Embrace ENVIRONMENT and human SOCIETY by extending Current Value (CV) in EBM (Proposal)
This post explores the opportunity to include some Environmental Sustainability and/or Corporate Social Responsibility (CSR) considerations to the Evidence-Based Management (EBM) framework, by extending the definition of Current Value (CV).
The idea link to the emerging #sustainableAgile movement (and Sustainable Development Goals SDG). We discovered that the impact of human activity on Earth and society, the way we used developing it in the past decades, it comes with associated notorious risks... Now, some of those risks have already become a problem.
So, we should take more and more responsibility on this reality. We should change... One way is possibly includes environmental and social considerations in our business decisions; day by day, in a proactive way. Applying system thinking.
But, it is difficult changing something unmeasured! Beside awareness, we also need practical ways for reminding about it. And, more important, for doing it in practice.
So, I see the opportunity for the EBM framework being a valuable way for increasing the chances that businesses around the world measure, consider and manage environmental and social stuff. For the better of business, and more. Putting focus on it with courage, in a spirit of openness, commitment, and respect.
EBM in short
EBM (fully defined in this PDF) is an empirical management framework than makes a company able to improve its delivered value, based on a wise and coherent measure of its reality. Focus is on the outcomes (business agility), being agile a mean for it (organisational agility).
Current Value (CV), as defined now
Within EBM, Current Value (CV) is a Key Value Area (KVA). It is defined somehow as: "value that the product delivers to customers, today". Reading further on EBM guide, it becomes evident that CV mainly refers to three categories of people: (1) users/customers, (2) employees, (3) investors/stakeholders.
By considering the three above said categories, I observe that CV definition wisely includes some highly important learning made over time by the industry (and the humanity, in broader view). I mean these valuable ones:
- Happy investors/stakeholders - First, a basic need of a company is being profitable. It is quite obvious: otherwise, it will not survive. Traditional business has made it a strong evidence.
- Happy user/customer - What industry more recently learned from Agile, User Experience (UX) and Lean-UX.
- Happy employees - Something that link to the Agile Manifest, and many more sources (recent discoveries on motivations, like "Drive: The Surprising Truth About What Motivates Us" by D.Pink; and so...).
Current Value (CV), extended for sustainability (proposal)
So, in my view, CV already include valuable learning. Still, there is (maybe) room for more! Nothing is explicitly said about Environmental Sustainability and/or Corporate Social Responsibility (CSR). So...
- What if extending the CV definition in order to embrace more than investors/stakeholders, user/customer and employees?
- What if extending the concept of business VALUE in a way that social/environmental consequences becomes more valuable too?
- What if start measuring our impact on Earth and society too, in order to increasing awareness and improving?
I propose to include some Environmental Sustainability and/or Corporate Social Responsibility (CSR) considerations to the Evidence-Based Management (EBM) framework, by extending the definition of Current Value (CV). The new Current Value (CV) definition will possibly looks like this:
- Happy investors/stakeholders
- Happy user/customer
- Happy employees
- Happy Planet
- Happy human society
It is maybe a crazy idea... But, I am enthusiastically convinced that there is room for it. What do you think?
Is that not more part of the vision or mission of the company? Raising awareness or specific impact due to X?
Sander Dur, thanks for your kind reply! I'll share with you my personal view.
<< Is that not more part of the vision or mission of the company? Raising awareness or specific impact due to X? >>
Some organisations make environmental sustainability, social welfare and similar topics as "their own business". Because those topics are "the reason they exist", so they obviously take care of that. It's evident watching at, e.g.: Greenpeace, WWF, UNICEF, ONE, and many others even local and small.
If they were using the EBM framework, they would surely have proper metrics in any KVA related with: health, biodiversity, conservation, assistance, support, life expectancy, etc.
Anyway, I'm NOT talking about these particular companies. By my proposal, I am NOT suggesting that any company should become "like an NGO" ;-) Instead, in my view, ANY company should B R O A D E N what they consider to be the boundaries of their business.
A trivial example. A tomato ketchup company is profitable, with happy people working there and customers delighted by its delicious sauce. EBM Current Value (CV) area would certainly look great!! That's super, but...
Let's widen our view. Looking e.g. at the environment: what's the generated value there? We're maybe supporting biodiversity, or we're maybe pushing market for producing just our only-one standardised best-ever tomato. We're maybe buying locally... Or, we're maybe have tomato flying through the world. Are bees healthy around us? Is underground water potable? Or, maybe, some pesticide we're using is preventing neighbour to grow their own vegetables.
To manipulate nature in a way that we have "only one variety of tomato in the word" is legal. As well as generating CO2 by having flying-tomato. The tomato ketchup company is generating full of value INSIDE its own BOUNDARIES. But, is that all? Well, it seems that the same company is lowering value on its EXTERNAL boundaries... :-/ And, most of humans - US - we're on that external boundary!!!!!!!!! O_o
Usually, a company proactively manages what considers to stay "inside" its boundaries; anything else is just not managed, it's out-of-scope. Until now, it seems that too much importan things have been left out!! Humanity is starting experiencing the effects of this short-sighted approach... It doesn't look that good to me.
So, let's put something more into the INSIDE boundary!! Let's start reverting the dangerous effect of previous approaches!
In my opinion, it is now time for companies to INCLUDE sustainability (social, environmental, etc.) into their areas of responsibility. Not the "all-world sustainability"... I do not pretend a only company "to save the world". Just something! E.g., something company has close. The most obvious: its own sustainability (e.g. a wood industry, making sure to reach a balance between growing and cutting trees). Then, a bit more... Let's begin, then let's iterate.
So, back to the EBM framework. Suggesting adding "Happy Planet" and "Happy human society" to the CV definition, it would invite company to a broader comprehension of what value is. So, what they have to manage. Many companies are already doing it. Agile can support for more.
Finally, it is worth noticing... Where is the inside/outside limit? Well... It is exactly whenever WE decide it stays. Moreover, this decision can change in time (and, in fact, has changed). Some examples...
- Nowadays, associating value with "happy employees" looks pretty fine! CV definition in EBM framework says: << considering employee attitudes recognizes that employees are ultimately the producers of value. Engaged employees [...] are one of the most significant assets of an organization, and happy employees are more productive >>. But not decades ago (and even today in many Countries and sectors).
- "Happy user/customer" and "delight clients" is quite new idea!! When FORD was producing the T-model, it is said that customers could << have any colour, as long as it's black >>.
- There used to be a border between "Quality" and "Development". Until Lean proposed "embedded quality" as a better approach. Scrum adopts it by cross-functional teams, where: (1) << Cross-functional teams have all competencies needed to accomplish the work without depending on others not part of the team >>; (2) << no titles for Development Team members, regardless of the work being performed by the person >>; and << no sub-teams in the Development Team, regardless of domains that need to be addressed like testing, architecture, operations, or business analysis >>.
Something that could sound weird, it can become a best practice!
It would be wonderful if by agile, Scrum and EBM framework in particular, we could contribute a better business for a better world.
A business of value and values.
EBM guide
Questions that organizations need to continually re-evaluate for current value are:
1. How happy are users and customers today? Is their happiness improving or declining?
2. How happy are your employees today? Is their happiness improving or declining?
3. How happy are your investors and other stakeholders today? Is their happiness improving or declining?
The key words are "continually re-evaluate".
When creating KVMs for a KVA, the organisation needs to have discussions with those persona's mentioned above to find out what makes them happy, in order to then be able to measure how it is changing over time. Organisations should never decide by themselves what makes those persona's happy!
This means if a persona says that part of what makes them happy is for the company that they 'work for/work with/invest in' needs to have environment/societal initiatives, then relevant KVMs could be created.
As Sandir has already mentioned, these are things that are usually part of a companies vision/ethos so that potential customers/employees/investors can know up-front if the company is aligned with their own values.
Remember, that just like Scrum, EBM is a framework and does not dictate what companies must do, which is why the KVMs listed in the EBM guide are just examples.