As we are learning the hard way, the new normal of climate change and a volatile, hyper-connected global economy mean that sudden natural disasters and unforeseen supply chain disruptions are here to stay—and pursuing business as usual is no longer a viable option. But how can businesses adjust? Joseph Fiksel argues that the key is resilience—an organization’s capacity to survive, adapt, and flourish in the face of change.

In his new book, Resilient by Design: Creating Businesses That Adapt and Flourish in a Changing World (publication date: October 22, 2015), Fiksel outlines a new paradigm that helps managers design for resilience. Check out chapter two below.

What happens when a company misleads consumers and intentionally pollutes the environment? We asked some of our authors to comment on the recent Volkswagen emissions scandal. Check out what they had to say below and share your own thoughts in the comments.

Photo Credit: Manik at Flickr.com

 

Jason Mark

Why I'm Suing VW

This content originally appeared on SierraClub.org and is re-posted with permission.

As an environmentalist, I probably shouldn’t say this, but I love my car.

For starters, I love its exceptional fuel economy—an average of 37.5 miles per gallon in the four years I’ve owned it and typically up to 45 mpg on the highway, a significant boost above the U.S. vehicle fleet average of 23.6 mpg. I love its understated style—sleek, compact, and modern without looking flashy. I’ve even come to love the feline purr of its diesel engine, the little rumble that signals its latent power.

Unfortunately, my dream car is something of a mirage. That’s because I’m the owner of a 2010 Volkswagen Jetta SportWagen TDI, one of the nearly half a million VWs that, as the company now admits, was secretly manipulated to evade U.S. and California clean air regulations. VW sold me, and hundreds of thousands of other Americans, a vehicle whose green promises (“clean diesel!”) were little more than a smoke screen.

Let’s be real: Owning a car is a regrettable necessity in our sprawling, industrial landscape. I’m lucky enough to live in a region—the San Francisco Bay Area—where I don’t have to drive much. I commute by bike and train, and I can get everything I need within walking distance of my home. Most weeks, my car sits curbside gathering dust and leaves. But on the weekends, my family and I like to get away to the seashore, the forests, or the mountains—and for that we need a car.

Continue reading more of Jason's thoughts here. 

 

Joseph Fiksel

Ripple Effects: What VW Means for Corporate Sustainabiliity 

The deliberate deception on Volkswagen’s part represents a breach of trust that will undoubtedly affect the company’s reputation and brand image for years to come. But the ripple effects of this scandal are even broader. For those who are cynical about capitalist motives, it simply reinforces the unfortunate stereotypes of corporate greed and manipulation. For those who respect the efforts of global corporations to be environmentally and socially responsible, myself included, it represents a setback in public perception of the business community. From my experience, the large majority of companies work hard to uphold their values and ethical standards, and are sincerely dedicated to the sustainability goals that they profess. Occasionally they are guilty of errors in judgment, and we have certainly witnessed a number of incidents where automotive companies clearly failed to protect the safety of their customers. However, even though no one was physically injured by Volkswagen’s actions, the company grossly violated the basic claim of their product—clean diesel engines. This is an unprecedented insult to society, comparable to the Enron scandal, and I expect that in the near term it will taint the credibility of corporate sustainability programs in every industry.

Photo Credit: littlemoresunshine at Flickr.com

 

Pavan Sukhdev

Beyond VW: More Automotive Deceit 

My book Corporation 2020 (Island Press, 2012) on the evolution of the Corporation – past, present and future – explored the changes that were needed in policies, prices and institutions to change the DNA of the Corporation. Today's economy and politics is dominated by the ethically challenged DNA of 'Corporation 1920,' steeped in the economic philosophy of Milton Friedman, and guided solely by the pursuit of profits, with their goals mis-aligned with society, generating trillions of dollars in social costs: the negative externalities of "business-as-usual." But I was able to find and describe many successful instances of the new DNA – corporations with social purpose, positive externalities, achieving private profits without inflicting public losses. And every so often, I hear or see something that makes me think I have found another one…. 

Such was my impression when I visited Volkswagen in Wolfsburg a year ago, to teach a seminar. I learned that their cars and assembly lines were being designed to ensure each model and chassis could take four types of engines: petrol, diesel, hybrid and electric. It seemed a very pragmatic way of staying open to business for a fossil-fuel-free world of tomorrow. But in hindsight, it was more likely a pragmatic way of staying open to a diesel-engine-free future. Volkswagen is guilty of misdemeanour on a massive scale but it looks like they are not alone. Recent research by the Institute for Transport Studies at Leeds University, UK, suggests that Mercedes, BMW, Ford, and Mazda diesel cars are even more polluting than Volkswagen, and up to the same software deceit.  How can an entire industry go so wrong? Very simple: by being driven solely by the pursuit of financial profits, totally ignoring the wider world of human, social and natural capital that they depend on and have impacts on. That is why we need a new corporate performance measuring system such as Akzo-Nobel's "4D-P&L" concept, see www.corp2020.com.  You cannot manage what you do not measure. Accountancy regulators need to wake up from their sleep of a century, and realise that the financial reporting of 1920 is simply NOT good enough for 2020! 

The terrorist attacks that occurred in Paris on November 13 shattered the complacency of the French lifestyle. A few weeks later, a savage attack erupted in San Bernardino, California, further exposing the vulnerability of Western societies.

Dealing with terrorism and, in particular, with the frightening emergence of the ruthless Islamic State organization, also known as ISIS, will preoccupy the attention of world leaders for some time.

But there is a larger lesson to be gained from this and other recent crises. Put very simply: our complex global society lacks resilience.

What do I mean by that? Everything from our vulnerability to power failures to our overreaction of vilifying people who merely “look like” the perpetrators of violent acts, an overreaction demonstrated by Donald Trump’s recent call to close our borders to Muslims.

The good news is that we can improve our resilience. First let’s examine our society’s vulnerabilities.

Economic vulnerability

Terrorism is just one of many global threats that we face.

Our economy is highly vulnerable to a range of unexpected crises such as the 2011 tsunami that destroyed Japan’s Fukushima nuclear power station, causing costly delays in the electronics, motor vehicles and other industries.

Since 2001, the US has endured a series of disruptions, including hurricanes, power blackouts, oil spills, bridge collapses, gas-line explosions and aircraft accidents.

The giant reinsurance company, Munich Re, reports a sharp increase in the number of natural disasters during the past 32 years – a trend that is linked to climate change.

Are we adequately prepared for the next catastrophe, even though we cannot predict what it will be?

Warning: turbulence ahead

The root cause of our vulnerability is the structure of the global economy: highly interconnected, complex and filled with turbulence.

Major disasters can occur unexpectedly, and even minor incidents can cascade into significant human and financial losses. Emerging pressures such as climate change and urbanization will only intensify the potential for extreme events and severe disruptions. When a catastrophe occurs, we rush to aid the victims, but the memory quickly fades and we return to business as usual, dealing with more immediate financial or political pressures.

Could we do a better job at anticipating and responding to unforeseen events?

Although businesses, communities and government agencies have developed elaborate “risk management” systems to detect vulnerabilities, this approach has an inherent weakness. It cannot protect against unidentified risks.

In an increasingly complex and volatile global economy, it is virtually impossible to predict and analyze all possible disruptions. Rather than resisting the inevitable waves of change, we need to embrace change and learn to ride the waves.

Learning to embrace change

The little poppy that could. Plant street via www.shutterstock.com

In my book Resilient by Design, I argue that to embrace change requires going beyond the traditional approach of minimizing unwanted disruptions and recovering normal operations as quickly as possible. We must treat each surprise event as a learning experience, and adapt accordingly.

Risk management makes sense in a stable environment with predictable events, but in today’s more complex risk landscape – the new normal – it is inadequate for dealing with fast-moving, unfamiliar threats that may cascade into disasters.

The most damaging disruptions are often a result of rare, “black swan” events that were never anticipated. Who would have guessed, for example, that a volcano in Iceland would ground virtually all air traffic in Western Europe?

The US government and many private companies have begun to study the resilience of our economic systems, urban communities and the infrastructures that support them.

A particular concern is adaptation to the emerging effects of climate change, including extreme weather and rising sea levels. Rather than responding to crises after the fact, we are beginning to design dynamic systems that are better prepared to anticipate crises and more capable of coping in the aftermath. For example, package delivery companies such as UPS use real-time monitoring systems to quickly reroute deliveries in the event of a transportation disruption.

Resilience – the capacity to survive, adapt and flourish in the face of disruptive change – is a basic characteristic of all living systems, from individual creatures to entire ecosystems. Most people are psychologically resilient in the face of setbacks, ranging from diseases to divorces or job layoffs.

Human communities are remarkably resilient, and many cities have been completely rebuilt after catastrophic events. In contrast, engineered systems such as machines, buildings and industrial supply chains are generally more “brittle” and prone to failure or collapse.

Designing for resilience

Brittleness is not inevitable. It is a fundamental design flaw.

Mechanistic systems based on logical rules cannot cope with events that the designers failed to anticipate. We have much to learn from the natural world, where resilience is seen everywhere from cells to organisms to entire ecosystems.

Today, innovative companies are learning to behave more like living systems, sensing, responding and adapting to change. They view resilience as a source of competitive advantage and are supplementing traditional risk management methods with adaptive processes and technologies.

For example, IBM has worked with the city of Rotterdam to deploy advanced cyber-based methods for flood detection and control, enabling the city to cope with the increasing intensity of flooding events. And researchers at The Ohio State University have developed a supply chain resilience assessment tool that helps to spot a company’s areas of vulnerability and identify corresponding capabilities that need to be strengthened.

Resilience capabilities are quite diverse, ranging from physical design of operations to information technologies to training of employees.

One basic approach to resilience is reducing the concentration and complexity of a system: for example, by building smaller-scale, distributed facilities instead of a single centralized facility. Global giants like Dow Chemical are exploring a range of supply chain resilience strategies, from increased flexibility of transportation modes to early warning systems that sense and respond quickly to surprise events.

And next-generation nuclear plants will have safety features that eliminate the chance of a meltdown. We hope.

Leveraging the human factor

The above research has shown that human intelligence and creativity are among the most powerful tools available to build resilience against unforeseen threats and enable both companies and communities to flourish.

Clearly the most challenging threat that we face today is the rise of violent extremism. Terrorist organizations, with their decentralized structure and covert operations, are inherently more resilient than the traditional armed forces deployed by nation-states.

Despite huge investments by the US and its allies in counterintelligence, we are still ineffective in “asymmetric” warfare. Overwhelming force may achieve temporary victories, but cunning and subterfuge eventually prevail.

To defeat terrorism, we may need to leverage the human factor – and its inherent resilience – by taking advantage of citizen involvement, social media and other nontraditional tools.

For example, the surveillance work of intelligence agencies can be complemented by conscious public efforts to promote inclusiveness, avoid alienation of minorities and reach out to potential dissidents. This type of adaptation seems more promising than trying to shut our borders to entire classes of immigrants.

In this age of turbulence, resilience has become a prerequisite for continued prosperity. Simply going back to business as usual – as we’ve too often done – is not the best strategy. Rather than bouncing back, we need to bounce forward.

This article was originally published on The Conversation and is reposted with permission. Read the original article.

This holiday season, give the gift of an Island Press book. With a catalog of more than 1,000 books, we guarantee there's something for everyone on your shopping list. Check out our list of staff selections, and share your own ideas in the comments below. 

For the OUTDOORSPERSON in your life:

Water is for Fighting Over...and Other Myths about Water in the West by John Fleck
Anyone who has ever rafted down the Colorado, spent a starlit night on its banks, or even drank from a faucet in the western US needs Water is for Fighting Over. Longtime journalist John Fleck will give the outdoors lover in your life a new appreciation for this amazing river and the people who work to conserve it. This book is a gift of hope for the New Year.

Satellites in the High Country: Searching for the Wild in the Age of Man by Jason Mark
Do you constantly find your friend waxing poetic about their camping tales and their intimate connection to the peaceful, yet mysterious powers of nature? Sounds like they will relate to Jason Mark’s tales of his expeditions across a multitude of American landscapes, as told in Satellites in the High Country. More than a collection of stories, this narrative demonstrates the power of nature’s wildness and explores what the concept of wild has come to mean in this Human Age.

What Should a Clever Moose Eat?: Natural History, Ecology, and the North Woods by John Pastor
Is the outdoorsperson in your life all dressed up in boots, parka, and backpack with nowhere to go? Looking for meaning in another titanium French press coffeemaker for the camp stove? What Should a Clever Moose Eat leaves the technogadgets behind and reminds us that all we really need to bring to the woods when we venture out is a curious mind and the ability to ask a good question about the natural world around us. Such as, why do leaves die? What do pine cones have to do with the shape of a bird’s beak? And, how are blowflies important to skunk cabbage? A few quality hours among its pages will equip your outdoor enthusiast to venture forth and view nature with new appreciation, whether in the North Woods with ecologist John Pastor or a natural ecosystem closer to home.

Also consider: River Notes by Wade Davis, Naturalist by E.O. Wilson

For the CLIMATE DENIER in your life:

Cartoon Introduction to Climate Change by Yoram Bauman
This holiday season, give your favorite climate-denier a passive aggressive “wink-wink, nudge-nudge” with The Cartoon Introduction to Climate Change featuring self –described Stand-up Economist Yoram Bauman and award-winning illustrator Grady Klein. Give the gift of fun, entertaining basic understanding of what is, undeniably and not up for subjective debate, scientific fact!

Also consider: Heatstroke by Anthony Barnosky, Straight Up by Joseph Romm

For the HEALTH NUT in your life:

Unnatural Selection: How We Are Changing Life, Gene by Gene by Emily Monosson
Give the health nut in your life the gift of understanding with Unnatural Selection. Your friends and family will discover how chemicals are changing life on earth and how we can protect it. Plus, they’ll read fascinating stories about the search for a universal vaccine, the attack of relentless bedbugs, and a miracle cancer drug that saved a young father’s life.

Also consider: Toms River by Dan Fagin, Roads Were Not Built for Cars by Carlton Reid, 

For the ADVOCATE in your life:

Prospects for Resilience: Insights from New York City's Jamaica Bay by Sanderson, et. al
Need an antidote to the doom and gloom? Stressed-out environmental advocates will appreciate Prospects for Resilience: Insights from New York City's Jamaica Bay. It’s a deep dive into one of the most important questions of our time: how can we create cities where people and nature  thrive together? Prospects for Resilience showcases successful efforts to restore New York’s much abused Jamaica Bay, but its lessons apply to any communities seeking to become more resilient in a turbulent world.

Ecological Economics by Josh Farley and Herman Daly
Blow the mind of the advocate in your life with a copy of Ecological Economics by the godfather of ecological economics, Herman Daly, and Josh Farley. In plain, and sometimes humorous English, they’ll come to understand how our current economic system does not play by the same laws that govern nearly every other system known to humankind—that is, the laws of thermodynamics. Given recent financial and political events, there’s a message of hope within the book as it lays out specific policy and social change frameworks.

Also consider: Tactical Urbanism by Mike Lydon, Cooler Smarter by The Union of Concerned Scientists

For the CRAZY CAT PERSON in your life:

An Indomitable Beast: The Remarkable Journey of the Jaguar by Alan Rabinowitz
The cat lovers in your life will lose themselves in An Indomitable Beast, an illuminating story about the journey of the jaguar. This is the perfect book for any of your feline loving friends, whether they want to pursue adventure with the big cats of the wild, or stay home with a book and cup of tea.

Also consider: The Carnivore Way by Cristina Eisenberg, Jaguar by Alan Rabinowitz 

For the GARDENER in your life:

Wild by Design: Strategies for Creating Life-Enhancing Landscapes by Margie Ruddick
Give your favorite gardener an antidote to the winter blues. The lush photographs of Wild by Design, and inspirational advice on cultivating landscapes in tune with nature, transport readers to spectacular parks, gardens, and far-flung forests. This book is guaranteed to be well-thumbed and underlined by the time spring planting season arrives!

Also consider: Brilliant Green by Stefano Mancuso, Principles of Ecological Landscape Design, Travis Beck

For the STUBBORN RELATIVE in your life:

Common Ground on Hostile Turf: Stories from an Environmental Mediator by Lucy Moore
For the person keeping the peace in your family this holiday season, the perfect gift is Common Ground on Hostile Turf, an inspiring how to guide demonstrating it is possible to bring vastly different views together. This book gives lessons learned on setting down at the table with the most diverse set of players and the journey they take to find common grounds and results. If your holiday dinner needs some mediation, look to the advice of author Lucy Moore.

Also consider: Communication Skills for Conservation Professionals by Susan Jacobson, Communicating Nature by Julia Corbett

For the HISTORY BUFF in your life: 

The Past and Future City: How Historic Preservation is Reviving America's Communities by Stephanie Meeks with Kevin C. Murphy
When it comes to the the future of our cities, the secret to urban revival lies in our past. Tickle the fancy of your favorite history buff by sharing The Past and Future City, which takes readers on a journey through our country's historic spaces to explain why preservation is important for all communities. With passion and expert insight, this book shows how historic spaces explain our past and serve as the foundation of our future.

Also consider: The Forgotten Founders by Stewart Udall, Aldo Leopold's Odyssey, Tenth Anniversary Edition by Julianne Lutz Warren

For the BUSINESS PERSON in your life:

Nature's Fortune: How Business and Society Thrive by Investing in Nature by Mark Tercek
For the aspiring CEO in your life who drools at phrases like "rates of return" and "investment," share the gift of Nature's Fortune, an essential guide to the world's economic (and environmental) well-being.

Also consider: Corporation 2020 by Pavan Sukhdev, Resilient by Design by Joseph Fiksel