The variable that I rarely hear in the discussion of the financial crisis and the issues that plague our economy is that of time. It appears that our society has become reactive, linear, impatient, and unwilling to look outside the immediacy of whatever issue we are dealing with at any given moment. Because we are constantly reacting rather than actively improving, testing, and producing we are unable to see the benefit of long-term planning and the full impacts of the quick fixes we implement. In addition to short-term thinking, it seems that we forget that the economy and financial systems are of our own design and that we have the power to change not only our actions, but the interconnected system in which we operate.
When I first think of my own role in the economy, finance, and specifically the crisis, it's difficult to not feel powerless. What could I have done? I don't work in the financial industry, invest in the stock market, or even own a home. I am not a shareholder of any corporation. Yet, all of these actions and reactions affect me as a United States citizen and as a global citizen. I am then reminded of the variable of time and the interconnected systems we live in.
When I think about time, especially in regards to financial systems, I am reminded that we all perceive it differently, especially during moments of crisis. Our ability to think about long-term productive solutions to the issues we face is reduced when we exist in a volatile political climate. For example, the most recent "fiscal cliff" crisis has completely swept aside conversation about climate change (and the long term financial effects of a reliance on fossil fuels), our strongly divided dual-party political structure, and even violence in America. This tendency towards distraction during crisis is, I believe, true for those of us deciding how to stimulate the economy as well as those of us who are deciding how to feed our families over the next week. Whether we are desperate for jobs or desperate for food, the immediacy is the same. Collectively, we believe that we need to do whatever it takes to find a solution (now!). And yet, the fiscal cliff will be followed shortly by the Farm Bill Cliff and the deficit cliff... as Maureen Dowd of the New York times describes, "Once you start with the cliffs, you can fall into cliffinity-- with endless cliff riffs on the horizon."
We are living in a paradigm of revolving crisis where the discussion is not about long-term improvements but of short-term fixes. When we only feed the immediacy of now, we fail to see opportunities for long term societal health.
When I think about the interconnected systems we live in, I am reminded of how important it is to break free of linear thinking. If one party is right, then the other must be wrong. If we have this, then we cannot have that. We are in a constant state of compromise where there are clear winners and losers. Does anyone stand to gain when some of us lose, or at least perceive to have lost?
The 2008 financial crisis was the result years of increased government deregulation of the financial sector and the prevalence of complicated financial products such as bundled securities that leveraged bank assets at an alarming rate. For example, banks sold mortgages to Americans to buy homes. Because of the high rate that homes were being purchased at, home prices rose. Banks that lend, before deregulation, were not legally allowed to sell high risk investment products but because of deregulation of the banking sector, the very banks that sold mortgages were (and are) able to bundle these mortgages and sell them as securities to other investment banks. This allowed lending banks to turn a profit quickly and not wait for homeowners to pay off their mortgage over time. This short-term payoff caused these banks to relax their standards of who they sold mortgages to, meaning that, many, many people who could technically not afford to pay back their loans were given them anyway. Options on these bundled mortgage securities were then sold meaning that some banks (and investors) stood to gain whether these mortgages were paid back or not, whether Americans were able to make their payments and keep their homes or not. When people began to default on their mortgages, the chain of investments that leveraged and releveraged other people's "real wealth, fell apart.
Over the years that led up to the crisis, those who who sold these highly leveraged financial products made an incredible amount of money by being rewarded for their risk taking. Those who leveraged people's long term investments to make a short-term gain were rewarded with cash. As David Korten says, phantom wealth was created by leveraging other people's real wealth. Phantom wealth being money that is created by accounting tricks and real wealth being productive uses of money in such things as homes and infrastructure that helps people meet basic needs and increase the capacity of even more people to do so. As phantom wealth increased for a few, real wealth diminished for many. Whether those who gained understood how their actions and risk taking affected others in the system, they did nonetheless.
In order for us to truly "fix" our economy and ensure that our financial systems perform in a way that helps many people meet their needs and increase our collective capacity to do so, we must think with long-term stability and productivity in mind and appreciate our ability (and responsibility) to adapt the systems we use.
Joel Solomon, a responsible investor from Vancouver British Columbia, once explained the power that each of us has vote with our money. This sentiment is something I now live by. No matter how big of a player we are in the financial system, every dollar we spend has the ability to be productive. Change will take time and there is no one way to fix the economy but by understanding our own role and our own power to influence the systems that we design, we have the opportunity to create financial systems that allow us to thrive.
Thursday, December 27, 2012
Saturday, December 1, 2012
If You Are Willing...
Thank you, Sarah Green, Associate Editor at HBR, for tipping me off to an opinion piece that I missed last week in the New York Times.
The piece, "The Go-Nowhere Generation," by Todd G. Buckholz and Victoria Buckholz, a critique of the millenial generation, is an incredible display of two of the biggest challenges (also known as opportunities) of our times: One, the disillusionment of an entire generation with almost every current system in place, and two, the seeming obliviousness that older generations have to a movement and an economy that is being developed right under their noses.
Another opinion piece that ran recently in the Times also points to the challenge of disillusionment.
Christy Wampole's critique of hipsterdom and all its irony appears at face value to echo the sentiments of the Buckholz's piece; our generation needs to grow up and start taking things seriously. Wampole believes that hipsters somehow feel nostalgic for times they never actually lived. By growing mustaches, raising chickens, learning to pickle things, and filtering their digital photographs to "look old" they are living in irony because, how could and why would they ever hark back to a time they never actually experienced? The answer is because we are a generation with a dearth of living role models and we are a generation collectively going through paradigm shattering change where every system we know is falling apart.
I'll frame this disillusion with a personal story.
On September 11, 2001, I turned 18. I was a senior in high school from rural Western Massachusetts preparing to apply to college. I felt privileged to come from a supportive family and community and was raised to be aware of the world outside and those without privilege. Until that day, I viewed the world as full of opportunity. I knew there was war, poverty, atrocities, and many, many people in the world who did not feel this same way as I did, but because there was the promise of opportunity, I felt optimistic about my role in making the world a better place.
Things shifted after that day. My perspective of my role in the world changed. Rather than operating on optimism, the world (I knew) began to operate on fear. Purse strings tightened, along with security and trust. My friends who had signed up for the National Guard with the promise of tuition and higher education found themselves in Iraq and Afghanistan. My friends who applied to college with the promise of employment, found themselves feeling dismal about their prospects upon graduation. There was a collective shift from, "what can't I do to," to "what the hell can I do."
Disillusionment is not the same as apathy. If we are speaking in generalities, my generation is not apathetic, we are disillusioned and fed up with what we have to deal with. Staying home to save money and using technology that connects us is not apathetic just as learning to pickle things and developing other self reliant skills because of the realization that the economic system we were born into may not exist in the near future is not ironic. If we were apathetic we would be pretending like the world around us has not changed. We would be doing things your way. The combination of this generational awareness of the need for systemic change, our increased global connectivity, and new (old) skills that allow us to meet our basic human needs actually gives our society a chance to adapt and survive. Apathetic we are not.
Calling an advertisement an advertisement, within an advertisement, may be ironic. It may also be a sign of disillusion with a medium within a broken system. I see the irony too. More disturbing than hipsters wearing trucker hats, when they've never actually driven a truck, is that the only mainstream media figures telling the truth about our pathetic government are doing so on Comedy Central. Perhaps turning to irony is not an aversion to risk but a collective strategic attempt to hold up a mirror and show the generations who built the broken systems that we've inherited how ridiculous everything they did before us was. If I sound disillusioned, I am. The great thing, is that my tone in this post is both a symptom of inheriting a broken system and of my deep belief that my generation is seizing this opportunity and is in the process of harnessing our collective disillusion to create real long term change.
Christy, I appreciate your humility and self critique as well as your frustration with irony. And, please remember that everyday is an opportunity to live in sincerity.
The second challenge, this lack of awareness that older generations have to the changes they cannot see or measure, also provides great opportunity. Let me hold a mirror to a couple of the questions and points I heard in the Buckholz's article, and again, I'm speaking in generalities.
Why don't you get off your ass, hit the road, and find opportunity?
I if I may, why didn't you value community and sense of place enough and bust your ass to make your hometown a better place for the next generation?
I see a great movement toward a deeper respect for place and community. I have friends across the country working to make their communities, many of which have high unemployment, better places for the people that call them home. Even in Portland, OR, where I live, the epicenter of hipsterdom and the DIY economy, (where young people come to retire), I see a generation of young people who genuinely care about this place and are actively prototyping scrappy business that can thrive in a new economic paradigm.
You're not even buying bicycles. Even further proof of your sedentary lifestyle! (What?)
There is an entire economy that is being built based on meeting human needs, living within systemic means, and building productive and real wealth. Craigslist, or, selling the stuff you don't want anymore to people who do want it, is just an example of how we are shifting from an economy based on consumption and growth to an economy that meets the needs of people and within the systems means of the planet.
It's not that our generation doesn't care, in general, it's that our generation doesn't care about the only way you know how to do things. So, it's no surprise to us that you explain what you see with cynicism and poor logic.
The irony of the Buckholz's piece is glaring. The only thing more ironic than pointing to rebels and risk takers who shunned the status quo and who were misunderstood by the generations who came before them, to prove their views about our generation, is their use of targeted cynicism and passive tough-love to shake us out of our disillusionment of the cynical, fear-based, and passive systems they perpetuate. The fact that they are using cynicism, shallow data, and a lack of long term systemic thinking to sell their books, proves the sentiment of our generation. If you want us to be like you, all we ask is that you change. Until we see that change, we're going to assume that it's business as usual. A business with practices that have left our country with a mess that our generation is stuck with cleaning up.
If you're willing, perhaps the greatest opportunity to build a high performing society and a strong resilient economy is to match your experience, resources, and knowledge of current systems with our ambition to change. I have the absolute privilege and honor of working with authentic, passionate, hard working leaders from older generations. Because of these people I have hope that the shallow cynical thinking I read in pieces such the Buckholz's and this one in Forbes (from four years ago) that essentially calls social entrepreneurship a cute fad and likens it to "cuddling up to Barny," is on its way out.
If you're unwilling, please step aside.
The piece, "The Go-Nowhere Generation," by Todd G. Buckholz and Victoria Buckholz, a critique of the millenial generation, is an incredible display of two of the biggest challenges (also known as opportunities) of our times: One, the disillusionment of an entire generation with almost every current system in place, and two, the seeming obliviousness that older generations have to a movement and an economy that is being developed right under their noses.
Another opinion piece that ran recently in the Times also points to the challenge of disillusionment.
Christy Wampole's critique of hipsterdom and all its irony appears at face value to echo the sentiments of the Buckholz's piece; our generation needs to grow up and start taking things seriously. Wampole believes that hipsters somehow feel nostalgic for times they never actually lived. By growing mustaches, raising chickens, learning to pickle things, and filtering their digital photographs to "look old" they are living in irony because, how could and why would they ever hark back to a time they never actually experienced? The answer is because we are a generation with a dearth of living role models and we are a generation collectively going through paradigm shattering change where every system we know is falling apart.
I'll frame this disillusion with a personal story.
On September 11, 2001, I turned 18. I was a senior in high school from rural Western Massachusetts preparing to apply to college. I felt privileged to come from a supportive family and community and was raised to be aware of the world outside and those without privilege. Until that day, I viewed the world as full of opportunity. I knew there was war, poverty, atrocities, and many, many people in the world who did not feel this same way as I did, but because there was the promise of opportunity, I felt optimistic about my role in making the world a better place.
Things shifted after that day. My perspective of my role in the world changed. Rather than operating on optimism, the world (I knew) began to operate on fear. Purse strings tightened, along with security and trust. My friends who had signed up for the National Guard with the promise of tuition and higher education found themselves in Iraq and Afghanistan. My friends who applied to college with the promise of employment, found themselves feeling dismal about their prospects upon graduation. There was a collective shift from, "what can't I do to," to "what the hell can I do."
Disillusionment is not the same as apathy. If we are speaking in generalities, my generation is not apathetic, we are disillusioned and fed up with what we have to deal with. Staying home to save money and using technology that connects us is not apathetic just as learning to pickle things and developing other self reliant skills because of the realization that the economic system we were born into may not exist in the near future is not ironic. If we were apathetic we would be pretending like the world around us has not changed. We would be doing things your way. The combination of this generational awareness of the need for systemic change, our increased global connectivity, and new (old) skills that allow us to meet our basic human needs actually gives our society a chance to adapt and survive. Apathetic we are not.
Calling an advertisement an advertisement, within an advertisement, may be ironic. It may also be a sign of disillusion with a medium within a broken system. I see the irony too. More disturbing than hipsters wearing trucker hats, when they've never actually driven a truck, is that the only mainstream media figures telling the truth about our pathetic government are doing so on Comedy Central. Perhaps turning to irony is not an aversion to risk but a collective strategic attempt to hold up a mirror and show the generations who built the broken systems that we've inherited how ridiculous everything they did before us was. If I sound disillusioned, I am. The great thing, is that my tone in this post is both a symptom of inheriting a broken system and of my deep belief that my generation is seizing this opportunity and is in the process of harnessing our collective disillusion to create real long term change.
Christy, I appreciate your humility and self critique as well as your frustration with irony. And, please remember that everyday is an opportunity to live in sincerity.
The second challenge, this lack of awareness that older generations have to the changes they cannot see or measure, also provides great opportunity. Let me hold a mirror to a couple of the questions and points I heard in the Buckholz's article, and again, I'm speaking in generalities.
Why don't you get off your ass, hit the road, and find opportunity?
I if I may, why didn't you value community and sense of place enough and bust your ass to make your hometown a better place for the next generation?
I see a great movement toward a deeper respect for place and community. I have friends across the country working to make their communities, many of which have high unemployment, better places for the people that call them home. Even in Portland, OR, where I live, the epicenter of hipsterdom and the DIY economy, (where young people come to retire), I see a generation of young people who genuinely care about this place and are actively prototyping scrappy business that can thrive in a new economic paradigm.
You're not even buying bicycles. Even further proof of your sedentary lifestyle! (What?)
There is an entire economy that is being built based on meeting human needs, living within systemic means, and building productive and real wealth. Craigslist, or, selling the stuff you don't want anymore to people who do want it, is just an example of how we are shifting from an economy based on consumption and growth to an economy that meets the needs of people and within the systems means of the planet.
It's not that our generation doesn't care, in general, it's that our generation doesn't care about the only way you know how to do things. So, it's no surprise to us that you explain what you see with cynicism and poor logic.
The irony of the Buckholz's piece is glaring. The only thing more ironic than pointing to rebels and risk takers who shunned the status quo and who were misunderstood by the generations who came before them, to prove their views about our generation, is their use of targeted cynicism and passive tough-love to shake us out of our disillusionment of the cynical, fear-based, and passive systems they perpetuate. The fact that they are using cynicism, shallow data, and a lack of long term systemic thinking to sell their books, proves the sentiment of our generation. If you want us to be like you, all we ask is that you change. Until we see that change, we're going to assume that it's business as usual. A business with practices that have left our country with a mess that our generation is stuck with cleaning up.
If you're willing, perhaps the greatest opportunity to build a high performing society and a strong resilient economy is to match your experience, resources, and knowledge of current systems with our ambition to change. I have the absolute privilege and honor of working with authentic, passionate, hard working leaders from older generations. Because of these people I have hope that the shallow cynical thinking I read in pieces such the Buckholz's and this one in Forbes (from four years ago) that essentially calls social entrepreneurship a cute fad and likens it to "cuddling up to Barny," is on its way out.
If you're unwilling, please step aside.
Monday, November 12, 2012
Open Solutions Society - Greg Dees - Portland - November 9, 2012
On Friday evening, Greg Dees, professor at Duke University's Center for Advancement of Social Entrepreneurship and who many call the godfather of social entrepreneurship, introduced a group at the Pacific Northwest College of Art to the concept of what he calls the open solutions society. The concept, which I believe will soon be laid out thoroughly in book form, is an all hands on deck approach to collectively solving the issues we face.
The lecture (more of a conversation) was hosted by PNCA's Collaborative Design program and Portland State University's Impact Entrepreneurs. Prior to the conversation, there was an open house at the Collaborative Design space where we learned about three projects that current graduate students in Don Harker's Social Entrepreneurship class are working on. Three groups presented their projects that proposed collaborative design solutions to the opportunities of urban connectivity in East Portland Neighborhoods, the re-purposing of tsunami debris washed up on Oregon shores, and the introduction of systems thinking to the education of our educators.
Dees framed the conversation of the open solutions society with the economic notions that: (1) The world's history is of constant adaptation. (2) Entrepreneurs, risk takers, innovators, must be able to test new ideas. (3) There must be institutions and systems in place for new ideas to be supported and absorbed.
So what does an Open Solutions Society look like? Greg Dees posed the following questions to spur the conversation.
What do you think?
The lecture (more of a conversation) was hosted by PNCA's Collaborative Design program and Portland State University's Impact Entrepreneurs. Prior to the conversation, there was an open house at the Collaborative Design space where we learned about three projects that current graduate students in Don Harker's Social Entrepreneurship class are working on. Three groups presented their projects that proposed collaborative design solutions to the opportunities of urban connectivity in East Portland Neighborhoods, the re-purposing of tsunami debris washed up on Oregon shores, and the introduction of systems thinking to the education of our educators.
Dees framed the conversation of the open solutions society with the economic notions that: (1) The world's history is of constant adaptation. (2) Entrepreneurs, risk takers, innovators, must be able to test new ideas. (3) There must be institutions and systems in place for new ideas to be supported and absorbed.
So what does an Open Solutions Society look like? Greg Dees posed the following questions to spur the conversation.
What do you think?
Wednesday, October 31, 2012
The Scrappy Shall Inherit the Earth
The Merriam Webster Dictionary definition of the word scrappy is: having an aggressive and determined spirit : feisty
The definition I prefer is one that I found on a slightly less official source, yet a source that, I believe, more accurately represents the way people use the word currently.
Urban Dictionary, more specifically the user skippy88, defines scrappy as: "seemingly small and unthreatening but shockingly able to kick your ass and anyone else's." Here's how it reads in a sentence: "Look at that scrappy lil dude over there. He just beat the crap out of those punks."
Nilofer Merchant recently wrote a series of blog posts for the Harvard Business Review laying out the new rules of doing business in what she, and many others, are calling the social era. The social era is defined by our society's move toward social media to connect and how our ability to be so connected and in contact is shaping our expectations and experiences. She states that the new rules of the social era are based the fact that companies must now be fast, fluid, and flexible to thrive. Rather than gaining superiority through size, companies now must be lean; rather than linear (like Porter's value chain model), the social era is fluid and conversational; and, rather than telling customers what they need, companies must share and collaborate with their community.
I agree. I like to think of the companies that will define the new economy as scrappy and these rules paint a high level picture of how a company can best thrive in it.
So, what does product innovation look like in a scrappy economy where to thrive our companies must be lean, conversational, and collaborative?
I work for an organization who's model of problem solving (design) is based on collaboration. We know that we are nothing without the communities we serve. This approach has allowed us to build trust with our stakeholders and grow and learn with our community as they grow and learn with us.
I believe people are increasingly wanting to feel connected to the brands they support and increasingly see purchases as investments, not just in quality products, but in the companies that produce and sell them. This is especially true in the local movement. People want to support their neighbors' restaurant, the farmer they like talking to at the farmers market, and the local retail establishment that goes out of their way to make their favorite products available.
Local businesses (some) are able to innovate at a high rate, in part, because they are in close contact with their customers and other stakeholders. Small local businesses are inherently lean, conversational, and collaborative. Small local businesses are the original scrappers, able to learn quickly, adjust, and innovate solutions as new market pressures and opportunities arise.
In this new economy, to stay relevant, companies must have the ability to innovate products at a high rate. Because the times we are operating in are also increasingly social in nature, collaborative development of products is crucial to the success of companies making and selling goods.
The below graph represents the rate of product innovation increase as new stakeholders are included in the process of the development of new products. Consider the example of a small manufacturer of high-end shoes that has grown from a small local shop to a company selling their products to customers in multiple countries through their website. The founder working by him or herself can innovate at a certain rate, add employees and the rate increases. Enter vendors, and now their working with new resources, capabilities and understanding of the market. Next, to increase the rate of innovation, the company seeks product partners, each invested in the others' brand and success, innovating products together, sharing knowledge and resources. Finally, what does it look like if customers are intentionally involved in the innovation of new products?
Of course, customers are always considered when new products are developed by any company but consideration is no longer enough. For customers to be truly invested in a company and their products they must feel invested in. Just as customers of small local businesses have always had a voice in the establishments they support, because of technology and the connectedness it brings to society, everyone has a voice that can be broadcast and picked up almost anywhere at anytime. Because everyone has the ability to broadcast everyone has the opportunity to be heard. This connectedness allows for the incredible opportunity to not just consider customers in the innovation process but to collaborate with customers.
This ever increasing interconnectedness allows lean, conversational, and collaborative businesses to thrive. It allows the scrappers to kick some ass.
A high rate of innovation is not the only key to success. Over the coming weeks, we'll explore what else it means to be scrappy.
The definition I prefer is one that I found on a slightly less official source, yet a source that, I believe, more accurately represents the way people use the word currently.
Urban Dictionary, more specifically the user skippy88, defines scrappy as: "seemingly small and unthreatening but shockingly able to kick your ass and anyone else's." Here's how it reads in a sentence: "Look at that scrappy lil dude over there. He just beat the crap out of those punks."
 |
| The young Hebrew David hoists the head of the Philistine Goliath - Gustave Doré (1832-1883) |
I agree. I like to think of the companies that will define the new economy as scrappy and these rules paint a high level picture of how a company can best thrive in it.
So, what does product innovation look like in a scrappy economy where to thrive our companies must be lean, conversational, and collaborative?
I work for an organization who's model of problem solving (design) is based on collaboration. We know that we are nothing without the communities we serve. This approach has allowed us to build trust with our stakeholders and grow and learn with our community as they grow and learn with us.
I believe people are increasingly wanting to feel connected to the brands they support and increasingly see purchases as investments, not just in quality products, but in the companies that produce and sell them. This is especially true in the local movement. People want to support their neighbors' restaurant, the farmer they like talking to at the farmers market, and the local retail establishment that goes out of their way to make their favorite products available.
Local businesses (some) are able to innovate at a high rate, in part, because they are in close contact with their customers and other stakeholders. Small local businesses are inherently lean, conversational, and collaborative. Small local businesses are the original scrappers, able to learn quickly, adjust, and innovate solutions as new market pressures and opportunities arise.
In this new economy, to stay relevant, companies must have the ability to innovate products at a high rate. Because the times we are operating in are also increasingly social in nature, collaborative development of products is crucial to the success of companies making and selling goods.
The below graph represents the rate of product innovation increase as new stakeholders are included in the process of the development of new products. Consider the example of a small manufacturer of high-end shoes that has grown from a small local shop to a company selling their products to customers in multiple countries through their website. The founder working by him or herself can innovate at a certain rate, add employees and the rate increases. Enter vendors, and now their working with new resources, capabilities and understanding of the market. Next, to increase the rate of innovation, the company seeks product partners, each invested in the others' brand and success, innovating products together, sharing knowledge and resources. Finally, what does it look like if customers are intentionally involved in the innovation of new products?
This ever increasing interconnectedness allows lean, conversational, and collaborative businesses to thrive. It allows the scrappers to kick some ass.
A high rate of innovation is not the only key to success. Over the coming weeks, we'll explore what else it means to be scrappy.
Wednesday, August 15, 2012
Cynicism
"Too often, in established cultures, cynicism is a way to attain status, and cynical responses to ideas seem justified because they are more “realistic." It is much easier to critique than to build. Yet equating cynicism with realism shrinks the imagination."
- Excerpted from "Yes to the Mess: Surprising Leadership Lessons from Jazz." Frank J. Barrett.
- Excerpted from "Yes to the Mess: Surprising Leadership Lessons from Jazz." Frank J. Barrett.
Saturday, June 16, 2012
Conscious culture change
Every culture changes over time. They change to adapt to new pressures, they change to allow for new opportunities, they change because members of the group leave or enter, and they change for countless other reasons. The change that fascinates me is that which is conscious. How can an organization look inward and not just shift aspects of its operations or reorganize its structure, but change its very core - change the things that seem inevitable, the most subtle of things. Over the next few months, I'll be seeking out examples of such change and I look forward to sharing what I find.
Caleb
Caleb
Friday, June 15, 2012
Design = Intent
We're all talking about design but what does it mean? And, how important is it to incorporate design into an organization's culture?
John Hockenberry explains that design is more than creative problem solving, using the Adobe suite, or reinventing the pen, it's having intent in what you do - values and focus and being thoughtful in your actions. These traits are crucial to a high performing culture.
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