How can innovation decouple growth and consumption?

How can innovation decouple growth and consumption?Some weeks back the International Herald Tribune (June 7th, 2011) offered a view by Chandran Nair, the CEO of Global Institute for Tomorrow, under the title Can the planet support more Americas? Then this week an article Over-innovation makes US firms suck at Sustainability because they are too innovative by Jens Martin Skibsted and Rasmus Bech Hansen. Each makes me stop and come back to my deepening view we have to decouple growth and consumption through innovation.

This is not an easy subject but let me lay out some opening views and thoughts. Why bother? Well I really do believe we need to radically change our approaches through the use of applying innovation in new ways.

These two articles added further to my personal concerns that we do need to (quickly) come out of the denial we seem to have in all societies. Innovation needs to be radically applied in new ways that alter the present mindsets of politicians, economists and business people who feel that the only path is continued consumption and growth. This approach is simply not sustainable and we need to find a radical alternative that still offers all of us progress but in a radically altered world.

The two articles in summary first

Try to imagine a world with three Americas- three giant economic super powerhouses with citizens all pursuing their equivalent American type dream of buying, selling and just consuming more. It is a prospect that excites many business people hell bent on growth as their yardstick. Can we deny Asian governments and their people after decades of poverty, struggle and hard work to be on the brink of obtaining a greater degree of abundance? The answer is our planet will become unimaginably stressed; we have already passed the earth’s regenerative capacity. We all would be condemned not blessed by this. The world does not have enough for two more consumption driven Americas. Yet we stay in denial and the spin of innovation is all about achieving more.

Equally America today is an amazing consumer. Some argue the US is the biggest environmental sinner as the economy is based on consumption, throw away consumption. The argument is the American company is innovative, entrepreneurial, and intensely competitive and they tend not to look at sustainable solutions, only the next big thing. Getting any change here is challenging those deep-founded and engrained beliefs and that is seemingly unlikely to happen, especially when the Government and the parties wrangle on increasing the debt ceiling. It seems we are not addressing the long term problems that are hurtling towards us. Can America become more standard to allow more recycling, greater re-usage and shared systems? Can America actually slow down and optimize and not chase consumption by encouraging change in a throw-away society? Can America redefine consumption by adding extra value and prolonging product life cycles?

What would it take to make such dramatic changes?

Clearly innovation thrives when there is a crisis. We seem to be heading for many, like rolling thunderstorms building up until they are so over our heads we just jump. Jump in real fear but jump in responding with a desire to survive by changing our habits and supposed consumption needs.

The main need is in finding fresh ways in taking those first big steps to radical change.

We must find ways to constrain consumption that do not continue to stress, deplete, degrade or waste our natural resource base. We need to reward, and reward heavily those “more is less” activities that put natural resource management in the center of our thinking. Governments will be looking more at carbon taxes (Australia has just announced one), resource taxes and ensure producing organizations use far fewer materials and far less energy in their products and these can only be radical not incremental as it is today. This will slowly change consumption habits. We have to get multiple-fold increases in resource-efficiency that don’t move the problem from one stressed aspect to another or trade off mutual dependencies. We must REDUCE dramatically fossil fuels, fisheries, grain stock consumptions and forest products by applying disruptive intervention by Governments that impose tax on the people that ‘pollute’ and don’t want to face the radical change necessary that continue to ‘consume’ more than they really need . We will have to “name and shame” the ones that have vested interests in maintaining the status quo. Leadership, global leadership is needed but re-orientating innovation away from consumptive growth can be one of the major enablers to support this need.

Managing in an uneven world

There is a good book called “What’s mine is yours? Collaborative Consumption” by Rachel Botsman & Roo Rogers that tracks and explains the rise of a fascinating new consumer behavior they call “collaborative consumption.” Driven by growing dissatisfaction with their role as robotic consumers manipulated by marketing, people are turning more and more to models of consumption that emphasize usefulness over ownership, community over selfishness, and sustainability over novelty. Although it focuses more on exploiting the ability of the Internet so as to create networks of shared interests and trust and to simplify the logistics of collective use it offers some further thought to managing change in consumption.

Collaborative Consumption appears in three “systems” suggest the authors, product service systems, redistribution markets and collaborative lifestyles.

The movement described in collaborative consumption helps but it is not radical enough. We need to constrain consumption, to channel this into smarter solutions that continue to create value for both the business and society so the consumer sees extending use as critical. Out of this shift can come entirely new industries that manage product life to extract, to extend and enhance and the consumer gets rewarded by constrained consumption in different imaginative ways -getting sent consumption tax pay checks for instance, to continue to invest and fuel the consumption of them wanting to consume less because they get paid for it. Radical but necessary and this would be needing every ounce of innovation ingenuity and reshaping of whole industries, government approaches and our mindsets. A tough one that!

There is no easy path but we have to take the right one.

I like the idea of these three parts- systems, markets and lifestyles. We do need significant breakthroughs in innovation that allows for ideas that feed off of novel life-changing concepts that meet cultures different adjusting needs of expectation. One that values a more sustaining lowering of consumption and does not add deepening conflict and strife but allows for a more balanced consumption for all to share. Call me an innovation idealist!

Recently Don Tapscott and Anthony D Williams famous for their Wikinomics book commented recently “the rate of business model innovation has not accelerated” since they wrote their book in 2006. They are beginning to understand the reason as “it is becoming difficult or even impossible for companies to achieve breakthrough success without changing their entire industry’s modus operandi”

I would suggest we have to go even further on this observation, we have to change entire society modus operandi over to ‘more is less’, away from constantly increasing consumption and growth. Otherwise in the 21st century of a very crowded planet, already highly stressed in its resources we will be facing a very tough, bleak world.

Taking off the blinkers

It is time to take off the blinkers and find alternative ways to put innovation to work. Are you an optimist or pessimist? Can innovation be put to work and be so radical to alter habits of lifetimes? Can societies recognize and reward ‘more is less’ as a viable alternative to today that pushing consumption is simply not sustaining- higher growth through increased consumption is a road to depletion? Seemingly necessary is a huge shift away in how we manage in society in what we seem to be told of our current planets problems. I have to admit, privately, sometimes I wonder where it will all end?

It is time we made one of those extraordinary steps on how we value progress and put to work innovate solutions in completely radical new ways, of ‘more is less’ as the sustaining and rewarding path that societies all have to work towards.


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Paul HobcraftPaul Hobcraft runs Agility Innovation, an advisory business that stimulates sound innovation practice, researches topics that relate to innovation for the future, as well as aligning innovation to organizations core capabilities.

This entry was posted in Innovation, Psychology, Strategy, collaboration. Bookmark the permalink.

5 Responses to How can innovation decouple growth and consumption?

  1. Interesting post. However, please let me offer a bit of perspective. In pockets of Europe, there is a kind of undercurrent of blaming American consumerism for some of the world’s sustainability issues. I find this undercurrent lacking in a basis in reality. There are many causes of consumerism, mostly stemming from the evolution of human nature rather than anything unique about one country’s inhabitants.

    This current seems to reflect more about the person parroting it than reality. I have lived and worked on three continents. I have seen the same level of consumerism, and sometimes more, outside of the US than inside. It exists in Korea and China. The culture of fashion and consumerism is at a high level in Spain and Italy…to the point where debt spending (to the degree that banks will allow) has become the norm. It is high in the UK, and of course, it is at a high level in the US. Everywhere I have gone, they all seek the coolest car, newest TV, and the biggest house.

    It seems the main difference in attitudes relates to the willingness to talk about things like sustainability. In Europe, it is fashionable to throw around this term, and of course, it has a place in our future. However, in terms of being a completely new paradigm…I’m not yet convinced. Of course we need to take sustainability into account in our business decisions, but in the current environment, it is mainly a matter of being more rigorous and using greater expertise in our approach.

    Finally, words are easy, but what matters is where we invest our money. Our European clients are still overwhelmingly investing in strategic sourcing, negotiation, and supplier relationship management (which had already taken into account sustainability) ahead of a purely ‘sustainable’ approach.

    • Thanks for your comments. This was not intended to take one side of the ‘pond’ as the issue here. I think you are spot on with Europeans banding around words like “sustainability” but we need to look at the bigger ‘consuming’ issue. We can’t live on a planet that requires three times what it can produce, we need to change and change fast our habits. Consumerism is ‘demanded’ in Asian countries but the way we are offering it, is not possible without depletion of all we have. We somehow need to alter the mindsets, the aspirations, the habits, the attitudes and that is going to be unbelievably tough to achieve. Yet we simply have too, we have no alterntative planet to hop over too.

      I repeat we have to change entire society modus operandi over to ‘more is less’, away from constantly increasing consumption and growth.

      Yes words are easy but they attempt to deliver essential messages

  2. Pingback: Why Economic Growth Needn’t Mean Environmental Catastrophe « Demand by Adrian Slywotzky

  3. Pingback: Can Innovation Lead Us to Growth (and Happiness) Without Consumption?

  4. Pingback: Can Innovation Lead Us to Growth (and Happiness) Without Consumption? | Social Entrepreneur Guide

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