only contributing positively to society and the environment but are also reaping the rewards of their efforts through enhanced reputation and stakeholder trust.

Ultimately, the evolving landscape of business underscores that financial gain and social good do not have to be mutually exclusive but can coexist to create a more inclusive and sustainable future.

As leaders in change and innovation, let us commit to not just measuring outcomes, but driving meaningful impact that transforms lives and safeguards our planet.

Bottom line: Futurology is not fortune telling. Futurists use a scientific approach to create their deliverables, but a methodology and tools like those in FutureHacking™ can empower anyone to engage in futurology themselves.

Image credit: Unsplash

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