Ein Hai beißt sich in den Schwanz

YET ANOTHER ARTICLE ABOUT THE CIRCULAR ECONOMY

Systemic circular thinking

I’ve been thinking more or less well-rounded thoughts about how big we need to conceive of this transformation to actually turn it into reality and how it all relates to systemic consulting.

“When I was a child, we didn’t have a single rubbish bin in the house.”

Quote: my grandmother.

Everything on the farm in Innviertel was reused, repaired, repurposed, eaten, composted and the few remaining (paper) bits used for lighting the oven. Two generations later, in the city centre of Vienna, I look at my dustbin which seems to have taken on a life of its own, and I don’t get it. What has happened in the intervening years? And – nostalgia aside – what does it have to do with today’s economy?

The invention of disposal

We produce and consume things, get the maximum use out of them for a certain period of time, i.e. siphon off whatever value we see in them for ourselves, and return the rest. Or pass it on. To somebody else. Anyone. To whom exactly, we don’t know. And that’s not our job. Or is it?

We’re good at disposal. After all, in a consumer society that revolves around regularly purchasing new products, we eventually need to get rid of everything we’ve consumed. But what do we actually mean by disposal? Do we then really dispose of material things or are we rather discarding our concerns? Are we freeing ourselves from worrying about the material for which we feel responsible because we bought it? And is that even possible – to rid ourselves of this responsibility by placing a rubbish bin in every room?

Recycling and our self-image

As a concept, recycling is currently somewhere between dreams of the future, a trend and new normality – depending on the material, regional infrastructure and sector. Quite a few things are already working really well in terms of technology, organisation and change, but there is still a lot to do. The technological options for recycling and reprocessing are fascinating and very promising. But that is not the point I’m trying to make.              

At the end of the day, recycling is (also) a question of attitude. Because technical innovation can only come fully into its own in combination with appropriate behaviour on our part.

When we recycle, we obviously think that we’re returning something into the loop. Language creates realities.

But before this is even possible, we need to remove it from the loop. Question is: which loop exactly? Ultimately, the cycle of nature always constitutes the frame of reference. And now for the crux of the matter: can we remove something from and return it to a loop that we belong to ourselves?

And what does that mean in terms of the concept of circular economy in organisations?

No company can “close the loop”.

At least, not on its own. What may at first sound irritating and discouraging can also be seen as relief. Closing the loop is not something for lonely cowboys.

Rather, it is a case of companies finding their own role in the loop. And then identifying the other parts of the loop and accepting them as fellow players. Working together towards passing on the baton in the loop. Keeping the needs, resources and objectives in mind – both our own and those of the other companies. Accepting that the path of the loop is intrinsic to nature and acting in an appropriate manner. Nature shows us how it’s done – she’s a patient, creative teacher.

“The uncreative mind can spot wrong answers, but it takes a very creative mind to spot wrong questions.”

Antony Jay: Management and Machiavelli

So, what roles do organisations see for themselves within the loop? Where are the touchpoints with other organisations? Where does the handing over work well, where is something lost?

“Circular economy” as a term has now become a hot candidate for Bullshit Bingo. We hear and read it more often than we’d like. These days, hardly anyone dares ask what it actually means. Because: of course you know, as an enlightened person! I ask myself: really?   
If we take the concept of circular economy seriously, this means more than just shifting from primary resources to recycling material. It will turn the way we manage our business and compete with others completely upside down. Not only the origin of our materials will change, but also the rationale of the process of adding value.

Darstellung durch Trainconsulting

The line “take – make – use – dispose – pollute” comes back around: “make – use – reuse – remake – recycle”1. And if you dig any deeper, you’ll get to the 9 Rs of circular economy: refuse, rethink, reduce, reuse, repair, refurbish, remanufacture, repurpose, recycle2.

According to this, recycling appears last in a long chain of recommended actions – and yet it is what we mostly associate first with circular economy. The refuse bin sends regards.

“What starts as a park ends up as a parking lot”3 is indigenous leader and environmental activist Ailton Krenak’s way of criticising environmental thinking purely in terms of the economy. What we need, according to him, is to find new balance between human beings and nature. To respect and acknowledge that we’re embedded in an overall system. And that we and all our economic activities are dependent on the natural services provided by this system. Forestry, for example, needs healthy forests in order to harvest wood. The entire farm industry (and consequently also the food production sector) depends on stable weather, biodiversity, healthy soil and a number of other things. It is therefore important to preserve and nurture the services provided by nature, instead of exploiting them for making profit.

The 9 Rs of circular economy go deeply into the behavioural levels – so, every single one of us would have to make lifestyle changes and undergo fundamental transformation on an economic and social level if they are indeed implemented. I think that if we’re going to go the transformation route, we may as well do it properly. By not “only” aiming to close the loop, but by seeking universal balance. And ultimately this means not taking more than nature provides – and then managing this amount in renewable loops.

In summary: there are three musts. 1) Accepting the natural limits of resources. Within these, 2) finding and living our own role within the loop. And 3) identifying fellow players in the loop and involving them.   

With a single objective: to collectively make the best use of resources – in the sense of responding to both human and environmental needs.

This in turn leads to questions. How much anonymity can a closed loop handle? Who must we start a dialogue with? And how does each part of the loop benefit if a high standard of quality is maintained for the goods managed in the loop?

The logic is simple: the better the quality of the goods I pass on, the better the goods that I get back at some point.

So, this means: suppliers and customers are part of their “own loop”. And their suppliers and customers are too. In the same way that our own organisation is integrated in other loops.

Rollen im Kreislauf

What does this mean for our understanding of competition and cooperation? How will competitive factors and rules change if we systematically take forward and implement circular economy?

Many major questions. My grandmother would say: Jeepers Creepers.

So what to do, where do we start?

The first lesson of systemic change is: it takes a lot for energising change to happen. A “driver” – the reason for change. Add to that a powerful, clear vision, appropriate resources and the first concrete steps.

Change Formel
The change formula for profound transformation

A number of drivers are obvious – but is there also a shared point of view in the company about these drivers? Or does everybody have their own image and uncoordinated priorities in mind? Lack of resources, climate change, reduction of CO2 emissions, customer expectations, statutory regulations… “external” reasons for finding new balance are accumulating. An energising start would be to “internalise” these reasons and jointly translate them into drivers for change.

What about a shared vision of the future? Not to move away from an unfavourable situation, but towards a future that is desirable for all parties? How does this future manifest itself, how will we know that we are moving closer towards it?

A look at our resources provides confidence and presents opportunities. What are we good at, what are we already succeeding at, where can we see our first closed loops that we’ve previously not actually been aware of? Positive psychology shows us: the most successful way to change is positive reinforcement of previous success. This is where we can start and expand from.

And last but not least: first concrete steps could be, for example, to identify fellow players, “our neighbours in the loop”. And when it comes to making contact: hey, how are you coping with these challenges? What can we learn from one another, how can we yield synergies and exploit the potential of collaboration?

So, there are four ingredients for effective change processes to align our economic activities with nature, to close loops and to find new balance. To get rid of these many dustbins again at some stage. I’m sure my grandmother would approve…and so would our ecosystem.

1. https://www.entrepreneurship-campus.org/the-difference-between-linear-circular-economy/
2. https://circulareconomy.europa.eu/platform/sites/default/files/categorisation_system_for_the_ce.pdf
3. https://www.riffreporter.de/de/umwelt/cop26-nachhaltigkeit-kolonialismus-naturschutz-ailton-krenak?fbclid=IwAR1r24F0FpZ1CTuRo3RaGY5DqslOPv2pVzhmRshex7U7CE17UwvyNaoK8DE

Let’s talk about #circulareconomy.

Portrait von Pia Hofmann

Pia Hofmann

Systemic consultant and mechanical engineer. Enjoys being intensely involved with the topics of sustainability and circular economy. She knows the challenges of closing the loop, both from a technical and advisory perspective.

p.hofmann@trainconsulting.eu
+43 660 495 66 59