Kusz, JohnPaul, “The Sustainability Challenge: to Redefine Prosperity in a World of Population Growth, Energy Depletion, Climate Change and more…” Wayne State University, Executive PhD Track, Dept. of Industrial & Manufacturing Engineering, (A one-day seminar and workshop) Detroit, MI., 2009 - 2015…
Risks can no longer be heavily discounted or ignored completely, as they have been in the past. An increasingly ubiquitous and rapid information sharing technology is changing the landscape with regard to consumer awareness and the resulting governmental regulations that demand accountability. As these societal and ecological costs become more visible our product development and planning efforts will be required to include them. The opacity of activities such as resource depletion, greenhouse gas emissions, and exploitation of uninformed communities, is no longer acceptable for reasons that range from social consciousness to a more accurate allocation of costs – including the now obvious risks to all of us, as well as the industry sectors themselves. Risk costs!
Moving from product business and systems models that acknowledge risk, mitigate it, and potentially eliminate it with solutions that are restorative will require Radical Innovation.
Design plays a key role in the development of any product, business and/or system model. It is in the design phase of development that 80 to 90 percent of the product costs are essentially set. If these costs were to include the future costs and impacts of our products, not just the processes that are used to make, distribute, and use the product, but the costs related to final disposition of the product, and the costs related to the societal impacts and all the life cycle environmental impacts, that percentage would be even higher…
We are all familiar with the traditional investment model necessary to develop and produce a product. (Chart A)
We spend or "burn" capital in the design and development phase with the expectation that our capital will be returned and we will move past a break-even point and into profitability. Our business models have traditionally focused on the financial aspects of the investment, not linking and/or including financials and other metrics of ecological or societal disruption or well being related to the development endeavor.
If our product is transformational by virtue of creativity and innovation we are rewarded, capturing more market share and possibly a leadership position in our sector or category. Typically, profitability is extended with incremental innovation, thereby maximizing the return on the original investment. This is the “replication” of the early innovation through one or more cycles; a strategy that requires little or no risked financial investment to generate another wave of returns on an existing base technology. However, repeated replication can become a barrier to innovation. There are many examples of this in industry, perhaps most notably, the automobile.
Given our new consciousness, driven by information sharing and transparency, our attention must be focused, not just on the financial investment and returns, but the environmental costs and the societal costs, and the potential returns to the Natural and Human Capital.
If our design brief includes optimizing the returns on all three forms of capital, then our solutions will indeed be different. The results of our more comprehensive design efforts will more likely move us to a greater social equity and environmental integrity, ultimately enriching the entire society - not just the maker and users - while restoring the environment. The resulting product development program will provide for measurable investments as well as measurable returns on three mutually interdependent trajectories.
Looking at the design problem in this way is a form of Radical Innovation at the societal and organizational level.
If we choose to deny these considerations, and continue to treat them as externalities, we are essentially in a state of Design Default.
If we consider the environmental and societal costs associated with our designs at the beginning of the product development process the possibilities for a truly comprehensive solution begin to unfold.
Comprehensive Design, a term that was first coined by Buckminster Fuller in the 1930s, is born of Radical Innovation.
It is systems-based thinking. It is bold, and progressive – both socially and technically.
“…by Design” we can positively change (restore) the “natural & human systems” that support us, positively affecting all of the revenues and all of the returns; the environmental (EROI), the societal (SROI), and the physical and financial (ROI) – preferably in that order! (Chart B)
Sustainable innovations are as likely to be thwarted by the phenomenon of incrementalism as any other innovation, therefore policies that promote investment in better social and technological innovations and stifle subsidization of entrenched platforms must be carefully structured to assure the timely emergence of optimal solutions.
If the characteristics of sustainability can be defined in existing models and embodied in future product briefs and business plans, the new constructs associated with the briefs and plans are likely to generate more robust and resilient (sustainable) results.
The resulting discretionary (internal to corporate/sector) and non-discretionary (external to corporate/sector) policies and constructs can shape future models which can, in turn, shape the environment and social landscape.
Embedding these policies and constructs in coursework and using them in projects in design and management will move the disciplines engaged toward more comprehensive and sustainable solutions.