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Human commerce utilizes the most significant share of natural resources and produces the largest aggregate impact on the earth’s environment. As a consequence of modern employment and work cultures, commerce, corporations as opposed to governments, also construct much of the social contract and social organizational forms in developed societies. Sustainable development movements to conserve resources and to democratize or enhance organizational practices have called for culture change or transformation. However, these approaches have not yielded results that will significantly enhance human flourishing in the face of globalized commerce, which has no common governance system. We suggest that the goals of alignment toward sustainable development or so-called corporate sustainability are misguided and systemically depreciative, as they purport to sustain activities that foreseeably accelerate ecological degradation. We propose a modeling practice for stakeholder design of strongly sustainable enterprises for the intention of whole system flourishing across living ecosystems and organized social systems. This systemic design approach to business transformation functions at the level of the business model. We claim that business model design affords the highest leverage across all modes of organizing for collective cultural adoption ecosystemic practices.
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Peter Jones, PhD
OCAD University Strategic Foresight & Innovation
November17, 2014
Caring for the Future: Artifacts for the Systemic Design of
Flourishing Enterprises
Strongly Sustainable Business Model (SSBM) Group • P. Jones, N. Harfoush (SFI OCADU) • A. Upward (York), B. Willard (TNS) • 100+ members of SSBM community of practice
Research Agenda
A Design Science project.
1. Develop and validate an ontology for strongly sustainable business models and a visual tool for modeling such businesses (the Flourishing Business Canvas).
2. Explore advanced methods of impact definition, measurement and valuation of social and environmental benefits that can support decision making in organizations.
3. Identify and map the processes related to business strategy decisions in SMEs. 4. Use design methods to develop a toolkit for SMEs and test the kit with organizations to further
improve it and to create case studies. 5. Human-centric research into the role of business models in SMEs
Ultimate Aim of the Design Research.
5
RSD3 Oslo School Architecture & Design
Social Business – Global Business U Plymouth, Dec 8-9 Article accepted for Organization & Environment special issue: Business Model Frameworks for Strongly Sustainable Outcomes
Paradox of Design Research.
“Design is not only about what is quantifiable and measurable; it is also about what cannot be measured, the non-quantifiable. As the source of values for decisions in design is not only the artifactual world (objective, quantitative data), but also the world of culture (subjective, qualitative data), there are many things that are difficult or impossible to measure adequately.” Charles Owen (2007). Design Thinking: Notes on its Nature and Use Design Research Quarterly, 2 (1) 16-27.
Evaluation of efficacy - How effective is an artefact in its intended application? Action research mode of design evaluation. • Developed framework & compared with Osterwalder • Artefacts presented in plausible situations of engagement • Iterative design with expert & user feedback • Sufficient for this stage of early tool development
(Design science research achieving delayed acceptance in non-IT literatures. Epistemological mismatch with natural & social science, which we (design) futily attempt to appease. Key is unit of analysis.)
Design Science methodology.
The term has lost impact & meaning. For 3 decades we’ve anchored on sustainability.
• Since Bruntland Commission (1987) • Sustainable Development • Ecological Modernization
Considered “weak sustainability” & enablers of the status quo
The Resilience of Sustainability
Can we sustain “Sustainability?”
Ehrenfeld, J. (2000, March). Does eco-efficiency Lead to Fundamental Changes in the Dynamics of Industrial Activities? In national Conference on Sustainable Development: Eco-efficiency and industrial development. Oslo.
Strong vs Weak Sustainability • Non-substitutability of natural capital w/ others • Emerged from Ayres (1998) & others criticizing the lack of
progress from sustainable dev • Few examples of strong sustainability in 90’s, & as applied to
business, considered improbable.
• Aim for compatibility with The Natural Step (FSSD) & anchor in bio-physical sciences
• Living systems theory (Allen, Tainter & Hoekstra) Supply-side • Socio-ecological systems & ecological macroeconomics
A Foundation for Speaking of Flourishing
• Product/Service Systems (Vezzoli, et al) • Dematerialized product/services • Industrial (waste as supply) ecosystems • Collaborative consumption • Public-private incentive models • Regional mutualism / Import shifting / Circularity
Best cases include - • Interface (circular carpet model) • Patagonia, Timberland • Unilever (societal health aims)
“More sustainable” business models
The most salient point to influence an entire enterprise, its people and operations, and to endorse and develop organizational values and processes oriented to sustainability. “Represents the business & money earning logic of a company” (Osterwalder, 2004)
Later “the rationale of how an organization creates, delivers and captures value” (Osterwalder & Pigneur, 2009) Upward & Jones: A business model describes for an organization the logic for its existence, who it does it for, to and with; what it does now and the future; how, where and with what does it do it; and how it defines and measures its success.
A Design Argument for Business Models
Business Model Canvas
Osterwalder & Pigneur. (2009). Business model generation. No environmental impact model No value chain / supply impacts No societal impacts, No triple-bottom line option
Understand the Natural and Social Science of Sustainability
Defined the gaps in Osterwalder’s Ontology of profit-first businesses, based on the science
Designed an Ontology of Strongly Sustainable Business Models
Co-designed Strongly Sustainable Business Model Canvas, a visual design tool, structured by the Ontology, and tested:
1. Against standards of sustainable business 2. Formally with 7 experts and 2 case study companies 3. Informally with dozens of others:
Business people, professors, students
Upward’s research led to ...
Article in review: Upward & Jones, Business Model Frameworks for Strongly Sustainable Outcomes
Revising Definitions…
A description of how an organization defines and achieves success over time.
A Business Model = the logic for an organization’s existence:
• Who it does it for, to and with • What it does now and the future • How, where and with what does it do it • How it defines and measures its success
“A Business Model describes the rationale of how an organization creates, delivers and captures value [in monetary terms]”
Value = the perception by an actor of a need being met; measured in aesthetic, psychological, physiological, utilitarian and / or monetary terms.
Value is created when needs are met via satisfiers that align with the recipient’s world-view, and destroyed when they don’t
Necessary, but not sufficient
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© Antony Upward / Edward James Consulting Ltd., 2013
• Small OCADU research seed grant • Led a team of 2 SFI grad students – Kornet & Sharma • Visual identity & revised canvas (same entities) • Encoded meaningful palette & boundaries • Revised model through case studies • Continual iterative refinement since summer • Canvas presented at fall conferences (RSD, BAWB) • Workshops at BAWB, Intersections, sLab,
This year …
New canvas remains © author, by agreement until we have suitable collective entity.
A Value–Based Care Business Model using Osterwalder BMC
Integrated Practice Units
Patient-Centred ITC
Collab Inter-professional Decisions
Patient-centred business strategy
Health outcomes that matter to Patients / family
Meet pts in more locations, online, community
Community care partners
Partner w/ small clinics
Delivery across clinics & centres
Long-term patient relationships
Treat pts by bundling care across journey
Incentivized reimbursement models
Expand service across geographies
New cost models based on bundled / integrated care
Measure outcomes & costs / patient
Waste products
Support services – water, cooling, air refresh
Cultural service, Natural settings
Regulatory services: air, waste, water
Bio-stocks used directly
Patient-led care circles
Active care continuity
Volunteers for non-critical needs
Decentralize hospital into special units
Patient-relevant agencies
Gov agencies
Local ecologies, watersheds
Local Communities
Social health determinants
Housing Food supply …
Community health outcomes
Increased Dr & Patient preference
Faith & social communities
Real resource costing
Shared assets across regions
Return on Social capital
Costing across patient lifecycle
• BM explicitly represents value system & mental model • New design provides social affordances for claiming new values • As anticipatory system, feed-forward loop
Business Model as Formative Context
Business Model as Anticipatory System (Rosen, 1991)
• Novel models are not simulatable – sims based on past data • Causal entailments (rel to environment) too complex • New BM theories “operational models entailing strategy” • Anticipated outcomes guided by updating model with
feedback information (encoding) • & updating new decisions with updated decoding.
• New view of a flourishing “enterprise”
Living system model of firm & entire value network in bio-socio-eco-cultural contexts, within planetary limits
Business Model Designs the Enterprise
May have a revised research agenda …
• Completing article for Organization & Environment (2014) Business Model Frameworks for Strongly Sustainable Outcomes
Participating in key conferences / workshops • Continuing research w/ sLab team:
Healthcare case study Flourishing Cities / urban policy canvas
• Client projects & early adopters (First Explorers program) • 2015 – identify key project to sponsor field research • Propose / publish field research with SSHRC or other sponsor
Next steps in SSBM design research
Peter Jones, Ph.D.
[email protected] designdialogues.com designforcare.com @redesign
Questions & Discussion?
