I love and hate public holidays.
I love them because, like this weekend just gone, it brings people out of their homes into the public spaces. They move slower, seem to smile more, and engage with other people as part of a collective whole … whether they are at a festival, or queuing at a supermarket checkout.
I hate them because we can’t bill. And this season is a shocker. In Melbourne we’ve got 5 of them in a few months. (We so need a redistribution of public holidays; the long stretch between the Queens birthday in June and Melbourne Cup in November is gruelling. Good for billing but.)
At the end of the day, public holidays, when sucked for regenerative value, are fantastic because people need refreshing. Which brings me to something I have been pondering of late …
I did an interview for an audio magazine called Business Essentials last week. (great publication by the way) In the context of describing Ergo Consulting and what we stand for, the question ‘isn’t that idealistic?’ was posed. It got me thinking again about how traditional business thinking makes it pretty easy to appear radical. I thought the same thing when reading last week’s Economist, whose special report on Asset Management was essentially about funds management, which is not how I think about business assets.
12 months ago I was fortunate to meet pioneer business thinker Jay Bragdon, whose book called Profit for Life (Published by The Society for Organisational Learning, 2006) I had read when it was released . Jay argues the case for Living Asset (people and nature) Stewardship and has researched over many years the performance of companies who look after their living assets, as well as their non-living assets (capital). To test the commercial value of Living Asset Stewardship (LAS), he constructed the Global Living Assets Management Performance (LAMP) Index ®, and compared its performance over 10 years from 1995 with Standard and Poor’s 500 Index and the Morgan and Stanley Capital International (MSCI) Index. He selected 60 global companies according to their commitment to LAS relative to their industry peers. The annualised returns over 10 years were LAMP: 17.37%, S&P 500: 9.07%, MSCI World: 7.04%.
Why do I use this blog space to regurgitate figures like this? Because it’s time for us to realise that what might look radical, even soft and idealistic, is actually good business sense. Which doesn’t mean it should be the primary reason the look after people and the environment, but the argument that says people are not resources, and that business has a responsibility to care for the environment, are not the quaint thinking of leaders on the margin.
I resonate with what Jay describes as the two fundamental truths of Living Asset Stewardship. (i) Profit can only arise from life. Economic systems are sub-systems of biological ones. (ii) In a healthy world, profit must serve life.
Ergo’s approach to business is based on Living Asset Stewardship. How is this different from a traditional way of thinking about business? I include a table from Jay’s book for your interest and musing. (Note the last line – that’s mine!)
|Paradigm:||Organic, living system||Mechanical, non-living system|
|Context:||Integral to web of life||Separate, web is an externality|
|Culture:||Networked, emergent||Structured, ordered|
|Defining Elements:||Living assets||Non-living capital assets|
|Dynamics:||Self-organising, humanistic||Directed, materialistic|
|Reason for Being:||Serve humanity / life (infinite)||Serve owners / managers (finite)|
|Authority:||Decentralised, localised||Centralised, hierarchical|
|Governance:||Diffused responsibility||Command and control|
|Workplace:||Open, interactive||Closed, bureaucratic|
|Communications:||Transparent, shared access||Restricted, limited access|
|Learning:||Self-directed, spontaneous||Prescribed, formulaic|
|Strategic Thinking:||Holistic, inclusive, organic||Analytical, reductive, acquisitive|
|Leverage:||Inspired employees||Financial engineering|
|Key Metrics:||Balanced scorecard||Financial indicators|
|Mission:||Quality of life, service||Quantity of profit, financial wealth|
|Vision:||Sustainability, harmony||Control of resources, markets|
|Organisational:||Eco-centric, collaborative||Anthropocentric, competitive|
|Employees:||Value generators, assets||Costs, potential liabilities|
|Leadership:||Serves, mentors, teaches||Dominates, orders|
|Financial:||Low debt, self financing||Higher debt, frequent borrowing|
|Profit:||Means to fulfil a mission||End in itself|
|Public holidays:||Regenerative opportunity||Missed billing opportunity|