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Volume 4: Summer 2011 Developing Sustainability Leaders for Balanced Organizational Change

The Rocky Peak Leadership Center “News from the Peak” newsletter is a seasonal newsletter aimed to educate, encourage and inform leaders. Its practical down-to-earth approach to present timely leadership information can stimulate and inspire others to engage in constructive dialogue and intends to help move organizations forward in a positive direction.

IN THIS ISSUE:  
> Developing Sustainability Leaders for Balanced Organizational Change by Dr. Dale S. Deardorff


UPCOMING EVENTS:  

August 14th
Clos Peppe Sustainability Tour
Santa Rita Hills, Ca
September 3rd
Consumnes River Preserve 
Wetlands Sustainability Hike

Sacramento, Ca


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Related Links:

Additional Reading:
Sustainability Leadership Institute
Sustainability and Lean Operations (.pdf) – by Tom Johnson 
Blueprint for Corporate Sustainability (.pdf) – United Nations Global Compact
Leading a Sustainable Enterprise (.pdf) – IBM Institute for Business Value 
Sustainability expert points to leading role of business in 2011 – by Heather Clancy 
YouTube Links:
Communication To Inspire Sustainability - John Marshall Roberts
Sustainability: Ideas Can Change The World - Darcy Hitchcock 
Building Green: Positive Business Relationships - David Gottfried
Story of Stuff, Full Version; How Things Work, About Stuff  
Other Publications:
Sustainability Indicators: by Stephen Morse
The Sustainability Handbook: by William R. Blackburn
Sustainability by Design
by John R. Ehrenfeld 
Leadership & Sustainability: by Michael Fullan
Sustainable Leadership by Andy Hargreaves & Dean Fink 
Redesigning Society by Russel Ackoff & Sheldon Rovin

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Developing Sustainability Leaders for Balanced Organizational Change

The Leadership models practiced today typically describe the personality style and positive or negative characteristics associated with their leadership theme. The downside to this is that these models rarely encompass the interconnection to larger society, or other global implications.

Sustainability Leadership is considered one answer to this challenge. This is accomplished by fostering a set of organizational business ethical values and morals that can align the organization with the triple bottom line (people, planet, profit). This helps you create an enterprise that may limit its negative impact on the global or local environment, community, society, or economy.

Additionally, a Sustainability Leadership model can embrace theories of Organizational Social Responsibility (OSR), Corporate Social Responsibility (CSR) and Socially Responsible Investing (SRI). These theories can help provide a self-regulating business model that monitors and ensures its activities are in compliance with the spirit of the law, ethical standards, and international norms.

But this is only an external view of Leadership impacts. What is also needed is an internal view which we can refer to as a "Sustainable Leader". This may seem like a play on words or a word-smithing nuance but there is an internal responsibility required to help us balance organizational change.

In this proposed Sustainability model, leading balanced organizational change means finding a way to lead and emulate communication both horizontally across organizations; providing the Vision, Mission and Purpose message and vertically in specific domains to provide direction for performance, mentorship and systems thinking.

In this newsletter, we will discuss and describe both Sustainability Leadership (external) and the mindsets and worldviews of being a Sustainable Leader (internal). This dynamic integration of the internal and external view presented can lead to a balance of organizational networking (sharing) and intelligent accountability to help communities of practice with an awareness of their global and local sustainability challenges.

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Sustainability and Sustainable Leadership

It’s hard to pick up a newspaper, magazine, journal or publication today without seeing the word sustainability highlighted. If you go to a Yahoo or Google web browser today and search for the terms “Leadership” and “Sustainability” there are over 28 million hits available. Currently, our awareness of sustainability is greatly increasing, allowing us to see the abstract connection to Leadership strategies and responsibilities.

Some business leaders use the term “Sustainability,” only when it’s convenient to show they are active and engaged in a partnership to help society and the planet. Sustainability for others may be seen like a symbol for illustrating a general Leadership direction they think they should take, without knowing the true path to create an organizational capacity to endure.  More Challenging, the concept of leading from a sustainability mindset may have different meanings to different people. The ambiguity over the meaning of sustainability has not reduced its popularity but has led to confusion over the expectation required to create a diversity of viewpoints and multiple sustainability mindsets. To establish some common conceptual ground let’s agree that:

“Sustainability” is aimed at producing long-term global well-being through the wise use and management of economic and natural resources, and through respect for people and living things (Blackburn, 2008). Further, “to create a world for humans and non-humans that environmentally, socially, and economically provides for a current population’s needs without damaging the ability of future generations to take care of themselves”.

Leading Sustainability is based on a philosophy of re-thinking behaviors (patterns) in the organization to create long-term business successes. This may also require changes in your organizations processes (physical structures), operations, and priorities to create a clearly understood set of values. The term Sustainability is a holistic term that also involves viewing the wholes and complete system changes proposed with a clear focus on the context in which the business operates. It is an organization which is built to last that embraces a continuous ongoing investment in acquiring knowledge and skills with an ability to create value to society.

Fundamentally, we can say that leading sustainability is about finding new ways to live and work on planet earth that support the ability for all living systems to be able to thrive indefinitely. There are three required cornerstones for sustainability:

  • People - Pertains to the fair and beneficial business practices for the employees, the community and the region in which a corporation conducts its business. The organization helps create a reciprocal social structure in which the well-being of the corporation, the employees and other stakeholder system interests are considered interdependent.
  • Planet - Refers to sustainable environmental practices. The organization endeavors to benefit the systems natural order as much as possible or at the least to try to do no harm or prevent positive environmental impacts.
  • Profit -  Is the economic value created by the organization after deducting the cost of all of the inputs, including the cost of the expended or reserved capital. Within a sustainability framework, the "profit" aspect needs to be seen as the real economic benefit enjoyed by society as a whole. It is the real systemic economic impact the organization has on its economic environment.

Sustainability also means examining any decision to determine its business or institutional value, which involves the financial (prosperity) bottom line, as well as the potential costs and benefits to the other areas. This is a path to what is called the “Triple Bottom Line.” A current example of Leading Sustainability with a goal of a successful bottom line is the Ebonite International Company which manufactures bowling pins.

IQ Bowling Industries had made a previous decision to move its US manufacturing process to Mexico as a cost reduction initiative. In Mexico the product line was employing 27 workers where labor was cheaper. After Ebonite acquired the IQ Bowling plant, the company officials thought they could increase the quality of their product by moving it to a small Hopkinsville, Kentucky location as a proposed strategic fit for the company.

Currently, in Hopkinsville they are paying higher wages to about a dozen US workers who are applying the latest time and labor savings techniques on the same equipment used previously in Mexico to improve the quality and cost structure. Local wood is used from Pennsylvania and Ohio which has shifted shipping costs and expenses to a point where the production and overall production costs are less per pin.

The company now has better control over the manufacturing and quality of the product which is seen as a win-win scenario. The higher quality product makes the bowling pins more “scoreable” by removing the manufacturing inconsistencies. Ebonite is producing 150,000 American-made bowling pins in the new Hopkinsville factories first year with an anticipated growth target of 5-6 times that production in the future.
In this example, you can see that the Ebonite “Leadership” team, who made the decision to move the manufacturing capability back to Hopkinsville, was looking at a long term sustainability solution. This solution was made to create a positive impact on the people, profit and planet to solve a “wicked” problem. A “wicked” problem is one that requires a resolution to a problem which is difficult or impossible to solve due to incomplete, contradictory, and changing requirements that are often difficult to recognize.

Sustainable Leadership benefits the long-term good by positive influence of people to create change and demonstrate values that support positive principles of society. It must make substantial contributions to the quality of life of their employees and the community as well as sustaining and renewing the natural environment. A great way to illustrate this goal is to use the Sustainability Leadership Relational Model© from the Sustainability Leadership Institute:

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Sustainability Leadership Relational Model ©


In the model above, we have 8 unique but interconnected sustainability leadership practices that can be embraced in total or independently to:

  • help create sustainable solutions for core challenges
  • engage in creative thinking
  • hold self and others accountable for achieving agreed upon outcomes
  • recognizing relationships among independent entities or actions
  • leverage the impact of resources developed through strategic partnerships
  • stimulate one’s own and others thinking
  • assist collaboration, collective discovery & learning to broaden systems capacity
  • acknowledging diverse points of view
  • find solutions in the face of uncertainty and contradictions
  • reexamine personal integrity to guide action

The major tenants of sustainability leadership value include economic, social and environmental outcomes that can be systemically developed. Sustainability requires greater Leadership trust, transparency and cross functional collaboration within their organizations. Leaders are challenged with a shift from short-term returns on investments to more uncertain longer-term profit models. They can see across their organization to put various pieces of a sustainability puzzle together on the front-end of their efforts. These leaders approach this work from a holistic, systems perspective as co-creators of an interconnected reality.
One aspect of being a sustainable Leader is the concept that you’re planning on your own obsolescence. This is a challenge of letting go, moving on and preparing for succession from the first day your appointed. These leaders provide positive intrinsic rewards and extrinsic incentives to attract and retain the best and brightest employees possible. These employees are engaged in collaborative teams to open dialogue and shared decision-making. To accomplish this, means that a Sustainable Leader understands the difference between their people being used as a resource versus an asset.

When people are viewed as an “Asset” they have a future economic benefit, controlled by an entity as a result of a past transaction or event – in other words a person’s previous behavior has demonstrated that they are valuable in future work or efforts for you. When a person is viewed this way, it is understandable that we will make an investment in them by providing education, training and medical care.

When we view people as our greatest “Resource” it means that they contribute with skills, energies, talents, abilities and knowledge that are used for the production of goods or the rendering of services. This perspective is one where people are considered an expense for consumption or loss in future economic benefits. It is a short-term myopic mindset that does not embrace sustainability or the connected relationship between people. It assumes that once a resource (person) has been used a person would be dismissed until there was another need. Viewing people as only a resource implies they are a temporary expense in the form of salaries, insurance, sick leave pay, superannuation (retirement or pension benefits) and bonuses measurable only as a profit line entity.

Both of these descriptions have a problem because people are not an asset, they are not owned by their employer, and should not be referred to this way. What should be said is that; “People are our most important Value Partners, and our value comes from them.”  We treat a Value Partnership in a very important way by recognizing that this relationship is one where everyone shares a common interest or participates in achieving a common goal. Additionally, this type of partnership indicates a profit and idea sharing status creating a collaborative synergistic structure for innovation & opportunity.

Many organizations perform at their best when their leaders treat people with respect, valuing them by nurturing and developing them, rather than seeing them as costs to be controlled. The collective attitudes, skills and abilities of people can contribute positively to organizational performance and productivity. People are also responsible for continuing life-long learning by keeping their skills valuable and relevant for the organization. Sustainable Leaders are responsible for growing these same people with future opportunities.

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Systems Thinking Leadership
As a Leader embracing sustainability, you need to think in a “bigger picture” and mental model. One that encompasses a systems perspective understanding of the individual pieces integrated into the whole organization. Additionally, this requires a systems structure perspective of feedback loops and critical Leadership leverage points.
According to leading theorists, the failure to shift or modify our economic thinking to a living, systems view will soon have disastrous consequences for the well-being of humans everywhere. Examples of this are all around us but many times they are hidden from view because they are seen as backward intuition. We don’t know what to look for. As Leaders we may push in the wrong direction without recognizing the impact until it is much too late and systemically worsening whatever problems we are trying to solve.

An example is spending more money on police, interdiction and incarceration which does not make crime go away. Crime is a behavior that has a cause and until we address that cause and intervene we cannot make the total impact to society we desire. If a system is chronically stagnant, then parameter modifications or changes rarely have a significant impact to stabilize it.

Systems Thinking Leadership is the understanding and designing of organizational feedback processes and information systems that can accurately determine enterprise performance. We can use systems thinking to design the structures to help an organization interconnect its vision while fulfilling its purpose by living its core values on a daily basis. System Leaders operate in a perspective of bewildering uncertainty and staggering complexity. Today's problems are rarely simple and clear-cut, many times they are based on paradox, contradictions and potential lose-lose scenarios. Even worse is that today’s solution can become tomorrow's “Wicked” problems as previously described.

System's Thinking enables leaders and individuals to gain a clear understanding of their complex social system based upon paradigms and behaviors. Success in a Systems Thinking Environment requires different ways of thinking about problems and organizations. Paradigms are a composite of the shared social agreements about the perceived reality, systems goals and informational flows in the system. Changing a system paradigm is a leadership leverage point which shapes your world view and the collective impression and reality of others.

Making a paradigm change is hard because it is not physical nor is it recognized as a tangible expense. All it takes for a paradigm shift in an individual is a millisecond click where the mind sees a new way of understanding what used to be reality. As a systems leader you must continue to describe both the old and the new paradigm so that people understand the difference between them. It must be communicated by speaking and actions in places of public visibility and power. If you look at the image below do you see a duck..or a rabbit….or both?

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Duck-Rabbit Ambiguous Image

Thomas Kuhn used the duck-rabbit optical illusion seen above to demonstrate the way in which a paradigm change could cause you to see the same information in an entirely different way. It can be described as a radical change in mindsets, personal beliefs, complex systems or organizations by replacing the former way of thinking or organizing with another radically different or new way of thinking or organizing. If you look at the picture above you can only see one object at a time, not both completely at the same time.

For a Systems Leader engaged in an organizational sustainability paradigm, it requires a creative dialogue and paradigm shift to explore desirable sustainable characteristics. Sustainability is more intention than a practice and information and communication are the tools to create the systems awareness required to foster sustainable organizational performance and opportunities.

Embracing meaningful sustainability requires organizational leaders to take bold steps to move beyond efficiency and effectiveness, beyond regulatory compliance and being “green”. It requires systems thinking leadership which understands balanced organizational change. 
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Balanced Organizational Change

Sustainable Leaders need to help their organizations anticipate, recognize, strategize, plan, implement and execute change in a timely manner. This also requires leaders to ensure their organizations are constantly and properly aligned with the new business realities. More importantly they must create change, not merely anticipate it. This change is not only the responsibility of leaders but also of all employees. So there is a collaborative need to overcome resistance to change and embrace an increased change involvement through people and stakeholder activism.

Organizational change has typically been associated with leadership. We live in a very temporary mindset where introducing change can provide an organization a competitive advantage. The problem is that the same people who can help create a competitive advantage are the same people that instinctively fear restructuring, downsizing, re-strategizing, acquisitions and cultural changes. When creating “organizational change”  there are common mistakes or errors that significantly cause waste and anguish. John P. Kotter describes these as:

  • Allowing too much complacency
  • Failing to create a sufficiently powerful guiding coalition
  • Underestimating the power of vision
  • Under communicating the vision by a factor of 10
  • Permitting obstacles to block the new vision
  • Failing to create short-term wins
  • Declaring Victory to soon
  • Neglecting to anchor changes firmly in the corporate culture

Any of these can have serious consequences to transformational change creating a resistance to the needed change. The consequences can be that expected strategies or new strategies are not implemented well. That downsizing efforts cannot get costs under control and that planning fails to meet desired critical milestones. For sustainable leaders the central challenge is not their strategy, systems or culture, but more to change the people’s behavior for what they do. As Kotter indicates:

“Changing behavior is less a matter of giving people analysis to influence their thought than helping them to see a truth to influence their feelings. Both thinking and feeling are essential and both are found in successful organizations”.

So if we ask ourselves what balanced change model fits a sustainability leadership mindset we have to look for an interconnected flow between the leader, the team, (or group) the individual and the change required. Sustainability initiatives can’t be driven through an organization the way other changes can because of its complexity.

To create sustainable balance change; the individual, organization, and leader can embrace a change philosophy that supports holistic change and leadership leverage points where a sustainability leader should:

  • Do what you say and say what you do
  • Talk to people in an authentic, sincere and respectful way
  • Be open to, and care about the change
  • Do the right thing wrong, rather than the wrong thing right (Ackoff, 2004)

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Lester Brown challenges us to balance the demands of the human economic system with the Earth’s capacity to meet not only human demands, but also the demands of all other species and natural systems that inhabit Earth’s total bio system. To achieve this we must consider how to design our organizations in such a way that they generate a human economic system that flourishes in and nurtures Earth’s bio system. Every balanced change in an organization moves towards a more sustainable action in the world. Leaders who can review themselves, their choices, and their values can begin to experience themselves as co-creators of an interconnected world view.

Sustainability engagement needs special competencies, including knowledge about the challenges of globalization, dialogue skills, relationship management in cross-sector co-operations and the knowledge of how to design consensus building processes in a result-oriented way. Leaders who have become examples for others believe effective sustainable leadership is a combination of three basic components:

  1. Moral Values
  2. Positive Influence
  3. Innovation & Creativity

So if you ask yourself where do I start on a Leading Sustainability “Journey” for my organization and need some help, don’t worry , you’re in great company. The list of things you “Could” do is very long, but the list of things you “Must” do is much shorter.

My organization is accepting the challenge to focus on a handful of issues in the following areas:

  • Educational Needs for Disenfranchised – Current Education and Skill Training Programs
  • Overconsumption of Resources – Industrialized Nations use and/or overuse of resources versus low-income nations
  • Fossil Fuel Depletion – Global Energy demand and current consumption  due to auto, power plant and industrial use
  • Climate Change – Burning of fossil fuels output of greenhouse gasses
  • Biodiversity – Acceleration to animal life extinction
  • Freshwater Depletion & Water Contamination – Limited global freshwater for human consumption

In North America alone, about 5% of the earth's population, consumes an estimated 40% of the earth's resources. Additionally the rest of the world aspires to the North American "standard" of living mindset. Clearly, this current North American level of consumption is unsustainable, requiring us to re-think and change our habits and behaviors.

Egocentric and narrow minded motivations can result in conscious or unconscious leadership decisions. These motivations can harm rather than heal the environmental, social, and economic conditions of our planet.  The impact of sustainability leaders is their commitment to consciously embrace balanced organizational changes that can help create positive impacts on their people, organizations and society's bottom lines.

Dale S. Deardorff

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The “News from the Peak” Newsletter is FREE. And it's delivered to your email box at the transition of the quarterly season. If you have any comments, or questions or to learn more about our leadership and Innovation programs call us at 818-730-8203 or email: dale@rockypeaklc.com.

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Copyright Dale S. Deardorff, 2011. All rights reserved.