Magic: Ecology, Economy and Equity

March 11, 2018 | Katrin Scholz-Barth

My name is Katrin Scholz-Barth and I have been mentoring Frank Mollel, a social entrepreneur in Tanzania and his startup of MCA Technologies through Bridges for Enterprise over the past year. I am grateful for the opportunity to write this blog post because BfE is such an admirable programme that helps young social entrepreneurs develop creative ideas into businesses that address problems worth solving.

I am a mom, wife, and businesswoman, in that order, and in these roles I daily encounter opportunities for meaningful and worthy enterprises. In my work and life I aspire to combine ecology, economy and equity and to examine everything through the lens of strategic sustainability.

I like to call it MAGIC because people are enthralled by and can actually relate to mysterious, thrilling superpowers. Let’s explore and harvest these superpowers for business ideas.

Looking at the big picture of our current world, what are the big problems worth solving? Energy, water, food security, health, education, transportation and logistics, communication, waste, and climate change – in no particular order. Some of these lend themselves, at least in part, to technological solutions, however, the barrier for finding enduring solutions to these problems is poverty.

But that is where you come in – the young social entrepreneur with a fierce sense of fairness. The world needs you as change agents because poverty is the root cause for inequality, corruption, political instability, and stagnant or negative economic growth.  

I challenge you to think critically when formulating disruptive business ideas. Think about what you deeply care about, what motivates you and what impact you wish to have. Consider whether your idea addresses a big problem and the pain points of customers, or if it simply feeds an obsession, a ‘social disease’. Finding and acknowledging the root cause of a problem gives us control and the power to do something about it, as opposed to considering ourselves victims of a situation, which leaves us trapped, overwhelmed, powerless and hopeless.

Disruptive ideas require some bold and radical thinking. Have you thought of reframing the problem you want to solve? When you broaden the conversation, you will be able to challenge your own assumptions, provoke your thinking to tickle out new approaches and solutions you may not have considered yet. Often the most effective and wildly radical solutions only emerge when we reframe the questions we ask.

When we dare to acknowledge that something is fundamentally wrong with our current way of thinking, then we can do something about it, because we take control. That is purpose and power and becomes your competitive advantage and strategy. So, dare to go beyond the competition and business-as-usual and position yourself for long-term success.

Have you heard of the book Biomimicry – Innovations inspired by Nature by Janine Benyus? It’s fantastic and inspiring. Get it and read it.

Why do I bring up nature? Because ecosystems like forests, freshwater systems, soils and coral reefs deliver services are worth about $72 trillion a year, which is about equal to the total world’s gross national income, which was $78 trillion in 2014. However, business operations cause environmental damage in the form of pollution, waste and climate change through greenhouse gas emissions worth $7.3 trillion per year. That’s destroying value – a tenth of the total world’s gross national income!

Perhaps we can learn something from nature’s tested ways of doing things for 3.5 billion years. Janine Benyus suggests we ask three questions:

  • How does nature make things?
  • How does nature make the most of things?
  • How does nature make things disappear, get rid of things?

There are great industrial examples already that mimic nature, including:

  • Self-cleansing surfaces like leaves
  • Weaving fibre like a spider at atmospheric temperatures and pressure.
  • Building air conditioning like a termite mound
  • Producing color by microscopically structuring surfaces to interfere with visible light
  • Collecting water from the atmosphere – for some bugs it’s a wild way of getting a drink
  • Using carbon dioxide as feedstock for production of the daily oxygen we breath or algae based biofuel

Most people dismiss the unusual because they’re in a routine. If we stay open and alert to our surroundings, ideas will come to us. We can employ these old/new ‘magic tricks’ as innovation and differentiation strategies to create and sustain our competitive advantage. This means that you can cash in on mimicking nature by employing it in your profit equation and you can strategically manage and diversify your risks and thereby position yourself as more investment worthy.

Consider your supply chain for production. Is it a linear supply chain, heat-beat-treat manufacturing or slash-and-burn agriculture? Be aware and cognizant of your product’s ingredients, production, use and end-of-life disposal. What impact does it have on physical, mental, and environmental health?

There are considerable opportunities for innovation in the supply chain, a bold and drastic shift away from the better-cheaper-faster model to the new functional model, the brave-new-world model, which is no more technically risky but which addresses customer pains and allows you to pivot to a circular economy to improve your product, process and revenue.

Why did I ask you earlier about what you deeply care about, what motivates you and what impact you wish to have? Because we need memories, a vision and purpose in life to be compassionate about the businesses we create. This will ultimately drive our thoughts, behavior and actions, or non-actions, to be either:

  • Destructive: negative impact – short-term gain but long-term destructive value
  • Constructive: positive impact – long-term success based on resilience, preserving, protecting, and creating value

Restrictions, be it limited resources, changes in policy or external conditions, can become lucrative opportunities, if, and only if, we are willing to pivot and recognize the blue oceans and new markets. If we have the courage to pursue our curiosity, dare to be different and bold enough, we can turn mindless degradation into innovative products and services that feed a circular economy and regenerative growth.

Let’s review and summarize the key points so far. We discussed:

  • Acknowledging the root causes of problems and business-as-usual to take control
  • Reframing the problem and rethinking the supply chain
  • Considering how to strategically create and sustain our competitive advantage by mimicking nature
  • This will increase your returns because we increase efficiencies with less capital employed. Plain and simple.
  • Benjamin Franklin once said “If you know how to spend less than you get, you have the philosopher’s stone.”

Companies have realized that when they behave more responsibly to people and the planet, they make more money. Big data supports the claim that impact investment awards higher and more reliable earnings and returns, thanks to Environmental, Social and Governance (ESG). It may be helpful to think of it as a balance sheet to measure and report value creation (or destruction), where you consider both assets and liabilities (including externalities like emission and pollution caused by our product) to build resilient future proof businesses for long-term success.

I would like to leave you with a few quotes to contemplate.

“Impossible isn’t a fact, it’s an attitude.”  Christiana Figueres, former UNFCCC Secretary

“The best way to predict the future is to create it.” Peter Drucker

“Stay hungry. Stay foolish.” Steve Jobs

Capitalism is a fantastic tool, a very powerful tool! If we do it right, Capitalism is not just ‘money’ and ‘stuff’. It is humans, intact communities and intact ecosystems; all forms of capital.”[1] It is MAGIC!

Katrin Scholz-Barth

BfE Mentor | Katrin Scholz-Barth Consulting

[1] Hunter Lovins. Podcast. “Regen360: Creating a Green Legacy” with David Gottfriend. Episode 24. April 4, 2017.