Unit 4, GRE401


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Sustainable Development and the Prospects of Paradigm Shift; Business Leadership as a Catalyst for Change; Case study: The Deepwater Horizon Disaster

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Unit 4, GRE401

  1. 1. 1 Sustainable Development and Competitive Advantage Unit 4, Part 1 Sustainable Developmentand the Prospects of Paradigm Shift © Jeremy B Williams 2012
  2. 2. 2 Outline1) Thomas Kuhn and the theory of scientific revolution2) Normal science and paradigm shift3) The current crisis in neo-classical economics © Jeremy B Williams 2012
  3. 3. 3 1) THOMAS KUHN AND THE THEORY OF SCIENTIFIC REVOLUTION • Kuhn wrote the 1st edition of The Structure of Scientific Revolutions in 1962 • Introduces concepts to help explain how changes have occurred in the past, and of the forces currently working either to promote further change or, indeed, to prevent change. http://pup.princeton.edu/titles/7041.htmlThomas Kuhn (1922-96) © Jeremy B Williams 2012
  4. 4. 4 The scientific community• Kuhn describes a scientific community as a group of scientists with similar education, acquainted with the same scientific literature• There are professional societies, journals and conferences devoted to their particular branch of science © Jeremy B Williams 2012
  5. 5. 5How a scientific community functions• There are also informal communication networks; e.g. they circulate drafts of their work, and frequently cite one another in a complex network of citation linkages.• Kuhn defines the scientific community as ‘the producers and validators of scientific knowledge’ (Kuhn 1962, p. 178). © Jeremy B Williams 2012
  6. 6. 6 The paradigm• The paradigm is Kuhn’s central concept, and it is integral to concept of the scientific community• A paradigm is defined by Kuhn as a ‘disciplinary matrix’; i.e. a set of ideas, models, values and attitudes accepted by members of the scientific community. © Jeremy B Williams 2012
  7. 7. 7 The advantages of a paradigm• Acceptance by the members of the scientific community means energies can go to further developments of the paradigm• The fundamentals have been expressed in the form of the paradigm, and have become a starting point for further research © Jeremy B Williams 2012
  8. 8. 8 The advantages of a paradigm• The paradigm sets the research direction of that particular community, and enables members to distinguish themselves from competing communities/paradigms• It is also a sign of discipline maturity. © Jeremy B Williams 2012
  9. 9. 9 The disadvantages of a paradigm• Those who adhere to one paradigm accept innovation within the context of that paradigm, but they strongly resist changes that threaten the fundamentals of the paradigm © Jeremy B Williams 2012
  10. 10. 10The disadvantages of a paradigm• It is not uncommon to find obstacles in the path of new paradigms: – Intellectual obstacles – Financial obstacles• The result? © Jeremy B Williams 2012
  11. 11. 11 Sanitisation of the science• The forces of the paradigm act as ‘unofficial censors’• The paradigm and its supporters tend to sanitise the science, and to insulate it from newly- emerging real world problems © Jeremy B Williams 2012
  12. 12. 12 Science, but not our science• They become a reactionary, conservative force, intolerant of new theories• In many cases, new and important problems are ‘defined away’; i.e. issues are declared to be outside the realm of interest of the scientific community• e.g. economics has nothing to do with biodiversity © Jeremy B Williams 2012
  13. 13. 13 2) NORMAL SCIENCE AND PARADIGM SHIFT• Normal science – the day-to-day activity of a scientific community• In pursuing normal science, scientists are concerned with puzzle-solving• A puzzle in this context is a category of problems that test the ingenuity and skill of the scientists, but they are problems that can be solved with the application of the current paradigm. © Jeremy B Williams 2012
  14. 14. 14 Anomaly and crisis• If the paradigm continues to solve the puzzles, then there is no impetus for change• But if some important aspects of reality cannot be solved by the paradigm, professional insecurity and tension mounts © Jeremy B Williams 2012
  15. 15. 15 Anomaly and crisis• The first reaction to a state of anomaly is not to abandon the paradigm, but to try harder to make it work• While a state of crisis does not necessarily precede a ‘revolution’, it is a usual occurrence. © Jeremy B Williams 2012
  16. 16. 16 Scientific revolution• Scientific revolution, or paradigm shift, is the transition from one paradigm to another• Unlike a political revolution, a scientific revolution does not involve bloodshed and violence, but both kinds are the result of profound discontent © Jeremy B Williams 2012
  17. 17. 17 Scientific revolution• After the revolution, the new paradigm does not necessarily replace the old one completely, but most parts of the old paradigm, which are incompatible with the new, have to be dropped. © Jeremy B Williams 2012
  18. 18. 18 Post-revolution• Serious intellectual and psychological difficulties may ensue for those who adhered strongly to the incompatible parts of the old paradigm• Some will be persuaded and converted to the new paradigm, but some will resist © Jeremy B Williams 2012
  19. 19. 19 Post-revolution• After years of research in the previous paradigm, and having achieved personal status and fortune through its promotion, there will obviously be a reluctance to concede their efforts have been misdirected. © Jeremy B Williams 2012
  20. 20. 20 3) THE CURRENT CRISIS IN NEOCLASSICAL ECONOMICS• It is easy to see how certain sections of the economics profession close ranks against new problems by defining them as beyond the realm of economics• They are often reluctant to extend the boundaries of economics into areas that border on politics, sociology, or environmental ethics• As a result, important economic issues such as those associated with environmental degradation are rarely taught in mainstream economics courses, and are often regarded as not truly ‘scientific’. © Jeremy B Williams 2012
  21. 21. 21 ‘Academic scribblers’• ‘Madmen in authority, who hear voices in the air, are distilling their frenzy from some academic scribbler of a few years back. I am sure that the power of vested interests is vastly exaggerated compared with the gradual encroachment of ideas. Not, indeed, immediately, but after a certain interval; for in the field of economic and political philosophy, there are not many who are influenced by new theories after they are twenty- five or thirty years of age, so that the ideas which civil servants and politicians, and even agitators apply to current events are not likely to be the newest.’ Keynes, J.M. (1936), The General Theory of Employment, Interest and Money, pp. 383-84 http://www.jobsletter.org.nz/jbl04610.htm John Maynard Keynes (1883-1946) © Jeremy B Williams 2012
  22. 22. 22Sustainable Development and Competitive Advantage Unit 4, Part 2: Business Leadershipas a Catalyst for Change © Jeremy B Williams 2012
  23. 23. 23 Outline1) Business leadership as a catalyst for change2) Business approaches to sustainable development3) Summary and conclusions © Jeremy B Williams 2012
  24. 24. 241) BUSINESS LEADERSHIP AS A CATALYST FOR CHANGE • Serious change in unlikely in any society so long as the people in the seats of power (and their advisors) continue to be the products of the mainstream paradigm © Jeremy B Williams 2012
  25. 25. 25 People respond to incentives• Human behaviour is such that it only responds to incentives, and so long as the incentive to embrace paradigm shift remains weak (or non-existent), the prospects of change are remote. © Jeremy B Williams 2012
  26. 26. 26The most powerful institution within the political economy • Business is the only institution powerful enough to quickly foster the changes necessary for ecological and social sustainability • The profit motive has an important role to play (something largely absent within academe and state bureaucracies) © Jeremy B Williams 2012
  27. 27. 27 The key ingredient• For business to take up the challenge, sustainable behaviour must be a source of competitive advantage• The vital ingredient is education of business leaders. © Jeremy B Williams 2012
  28. 28. 28SD adoption dynamics • If it can be demonstrated that a business strategy based on SD is capable of providing a competitive edge in the marketplace • Then it is possible for positive feedback to prompt a logistic or ‘S-shaped’ pattern of adoption, and for paradigm shift to be effected. © Jeremy B Williams 2012
  29. 29. 29 2) BUSINESS APPROACHES TO SUSTAINABLE DEVELOPMENT• An array of tools and approaches have been developed that focus on various aspects of sustainability. These include, for example: – The 4 central strategies of ‘natural capitalism’ – The Natural Step (TNS)• NB. This is not an exhaustive list. © Jeremy B Williams 2012
  30. 30. 30 Creating the next industrial revolution? Paul Hawken, Amory and L. Hunter Lovins propose 4 central strategies of natural capitalism: • Radical resource productivity • Biomimicry • Service and flow economy • Investing in natural capital See, also by Paul Hawken, (1994) The Ecology of Commercewww.naturalcapitalism.org © Jeremy B Williams 2012
  31. 31. 31 Radical resource productivity• Using resources more efficiently in ways that can already be achieved; e.g. process redesign (disembodied technical change) or energy efficient buildings, passive solar heating. © Jeremy B Williams 2012
  32. 32. 32Reorient to a service and flow economy • Focuses more on selling and purchasing services rather than products • Makes manufacturers more ecologically responsible © Jeremy B Williams 2012
  33. 33. 33Invest in natural capital © Jeremy B Williams 2012
  34. 34. 34 Research biomimicrySpider silk Abalone shell © Jeremy B Williams 2012 Stenocara beetle
  35. 35. 35© Jeremy B Williams 2012
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  37. 37. 37© Jeremy B Williams 2012
  38. 38. 38 The process of creative destruction • Describes the process of industrial transformation that accompanies radical innovation • Innovation sustains long-term economic prosperity, even as it destroys the value of established companiesProfessor Joseph Schumpeter 1883-1950 © Jeremy B Williams 2012
  39. 39. 393) SUMMARY & CONCLUSIONS © Jeremy B Williams 2012
  40. 40. 40 The role of government• Unfortunately, governments are often motivated by the political cycle• For this reason, command-and-control solutions are not expedient• At the very least, governments need to provide the legislative framework to change behaviour; e.g. ecological tax reform © Jeremy B Williams 2012
  41. 41. 41 The role of business• Business is more dynamic than government• There is a competitive advantage to be gained from developing a business strategy based on sustainable development• Supply-side: reduce costs• Demand-side: attract environmentally-conscious customers © Jeremy B Williams 2012
  42. 42. 42 The role of the individualTime tohave arethink © Jeremy B Williams 2012
  43. 43. 43© Jeremy B Williams 2012
  44. 44. 44 Case Study: The Paradigm Shift:Does it have to be Painful? Sustainable Development and Competitive Advantage © Jeremy B Williams 2012
  45. 45. 45Think © Jeremy B Williams 2012
  46. 46. 46 “If it’s that badwon’t we react?” © Jeremy B Williams 2012
  47. 47. 47© Jeremy B Williams 2012
  48. 48. 48 Deepwater Horizon, April 2010Image source: The Guardian © Jeremy B Williams 2012
  49. 49. 49• My administration is intensively engaged with scientists and engineers to explore all alternative options, and we’re going to bring every resource necessary to put a stop to this thing … But a lot of damage has been done already – livelihoods destroyed, landscapes scarred, wildlife affected. Lives have been lost. … We will not rest until this well is shut, the environment is repaired, and the cleanup is complete.’ © Jeremy B Williams 2012
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  53. 53. 53© Jeremy B Williams 2012
  54. 54. 54Discuss © Jeremy B Williams 2012
  55. 55. 55 Consider, for example, …• Can a paradigm shift from industrial capitalism to natural capitalism proceed relatively painlessly? Or is Paul Gilding a scaremonger?• Can economists and government advisors continue to put faith in macroeconomic policies for economic growth that rely so heavily on energy from fossil fuels?• If disasters like Hurricane Katrina, the Deepwater Horizon, rapidly melting ice sheets are insufficient to serve as a catalyst for paradigm shift, what kind of event is required? © Jeremy B Williams 2012
  56. 56. 56Deliver © Jeremy B Williams 2012
  57. 57. 57 Prepare a 10 minute presentation outlining your analysis of the prospects for paradigm shift• Are you optimistic, pessimistic, or somewhere in between?• Suggest what sequence of events might bring about a paradigm shift• What key initiative would you like to see implemented to serve as a catalyst for change? © Jeremy B Williams 2012
  58. 58. 58Read© Jeremy B Williams 2012
  59. 59. 59• PowerPoint slides for Unit 4 (especially Part 1)• Study Guide notes for 4.1 and 4.2• Also revisit Unit 2 on ecological economic efficiency © Jeremy B Williams 2012