Category Archives: sustainable business education

Psychological Traps in Sustainable Thinking

I am going to build on Matt Wilson’s excellent post about cynicism. I agree that overcoming cynicism is the first step – but what a big step it is! In this post I’ll talk a bit about leaving cynicism behind, about the psychological traps that are inherent in this decision, and how I personally experienced this at Net Impact in Portland.

My communications background spawned my interest in how people organize themselves and work with information technologies to make good decisions. I picked workshops at Net Impact that related to my areas of greatest interest – how to measure the impact of business decisions and how to share impact information with stakeholders to best support the common good. I went to workshops on integrated reporting, employee engagement, impact investing, organizational learning, innovative balanced scorecards, and other things on that theme. The results were mixed.

I’ll start with my cynic hat on: the workshop on employee engagement featured a rep from Southwest Airlines, whose much-studied rise to success was based on the competitive niche of getting people out of cars and into planes, massively increasing the carbon footprint of intercity travel in the US. The most sustainable thing Southwest could do is get people out of planes and back into cars again, but they don’t engage employees who think that way… I disappointedly snuck out of that session before it finished. I also left part-way through the workshop on creating a personal portfolio of “social impact investments” when I realized the gaping disconnect between the workshop content about evaluating the impact of the investments themselves from the systemic impacts of the personal investment goals brainstormed by the audience: fly to the tropics every winter, buy that second vacation home, the fancier car, and other first-world consumer fantasies. Investing money “in an impactful way” does not validate your wasteful lifestyle choices, people! There was a broader understanding of systemic issues decidedly missing here.

I don’t want to be a cynic or contribute to the cynicism of others – I agree with Matt Wilson (and Lord Hastings) that it is a huge barrier to progressive action. But my experience of Net Impact was that a relentless tide of positive optimism competed for attention with critical, realist discussion, and from my examples above I think there are legitimate reasons to be critical. Without a real, critical discussion of Southwest’s role in the carbon economy, or of the lifecycle costs of our investment/consumption habits, we ignore “the elephant in the room” and it becomes easy for people with dissenting views (like me) to feel isolated and cynical. Substituting “everything is great” for “everything is hopeless” hardly strikes the balance that is required to tackle the complexity of sustainability problems.

The important point I want to make is that giving up cynicism doesn’t have to force a personal choice between full blown cynical gloom and an obstinately positive attitude. Blind positivity is the first psychological trap when you try to get over your cynicism. For a really excellent summary of the trap that positive thinking sets for us, see Barbara Ehrenreich’s (brilliantly animated) talk here: https://www.youtube.com/watch?v=u5um8QWWRvo. In this respect I think Net Impact could offer more value to participants by offering structured “360° feedback” sessions to companies, organizations, or individuals to help them broaden their understanding of how to improve, rather than the panel discussions where everyone is applauded for making an upbeat presentation about whatever positive work they want to highlight.

On the bright side, my best experience at Net Impact was attending a workshop on organizational learning hosted by Libbie Landles-Dowling of Bridgespan consulting group. The focus was on how to systematize the incremental learning and critical feedback process in every project and consulting engagement, and make this information available to an organization in an accessible, searchable way. It was the most useful angle for tackling the psychological traps I have described here – it allows a whole organization to make critical reflection a core part of project work, and help make decisions based not just on our belief that we are doing the right thing, but on the best data that we can muster about what has worked well in the past. This workshop, and other sessions that focused on how to engage with stakeholder groups in ways that allow you to get at the root of problems, made the conference worthwhile for me.

However, once you start down the critical appraisal road, the complexity of issues can become overwhelming, and we fall into the next psychological trap: “analysis paralysis”. An MBA-friendly analogy is the case competition – you have to start with research and get all your issues sorted out before making a plan of action. Experienced case crackers warn about “analysis paralysis” – getting stuck on trying to find the “perfect”, mutually exclusive, collectively exhaustive set of issues that describe the problem at hand. Cynicism in daily life comes from a sort of “analysis paralysis” – it is very easy to dwell on all the reasons why different ideas haven’t worked in the past, and to wait around for the “perfect big idea” to come along. To get past this stage you have to hold your nose and take the best course of action you can with the information that you have available. Be prepared to work iteratively, fail many times successively, and keep learning on the way (this is what Design Thinking is supposed to help with). This trap gets me the most, and I blame that on an undergrad steeped in marxist economic critiques and post-modernist cultural studies: heavy on the criticism, but light on decisive plans of action!

Cynicism is rooted in fear that leaders of social change or sustainability movements are inappropriately positive about their missions – perhaps naively, for lack of experience; perhaps deliberately, to hide a personal interest in attracting funds and followers; or perhaps because they are blinded by their own ideological beliefs. Ideology is the most common, and most insidious cause for cynicism – the most passionate, zealous leaders, no matter how well intentioned, seem more prone to be fundamentally misguided or blind to the shortcomings of their vision. Cynics think that uncritically taking direction from these leaders will lead to a disappointing or destructive outcome, far from the ideal of “doing good by doing well” or whatever other catchy phrase Porter and Kramer have coined that motivates us to get on the sustainability train.

It’s difficult to keep far enough ahead of the torrent of writing on the subject to critically appraise anyone’s claims to being progressive or sustainable. Sometimes you have to go with your gut and hope for the best. As a result of attending Net Impact and reflecting on my experience there, I now feel much more focused on what I am looking for in a potential employer, and how to ask them about it. I know not ask really soft-ball questions like “what do you do about sustainability”, because most companies now have a well-rehearsed ‘elevator pitch’ about how green they are (I guess I remain cynical about these elevator pitches). I will ask “how will you get me involved, as an employee, in finding out where the problems are in the sustainability of your strategy? How will the company incorporate this learning at every level into its strategy? What sustainability problem are you facing now that you expect to still be working on in twenty years?” These are the questions that will get a bit more real information about their future vision. Overall I would recommend Net Impact to anyone who is ready to roll up their sleeves and take action, and perhaps even inspire some die-hard cynics to do the same.

Visiting Bainbridge Graduate Institute

I hastily grabbed another cup of coffee and made my way in the direction of the meeting room. As an invited guest, I did not want to be late. When I got there a few minutes late, I was pleasantly surprised to discover that it was not what I expected from an early morning planning and administrative meeting.

The setting was 8 am on Saturday morning and it was an intensive weekend for the students of the Bainbridge Graduate Institute (BGI). All of the students were pursuing their MBAs in sustainable business. For almost 10 years now, BGI has run an alternative green MBA program out of the shared facilities at Islandwood on Bainbridge Island. The full program has both an online component and one weekend intensive a month. Because of this structure, it can draw residents from across North America to the tiny island campus across the sound from Seattle, Washington.

The meeting that I was rushing to was better known as “morning circle” and it is just one aspect of what makes BGI special. In a large open room, about 70 students, faculty, staff and guests gathered in a circle. The format was simple. Anyone with something to say took turns and shared in brief one to two minute contributions. Roughly speaking the contributions followed the order of introductions, announcements, appreciations, puzzles (or puzzles with solutions), and hopes and dreams, although great latitude was allowed in what was offered when.

It was the appreciations section that made the most lasting impression on me. Here was the time when individuals (mostly students but some staff and faculty) spoke up about someone who they wanted to thank. It could be a simple ‘thanks’ to another student for help on their quantitative analysis (“quant”) homework or it could be a much broader heart-felt sentiment of appreciation for the way the whole community has acted. Many of these appreciations were emotional and personal. The overriding effect was to create an atmosphere of mutual support and community. I had to remind myself that this was a business school and these were aspiring managers and business leaders. Further, it was 8 o’clock in the morning and most of the people in the room had been up very late the night before.

Beyond the morning circle, the other aspect of the BGI experience that surprised me the most was the quality of the contributions in the classroom. My point of comparison was my own recent experience in completing the MBA at Sauder. I sat in on a strategy class on Sunday morning. To give a little context, this class came after three, intensive, 14-hour days and just before many would make a mad dash to the ferry to Seattle. Yet given the obvious challenges and distractions, the students remained focused on the sometimes quite abstract material.

When the professor asked questions, the students shared with very little hesitation. They offered concise, relevant contributions that often built on what was said before. It showed that they were engaged and listening to their peers. In fairness, though, the participants were well aware that they had limited time together and that this format was infinitely better than participating in an online virtual classroom. Still, in my experience, this type of discipline is rare in a class full of overachievers who often are far from brief.

The quality of an education is often determined not by its content, but the learning environment in which that content is delivered. Nestled in the quiet forests of Bainbridge Island, Washington, the students of BGI are taking full advantage of that beautiful setting by creating an extraordinary learning community.

Slowing down money so we can savor it

I just finished Woody Tasch’s book Slow Money. While I was muddling through it, I kept thinking that I am not getting his main idea. What was he trying to say? Tasch’s style is to quote his favorite authors at length. Add to this his preference for poetic metaphors and analogies and I found myself getting lost. Was he trying to say that we should just agree to make a little less money (or ‘return’ from an investor’s perspective)?

Having just finished my MBA, I imagined myself trying to explain the book to my more traditional business classmates who see the world through the lens of economic incentives. They might say back to me, ‘Well, Miguel, that’s a nice idea, but why would anyone do it? Where’s the return?’ I actually tried this line of reasoning on a friend and classmate from my program and his response was as expected. So what was I missing or was Tasch just calling for charity in another form?

Tasch builds his movement on the rather successful social movement known as Slow Food. The Slow Food community may be about finding ways to enjoy good food, but on a deeper level, it’s more about community—coming together to enjoy a meal. Tasch feels that that’s where the connection can be made to alternative finance. Slow Money is also about community. It is about choosing to switch some of your money from a far away fund to a closer-to-home friend or friend of friend with a food business. Tasch roots his ideas in sustainable food and farming, which is another connection between the slow food and slow money movements.

Central to the idea of modern investing is the idea that you should be compensated for a risky investment with a higher rate of return. Similarly, lower risk investments offer lower rates. Think bonds versus stocks. So, perhaps the investments we make in community-based, sustainable food enterprises are not as risky as bankers and investors believe they are. If this is the case, these lower rates of return might be a better deal then they appear. But how could bankers and investors have so systemically overestimated the risk for this class of businesses? Isn’t that their job? To assess and properly price risk?

I struggled with that one for a while. I did not have an answer, just a hunch. Not a lot to go on, but the idea that a banker might miss something important is not unheard of in the wake of the financial crisis. Putting my observer hat on, I would guess that there is a relationship to the social-psychological factors that help underpin the success of the microfinance movement. Making loans within a geographically-bounded social network to startups whose business models are based on something we all understand—food—might actually lower risk. The network takes care of itself. Neighbors help neighbors in a system of mutual aid. Also, in these communities, I would argue that trust and credibility are established the hard way—through time—instead of through looking solely at financial statements and recovery rates.

Borrowing from one of the lessons from Freakonomics, incentives are everywhere and have many different forms. In other words, financial incentives are just one of several types. Another powerful set of incentives are social incentives. Peer pressure and social norms. I wondered whether this was the idea that Woody Tasch was trying to get across. Slow food is not just a good idea to preserve what little topsoil we have left, but also because it represents a fair return on a lower risk investment with great collateral benefits like beauty, community and resiliency.

Here’s a video from the folks at Slow Money Alliance.

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Get out of Sauder for your eco-MBA

The other night at the MBA Gala, I found myself talking to a first year about how I wanted to get more environmental courses during my MBA. Perhaps because I did not get out of Sauder to take courses before completing my MBA, I wanted to provide this somewhat incomplete guide to some of my ideas for getting more environmental rigor and knowledge into your MBA. If you are interested in getting a more sustainable education experience from your MBA, you might consider taking courses outside of the business school.

Here are three ways to start to explore options outside of Sauder:

  1. Contact Bill Rees and get his thoughts on how to make the most of your MBA experience at UBC. He is facility at SCARP—the school of community planning at UBC. He is a bit of a celebrity. He has a particularly challenging way of seeing the world. Just having a conversation with him and truly trying to understand what he is saying is a learning opportunity. But he might also have a suggestion or two for you on how to make your own degree while also fulfilling your MBA requirements.
  2. Perhaps the most relevant school at UBC for interdisciplinary environmental studies is the Institute for Resources, Environment, and Sustainability (IRES). Their graduate program is very well regarded. You should talk to some of the professors, like Kai Chan for example, and see whether there is an appropriate course or two. These will be more difficult classes than your MBA courses. They are a full semester instead of six weeks, so one course is the equivalent of two MBA modules. The MBA office recognizes this and will allow you up to 3 credits for one course instead of the usual 1.5 credits.
  3. Check out the UBC Organic Farm. This is not a course, but is a great way to get relief from some stress while you reconnect with nature. You can buy produce at the farm stand on Wednesdays at the bookstore during the summer and early fall. Also, you can always volunteer at the farm. I helped out with a friend who had a job picking up and cleaning the eggs from the hens once a week. There are dozens of other volunteer opportunities on the farm too.

Remember to check in with the appropriate person in the MBA Office and make sure to clear whatever requirements they have for courses taken outside of Sauder.