Complexity, Uncertainty and Societal Responsibility: The paradigm of the emergent economy

For those that would have missed it, today it is 20 years ago that the Berlin Wall came down.  For a European this means something. But I think it was a significant moment in world history, and more so in the history of these last 20 years. Formally, for most, it was the end of communism (for easiness we forget that China is still a communist regime) and for some, it was the ultimate proof of the supremacy of liberal capitalism (that was of course a few years before one of the few crises of the last two decades).  At the same moment we forget that some walls still exist (and are even erected later), like in Cyprus, Israel, between the US and Mexico, etc.

What it did mean, at least, was the end of a world that was divided according to the dichotomy US-USSR. So much is clear.  Europe got reestablished and today we cannot even imagine from where we come, in such a short period of time.  I think this is the real good news. Suddenly the world was in a need for another focus.  Liberal capitalism has taken advantage of the vacuum, with the consequences we know.  But equally, there was a growing interest for emergent economies.

Not only was there a sudden interest for the larger continents India and China, but other emergent economies got more attention.  Over the last two decades, this attention only grew, and today emergent economies are taken seriously. Instead of talking primarily in terms of competition, we start talking in terms of emergence. But what are those emergent economies?

Today we have organised at the GSB our conference on emergent market business. As already mentioned earlier, the GSB wants to be another type of business school, based on the paradigm of the emergent economy.  We do not think we can continue with business as usual, but we rather need to explore what it means to operate in economies with high degrees of uncertainty, high degrees of complexity and indeed, high degrees of inequality and poverty. Today we have identified our research agenda for the coming years, and I am glad to share that with you. We see five transversal themes of relevance:

• Governance in emerging economies and the impact on economic development
• Culture, diversity and dynamics
• Entrepreneurial development and sustainable business
• Development, innovation and technology
• Infrastructure and regulation

This ambitious research agenda is a desire to produce understanding that is relevant for major parts of the world, be it so-called emergent economies, or international companies operating under uncertainty and complexity.   Are there any other companies out there ?

I am sure I am not saying anything new or revolutionary claiming that crucial for emergent economies is education and health care. I will get back in another post on health care.  We seem to have developed a deep-rooted belief in the world that people first have to become sick, before they become interesting for health care. On a societal level, indeed, health care as a business: first make them sick (junk food, stress, non-inclusiveness, non-respect, etc), then make them healthy again. Ever thought about preventive medicine ?

But the idea was educational leadership. The role of the principal in day to day school life is of course crucial.  Not that much for running its finance, making the schedules, etc, but rather for really showing leadership; educational leadership.  As Drysdale and his colleagues (study at the Melbourne University) said a few years ago: we need to start thinking from success to sustainability. They give four roles to the principal: Building vision; understanding and developing people; redesigning the organisation; managing the teaching and learning programme.

And I would like to add: building a vision starts with identifying the values we want to realise.  What are we doing it for? What do we contribute to society? If we feel society would be missing on values, how can we contribute to realising them?

A short while ago I had the pleasure to address a large number of principals of a Western Cape region.  The argument I developed was not only for the principal to be a visionary leader, the way we describe him or her above. In many aspects, the successful principal is a social entrepreneur.

A few thoughts of interest of Charles Maisel on what a social entrepreneur is might explain my argument.  A social entrepreneur needs to see things differently, start flipping things around. Entrepreneurship is about seeing, seeing the possibilities. In fact, it is all about learning to look at things differently. A social entrepreneur is not in for maximising profit, but for solving a pressing social problem on a population-wide scale. He or she creates. And oh yes, share your idea, tell people about it.

Building principals to visionary leaders in education is probably the task we should tackle today. I would suggest this goes via the development of the social entrepreneurships skills of those principals: hence a managerial concern and not an educational one !

Finally I got some time to make my very first new post in SA.  Better said, finally I have made some time available to do so. I thought my 101st day in the country and in my new position of director of the GSB was a good moment to make up a first surprise report. Let me start upfront with the easiest one: I would have expected the weather to be better by now. But compared to northern winters, it is still very comfortable.

I have met by now very many nice people, friendly people, that all have a high degree of willingness to serve (others, society, etc).  It is refreshing compared to other places in the world, and certainly compared to the “older” world.  Though of course we yet still feel not really at home, the SA people do all they can to help us settle down, integrate, they invite us, etc.  High energy levels, high commitment, and this despite the sometimes difficult situations for certain people in this society.

A second observation is the rather omni present “community” idea.  Where most of the old world is highly oriented on the individual, me, me and me, what I observe here (and maybe SA citizens might feel different about it) is that deep belief in the community.  People seem to me much more purposeful, they are aware that things should have a meaning, that there are reasons why somebody is doing something. I presume this is part of what we call the African way of seeing the world, but it is for me a strong quality of SA’s society and economy.

In many ways, and further on my previous remark, this country seems to have an eye for interconnectedness, the human within his network of people. I presume that is what one could call a spiritual dimension to life and business. Issues like social responsibility are omnipresent in this society.  Where in Europe, it is a new fashion, on which one needs to work hard, and which one needs to justify all the time, this country lives social responsibility.  Almost all companies have social responsibility programmes, support development of a kind, but so do many individuals.  Individuals invest a lot of their private time in developmental projects of any kind, progressing the least favoured in this society. And indeed, there is a lot of poverty in the country, and still a lot of inequality, but this attitude is so refreshing and so important for getting to solutions, that I really believe this country has a great potential.

There is still a lot of poverty, inequality, and this is, of course, unacceptable.  There is a lot of grief and anger in people, which is understandable if one gets hold of many years of apartheid and what it brought to this country. And where some use this situation for their own profit, which one sees in all parts of the world, there is at the same time a genuine motivation of many to get this country through a real transformation: not a transformation of the numbers only; but a transformation of mutual respect, dignity and inclusiveness for all. A challenge for sure, but one that this country is able to rise to.

I think it is not by accident that some very great people stood up in this country. Of course there is Nelson Mandela, that I can only honour for the way he steered his country through a very difficult transformation, never seen before elsewhere in the world. I had the pleasure to meet Archbishop Desmond Tutu, my long time youth hero (together with Dom Helder Camara, for those who might recall him), and the love, compassion, and commitment that shines off this real human being is so motivating, but at the same time so representative for this country. 

Back to business, but please not to business as usual.  I described in my previous post what we understand by the New Paradigm of the Emergent Economy: how do you operate in situations with high degrees of uncertainty, high degrees of complexity and high degrees of inequality.  I do find managers and companies that care in this country, and though of course one has to keep also a financial focus, companies in this country seem to be more aware of the crucially important role that all stakeholders play.

The little downside is that South Africans do not seem to believe enough in their own country.  They do not seem to see what the potential is that this country has to show to the world, both the old world (Europe, US) and the emergent world.  That makes them maybe a bit too much looking inwards, for the short term, whereas a more longer term view could really boost the contribution that this country can make to world economic development.

I hope I will be able to bring some of this trust, this conviction into the School, in order to allow the GSB to become recognised for its contribution to this new way of thinking: more values based, more responsible, more sustainable, in the interest of all stakeholders.

I am very happy with my first few months, and with the discoveries I made, and I trust that we are going to make that difference that is needed. This post is nothing more than my surprise report.  No links yet, no strong positions, but just how I have experienced it.  There is more to come, of course.

Welcome to the new GSB Director’s blog where I’ll be sharing my thoughts on topical issues with the GSB community – and beyond.

Keep an eye out for new content soon, in the meantime here is my last blog post at my previous school Euromed Management Marseille:

It has been a bit calm on my blog lately, but this has everything to do with the fact that I am moving places.  Despite the enormous pleasure I have had at Euromed Management, I move totally South, in order to become the director of the Graduate School of Business of the University of Cape Town.

I have found a school that has the vision to become a new type of business school, a business school based on the paradigm of the emergent economy. Emergent economy means economies with high degrees of uncertainty, high degrees of complexity and unfortunately often high degrees of inequality. As much as this is true for what we classically call the emergent economies (BRICSA), uncertainty, complexity and inequality is equally a true issue of the company in turbulent economies.  I trust that the exploration of the paradigm of the emergent economy will give interesting insights in the financial crisis and how we could do things differently.

The GSB is developing a few areas of excellence.  The mission of the GSB is to develop a pedagogical excellence, around sytemic thinking and action learning.  An academic excellence is constructed around the paradigm of the emergent economy as described before. But it is equally the role of a business school to contribute to the alleviation of inequality, and therefore the GSB is developing and continues to grow in the area of social entrepreneurship, both academically and in the field.

Finally, the GSB aims to develop a thought leadership in all these areas, with a particular focus on executive education in the world (Europe) and its contribution to the development of Africa and in particular Africa’s academic potential (via an innovative PhD programme).

More will come, but I felt I had to share this with you on the evening of my departure.