When the learning curve is a wall

The hybrid nature of innovative business

The Roundtable on Social Entrepreneurship with Leticia and Victoria Hale that Pamela facilitated was one of the highlights of the conference (although it is hard to generate a ranking because everything was of such high caliber). “Real systems change is not just [the provision of] palliative goods and services,” Pamela explained. Systems change requires forging “partnerships […that…] leverage off each other in the positive sense to create synergies.” Learning how to accomplish this new balance between established modes of doing business (e.g., short-term, bottom line profitability for discrete individuals) with new sustainable modes of doing business (i.e., long-term, continuous resiliency with dispersed community benefits) was the main topic of this roundtable conversation.

Womensphere with Newsweek
Global Summit (Day Two, 25 September 2010)

Manhattan (Goldman Sachs)


Leticia Jáuregui described her experience starting up a business within the rapidly expanding field of social entrepreneurship to Pamela Hartigan, author of The Power of Unreasonable People: How Social Entrepreneurs Create Markets that Change the World.  I cite the whole title of Pamela’s book because I was thrilled to discover such a simple explanation for most of my biography:  I’m unreasonable!  The Global Summit reinvigorated hope that I can leverage this unreasonableness into new market creation which ripples out and contributes to positive changes for the world – especially we people living on earth now  and in the immediate next few generations. I realize this is a species-centric perspective, but there is tremendous potential when such selfishness is coupled within a matrix of relationships. Suddenly your health and well-being is recognizable as deeply intertwined with mine. By extension other living beings and the planet become relevant and valued, too.

The hybrid nature of innovative business

The Roundtable on Social Entrepreneurship with Leticia and Victoria Hale that Pamela facilitated was one of the many highlights of the conference (although it is impossible to generate a ranking because everything was of such high caliber).  “Real systems change is not just [the provision of] palliative goods and services,” Pamela explained. Systems change requires forging “partnerships […that…] leverage off each other in the positive sense to create synergies.” Learning how to accomplish this new balance between established modes of doing business (e.g., short-term, bottom line profitability for discrete individuals) with new sustainable modes of doing business (i.e., long-term, continuous resiliency with dispersed community benefits) was the main topic of this roundtable conversation.

Being (perceived as) unreasonable means one necessarily attracts a lot of negative attention: critiques, people telling you you’re foolish, resistance of all sorts. This can wear you down if you’re not able to apply a productive frame.  “You know you’re on the right path when just about everyone says you’re nuts.”  Victoria matter-of-factly told us about the importance of setbacks, teaching us how to interpret them as a way to “appreciate that the universe is moving.” Rather than viewing resistance and the need to alter or modify plans as a setback, view them as “revelations.”  “You can’t be too much of a fighter, not too committed to ‘my way’,” she told us, otherwise you miss important information about the world that you need to be aware of and adapt to in order to succeed.

“Kill all the Negative People”

Pamela proposed this a bumpersticker, and she’s only half-teasing!  Analisa kept reminding us that leadership and invention do not have to be lonely (at least not persistently and characteristically so), and no one would argue against constructive criticism. But there is a difference between criticism that contributes to one’s understanding about issues relevant to success, and complaints from people whose outlook is systematically negative. “Spend time,” Victoria continued, “with people who get it.” Her work in medical research goes against the grain. “Strategically, we do what the world needs,” and “In R&D, things change.” In practical terms, this means “work[ing] with funders who are very hands-off” and, in Pamela’s words, focusing on “the issue as the unit of development.

Drawing from history, Pamela reminds us, “Many people come together from many different areas to make social movements.”  The challenge, of course, is how to work with the complexity and hybridity of all the various ways difference can cut across contemporary social forms of interaction.  Pamela suggested applying The Three P’s: Passion, Patience, and being with Positive people as a way to assess whether one is “in the right place at the right time.” She distinguished between “entrepreneurs” who don’t stick with bureaucracies for very long, and “intrapreneurs” who chip away from the inside, coming at things from within an organization or institution.

Dismissing the label of “social entrepreneur” as a term that has served its time, Pamela argued that we must begin to distinguish between “value appropriation” and “value creation.” We need “visionary pragmatists” who “refuse to take no for an answer” and thus come up with “fascinating solutions to intractable problems.”

“People are poor, not stupid”

Molly Tschang made this point a bit later in the afternoon during the presentation of Case Studies of Impact of Corporate Investments & Innovations on Global and Local Problems. In a significant way, Molly was talking about the power of “no.” Sometimes, no is the answer which has to be respected! Pamela did not mean “no” is always to be disregarded, she meant “no” should not stop us from persisting – with wisdom and awareness of consequences – in search of the goal. Victoria’s openness was quite beautiful in this regard: “I didn’t know how to ask; I was told.” When we’re working with intercultural differences, we have to become sensitive to nuances along a continuum that spans when it is the difference and when it is our reaction to difference that provides the stimulus for powerful learning.

Victoria, Pamela, and Leticia provided us with living examples from the ground-up of Molly’s top-down challenge regarding, “how to engage the full diversity of resources and bring them to bear on solving issues.”   If the goal is “how to make things work in disadvantaged communities,” then you cannot rely only on top-down policies and institutional vision. Molly insisted “you must adapt” and embrace the fact that “people see where they are” and are able to articulate their daily realities in ways that people from a distance are simply unable to perceive.

Future markets, Peer partnering, and the Wrong Question

Molly told us about a TED Fellow who inquired, “What’s the one thing you want to tell the world?” This, she insisted, is the wrong question.  There is no one thing, “its everything!” We are not, as Pamela put it, “generating the next widget.” We are engaged in behavioral change, systems change, and political processes. Molly encouraged us that the only way forward is to “acknowledge the complexity [rather than] be daunted by it.”  In other words, you’ll know you’re in the right place at the right time when you are aware of multiple realities intersecting in complementary ways.

When you sense the future with a vertical slope of 90-degrees, you are facing the moment described by Pamela as the juncture when “complex problems become opportunities.” You will inevitably be engaged with people who are – in some fundamental way – essentially different than you, and you will consider them peers because the knowledge base they bring is equal and necessarily in proportion with your own experience and skill. Leticia captured the phenomenological experience perfectly: “We started as an idea, got funded as an idea. The reality on the ground? The learning curve is still a wall.”

It’s the economy AND the environment (stupid!)

Womensphere with Newsweek
Global Summit

Day 1 at NYU: see photos!

I almost bailed out. My back was out of whack when I woke up the day before the two-day conference. I thought: I need to listen to my body. It isn’t up for this trip. As I lay in bed imagining the five hour bus ride to NYC, the additional hour (or more) to get out to Maria’s in Queens, the intensity of the two-day conference schedule, the return trip on Sunday and subsequent “loss” of the entire weekend in terms of everything else I needed to do, I decided not to go.

The luxury of a long weekend of “extra time” stretched out before me as I settled into a hot bath and began reading a gift from my former roommate – a partner in the (idea of) my start-up. As far as I know, Joan Borysenko did not attend the Global Summit, but she got me there by reminding me that I am on to something…

Resiliency (not only Sustainability)

Leaving aside the question of whether or not human activities have caused global warming, the need for climate recovery is the fundamental context for the current and future societal organization of, by, and for homo sapiens. When Goldman Sachs states that without change the planet will be two degrees warmer by 2030, they signal the seriousness of the matter for every human being on the planet, not just the wealthy. The concept of  sustainability, however, is severely limited:

a) “sustainability” – as used in the media, politics, business, academia and grassroots movements – can refer to anything (what linguists call an empty signifier), hence is prone to being misunderstood among people using it (what interpreters call a communication breakdown), and

b) the premise of “sustainability” is continuity: the avoidance of change. Hello? This is not a newsflash: change is already here.

From a discourse and group dynamics perspective, continuing to use the term sustainability in the current ways is evidence of mass rationalization of reality. During the Community Circle conference review sessions at the end of the first day of the program, Amy, Devon, Cynthia, Judy, Katie, Marika, Jenny, Mary, Teresa, Nancy, and Mr. Manbassador helped me realize there are similar challenges with the term resiliency. As I’ve continued to consider our conversation about Building Green Economies and Enabling Sustainability, what I realized is that we need the interplay of these two terms – conceptually and in practice – if we are really going to recreate institutional systems capable of maintaining and spreading high qualities of human existence.

“The World Flows on Credit”

The economy, leadership, and change were consistent themes of the Summit. We learned about the current state of the economy, including historical factors and future projections. Barbara Byrne was, as she said, “in the front car of a railroad train that went off the tracks.” She had worked for Lehman Brothers for 28 years prior to “that Sunday morning,” September 15, 2008, “the morning I no longer had health insurance or job security or anything else…(and) had lost 60% of my net worth just like that.” Barbara emphasized the psychological elements of group decision-making during and after the “12 Standard Deviation Event” that was the unintended consequence of Lehman Brothers being deemed a moral hazard.

I was particularly intrigued by Barbara’s perspective  because of having watched the Frontline program, Inside the Meltdown, which included an instance of a problematic moment. James Cumming has distinguished group-level problematic moments from difficult interpersonal interactions. During a PM, conflicts in social realities emerge, becoming temporarily evident and available in ways that open possibilities for restructuring hierarchies of relationships within a given sociocultural field. Problematic moments are leverage points for fundamental social change.

Barbara spoke of the select group of male CEOs gathered with Treasury Secretary Hank Paulson at the White House making decisions according to the restricted focus that characterizes group communication during a crisis. Decision-making during crisis is especially challenging when the group lacks diversity. Barbara argued that society needs guardrails (government regulations), while insisting:  “Business is important. It’s what makes the wheels turn.”  She emphasized the “need (for) diversity in the room,” listing demographic features and knowledge sets so that people can test and push the boundaries of decision-making processes. Ultimately, she argued, “No matter what you think of TARP, [in this instance] government worked,” because Paulson confronted the credit freeze fallout “one piece at a time to open everything up.”

Time, Timing, History and the Future

Barbara emphasized the “need for long-term thinking.” This could have been interpreted as a poke at Abby Joseph Cohen of Goldman Sachs, who (earlier) had opened her talk with a joke: “I was just told I have ten minutes to tell you how to fix everything.” Chuckles spread through the room – we’re all looking for the quick fix, the right answer! This is (unfortunately)  not forthcoming.  Abby gave us “the one minute CNBC summary”:

  • There will be no double dip, what we’re experiencing is the continuation of a natural deceleration
  • The slow improvement in the labor force is a big problem that comes from longer-term structural issues – not just the credit crisis or recession (emphasis added)
  • The equity market is priced below value, bonds are priced for perfection

“Something has happened…”

Abby described two historical trends in jobs and education. She spoke at the macrosocial, institutional level in the context of global competition, lamenting, “We have not seen this in generations. It goes to the heart of the American dream.” Barbara too expressed concern that Americans are losing our mojo, acting on the basis of fear instead of remembering and celebrating that the US “is fundamentally the most optimistic place on earth.” Abby’s diagnosis was sharp. The problem is the lack of job creation in the United States.

Abby explained that there has been “an ongoing deceleration of new jobs for a decade preceeding” the credit crisis; a 5% loss in jobs overall, and a 10% loss of blue-collar jobs were evident before the financial crisis erupted into public awareness. “When,” Lynn Tilton asked a short while later, “was there a taint on being blue?” Described by Vanessa Angeles of HSBC as “a private equity rock star,” Lynn minced no words arguing for bottom-up restructuring. Abby described the policy decision about the American economy when we switched to “what you know” from “what you can carry.”  Lynn put numbers on the current fallout: 1 in 5 Americans is unemployed. One in seven American families is below the poverty level.  “Why,” she challenged, “can’t we admit we made a mistake when we decided it is what you know rather than what we make?”

“What do we want for the future?”

Dr Mae Jemison (self-described as “the only person on the Star Trek set who had actually been in space”) put the problem in context by defining globalization in terms of two opposing possibilities.

Jemison: We can design globalization by emphasizing “the ability [of business] to make all markets homogenous,” or we can emphasize “the capacity of business to deliver to people the capacity to do what they want.”

Tilton: Describing how – contrary to the general historical drift – she had become an industrialist: “Nobody really wanted to rebuild the companies, they just wanted to focus on balance sheets.”

Cohen: “Our educational system is not keeping pace” with the rest of the world,” there has been “no improvement” in graduation percentages (especially from college) in more than a decade.

Tilton: “When parents are out of work, children are focused on survival, not education.”

The Blue-Collar Challenge

“We have the most extensive collegiate and university system in the world,” Abby insisted. “This is an important form of foreign aid.” International students who come here to earn degrees need to be allowed to stay.

“We also lose technology,” Lynn reminded everyone, “when we ship manufacturing overseas.”

Barbara was explicit: “We need to open the borders. We need to let the immigrants in.” Rally for Sanity. Pass the Dream Act (this suggestion is an editorial supplement).

Lynn argued for subsidized employment as “a better route than welfare.”  “We are a nation that doesn’t have enough jobs,” she repeated, describing institutionalized unemployment as an illness which needs to be attacked at the root. “We can recreate jobs if we revisit the policy not to manufacture.”

While Lynn emphasized the absolute necessity of bottom-up restructuring, others focused on top-down policy-making that can “align business with social concerns,” as asked by someone in the audience during the lunchtime roundtable on Women & Innovation: Driving Innovation and Creating a Culture of Successful Innovation.

Later, in the session on The Future of the US and Global Economy: Market Dynamics, Growth, Black Holes & Public Policy, Andrea Feingold described the outdated logic of mortgages, in which people planned to live their lives in a single place, so it made sense to buy in one’s thirties and pay-off by one’s sixties in order to enjoy retirement in a home owned free-and-clear. Overall, however, the top-down discussion about solutions is a muddle. During the same panel, talking about tax incentives, Stephanie Breslow warned that “we can’t wean ourselves off foreign oil and just replicate another kind of dependency.” Joyce Chang described the necessity of ensuring “coordination of regulation or we will just transfer risk to another part of the world.”

Actionable Solutions

Although we teased about HVPS, there are known and established facts which can guide the processes of defining problems and creating solutions:

  • investing in women generates greater returns
  • supporting the spread of international law serves to counter injustice
  • defining terms and coordinating language use builds community
  • creating desire promotes motivation to achieve goals
  • considering others’ welfare enhances personal well-being and safety
  • facing fear enables cooperation at new & different levels

In other words, as Angela Leaney emphasized, “When the plane is going down, its not time to be a jerk. Put your oxygen mask on and help others.”