Friday, August 13, 2010

Security and Opportunity in Turbulent Times

Today's columnist is Stephen Huddart from the J.W. McConnell Family Foundation. Stephen writes:

It’s Friday the 13th. Feeling lucky? Nervous? Let’s see... massive flooding in Pakistan, the warmest year in recorded history, rumours of a new superbug, the largest oil spill ever, a threatened double-dip recession, and who knows what’s next, other than it’s sure to be something.

We live in turbulent times, the nature of which is to throw up surprises, to be erratic, and to be non-linear. We have a clear choice: reach for that lucky charm and trust that things will calm down, or tune in to what turbulence is telling us – that we need a new planetary operating system. As Peter Drucker wrote thirty years ago, management in turbulent times is about:

  1. Surviving

  2. Adapting

  3. Taking advantage of new opportunities.

Canada, we’re told, has come through the financial crisis rather well. You might not agree if you were downsized out of a well-paid manufacturing job, but as a country we fared better than many others. We were lucky – this time. However, we shouldn’t become complacent. Unfortunately, the billions of taxpayer dollars that we’re pouring into “stimulus funding” is, in many cases, going to prop up what Harvard Business Review blogger Umair Haque terms the “Zombie Economy.” This refers to big industries that ignore new social and environmental imperatives and are going the way of the dodo, especially if they depend on cheap oil. In short, we’re helping them survive, but if they don’t adapt, it will be unlucky for them, and for us.

If adaptation opens up new opportunities, where do we find them? One answer is in the new hybrid world of social entrepreneurship – ventures that integrate two types of bottom line: financial and social. Talk to anyone working in one and you get a sense of how genuinely lucky they feel to be earning a living while doing good.

Michael Porter pointed out in his seminal 1998 piece on Clusters and the New Economics of Competition that the “advantages in a global economy lie increasingly in local things – knowledge, relationships, and motivation that distant rivals cannot match.” The clusters he refers to arise from the confluence of investors, visionaries, companies, and universities for whom innovation is oxygen. In the world of social entrepreneurship, they are also value driven, and we’re seeing a lot more of them. For example, witness the rapid growth of B Corporations.

This combination of ingenuity and values is percolating up in Canada too. MaRS Discovery District is an example where the focus is on science, technology, and social innovation. Waterloo’s Capacity Waterloo Region, which is co-located with the Communitech enterprise incubator, is another. Halifax’s Hub serves as operations base to a diverse array of community organizations, social entrepreneurs, and techies. An example is Apps4Good, which builds applications to benefit charities and hosts an annual iPhone Hackathon, pairing up with folks in Saskatoon.

Rural areas are getting into this too. Prince Edward County, at the eastern end of Lake Ontario, is reinventing itself as a creative hub that offers fine wine, art, and local food. On a recent stay, my wife and I enjoyed the award-winning products at North America’s first LEED Platinum dairy, the Fifth Town Artisan Cheese Company, and spent time at Small Pond Arts – an “art farm” where national and international artists-in-residence create installations and performances for an appreciative public. We also had pretty good luck with the wine.

In Managing in Turbulent Times, Drucker wrote: “The greatest danger in times of turbulence is not the turbulence; it is to act with yesterday’s logic.” In the face of insecurity and rapid change we can either invest in the next economy, building stronger neighbourhoods, communities, and local economies designed to withstand the inevitable shocks to come, or we can trust our luck by turning back to the safeguards of yesteryear. Spending $9 billion for new fighter jets won’t do much for our security in this age of turbulence. The likelihood of armed invasion is way down the threat list. Given the innovation payoff that military expenditure yields, why not just invest directly in health care innovation or the next generation of high speed rail? Likewise, the planned $10 billion to build and upgrade prisons to house the uncharged, unidentified perpetrators of “unreported crimes” would be better spent improving education and social supports for the young aboriginals who make up such a disproportionate percentage of our prison population.

So, on this Friday the 13th, let's put superstitions and shibboleths aside and take advantage of the new opportunities that these turbulent times provide.

- and good luck to us all!

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