Tag: Sustainable Investment

How does a real estate investor in Milwaukee predict true housing market demand and fine-tune better forecasts of potential homeowners and or renters in New York City, 880 miles away? The answer lies in monitoring social interactions – location-specific tweets, pokes, and “likes” – where participants reveal individual and collective location preferences and willingness to pay. In the age of social technologies, the world has been flattening much faster since Twitter hit the corporate bloodstream with its 140-character limit, and Facebook began the long expedition to make the world “more open and connected.”

Most business leaders want to change how work is done — increase productivity, enhance employee engagement, build sustainable businesses and inspire innovation. Moreover, innovations such as shifting from one-to-one communication channels to social channels (one-to-many), creating accessible and searchable information, and enhancing creative forces among employees have been marketed as key drivers and benefits of social technologies.

But vital questions remain: How can organizations capture the value of social technologies, encourage collaboration across functional silos, and improve productivity? How can organizational practices be transformed to fully benefit from social networks on a large-scale basis? And how can social media facilitate or change the way businesses approach sustainability? Full article

We all remember the notable story that opens Daniel H. Pink’s Drive: The Surprising Truth about What Motivates Us. Harrow, a psychology professor, and two colleagues gather eight rhesus monkeys for a two-week experiment on learning. They’re surprised to see the primates—without any urging or coercion—begin to play with their specially devised puzzle with focus, determination, and enjoyment. The shock deepens when the experimenters observe the monkeys crack a code on how to remove a pin, slide a hook, and open the cover of the mechanical puzzle, each time, even without a food reward, affection, or applause. Conversely, when the primates are rewarded with raisins for solving the puzzle they make more errors and less frequently solve the puzzle. The reason, Pink concluded, was that the monkeys solved the puzzle repeatedly because it was gratifying to do so. That is, the intrinsic benefits of solving the puzzle outweighed the extrinsic rewards.

In view of Harrow’s dilemma, I find the description of what motivates us presented in Pink’s book to be an apt description of global sustainability today. And the example that perfectly fits this description is the self-organizing aspect of sustainable initiatives. I find that many people still see sustainability as a carrot or stick dilemma; they are pretty convinced their choices are the best and it’s other people who aren’t doing the right thing. Their reasoning takes this line: “Nature has a unique way of maintaining equilibrium and regenerating itself. Our company is not a big polluter like other big companies and if it means that we have to give up our current production processes, we probably won’t do it.”

We sometimes think of sustainability practices as bootstrapping themselves into existence. We fail to connect the dots between our lifestyle choices and the resulting macrobehavior. One Wall Street Journal article documents why, despite government efforts to encourage consumers to adopt zero-emissions vehicles, electric cars are not yet creating much spark. As one researcher observed, “Until battery technology improves and people can drive further, I don’t see significant growth in electric vehicles.” Other consumers have expressed interest in electric cars, but acknowledge that it is going to take time before an effective solution to the range anxiety problem is resolved. How about if government paid new electric car owners? Try to nudge car owners to buy zero-emission cars by paying them for each unit bought—and they’ll become more diligent in the short term and lose interest in the long term.

But those who drive electric cars, or use energy saving bulbs, or incorporate ISO 14000 standards into projects, or weatherize their homes, for instance, aren’t setting out to solve global sustainability challenges; they are solving personal or business—and indeed local—problems, such as how to drive to their workplaces, or what to use in lighting their homes, or how to set a framework for continual improvement of environmental performance of their business, or how to maintain a certain in-house temperature. And yet those personal and local decisions combine—and self-organize—to form the macrobehavior of their homes, companies, businesses, states and nations. As a result of this self-organization, new pockets of successes emerge: home energy bills are reduced, corporate image among regulators, customers and the public is improved, clean air is restored, cases of chronic pulmonary diseases are reduced, and the equilibrium is restored.

“It takes a village” is a cliché. And yet I see its dynamics are at play everywhere in addressing sustainability. The correlation reinforces the notion that global sustainability requires a trade-off driven by intrinsic rewards: we all have a role to play in improving the environment and we will have to sacrifice something (e.g., our backyard for wind farms, preference for mass transit, or inexpensive transportation). And while some people are willing to make this trade-off, many others are not. As a result, the notion of global sustainability may need some nudges, including peer pressure.

The interaction is two-way: the project manager who incorporates ISO 14000 standards into the project influences other project staff in his or her team, and vice versa; the new homeowner who buys, retrofits and weatherizes his or her home next to an existing homeowner influences the behavior of that homeowner, which in turn influences the behavior of the new comer; the quality assurance specialist who applies exactitudes rather than generalities in project cost, project quality, and project time trade-offs, and educates, trains, and holds project staff responsible for sustainability, influences the behavior of those staff, who in turn influence the behavior of the project manager. In other words, the relationships are mutual: you influence your peers and your peers influence you, and a ‘flow,’ which enhances intrinsic benefits, is maintained and enhanced.

More prosaically, Pink addresses the complexity of these interactions, both in personal decisions and corporate environments, and advises those who prefer a reward-and-punishment route that: “Building our businesses in sync with these truths won’t be easy. Unlearning old ideas is difficult, undoing old habits even harder. And I’d be less sanguine about the prospects of closing the motivation gap anytime soon, if it weren’t for this: The science confirms what we already know in our hearts.” That is his swanky way of saying that decisions on global sustainability will come down to our deep-seated desire to direct own lives, expand our abilities, and to continue to live a life of purpose.

I will admit that, in that sense, Pink’s work gives us hope. And to make progress with global sustainability we will have to come to terms with the fact that real headway will only be realized when we adopt sustainability practices because it is gratifying to do so. Success will be possible when the collective action to create more profitable, healthy, and sustainable businesses, communities, and nations, is bottom-up, and enjoyable. That is, when the intrinsic benefits outweigh the extrinsic rewards.

Harrow’s primates have cracked the code and solved the puzzle without any raisins, and the ball has now been tossed to the bigger-brained, less hairy human beings. I will bet on intrinsic motivation and kaizen—continuous improvement—to get us there.

This article first appeared in the Project Management Global Sustainability Community of Practice (CoP).

Steven Johnson opened Emergence, his searing 2001 book on how complex systems manifest from simple rules and are driven by bottom-up behaviour, with a fascinating rhetoric:

“How does a lively neighbourhood evolve out of a disconnected association of shopkeepers, bartenders and real estate developers?” he asked. “How does a media event take on a life of its own? How will new software programs create an intelligent worldwide web?”

It’s an interesting question. Emergence examines how simple, interconnected elements – such as amoeba-like slime mould cells, neurons or the individual members of an insect colony – self-organise to form more intelligent and sophisticated systems by coalescing with thousands of their neighbours.

But how does this happen? And how is it relevant for cities?

Consider that when it comes to control over processes such as how long it should take for traffic lights to change, or the amount of energy consumed in each household, or how many times in a week garbage is collected, every city model falls somewhere along a continuum.

At one end are highly controlled, top-down hierarchical systems being engineered by a master planner. Someone – at the control room of a Pacific Gas and Electric Company, or a Southern California Edison, or a British Gas – monitors how much energy is coming in and how much is being consumed at any given moment.

And at the other end are self-organising components, where no individual exerts control over the processes. These components are, in essence, far more than the sum of their residents and get their orders from below.

In all leading cities today, we talk about sustainability as both a big-picture goal and in terms of what individual residents can do – those who are looking through various processes with an environmental lens, whether it be a shorter commute to work, an affordable fuel-efficient car with better miles per gallon, the replacement of incandescent light bulbs with energy saving bulbs, a weatherised home, liveable and healthier neighbourhoods, etc.

Each decision has competing tradeoffs. Yet those random personal and local decisions combine – and self-organise – to form the macro-behaviour of homes, boroughs, regions and cities, leading to global patterns.

And with this self-organisation, new pockets of success emerge: monthly home energy bills are reduced, waste and expenses associated with inefficient processes are slashed, air pollution is fixed, and equilibrium is restored. In essence, it is neighbourhoods in cities solving problems that would otherwise appear insurmountable – without any of those cities realising it.

IBM’s Smarter Cities initiative equips city managers with tools and technology that enable them to drive sustainable growth and prosperity by analysing efforts among agencies and sectors as they happen, thus helping them anticipate issues rather than react to them. New York, Rio de Janeiro and Memphis, to name a few, are using IBM tools to coordinate emergency response units and strengthen crime fighting, while Singapore is working with IBM on a range of issues such as congestion charging in order to reduce traffic and air pollution.

“The majority of us live in cities, and the percentage is growing,” says IBM. “As centres of business, culture and life, cities are logical places to integrate many of the Smarter Planet principles and innovations: smarter transportation, policing, emergency response, governance and smart grid that links power and water systems, to name a few. By using these tested approaches, cities can manage growth and development in a sustainable way that minimises disruptions and helps increase prosperity for everyone.”

However, with budget cuts and slower economic growth, many cities are facing a tough challenge. Their populations are growing at a time when their revenues are shrinking. More than half of the world’s population now lives in cities. Moreover, this figure is estimated to grow to 80 percent by the year 2050.

These new realities have led people to ask some searching questions. What will happen to monthly energy costs in the coming years? How clean is the water supply? What adaptation and mitigation strategies will climate change require us to model? How can we replace fossil fuels with sustainable energy sources in our mass-transit systems in the urban environment? And how can we increase the vitality and competitiveness of our urban environments with solutions that optimise the entire city?

Consider one million people will have moved into the world’s cities by the end of this week. For the foreseeable future, cities may have to do more with less, and they may have to find new ways to manage complexity, to increase efficiency, to reduce overheads and still build liveable and healthier neighbourhoods and improve quality of life.

By eliminating operational silos, enlisting forward-thinking leaders and adopting self-organising smarts, cities can remain prosperous and sustainable in the face of unprecedented competing interests, and take the first steps toward creating more liveable neighbourhoods.

This article first appeared  in PMI Global Sustainability Practice

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