Systems Change vs Systems Optimisation: What they can do for the climate crisis
Before we begin, let me be clear. Despite all the hype, systems change will not solve our climate crisis. It is critical and it absolutely needs to start now. But, in my humble opinion, systems change alone is not the answer and it is a danger to think it is. Let me explain my logic and see what you think.
As always, feedback is welcome.
What is systems change?
During our time developing Project X, we were often labelled with the word “systems change”. At the time, this phrase was fairly new to me and felt quite complimentary, although a little obscure. It got me curious.
So, as time passed, when each person mentioned it, I’d ask them what it meant to them. Each time I got a different answer. Furthermore, when I started to look around, it felt like everyone was using it. Even ourselves. Over time, it started to niggle at me.
If we take Donella Meadows as a good benchmark, the definition of a system is as follows:
A system is ‘a set of things — people, cells, molecules or whatever — interconnected in such a way that they produce their own pattern of behaviour over time’
So, in simple terms, a system can be anything from a tree through to a forest, the timber industry that harvests it or the economy that underpins it.
If you, like me, are a fan of Donella Meadows and think the logical next step would be to find a definition of systems change with her — let me stop you there. Donella actually didn’t define ‘systems change’ explicitly until he Donella Meadows Institute merged with the Academy for Systems Change (ASC) in 2016. I can understand why it’s a hard one to pin down.
As one pair of select examples from the many online assertions, the definition can span from:
Systems change is a change that pervades all parts of a system, taking into account the interrelationships and interdependencies among those parts,
which could feel to some quite seismic and transformational, to:
System change is the emergence of a new pattern of organisation or system structure,
which could feel, to those same people, much easier to grasp and manage.
The former definition is closer to the common understanding of the word in the mainstream business community, and the latter is perhaps a more accurate description of what different entities are actually doing on the ground. After all, according to the above, crossbreeding a seed is systems change, but that’s not going to save the world on its’ own.
So, what harm can a misinterpretation do? In the context of the climate emergency — some could argue, not much. We should just all get on with it, right?
Well, yes. We should all get on with it. And yesterday. But for me, it is more about the lost opportunity.
According to the Academy for Systems Change, real systems change is tough.
The work involves deep shifts in mental models, relationships, and taken-for-granted ways of operating as much as it involves shifts in organizational roles and formal structures, metrics and performance management, and goals and policies. This is why they say it is both an inner and an outer journey.
The hierarchy of increasing effectiveness denoted by Meadows’ “Leverage Points: Places to intervene in a system” spans from practical interventions in constants or parameters, like subsidies, taxes and standards as the top and easiest entry, through to shifting the goals, mindsets or paradigm of a system in order to transcend it, as you will find in the bottom four.
Think like Einstein for a moment. We cannot solve a problem with the same thinking that created it. Instead, it requires a fundamental overhaul of whatever system it is tackling — and the people. So, by definition, it requires a longer-term horizon to effect change. Progress is achieved over decades, not years. Take for example the economy. The roots of our problems stretch back some 20,000 years. A redesign cannot be achieved overnight.
This, of course, doesn’t help the climate crisis. However, another form of systems intervention can.
Unlike systems change, systems optimisation does not require a complete system reboot or an overhaul. It identifies broken or inefficient systems and optimises them over a period of 10 years or less. For me, it is invariably spurred out of either necessity or opportunism.
By opportunism, as one example, I mean the way that market systems evolve through step changes in innovation and entrepreneurialism. Arguably, one could suggest the journey from cars to driverless vehicles and alternative transport systems is optimising a system.
By necessity, there is no better example than the urgent need for systems optimisation faced with the climate crisis. Systems optimisers either believe that the current systems aren’t broken, rather they are just dangerously inefficient and are not giving us the outcomes we need in time, or they are fully aware that the systems are broken, but recognise there isn’t time to fix them. Therefore, they seek new ways of working within the existing systems, rather than attempting a system overhaul. Project X’s goal is a good example of this. It exists to optimise a system. In our case, it aims at accelerated market adoption.
Two Types of Leaders
The types of leaders that I have seen thrive well in systems change can let go of their existing reality. They are comfortable in chaos, complex systems, and unpredictable feedback loops. They can demonstrate deep empathy, connect with others on a human level, and inspire those around them. Leadership styles are inclusive and create a loyal following through attraction rather than promotion. Examples of Myers Briggs personality types include Virtuosos, Adventurers, Campaigners, Protagonists and Mediators.
Conversely, the types of leaders I have seen thrive in systems optimisation embody more traditional leadership traits. They ‘command a room’, they ‘negotiate’, they ‘lead’ and they ‘smartly innovate’. Systems optimisation is a perfect role for them because the changes are needed yesterday. And that takes great political prowess and hard negotiating when dealing with the requisite large institutions to bring about meaningful change. Examples of Myers Briggs personality types include Entrepreneurs, Executives, Logisticians, Commanders and Debaters.
Can Systems Optimisation save us? Climate change and human survival
So why does this matter?
The global diplomatic experiment which is the UNFCCC, along with its Conference of the Parties and the Paris Agreement, has not asked the world to engage in true systems change — yet. Whether knowingly or not, it has created a framework to optimise it.
Let this statement not play down the scale of the challenge. We all know unprecedented changes must be made to ensure our survival. In order to reach net zero by 2050, we will need to produce and consume differently, collaborate throughout the value chain, phase out some industries, bring in new ones, raise enormous amounts of capital, accelerate the development of critical technologies and seek a just transition for those who are left in the slipstream. All the while, we will need to pick up the pieces of the ever-increasing climate impacts, globally. This is not a system overhaul; it is a fix, an urgently needed fix, but a fix nonetheless.
In theory, this can all be done without systems change in that all of the above changes can happen within the existing system and even go so far as to support it. Cue China and it’s green economy opportunity only just reaching centre stage in their fourteenth five-year plan. With this in mind, it makes perfect sense that the leaders of the world would place systems optimising mindsets in the front seat of these negotiations. After all, our systems aren’t broken, they are just inefficient, right? Right. And so, these negotiations will continue — protecting, commanding, negotiating.
However, as we are all acutely aware, the science upon which the Paris Agreement is based does not account for some seismic feedback loops on the horizon. As just one example among many, if you don’t know about permafrost yet, you should do. Bearing in mind, depending on which source you read, we have either ca. 120 gigatonnes of carbon left (about 3 years of current emissions) or we are underestimating and are already wildly careening into the danger zone. When, and not if, the permafrost melts, there is a whopping 1,400 gigatonnes that will be released. And that, my friends, is one of the many gateways to runaway climate change.
Of course, many are starting to understand this. The heat is already on. Australia is more than a warning call to kick off this critical decade. It is an angry protest from mother nature that we are already too late. As impacts increase, the world will get scared and some of the worst traits of the human condition will be seeking to advise and influence those negotiating tables. If you think COP25 was messy and counterproductive, just wait a few years. It won’t be pretty.
This too makes perfect sense. The closer we get to accountability, and the more severe the consequences, the more uncomfortable it will become.
Two heads are better than one: Systems change and systems optimisation working together
So, this is my theory: we need both systems change agents and systems optimisers advising our world leaders to get us out of this mess. And now. The relationship between the two, to me, feels deeply complementary and indeed critical to the success of this diplomatic experiment. But why?
Systems optimisers are action-focused, high-impact and deliver short-term, often exponential results. They can dive deep into the current systemic failures and seek to find the critical leverage points to buy us more time. They can work with climate negotiators on the specifics of what can be done right now and how quickly it can reach scale, so the leaders can feel more comfortable raising their ambitions. Then they can keep at it, industry after industry, taking an all-important helicopter view of the system to ensure that the strategy of interventions is coordinated and that resource allocation recommendations reach the negotiating tables. In effect, they can turn down the pressure so that we can deactivate the fight or flight “System One” brain that our leaders and negotiators will start experiencing more often, and start reasoning with the “System Two” brain capable of handling slower, more strategic, conscious and complex decisions again.
While systems optimisers like Convergence, TCFD, Client Earth and the World Banks’ NDC partnership busy themselves saving our plant-based bacon, few among them can afford to take the helicopter view of these interventions across the entire system. Therefore, a systems-optimising strategist or advisor is the perfect fit to help our leaders accelerate out of this mess, and pronto.
Systems change agents, on the other hand, can feel comfortable that the deployment of urgent resources is in good hands and can let go of seeking to influence current negotiations in order to architect a better world.
Now, before I continue, let me be clear: I am not suggesting we all hail the wisdom of siloed think-tanks or over-confident consultants. Hell no. The systems change agents we need on the job need to be integrated, inclusive and expert translators. After all, inevitably they need to build their experiments back into a constrained world, and they need to inspire and incentivise our leaders to believe it is possible.
An excellent example of how this could be helpful is the European Green Deal and their 10 pillars of change. Translate these into a series of experiments and an economic case for action and we are onto something that could enable more radical measures to be fed into the existing European Commissions Green Deal funding and mechanisms. Other excellent examples include the Transformational Capital Initiative emerging out of Climate KIC (let’s call it TCI1) and Tomorrow’s Capitalism Inquiry (TCI2, no denotation of priority) being developed by Volans. TCI1, under Dominic Hofstetter’s leadership, is seeking to design, define and demonstrate a new transformative investment practice, built on the ashes of our one-foot-in-the-grave capitalist system. TCI2, led by the awesome brain-trio John Elkington, Louise Kjellerup-Roper and Richards Roberts are stepping into Year 2 of their inquiry with a board briefing, a diagnostic tool for leaders and are inviting some of the bravest companies and investors to reimagine the regenerative economy with them, then design and test the concepts in 2020 and beyond.
The insights of these activities need to be synthesised and engineered into the mainstream. Incidentally, systems optimisers come in handy here, too. They are on the ground and are acutely aware of the chinks in the chain where systems interventions could gain traction. If anyone remembers my last blog, I talked about regime change with this diagram:
Think of it as a fractal. These niche innovations can be influencing the landscape of the collective mind or the mind of a particular leader which in turns influences the collective mind. At whatever scale you choose to look at it, it makes an impact.
Over to you, Boris
So, where should we start? Well, given the fact the UK has a Net Zero law by 2050 now and we are already under-delivering on the previous 80% target. Then throw in hosting the all-important COP26 and the fact that Boris Johnson has just appointed himself Chair of the cabinet’s climate change sub-committee, I’d say let’s give it a go here.
So what do you say, Boris and Dominic, prepared to give some ‘weirdos’ a go?
Kate Wolfenden | firstname.lastname@example.org