How can systemic change toward sustainability happen from within the existing system? How can sustainability take advantage of the blue ocean strategy?
Systemic change as a revolution
After the fall of state socialism in my country and elsewhere in Central and Eastern Europe, stories emerged of many newly-prominent individuals’ life journeys: they claimed to have joined the Communist Party in order to change the system from the inside. Most, if not all, got swallowed whole and failed to achieve their goals.
It was people who stood on the outside of the system (e.g. dissidents) or who had not yet been completely coopted (e.g. students) who (re)presented a viable alternative. It was they who overthrew the regime through negotiated change. The revolutions of 1989 took place because, all of a sudden, the Soviet Union ceased to constrain others’ domestic affairs – regime change took place because of the new external conditions.*
Sustainability faces a similar challenge: Should systemic change come from within or should it come from outside the dominant economic-growth paradigm? Because of my life experience, I have favored the external path: rather than aiming to change it from within, sustainability must present a viable alternative outside it and then knock the competitor out of play in order to avoid getting co-opted by it (of course, the same goes for marketing). The Great Recession seems to present the necessary external condition in which the revolutionary change can occur.
Reading Blue Ocean Strategy has helped me put this view in a theoretical framework. The structuralist view of strategy takes the existing market structure as a given that informs the players’ actions. Companies see competition as an inevitable part of the system, and they aim to beat their competitors by doing what they do better. In this zero-sum, supply-side game competition defines strategy. Companies compete for market share in an existing pie of customers, seeking innovative solutions to existing problems. Crucially, when market agents see the prevailing market structure as environmentally determined, systemic change can only result from the impact of external factors.
The structuralist standpoint commands sustainable companies to compete with “regular” ones within the given (growth-based) system and can only win if they build sufficient advantage over such competition. In fact, this has happened through the advancement of green or eco-friendly products, which are frequently alterations or variations of existing products with an added eco twist. Green products aim to build competitive advantage through environmental efficiency. By pushing lower impact on nature, green has carved out and served a niche of eco-minded consumers. But since the market pie is given (as is any niche within it), the niche strategy has its limits. Indeed, I see growing frustration among sustainable companies about the persistent barriers to mass adoption.
Under structuralism, sustainability as an alternative structure can prevail as a paradigm only if significant external forces intervene and change the existing market structure. The optimist view holds that the Great Recession is the catalyst for such change; I wouldn’t hold my breath.
Blue oceans and change from within
Blue Ocean Strategy has also put me on a new course of thinking. The book’s thesis assumes that “the only way to beat the competition is to stop trying to beat the competition”. To succeed, companies must “focus on making the competition irrelevant [by] opening up a new and uncontested market space”. This is what sustainability may have to do — or do a better job of it — to succeed as a paradigm.
In contrast to the structuralist view, reconstructionism holds that change can happen from within the system. The reconstructionist knows the market structure and its boundaries are flexible, and she aims to “reshape the boundary and the structure of an industry and create a blue ocean of new market space”. The pie can get bigger and better if companies shift from competing within an existing market to innovating into a new one. The demand-driven, positive-sum game combines elements from different existing markets and reconstructs them into new spaces — blue oceans — with new demand. “Buyer value elements”, not technology or methods of production, are the building blocks for this reconstruction. Reconstruction focuses on redefining the problem, and ”[r]edefining the problem usually leads to changes in the entire system.”  Typically, competition follows, which is when the innovator finds another blue ocean, and so on.
Blue ocean strategy may be a viable way for shifting the paradigm from growth to sustainability without overthrowing the former and without a significant external shock. Blue ocean strategy may just be the way to affect change from within the existing system. But how? Stay tuned for future posts exploring this issue.
What do you think? Should sustainability work from the outside or from within the dominant system? Should we seek better solutions to existing problems or aim to solve new problems altogether?
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* This is by necessity a simplified historical interpretation, for the purposes of this post only.
Image credits: TW Collins and hanakoyo
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Peter,
Your analysis is interesting and provokes discussion which is always a good thing. However, it does carry aspects of your perspectives and worldview that are formed in part by your background but also your desire to find an approach for action.
As with most commentators there is a tendency to polarise the situation and then choose one of the opposites as the solution.
The authors of Blue Ocean Strategy also have their own perspectives not least of which is a desire to sell their book.
My opinion, complete with my own underlying perspectives, is that to be sustainable change must come both from inside and outside a situation of interest. External revolutionary forces normally only generate lasting change when the mojority of stakeholders inside the system recognise the unsustainability of the current situation and begin to demand change. The internal gatekeepers then either slowly change their position to meet the groundswell of opinion or are cast aside.
I believe we need to recognised both the internal and external levers for change and utilise them together.
Steve
@Steve: Right on, Steve. Thanks to Claude Levi-Strauss we know that human narratives are built around binary oppositions. It’s easy to fall into that trap, especially with a blog post, a limited form at best. Opposing approaches are simpler to discuss: incremental vs. differential, evolutionary vs. revolutionary, innovation vs. invention…
But you’re right, absolutely we must take all possible paths toward sustainability, in line with its diversity orientation. In fact, for a few weeks now I’ve had a post brewing titled, Do all roads lead to sustainability? Thanks to you, it’s moved up the drafts ladder!