I will be joining Salesforce in September

I got some exciting news to share: I will join the ranks of a company called Salesforce starting from September! Salesforce is a fast-growing, US-based cloud computing company that provides cloud-based Customer Relationship Management products. Salesforce is known for being among the first to provide cloud-based CRM software, and for helping transition the CRM industry from heavy on-premise solutions to much nimbler and less expensive cloud services.

I was recently accepted to Salesforce’s Success Graduate Program, which is a 12-month program that trains and prepares new graduates to various business consulting and technical consulting positions within the company. I will be moving to Amsterdam in September, and will live there for at least the duration of the program. My final position and role will be decided after the program has ended.

I am super excited to work for Salesforce! Salesforce has an awesome company culture, and the company has been on the list of great places to work for nine years, and was ranked on place 8 in 2017. Salesforce emphasizes trust and transparency as key parts of its culture, which I got a glimpse of when I visited Salesforce’s Amsterdam office in January.

I’m particularly excited to join Salesforce because of Salesforce’s deep focus on creating customer value. Based on my experience, many businesses appear more focused on creating shareholder value and profits than providing superior services. Obviously, the purpose of business is to also make money for its owners, but in my view, the order of priority should be to first create customer value, then shareholder value. Therefore, I’m happy that one of Salesforce’s core values is Customer Success, meaning that every action taken should ultimately result in more value to customers.

My graduate profile was highlighted in Salesforce’s company blog, which you can read here: https://www.salesforce.com/company/careers/futureforce-university/

Before moving to Amsterdam, I will be on a holiday and enjoy the summer in Finland.

What I learned from publishing an e-book

Last spring I published an e-book: Business Models for a Circular Economy: 7 Companies Paving the Way, which you can download for free here: http://jpovaska.com/business-models-for-a-circular-economy-e-book/

I learned a lot from publishing the book, and I wanted to share my thoughts. So let’s jump right in.

Start small…

To be honest, I didn’t plan on publishing an e-book. In fact, all I wanted to do was to write one blog post about a company I heard of while working as an intern at Demos Effect.

However, after publishing the first blog post, things soon started escalating in my head. This is how my internal dialogue throughout the project, condensed into one conversation, looked like:

Me: “hmm, brain, did you see that – that’s a really interesting company! Why don’t we write something about it in my blog?”

My brain: “I’m on it, but have you heard of that other company with a very similar business idea? Now that we’re soon done with the first blog, why not write a second or a third?”

Me: “Well, I don’t know about that, I have a lot of stuff on my plate already, maybe we should..?”

My brain: “… write a whole SERIES of blogs about companies with similar plans?! We’ll call it Innovative Companies with Sustainable Business Models! We’ll distribute it through LinkedIn and prospective employers will soon be knocking on your door!

Me: “NOW WAIT A MINUTE. I don’t have time to write all this – I already have a ton of other stuff going on, including a full-time job, you need to calm down…”

My brain: “you know what, while we’re at it, we might as well wrap the blog posts in a nice e-book, write an intro article about circular economy and publish it on your website! This is so exciting!!”

Me: “What! No, wait, you’re getting out of control…”

My brain: “And we’ll get guest writers, a graphical designer to do the layout, and get Sitra to fund the project”

Me: “why are you doing this to me…?”

My brain: “don’t worry, we’ll write the blogs in a way that you can repurpose them easily, it’ll be fun!”

So that conversation happened during the first 1-3 blog posts that I published on my site around 1,5 years ago. Each blog post and interview built up my appetite, and eventually I was ready for a larger vision than I started out with. However, I would have been overwhelmed had I known all the work I would end up doing to get the book published from the beginning . In smaller chunks, it was easier to trick myself to doing the work.

So start small, celebrate little wins, and build up confidence in your work first to avoid becoming overwhelmed.

…but think BIG

I like contradicting myself whenever possible, so the next piece of advice is to think BIG when you’re planning a new project, whether it’s book publishing or anything else. My publishing process was messy and many of the ideas I came up would have been much easier to implement had I planned them ahead of time. For example, had I planned on bringing in other authors, I could have contacted prospective collaborators much earlier to ensure that I have enough time for editorial work and for potentially finding even more collaborators.

Thinking big allows you to see what’s possible, search for opportunities in your environment, and look for potential allies and collaborators for your project. If you’re fixated on getting the next blog post out the pipeline, you can miss opportunities that might allow you to align different people’s motives and interest under one project. For example, I already knew that Sitra and Aalto University were involved with circular economy projects, but because I didn’t think of writing a book, I ended up contacting these valuable collaborators much later in the process. While I did get support from both, I would have gotten more done with less hassle if I had had the proper mindset from the start.

So, think big – it’ll be easier for you in the long run.

Hint: Repurpose your stuff!

Whether you’re an entrepreneur, working as a content marketing professional for a company, or blogging about your favourite cat vides on the web, I think you should have content repurposing as one of your essential tools in your content tool kit. No, I don’t mean plagiarising or just copy-pasting content to other platforms. Repurposing means that you literally find new and VALUABLE purposes for your old content, and it’s commonly used by content marketers and bloggers all over the interwebs. The new purpose needs to be somehow valuable to your audience: For example, readers can find value in reading your series of blogs in the form of one, well edited e-book or a white paper, instead of having to go through each blog individually. Remember that if you repurpose your blog in another format or publish the blog in someone else’s platform, you need to make sure that the platform owner also knows that you’re repurposing content. Some content providers might not agree to this, though. One of the more interesting businesses that is based on repurposing content is the blog: Wait but why. While you can read the blog for free, you can also buy the blog posts in a pdf format for a few dollars on Amazon.

Thinking by doing

Let’s get philosophical for a moment. Sometimes you can’t think big no matter how you try, and that’s because thinking and doing are two sides of the same coin. We humans tend to disassociate thinking from doing, and to assume that we first use rational thought to come up with designs, and then we project these design onto the world. Many business, economics, and strategy theories are built on the assumption that thinking and doing happen in neat sequences, where planning and rational decision making is followed by efficient execution. There are many scholars that disagree with this model of human action, and several approaches have been put forth as alternatives, including design thinking, agile development, the lean startup method, and many others.

With my e-book, I didn’t see the big picture until I started taking action – doing came first, not thinking. So, I wouldn’t give up planning altogether, as it definitely serves a purpose. However, in the future I will also know that action is a integral part of planning.

Resources

Creative Commons Learning is Hanging Out by Alan Levine is licensed under CC BY 2.0.

Brown,Tim. (2009). Change by design: how design thinking transforms organizations and inspires innovation. HarperCollins. USA. https://www.amazon.com/Change-Design-Transforms-Organizations-Innovation/dp/0061766089

Ingold, Tim. (2013). Thinking through making. [A lecture]. Retrievable: https://www.youtube.com/watch?v=Ygne72-4zyo

Pulizzi, Joe. (2016). Content Inc: how entrepreneurs use content to build massive audiences and create radically successful businesses. http://contentmarketinginstitute.com/content-inc/

Schon, Donald. (1983). The reflective practitioner. Basic Books Inc. USA.

Wait but why: new posts every sometimes. (2016). Retrievable:  http://waitbutwhy.com/

Don’t jump to conclusions about yourself

Trying to understand oneself is a pain in the ass for many reasons, but most importantly because we humans are emotional beings and emotions tend to impact our ability to assess ourselves realistically. It’s especially hard to make a distinction between what are your actual traits, characteristics, and tendencies and what are ego-driven false beliefs and fears. For example, I had a friend in high school who had convinced himself that he was poor in math and English, and that that’s just the way it is. However, at the same time he was really good in physics and Swedish, which of course made no sense. Why would he be able to understand physics and Swedish if he was naturally bad at math and English? The truth is, he probably had gotten a bad first impression of learning math and English, and his ego coped with the frustration by developing a story that said: “I’m just naturally bad at these subjects, and that’s the way it is for me.” With physics and Swedish, he was somehow able to let go of that story and learn new things without beating himself down.

The story illustrates how we humans often react to feelings of frustration and fear: we give into our emotions and label ourselves as fundamentally bad at something. We then draw a black and white picture of ourselves, where we’re either really good at a given skill or we’re absolutely shit at it. This way of thinking is called splitting, or black and white thinking, and it’s an ego defense mechanism that prevents us from assessing ourselves in a realistic way. Because of this bias, we end up jumping into conclusions about our abilities, strengths, traits, and characteristics, which hinders our ability to lead balanced lives.

Let me use myself as an example. When I was in the Finnish army, I got selected to the reserve officer school in Hamina, Finland, where they train infantry platoon leaders, forward observers, pioneer officers and such. I was being trained to become an infantry platoon leader, which required learning about the use of terrain, leadership, tactics and strategy, different weapon types, and how to lead men in battle. Now, to be honest, I wasn’t a very good platoon leader, and especially when we were practicing leading men in a battle, I felt I was at a complete loss at times. It seemed there were so many little details that I needed to remember at the same time, and I just couldn’t multitask to the level required in the moment. Reading the map, giving orders, calling in artillery, using the radio, spotting the enemy, taking in reports from team leaders, and trying to breath all at the same time always put my head spinning. And based on the feedback I got (i.e. how red my instructor’s face got when he yelled at me), I just wasn’t a very good situational leader. And that’s the story I’ve been telling myself ever since: I’m just not very good at leading men in a battle.

But wait, is that really true?

What evidence did I really have that proved I wouldn’t be a good situational leader? Yes, I made a lot of mistakes during my training and most likely what I demonstrated really wasn’t particularly good leadership. But if you look at the circumstances, it only makes sense that I messed up. Firstly, I was doing something for the first time and mistakes are bound to happen. Secondly, multitasking in a rainy forest where it’s so dark you can’t see your nose, while you’re being yelled at by both your commanding officer (someone you’re naturally afraid of) and by your peers (someone whose respect you eagerly want), aren’t the ideal circumstances to practice something in the first place, let alone for the first time ever. And finally, considering I was 19 at the time and basically just learned how to wipe my own nose, it’s no wonder I had some issues leading 30 men into battle.

So, looking at the context, I actually did pretty good: we all got out of the forest alive and with only minor emotional traumas.

Let’s take another example, this time, someone who is a master: Cesar Rodriguez, an American former fighter pilot. Rodriguez has been named the Last American Ace because of his several aerial victories in campaigns in Iraq and Serbia, and no one can deny he is a true master in his art. But as the author Robert Greene reveals in his book, ‘Mastery’, Rodriguez wasn’t a natural-born fighter pilot or one of the ‘golden boys’ of the fighter training program. These golden boys were people who seemingly had the ability to fly a fighter the minute they got into the cockpit and would wipe the floor with people like Rodriguez all day every day. Despite flying several small aircrafts before, Rodriguez had tremendous problems handling all the multitasking, the G forces, the weight of the helmet, and the difficult maneuvers that were involved in flying a fighter plane. In fact, Rodriguez was completely overwhelmed by the fighter and was almost dropped out of the course.

What if Rodriguez had started telling himself: “I guess I’m just not meant to fly a fighter, I just can’t do it.” That would have been perfectly reasonable: not everyone did pass the fighter program, and he could have concluded he just wasn’t meant to fly a fighter. However, thanks to Rodriguez’s persevering attitude, he kept going, and after hours and hours in the cockpit, his brain got used to the multitasking and he could focus on the more advanced aspects in flying. And as it turned out, Rodriguez’s training allowed him to soon surpass the golden boys and become the Last American Ace.

The moral of the story? We humans can learn anything, and making too fast conclusions about your natural strengths and skills based on one or few experiences alone can place unnecessary restrictions on your life. So don’t judge yourself too fast, and be careful of what labels you give yourself – who knows what you can become if you just allow yourself.

Where to start with systems thinking?

Perfectionism and systems thinking

During the systems thinking 2 course of the Creative Sustainability program in Aalto University, we have encountered various ways of approaching and thinking about systems. Systems thinking as a topic of study is simultaneously both very broad and very deep, and we’ve ended up discussing a wide range of complex issues, including climate change, ecosystem resiliency, and problems in the financial system just to name a few. Having the tools and approaches involved in systems thinking at our disposal has made even the most complex issues at least a bit more tamable.

However, for me, systems thinking has also created an illusion of wholeness in the way people approach complex issues. What I mean is that when we’re talking about complex problems related to human systems by using systems thinking and systems methods, I start to sometimes assume that there must be someone, or some organization that is approaching these issues from a broader perspective. For example, when we were discussing the Viable Systems Model by Stafford Beer in our lecture and applying it to cities, I started to scan in my head for organizations where Viable Systems Model could be applied to cities as a whole. My mind wanted to know the optimal place to be involved in such interventions, as if there was in fact an organization that was trying to solve complex urban problems. Although cities have governments, mayors, and different civic functions, I was searching for an organization that could do a systems design intervention on the whole city scale, including infrastructure, civic services, urban planning etc.

My perfectionist mind wouldn’t therefore be content with approaching cities one aspect at a time, but wanted the perfect approach, and the perfect organization to start with. It would keep asking: how and where could we do an optimal intervention into a complex system or a problem?

Systems thinking ecology

The truth is that there is no one place, time or an organization that would give you a bird’s-eye look at complex situations and allow you to work on the whole system at once. That’s the nature of complex problems: they involve various actors and forces that interact dynamically, meaning that the whole is not controlled by any one organization. That’s why there is no one central location from where to approach complex issues, because if there was, the issues wouldn’t be complex.

Moreover, systems thinkers have developed their ideas in their own unique contexts and backgrounds. The field of systems thinking hasn’t developed from one central place, but is instead a network of loosely coupled scholars and professionals who have built on each other’s work over time. It makes sense then that systems thinking and systems intervention will also have to occur in one context at a time.

So, where to start systems thinking?

Systems thinking needs to begin now, and in the context you’re in. Instead of waiting for the perfect time and place, we must start applying systems thinking whenever and wherever possible. My advice to myself is: don’t try to solve the whole world at once – pick one aspect or a problem situation and start there.

Sense-making in the systems movement – observations of a novice

During the course Systems Thinking 2 at Aalto University we have already had the opportunity to explore different views on how systems thinking can be used in organizational sense-making and design. So far we’ve read and discussed articles about Ackoff’s Interactive Planning, Vicker’s Appreciative Systems, and Haeckel’s Sense-and-Respond organisation. All these views try to bring light on how organizational sense-making can occur, and on how to design systems that can deal with complexity.

What interests me in particular are the different assumptions and broader worldviews that the different approaches hold. The systems movement is a rather complex phenomenon in itself, and for a novice like me, seeing how these approaches relate to each other and the larger context is difficult at first. However, in this blog post I will try to make some sense of the systems movement and explore two major world views that I have recently come across in my readings.

According to the first view, the world is systemic, meaning that it’s formed of interconnected systems. We can objectively observe and design these systems by applying systems thinking principles. This view is based on positivism, spectator theory of knowledge (Dewey, 1929), and functionalism (Zexian & Xuhui, 2010). The second view dismisses the notion that world is essentially systemic and that we can objectively observe it. Instead, this world view builds on social constructionism, the interpretive paradigm, and Dewey’s (1929) experimental theory of knowledge (ibid.) The advocates of the second view argue that the process of inquiry is systemic, and that systems should be viewed ‘as if’ they existed in the real world.

Below is a more detailed discussion of both views, as I have understood them.

The world is systemic – first order (hard) systems thinking

The shift from the doctrine of reductionism and the analytical mode of thought to the doctrine of expansionism and the synthetic mode of thought that took place in the early decades of the 20th century brought with it several lines of inquiry into systems. According to Russell Ackoff (1974), the shift itself began with different scholars in separate fields making a move away from reductionism towards more expansionist thinking. For example, Suzanne Langer discussed the meaning of symbols in the 1940s, with Charles Morris later building on her work to study languages in late 40s and early 50s. From languages the next step was communication by Claude Shannon in 1949 and control and cybernetics by Norbert Wiener in 1948. According to Ackoff (1974), the final “Aha” moment that launched the systems movement was Ludwig von Bertalanffy’s General Systems Theory in the 50s and 60s.

Russell Ackoff.

Russell Ackoff.

These developments lead to the incubation of three distinct, but related systems fields: General Systems Theory, Cybernetics, and Systems Dynamics. All three strands of systems thinking departed from reductionist approaches in that they emphasized the importance of dynamic interactions between the parts of the system and between systems and their environments (Stacey, 2010, 201.) Problem solving did no longer begin by isolating the problem from its environment, but by looking at how the problem is connected to the larger whole that it’s a part of. Synthesis would now precede analysis, instead of the other way around (Ackoff, 1981).

The strands of systems thinking that emerged in these early decades of the systems movement are today called first order systems thinking, or hard systems thinking (Stacey, 2010; Zexian & Xuhui, 2010). Although the proponents of hard systems thinking dismissed the reductionist mode of thought and analytical thinking that formed the basis of the scientific method, hard systems thinking still held many of the beliefs behind reductionist thinking. According to Ralph Stacey (2010), hard systems thinking assumes an objective reality that can be rationally observed by individuals. When it comes to social systems, the social world is essentially assumed to be formed up of systems that have a purpose, and that can be objectively observed and modelled (ibid). The assumptions behind hard systems thinking were conveniently summarized in a 2010 paper by Zexian and Xuhui:

  • System objectively exist in our world and it has a good structure and identified goal.
  • The parts of the system have the same worldviews, values and interests.
  • The system intervener is an outsider of system and is not influenced by the system.
  • Achieving the optimal results is the ultimate goal of problem-solving process (Zexian & Xuhui, 2010, 143.)

According to Zexian and Zuhui (2010), hard systems thinking conforms to positivism in natural science and largely ignores the diverse worldviews, values and interests existing in human organization. Furthermore, hard systems thinking complies with the tradition of epistemology that ignores the relationship between the subject and the object, which Dewey (1929) called the spectator theory of knowledge (ibid.)

In summary, while hard systems thinking moved away from reductionism, i.e., observing and designing parts of a system in isolation, the world view still held on to many of the assumptions behind natural sciences. General Systems Theory, Cybernetics, and Systems Dynamics all assumed that systems could be modelled and understood objectively. Design and sense-making were therefore only a matter of patience and use of rational decision-making tools. Although synthesis would precede analysis, the design of systems could be done using the same scientific rigor that natural scientists used when analyzing natural phenomena.

Emergent behavior. A starling flock near Athens.

Emergent behavior. A starling flock near Athens.

 

The process of inquiry is systemic – Second order (soft) systems thinking

To recap, General Systems Theory, Cybernetics, and Systems Dynamics all assumed that systems exist as objective phenomena, and that social systems have identifiable goals, structures, and behaviors that we can evaluate and design. In the 1970s and 80s, however, systems thinking scholars began to question these assumptions. Among the most notable critiques were West Churchman (boundaries and moral), Russel Ackoff (Interactive Planning), and Peter Checkland (Soft Systems Methodology), who developed alternative approaches to organizational sense-making and design that involved people. Later the Critical Systems Thinking approach was built on top of the critique from Chruchman, Ackoff, and Checkland (Stacey, 2010.)

Zexian and Xuhui (2010) view Checkland’s Soft Systems Thinking in particular as a major milestone in the systems thinking movement. Checkland critiqued the positivist nature of the earlier systems thinking approaches as well as noting that they don’t consider different human values and worldviews in their analyses. He also dismissed the word ‘system’ altogether and instead employed the term ‘purposeful holon’ to discuss human systems. Below is Checkland’s systems thinking summarized in seven points:

  • System thinking takes seriously the idea of a whole entity which may exhibit properties as a single whole (‘emergence properties’), properties which have no meaning in terms of the parts of the whole
  • To do systems thinking is to set some constructed abstract wholes against the perceived real world in order to learn about it
  • Within system thinking there are two complementary traditions. The ‘hard’ tradition takes the world to be systemic; the ‘soft’ tradition creates the process of enquiry as a system.
  • SSM is a systemic process of enquiry which happens to make use of system models. It thus subsumes the hard approach, which is a special case of it.
  • To make the above clear it would be better to use the word ‘holon’ for the constructed abstract wholes, conceding the word ‘system’ to everyday language and not trying to use it as a technical term
  • SSM uses a particular kind of holon, namely the so-called ‘human activity system’. This is a set of activities so connected as to make a purposeful whole, constructed to meet the requirement of the core system image (emergence properties, layered structure, process of communication and control)
  • In examining real-world situations characterized by purposeful action, there will never be only one relevant holon. It is necessary to create several models of human activity systems and to debate and so learn their relevance to real life (Checkland, 1990, 27).

Checkland therefore states that there is no objective reality that can be observed from the outside, and neither is there only one optimal system (holon) for any situation. If I understood correctly, this is strongly against the first order systems thinking tradition of the 50s and 60s.

In short, the second order systems thinking approaches that were developed in the later decades of the 20th century dismissed the notion of rational observers objectively assessing reality and designing ideal systems based on objective goals. The idea of a system was questioned altogether and replaced by the word ‘holon’. Later, during the 80s and 90s the theories of catastrophe, chaos, and complexity would be added to the already broad spectrum of systems theories and sciences. Exploring the contributions of complexity theories is widely beyond the scope of this blog post, so I will leave the realm of complexity for another discussion.

So, coming back to Vickers’ Appreciative System, Ackoff’s Interactive Planning, and Hacekel’s Sense-and-Respond organisation, I feel it’s already a bit more clear where they stand in the bigger picture. To my knowledge, Ackoff’s critique towards hard systems thinking acted as one of the foundations towards soft systems thinking. Vickers’ Appreciative System method came about as a critique towards the rational decision making models that he saw to have little bearing on how real world works (Burt & Van der Heijden, 2008, 1111). It would therefore seem like a safe bet to say that Vickers also represents second-order systems thinking. I would dare to say that Haeckel too represents second-order systems thinking. In his book ‘Adaptive Enterprise: Creating and Leading Sense-and-Respond Organizations’ (1999), Haeckel builds his idea of a Sense-and-Respond organisation on Learning Organisation theory and Complex Adaptive System (CAS) theory. Learning Organisation theory emerged along with other second-order systems thinking theories, while CAS theory is part of the complexity sciences family.

References

Ackoff, R. (1974). Systems, messes and interactive planning. Portions of chapters 1 and 2 of Redesigning the Future. New York/London. Wiley, 1974.

Ackoff RL. (1981). Creating the Corporate Future: Plan or Be Planned For. John Wiley and Sons, New York. Pages 16-17.

Burt, G. & van der Heijden, K. (2008). Towards a framework to understand purpose in futures studies: the role of Vickers’ appreciative system. Technological Froecasting & Social Change. Vol 75. Pages 1109-1127.

Checkland, P. (1990). Soft systems methodology in action. Wiley. Chichester, UK.

Dewey, J. (1929). The Quest for uncertainty: a study of the relation of the knowledge and action. Balch & Company. New York, USA.

Haeckel, S. (1999). Adaptive enterprise: creating and leading sense-and-respond organizations. Harvard Business School Press. Boston Massachusetts.

Stacey, R. (2010). Strategic management and organisational dynamics: The challenge of complexity. Pearson Education Limited. Edinburgh Gate, England. Pages 54-55, 201.

Zexian, Y. & Xuhui, Y. (2010). A Revolution in the field of systems thinking – a review of Checkland’s systems thinking. Systems Research and Behavioral Science. Vol 27. Pages 140-155.

Creative Commons Starlings near Athens Nov 2008 by muffin is licensed under CC BY 2.0.

What the heck are SOHOs?

Systems thinking is an important part of our studies in the master’s degree in Creative Sustainability at Aalto University. During a recent course on systems thinking, I ran into an absolutely wonderful and intriguing concept called a SOHO system (1). A SOHO system is a system that is:

  1. Self-Organizing. Self-organizing systems may exhibit spontaneous coherent behavior and organization. This basically means that when an open system, such as a lake or a financial system, is pushed away from its equilibrium state by an influx of energy and material, the system responds with a spontaneous emergence of new, qualitatively different organized behavior and structure. An example of self-organization is the growth of a tree, or the development of an embryo in a mother’s womb.
  2. Holarchic. A holarchic system is formed up of holons. Holons are entities that are simultaenously a whole and a part. A holarchy is therefore a hierarchical system of interconnected part-wholes. These holons are connected with reciprocal relationships and mutual causality – meaning that the interactions between the holons are not linear cause-effect, but non-linear feedback relationships. What all this means is that, instead of having a one-way top-down power relationships as in a traditional view of a hierarchy, holons in each level are affecting other holons in both above and below levels. For example, a forest is a holon, which is consisted of smaller forest areas, lakes, and other ecosystems that are themselves holons. A lake (another holon) then consists of smaller pockets of ecosystems and organisms, that themselves consists of smaller holons… and so on. All the holons and their interactions over time form a holarchy, which extends over time and over different scales.
  3. Open system. Most systems out there are open, including you and me. An open system transmits and receives energy and material to and from its environment. Open systems do have boundaries, but they are not closed or isolated from their context. The opposite of an open system is a closed system. A classic example of a closed system would be the clockwork in a watch.

Self-organizing Holarchic Open systems are all around us. Lakes, forests, societies, social networks, and cities – just to name a few. All of these systems exhibit self-organizing behavior that cascades throughout their hierarchical levels.

SOHO

A SOHO system in action.

But what really makes the hairs on the back of my neck stand on end is the following idea regarding the energetics of open systems, originally developed by Kay and Schneider (2) , expressed below by Kay et al (1):

“When the input of high quality energy and material pushes the system beyond a critical distance form equilibrium, the open system responds with a spontaneous emergence of new, reconfigured organized behavior that uses the high quality energy to build, organize and maintain its new structure… As more high quality energy is pumped into a system, more organization emerges, in a step-wise way, to dissipate the exergy. Furthermore, these systems tend to get better and better at grabbing resources and utilizing them to build more structure, thus enhancing their dissipating capability.”

If I understand this correctly, this would mean that when a SOHO system receives energy from its environment, it starts to develop new structures and processes that make it more effective at receiving energy from its environment. This creates a positive feedback loop where increasing energy input into the SOHO system increases its capability to receive energy.

A Self-organizing Holarchic Open system. From Kay et al. (1999).

A self-organizing system that uses energy to increase its ability to take energy. From Kay et al. (1999).

For example, when our early ancestors invented tools or developed the ability to cook their food, the community’s ability to grab resources from their environment improved. The increased influx of energy (e.g. cooked food or a surplus of wheat) enabled the community to spend more time improving their tools and techniques, which in turn increased the influx of energy into the community, which again gave the community more time to create new tools and techniques… and so on.

But what does this really mean from practical decision-making point of view? So what if we’re dealing with SOHO systems?

Well, in my view it makes all the difference in the world whether we’re facing systems whose behavior and responses are easy to predict or systems that might have highly unpredictable, or even chaotic behaviors. And we don’t have to look too far to see the consequences of using linear decision-making techniques to non-linear, holarchic and unpredictable systems. Just take a look at the giant garbage patch that’s floating in the Pacific Ocean:

(1) Kay, J., Regier, H., Boyle, M., Francis, G. (1999). An ecosystem approach for sustainability: addressing the challenge of complexity. Futures. Vol. 31. Pages 721-742.

(2) Schneider, ED. & Kay, JJ. (1994). Complexity and thermodynamics: towards a new ecology. Futures. Vol. 19. Pages 25-48.

Innovative Companies with Sustainable Business Models: Coreorient

Company profile

Name: Coreorient Oy / PiggyBaggy (beta)
Founded: 2011
Founders: Harri Paloheimo and Heikki Waris
Industry
: Multiple industries / ICT-enabled services
Main services: 
PiggyBaggy crowdsourced ride-sharing for goods; Smart service system development and consulting
Sustainability: PiggyBaggy lowers emissions and resource consumption by providing access to already existing mobility, similar to car sharing.

Company history and idea in brief

Have you ever needed a particular tool to do some really small task, such as drilling a hole in a wall or tightening a loose screw in a bike, but didn’t have that tool available? And then had to either spend a lot of money to buy that tool or a lot of time finding someone who could lend it to you? Or have you ever spent half a day trying to get some mundane task done, such as delivering a book to a library or returning a broken MP3 player back to store?

I’m sure you have. And I bet you have some tool that you’ve only used a few times in your life, such as a power drill, lying around in your basement.

What if instead of owning expensive equipment, you could rent or borrow the tool you need, or pay someone else in your neighborhood to drill the hole for you? And how about if you didn’t always have to go to the library to borrow books, but could instead pay someone else to deliver the book, or use a library access point near your house?

What if you could live in a world with less stuff to take care of, less hassle over mundane things, and more time to do the things you really care for?

Moreover, what if in this world you could get things done by using less resources, less or no gasoline, and less energy. You would pay for services, instead of goods, and would have access to functionality and results, instead of having ownership of the damned power drill. And even if you do want to own your power drill, the rest of it sounds pretty good, right?

A Finnish company called Coreorient, is trying to build that world.

Founded in 2011 by several ex-Nokia experts, Coreorient is a company that has been involved in developing services and technologies that help people get everyday things done more efficiently and by using less time.

The company’s flagship service, PiggyBaggy, is a crowdsourced ride-sharing service for goods. This is how PiggyBaggy works: let’s say you need to deliver a broken laptop to an electronics store for a fix-up. Instead of going yourself, you can use PiggyBaggy to get someone in the PiggyBaggy community to deliver the laptop for you in return for a small payment. For example, someone might be commuting past your house and the electronics store and could therefore take your laptop on her way to work, giving you more time to do other things.

PiggyBaggy transporter picking up groceries for a customer.

PiggyBaggy transporter picking up groceries for a customer.

I was able to get in touch with one of the founders of Coreorient and PiggyBaggy, Harri Paloheimo, who shared his thoughts about the company. According to Paloheimo, the idea for crowdsourcing goods-delivery came to him when he was returning a broken microwave back to store. As he didn’t own a car, the journey to return the microwave involved taking several buses and a train.

“When I spent half a day returning a broken microwave back to store, I remember thinking at one point that this doesn’t make any sense, and that there has to be a more efficient way to get this done.”

Paloheimo began tinkering with an idea of a crowdsourced ride-sharing service for goods and even tried to get Nokia to do a collaboration with several existing ride-sharing companies. In the end, however, Paloheimo didn’t get the required support from headquarters and finally he left Nokia in 2012 to lead Coreorient. The company had already been founded on paper in 2011 by his college, Heikki Waris. Although the men were taking a leap from a big corporation to run a small startup, being an entrepreneur felt oddly familiar to Paloheimo:

“I had been acting as an intrapreneur at Nokia for years before starting my own business. I had imagined that things would work in a more rational way outside big corporations, but I soon realized that the same pitching theater and power point circus that I was used to continued in the “real world”.”

Power points and pitching weren’t the only thing familiar to Paloheimo. He was also very used to facing failure:

“They say that you can’t have success before going bankrupt a few times. Well, I hadn’t gone bankrupt, but I had experienced some big failures in Nokia. For example, having to disband a team you’ve lead feels a lot like going bankrupt to me.”

After initial difficulties, PiggyBaggy began gaining momentum and today the service has over 1800 users and between 800-900 items delivered so far.

Value for whole society

Aside from PiggyBaggy, Coreorient is also constantly experimenting with new concept and service development and wants to take part in developing a Sharing Economy. However, Paloheimo makes it clear that the company wants to avoid becoming similar to Uber:

“We want to frame ourselves as a second wave Sharing Economy startup. The first wave consisted of companies like Uber, which maximized value solely for their end users. We, however, think about Sharing Economy and our business from a broader perspective. We want to maximize value for the whole society and all interest groups involved in our business, not just for ourselves or our customers.”

Paloheimo explicitly emphasizes that Coreorient wants to take part in developing business models and win-win-win structures that maximize value for both consumers, the company itself, and the society at large. As an example of this, Paloheimo talks about Coreorient’s collaboration with the city of Tampere:

“We have applied for funding from the European Social Fund to find ways to activate youngsters that are in danger of becoming marginalized. We are now trying to find ways to use crowdsourcing as a medium for involving young people in society and to help them find a job. Although we use crowdsourcing as our main tool, it doesn’t necessarily involve PiggyBaggy or ride-sharing”, says Paloheimo.

According to Paloheimo, Coreorient has been involved in many similar projects all around Finland. The different experiments have also enabled Coreorient to test different assumptions about the markets and their customers, which helps the company to refine its ideas and services. Armed with this experience, Coreorient is now looking outside Finland to Europe and beyond.

“The experiments we’ve conducted in Lahti, Jyväskylä, Helsinki, and Espoo for novel concepts regarding social impact and circular economy have confirmed us that our systems and main concepts work. However, now the time for experiments is over and we need to make decisions about where and with whom we want to go on with this. Finland is too small and slow for us, and we’re potentially looking to expand to Denmark, or maybe India.”

First groceries being delivered

First groceries being delivered

Paloheimo and Coreorient are not only looking to expand as a company, but to also change the Finnish operating environment. In Paloheimo’s view, this is exactly what differentiates Coreorient from the first wave sharing economy companies.

“Even so called impact investors advised me two years ago to head out of Finland as, according to them, nothing truly innovative can succeed here due to tight regulation and small size of the market. I decided to address at least half of the problem and help change the operating environment. Since then we have conducted several projects with the ministry of transport and the public sector assisting in what I would call mindful deregulation.”

At the moment Coreorient is looking for partners and collaborators to make these changes happen, while also continuing to develop their core service concepts.

PiggyBaggy Business Model: Sharing Platform

Value proposition:  “Ride-sharing for goods. Convenient. Sustainable. Secure.”
Main customers: 1) People who need help in getting items delivered. 2) Businesses that need low-cost options for purchase delivery.
Revenue generation logic: Two options: 1) Subvention-based: online businesses will pay PiggyBaggy for using it in purchase delivery, 2) Transaction-based: end customers of second-hand online marketplaces will pay PiggyBaggy for using it in purchase delivery.

Below is Accenture’s framework of 5 different circular economy business models. Based on this framework, PiggyBaggy has a sharing platform business model. A sharing platform is either an online or physical platform that facilitates the sharing of resources and decreases the overcapacity of assets. In PiggyBaggy’s case, the excess capacity is people’s time and mobility. PiggyBaggy enables individuals and businesses to tap into the existing mobility  in order to get items delivered.

Accenture's (2014) 5 Business Models for a Circular Economy.

Accenture’s (2014) 5 Business Models for a Circular Economy.

PiggyBaggy is an excellent example of the power of IT and the internet to create new ways of organizing human action. What PiggyBaggy actually does is that it uses the internet to provide access for tapping into excess mobility and time – something that would have been near impossible to do 20 or 30 years ago. By creating the PiggyBaggy platform, Coreorient has essentially created a new marketplace where the supply and demand of mobility and time can meet.

For example, I might need a book delivered to the library, but I don’t have enough time or I’m otherwise unable to go to the library myself (lack of time and mobility). However, there are hundreds of people going past my house and the library every day, many of whom could pick up my book and return it without making a major detour (overcapacity of time and mobility). PiggyBaggy therefore creates a platform where the supply and demand of time and mobility can meet.

According to Harri Paloheimo, Coreorient has at least two potential business models for PiggyBaggy. One is based on a subvention model, where PiggyBaggy would essentially enable businesses that do home delivery to lower their costs by using the PiggyBaggy community to deliver customer purchases. Paloheimo elaborates:

“In EU and in Finland it costs approximately 15 euros to deliver a product to a customer. At the same time customers are on average only willing to pay 5 euros for the delivery. This means that businesses lose 10 euros on average per every packet delivered to consumers. Our idea is that we could lower these costs and get paid for doing so.”

The other option would be to use a transaction fee –based business model, where the customers would be individuals shopping at second-hand marketplaces. Usually in second-hand shops the end users arrange the delivery of items themselves, but by using PiggyBaggy they could use crowdsourcing to get their items delivered. PiggyBaggy would charge the transporter around 15-20 per cent of the fee he or she received from the customer.

In both business models PiggyBaggy lowers the costs of transportation while also reducing emissions and pollutions from cars by decreasing the overall number of car trips. Moreover, PiggyBaggy also provides people more time by helping delegate transportation of goods from busy people to individuals who are already on the road.

Smart container in action.

Smart container in action.

But PiggyBaggy is not the only service that Coreorient has been developing. The company has been experimenting on a concept called smart containers. A smart container is a ship container that is used as an access point for different services and resources. For example, the smart containers in Kalasatama, Helsinki have been equipped with library services, organic food services, recycling services and electric car charge points. Furthermore, the containers can be used as PiggyBaggy delivery points.

Smart container in action.

How are PiggyBaggy and the Smart Containers connected? Paloheimo shares a vision of a global network of community-run smart service points, connected by crowdsourced goods delivery. According to Paloheimo, this kind of network of services and crowdsourced transportation represents a viable alternative for today’s centralized mass manufacturing and transportation.

Thanks for reading! To find out more about sharing economy or circular economy, I suggest checking out the following resources:

  • Peers Inc, a book about platforms and the collaborative economy by the owner of Zipcar, Robin Chase. Check out her TED talk here.
  • What’s Mine is Yours, a book about the sharing economy by Rachel Botsman. Check out her TED talk here.
  • Ellen MacArthur Foundation website is an excellent source for information on circular economy.
  • Also take a look at European Commission circular economy strategy.

Wicked Opportunities in Sustainability

While our world has become more dynamic and more complex, so have our problems. Wicked problems, such as climate change, terrorism, social inequality and destruction of natural habitat are extraordinarily difficult to deal with because they are almost impossible to define accurately. However, if we change our perspectives and reframe the issue in a new way we can overcome the wickedness of the challenge.

 

Wicked problems

 

“[Wicked problems are a] class of social system problems which are ill-formulated, where the information is confusing, where there are many clients and decision makers with conflicting values, and where the ramifications in the whole system are thoroughly confusing”- Horst Rittel

 

The definition of wicked problems is as complex as the problems themselves. Wicked problems have been a topic of discussion since the 1970s when Horst Rittel and Melvin Webber published their article, Dilemmas in a General Theory of Planning. The authors explained how wicked problems differ from engineering problems in that they are almost impossible to define.

To illustrate, let’s imagine that you have a rising drug problem in your city. The root problem appears to be a new gang that is importing large amounts of drugs to the city from overseas. After identifying the gang leaders, the city police finally apprehends the gang leadership in a large raid and confiscates all the drugs. For a while it seems that the amount of drug offences is decreasing. Surely the problem has been solved, right?

In reality the opposite is the case. In the following months a violent gang war ensues and the amount of people detained for drug abuse is actually increasing! The reason? By eliminating the dominant gang, the police created instability in the hierarchy between other rival gangs in the city and in the drug markets. This instability was then corrected by a violent power struggle between the gangs that remained.

The police had therefore introduced only a temporary solution to the drug problem. In fact, the real problem is not the use of drugs, which is only a symptom of the underlying cause. The use of drugs and other criminal activity were the result of a variety of other societal problems, such as poverty, racial issues and bad city planning. These underlying, systemic issues were not addressed by getting rid of one gang, which is why the drug problem only got worse.

Here are some other examples of wicked problems:

  • Climate change
  • Global terrorism
  • Nation-wide obesity
  • Acidification of the oceans
  • Deteriorating biodiversity
  • Poverty

All of the above problems consist of several interconnected parts. For example, climate change cannot be reduced to one problem definition with simple cause-effect relationships, because the climate itself is very complex and hard to understand. The climate is not a singular thing, like a mountain is, but the cumulative effect of all the streams of air, water and heat in our planet.

Understanding the nature of wicked problems is absolutely necessary for today’s problem solvers and decision makers because most problems worth thinking about are essentially wicked. It is easy to become paralyzed after realizing how challenging it is to solve wicked problems. However, I believe that by reframing the issue we can unleash our creative thinking and turn the problems into an opportunity

Wicked opportunities

What if I told you that climate change, inequality and other similar issues are only problems if we choose to define them so? In fact, I like to think of wicked problems as signals telling us that change is necessary – that we need to start doing something fundamentally different from what we’re doing now. It means that we need to design new and better economic, social, governmental and physical systems than the ones that are now in place. Therefore, our biggest challenge is in fact overcoming our unwillingness to change.

Change is sometimes very difficult, but whenever there’s fundamental change involved, there are also great opportunities. Furthermore, we humans are experts in change! Just think of how different our world is from a hundred years ago – or fifty, or even twenty years ago. The automobile, the airplane and the advent of ICT have all changed our lives and the society so fundamentally that our forefathers would think they’re in a different planet if they saw our world today. So there’s nothing new to systemic change – it is already happening all around us.

Therefore, what we need to do is reframe wicked problems as opportunities. They are opportunities for creating new value, new business and new, more sustainable ways of living. I am happy and inspired to see many companies, such as Demos Effect, PlantagonMBA Polymers, Ecovative Design, Piggybaggy, RePack and thousands others, adopting this attitude.

There’s a lot to do, so let’s not waste time trying to solve problems because it leads nowhere. Let’s instead choose to change our perspective and begin creating the world we want to live in.

Here are some suggestions how you can reframe wicked problems:

  • If you or your organization are faced with a difficult challenge, ask yourself whether it’s really an opportunity disguised as a problem.
  • When dealing with a wicked problem in your own life, instead of trying to solve the problem, try to think of ways you can re-design your life.
  • If you hear someone talking about a difficult challenge, try to identify the social systems that are involved in the issue. Then try to think of how we could go around the problem by designing the systems better.

References:

Rittel, H. & Webber, M. (1973). Dilemmas in a general theory of planning. Policy Sciences. vol. 4. pp. 155-169.

Buchanan, R. (1992). Wicked problems in design thinking. Design Issues, vol. 8. no. 2. pp. 5-21.

What is Systems Thinking?

Systems thinking is a way of viewing the world. According to the systems point of view, the world is built around varying kinds of systems. How can this perspective help us view our problems in a different way and help us solve some of the most difficult issues of our time?

Imagine you are living in the suburb of a large city. You go daily to work by taking the bus, which takes a lot of time and forces you to wake up very early in the morning. After some consideration you decide to buy a car in order to free up time and to make the commute more tolerable. At the beginning you feel great: now you can sleep a little longer and there’s no more waiting in the bus stop! You also have more energy because of longer hours of sleep and more flexible timetable.

After a while though, you start to see the costs of owning the car. Gasoline prices are rising and the car needs maintenance, which is why you have to reduce your spending on other things. Some mornings there are traffic jams and every now and then you end up late from work. The increased costs and the unpredictable traffic both increase your stress levels and you feel some regrets about buying the car. It appears that the solution to the original problem only caused other issues!

When we approach problems in our daily lives, we usually assume that a given problem is the end result of some simple cause-effect relationship. This is because we are taught early in our lives how to use analytical thinking to solve issues. However, this kind of thinking has its limits. It assumes that every problem can be taken apart and that the parts are in linear cause-effect relationship. The problem is that not all issues fit into these criteria.

In the above example the long commute was seen as the problem to be solved. The cause of the problem appeared to be the bad bus connections, which was solved by buying a car. However, the car itself ended up being the cause of the second problem, which was higher costs and stress due to traffic.

Fortunately there is another way to approach problems that can bring new light to the above issue.

Systems thinking

”Systems thinking is a discipline for seeing wholes. It is a framework for seeing interrelationships rather than things, for seeing patterns of change rather than static ‘snapshots’.”

Senge, P. (2007). In his book The Fifth Discipline.

Systems thinking is a conceptual framework that sees the world as a system of interconnected wholes. Whereas in analytical thinking in order to understand the whole you take it into parts, in systems thinking you would instead try to understand how the parts are connected to each other. The interaction between the parts of the whole are not assumed to be based on simple cause-effect relationships. Furthermore, a systems thinker would pay close attention to how the whole itself is connected to its environment.

“A system is an interconnected set of elements that is coherently organized in a way that it achieves something”

Meadows, D. (2008). Thinking in systems.

Using systems thinking in the above long commute example, you would not try to solve the problem by buying a car, but instead you would try to understand the issue from a broader perspective. You would actually try to see yourself as part of a system that is formed by you, your home, your workplace and the modes of transportation available to you. From this point of view, if the problem is long hours of commute, by buying a car you are only optimizing parts of the system. Thus, when the basic structure of the system remains unchanged the problem only changes location. By optimizing parts you do not necessarily solve the issue, but only end up shifting it to other parts of the system.

From a systems perspective it is equally important to understand the relationship between the parts as it is to understand the functioning of each individual part. This realization has very important implications to our every day lives. In the commute example you could find other solutions by considering the relationship between your home and your workplace. What is the fundamental role of commute? Is it to move from place A to place B, or could we perhaps frame it differently? In this case the fundamental issue is about organizing work: in order to work, you have agreed to be at your desk when your employer asks you to. But could this be arranged in a different way? Perhaps you can work at home some days, or maybe you could work at a nearby café? If this is impossible, maybe you could move closer to your workplace in order to minimize commute time.

Another incredibly powerful example of this kind of thinking is understanding how an architect would plan a house. When planning a house an architect would probably first decide what and how many rooms will go into the house, and decide about the general outline of the building. Most importantly, the architect would plan each room in a way that would not compromise the overall performance of the whole! The architect understands that even if an individual room would look great and perform well, the room can’t stay if it makes the whole house worse.

In my blog I will explore and share resources about systems thinking. I will also talk about other related issues, such as complexity, chaos and sustainability, with the intention of learning and sharing what I’ve learned. These topics might seem abstract at first, but they have incredibly important implications to the lives of individuals, organizations and societies. Please join me in my quest to explore the interesting world of systems!

If you wish to learn more, here is a video about systems thinking that I have found useful, hope you’ll enjoy it:

http://www.youtube.com/watch?v=lhbLNBqhQkc

References:

Senge, P. (2007). The Fifth Discipline. Random House, London. pp. 68.

Meadows, D. (2008). Thinking in systems. Chelsea Green publishing, Vermont. pp. 11.