Volume 10, Number 1

Of Interest

n 2002, we honored Bill O’Brien’s contribution to the field of organizational learning by putting his manuscript “Character and the Corporation” into print on the occasion of SoL’s sixth annual meeting. At that event, many spoke of the powerful influence Bill’s work had on their careers and lives. That rich moment stands out for me as one where SoL was at its best. Continuing in the tradition of Chester Barnard and Robert Greenleaf, Bill saw business as sacred work and management as a vocation. He understood that the work of leaders and organizations was primarily the development of those placed in their trust. Business success was a natural result of this priority. I’m delighted to report that Bill’s final written work has finally been published in book form as Character at Work by Paulist Press; an excerpt is featured at the end of this issue. I think you’ll agree that Bill’s ideas have not only withstood the test of time but provide a legacy for his heirs featured here. They advocate for virtue in our systems as well as in our organizations, and pose ways to think about the changes in culture and design that will reinforce these systems attributes. Read Full Article

Feature

In this article, Jay Bragdon, author of Profit for Life (SoL 2006), explains why companies that mimic living systems consistently outperform those that exist as mechanical entities. The term he uses to describe this emerging living systems model is relational equity. Over the past ten calendar years he has tracked equity returns on the 60 companies in his learning lab against widely used benchmark indices – ones that broadly represent traditional bottom-line-first management methods. His data revealed that companies driven by a traditional bottom-line approach, on average, either lost value or barely broke even. However, those that followed a relational equity model were able to catalyze a powerful reinforcing cycle of profit. In reading this article, we learn that a business managed as if it were a living organism creates a radically different and more beneficial set of relationships than one managed as a static entity. Companies that operate as living systems inherently place a significantly higher value on people and Nature (living assets) than they do on non-living capital assets. They understand, as we as practitioners need to understand, that at a fundamental level living assets are a prolific source of capital assets. Read Full Article

Feature

Conventional wisdom tells us that the purpose of economic activity is to make money for shareholders. While this is true, it is only one truth. As new definitions of capitalism emerge (see "Capitalism as a Human System: The Value of Relational Equity," pages 1-8), a small but rapidly expanding group of corporate leaders believe that economic activity should and can be socially beneficial. In this article, Marjorie Kelly, author of The Divine Right of Capital, explains the rise of the beneficial corporation. The core purpose of beneficial corporations, or B corporations, is to ensure that their goods and services benefit society as they continue to return profits to their shareholders. They regard their businesses as living systems and believe that delivering social benefits is a core purpose, not an incidental by-product. New corporate structures are emerging to actively include the voice of multiple stakeholders and relieve the pressure to focus solely on short-term results - structures essential for the success of this new corporate form. With a commentary by Jason Schulist "In Search of the New Normal". Read Full Article

Feature

One of the most common approaches to reducing crime is to increase enforcement. In his first two years as police chief in Fitchburg, Massachusetts, Ed Cronin excelled in increasing enforcement. However when these efforts resulted in no decrease in crime, he was persuaded that community policing must address the causes of crime as well as its chronic symptoms. Using systems thinking, a community coalition recruited to address the immediate problem identified a number of strategies to increase safety and sustainability. The results of this new enforcement model include a reduction in criminal activity, the active engagement in the political process of a previously disenfranchised community, a police department who actively partners with other groups to address tough problems, and a law enforcement professional who has become an international advocate for a systemic approach to creating healthier communities. Read Full Article

Feature

As CEO of Hanover Insurance from 1979–1991, Bill O’Brien was one of the great practitioner pioneers of the interdependent development of people and their institutions. This new approach was the inspiration for the founding of SoL. In this excerpt from Character at Work (published posthumously), O’Brien explains why the most basic problems and flawed behaviors of an organization derive not from its lack of knowledge but from its lack of virtue. He defines four key values – localness, merit, openness and leanness – at the heart of those corporations that succeed in bringing out the best in its members. Ahead of its time, O’Brien’s work is an important resource for those responsible for the process of developing organizational leaders and for those experimenting with new designs to enable corporations to operate for the benefit of all stakeholders. Read Full Article