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Vision of comprehensive organisation and business for sustainable progress

Published by under News,Politics / Management categories on July 3, 2009

People together forming a circle within a glass sphere MIT Sloan leader of  the initiative on Inventing the Organisations of the 21st Century, addresses the mental models that constrain management progress, the view of comprehensive goals for business versus how wrong people are about what business is for, and the role of collective intelligence.

MIT Sloan School professor Thomas Malone has a larger, more ambitious notion of sustainability: Businesses can be used to accomplish a very wide range of human goals, not just making money. Business is a human enterprise, not just an economic one, and if we lose sight of that fact, we run the risk of undermining what businesses could do for us.

Imagine an executive, interested in understanding how his organization is going to need to function differently in the fast-coming future, as result of growing concerns about sustainability. What should the executive be prepared for?

One thing, will be a reconsideration of the “centralized mindset.” The idea is that if there’s a problem to be solved, we should put someone in charge of it, and if things are not well organized, that’s because there isn’t strong leadership. This mindset is very pervasive in our world.

But organizing things this way is becoming less useful in many situations. There are now more decentralized ways of organizing things that are becoming more desirable. In Linux, for example, a loose band of programmers, with very limited top-down control has developed an operating system that rivals Microsoft Windows. Sometimes, the best way for a leader to gain power is to give it away.

In addition to the belief in centralization, what other assumptions will need to change?

The heart of the answer is that managers and especially executives will need to serve the interests of a broader range of stakeholders. Serving the interests of stockholders is only part of the job. Managers also need to worry about serving the interests of their employees, their customers, their suppliers, and society in general. That’s another mental barrier that I think people need to get past.

This is an interesting avenue thinking about the larger possibilities for business reinvention that are found in the course of addressing sustainability.

Business people often think of sustainability as a constraint rather than an objective. In this way of thinking, the goal of business is to ‘maximize profits subject to the constraint of fulfilling your obligations to society.

But what I’m saying here is that you can flip that around. You can say there’s no reason at all why a business cannot maximize its contribution to society subject to the constraint of producing a reasonable financial return.

 For further detail please visit the following MIT link


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