2. 01
This report presents the findings of the first phase of the Leadership Vanguard for the theme Systems Thinking, Collaboration and Resilience presented
at the Vanguard Exhange in Singapore, February 2015. As the Leadership Vanguard moves forward it will also incubate project ideas designed to advance
future-fit growth.
Phase
3. About the LEADERSHIP
VANGUARD
Our prevailing growth model has delivered
huge gains for humanity.
More than one billion people have been lifted
out of poverty over the past two decades, the
average life expectancy has more than doubled
over the past century, and we have created
more wealth the past 100 years than in the
previous 100,000.
However, the escalating effects of climate
change, an employment market still reeling
from the last financial crisis, and the inequality of
access to healthcare, education, food and water
are proving with increasing clarity that our old
growth model is out of date.
We need a new growth model that accounts for
externalities and works with nature, not against
it; one that benefits larger numbers of people
instead of concentrating wealth in the hands of
a few; and one that maintains the dynamism of
business while delivering value over the longer-
term.
The Leadership Vanguard aims to identify,
support and mobilise future-fit leaders – all in
the interest of reinventing growth. By bringing
together four different kinds of leaders the
intent is for the groups to stretch each other’s
thinking and help each other become stronger
leaders. At the same time, the Vanguard’s
orientation will heavily emphasise action by
incubating, designing and maturing projects
that test and advance a new kind of growth.
The programme will explore three key
themes: Redefining value; Systems
Thinking, Collaboration and Resilience, and;
Communication in an Age of Radical Visibility.
SYSTEMS THINKING,
COLLABORATION AND
RESILIENCE
Resource scarcity. Inequality. Climate
change. Violent extremism. Viral disease. We
live in a world of “wicked problems”—those
that seem inherently impossible to solve but
are so serious and pressing that we have no
choice but to confront them. These dilemmas
have proliferated within the increasingly
knotted, interdependent connections between
societies, economies, and value chains in
the modern world. As the world has grown
more interconnected, our awareness and
understanding of those connections has not
kept pace, as we continue to make decisions in
silos and take action alone.
To realign our thinking to tackle these
challenges, we need to change along three,
related fronts: First, we must see across the
system to see ‘new combinations’ between
parts instead of just the parts themselves.
Second, we must aim for resilience, building
strategies and systems ready for multiple
futures and not just one. Third, we must
collaborate. When individuals and companies
extend their perspective to consider the shared
networks in which they operate, their arena of
action grows exponentially.
But examples of successful collaborations
are rare in the business landscape, and the
reason is they are notoriously difficult. Just as
wicked problems are infinitely complex and fluid,
making sense of the international landscape of
stakeholders willing to engage around a problem
can seem an overwhelming task. It can be a
daunting task to manage clear communication,
motivate all partners, ensure trust, and simply
have the patience to get it right.
Collaborative leaders have to strike a balance
between cultivating an inclusive space and
compelling partners to adhere to agreed
targets. In many ways, collaborative leadership
turns the traditional concept of leadership—and
leader development—on its head.
THE theme TEAM
Maurice Adriaensen
Head of Department, Operational Excellence
DNV GL
Kuangwei Huang
Project Engineer Manager
Keppel FELS
Christian Liberatore
Commercial Advisor, Corporate Development
Woodside
Sheila Redzepi
Vice President Global Advocacy and
Sustainability Policy
Unilever
Chris Slim
Vice President of Brand Building, Nordic
Unilever
Prashant Soni Kumar
Head of Safety
DNV GL
Gareth Wright
Business Adviser to SVP Browse Business Unit
Woodside
The Leadership Vanguard Theme Report
Systems thinking, collaboration and resilience
Together, we can leverage our
strengths, multiply our means, and
shift the global climate trajectory.
UN Secretary General Ban-Ki Moon
4. We have always been faced with complex issues, but never so many and all at once. Visualise
that we are using roughly one-and-a-half times the Earth’s available resources to sustain our
economy and soon-to-be population of nine billion people. We’re depleting our capital. At the
same time, global wealth is increasingly being grasped by the hands of a small and healthy elite,
leaving billions behind and creating instability. This is a moment of great risk, but it is also a
moment of great opportunity. This is a moment to reinvent growth – sustainable, inclusive
growth.
But to reinvent growth, we must tackle a set of problems that seem inherently impossible to solve,
but which we have no choice but to confront. A ‘wicked problem’ is different from a ‘normal problem’
in the sense that it evolves and continues to challenge us. This is why wicked problems are wicked – it
is difficult to define, problems are interlinked with other problems with similar characteristics, time
is limited and any solution can become problems themselves. Think about climate change, nuclear
energy, terrorism and resource scarcity. Most issues fuel one another, exacerbate impacts and create
ripples across society. Wicked issues have to be addressed as part of a broader system.
Wicked problems have one thing in common. They are all a part of the social, political and economic
system that has served us well in the past, but this system is no longer fit for purpose. Wicked
problems are now an economic issue. Look at climate change and economic growth as one example
– addressing climate change is increasingly seen as a smart macroeconomic strategy for achieving
growth and economic success.
We need to address systems not symptoms. Systems thinking, collaboration and resilience are
fundamental facets of the future-fit leadership that is required if we as a species are to succeed
in reinventing growth. Systems thinking means understanding the complexity of our world and the
relationships, interdependencies and stakeholders that have a direct or indirect influence on each
other. Put simply, it is a broad appreciation of the system we operate in and the key players involved
– a tool as much as a mindset. It allows you to identify stakeholders within the system and join them
together in collaborations to bring about positive change. Linked to this is resilience – another key
leadership attribute. Collaboration requires a significant investment in time and effort in order to
develop relationships and work towards a common and mutually beneficial solution for the ‘system’.
So leaders will need to be resilient when it comes to implementation as new approaches will always
receive push back.
Everything is made up of systems – forests, food, people, climate. We can no longer afford to
solve one problem at a time – instead, we must tackle several related challenges across industries,
borders and boundaries in order to bring about positive systems change. For example, it was mobile
technology firms that catapulted the agricultural revolution and food security efforts in Africa by
providing farmers with access to timely and relevant information about production, technology and
agricultural finance. These are all seemingly different but incredibly interconnected sectors.
The Leadership Vanguard Theme Report
Systems thinking, collaboration and resilience
CHAPTER 1
HOW IS YOUR THEME RELEVANT
TO THE REINVENTION OF GROWTH?
WHAT IS THE POTENTIAL?
5. Look at deforestation, which is seen as a key contributor to global greenhouse gas emissions. It is
responsible for up to 15 per cent of global greenhouse gas emissions and has an adverse impact
on ecosystems. The consumer goods sector is already working on cleaning up its supply chains on
the commodities that drive most tropical deforestation – which alone contributes the equivalent of
the entire global transport sector to net emissions. That’s 400 retailers, manufacturers and service
providers across 70 countries. Imagine if other business sectors joined together – from infrastructure,
basic materials, transportation, food systems – with the same ambition.
We need to accept there is no clear cut formula. But ultimately it always boils down to people and
leadership. People’s personal passion, commitment and deep sense of purpose have always been the
backbone of every real change that transformed humanity for the better. Mark Twain famously wrote:
‘The two most important days in your life are the day you are born and the day you find out why.’
Rallying around the moral cause served the world well when issues were fewer and far apart. Today, we
need more than incremental change. We need to engage with markets in a different way, and think
about business as a vehicle for change.
The Leadership Vanguard Theme Report
Systems thinking, collaboration and resilience
What would a transition
from a high-carbon econo-
my to a low-carbon econo-
my look like? Beginning with
the purple box in the middle,
this map is an illustration of
the factors, relationships
and impacts of what such a
transition may look like.
6. By having business as a vehicle for change in this new world order of ‘wicked problems’ and
their far reaching systemic effects, we really need to address the incumbent thoughts in the
systems we struggle to make sense of. These thoughts influence the behaviour of individuals,
companies and government organisations, and need to be weeded out if we are going to have
a chance to break from the status quo and start achieving positive changes. We have identified
six of these thoughts:
• The winner takes all in a zero-sum game
Businesses must compete for purportedly scarce capital, talent, favourable government
policies and public support, to name a few examples, in a zero-sum game. Companies and
industries are often pitted against one another to compete for the same resources. In the
energy space for example, coal competes with oil, which competes with solar, which competes
with nuclear. Energy independence is often touted as having an abundance of one source,
when it should really be about having a diverse portfolio of energy options. We need to have
the mature objectivity to look at how we can create and develop a suite of solutions to truly
track the problems we face. When we focus on competing in silos instead of collaborating,
we deprive ourselves of potentially revolutionary interactions that may generate the
breakthroughs we’re after in the first place. Ultimately, a zero-sum-game attitude is very
limiting. Rather than aiming to take the ‘biggest piece of the pie’, our approach should focus on
ways of expanding the pie.
• Vested commercial interests must be protected
Industries and governments with vested interests in current growth models will (or will be
tempted to) obstruct the progress of change. For example, a successful push towards a zero-
carbon economy will negatively impact oil and gas-producing nations and their supporting
industries. Powerful lobbyists will argue for industry-protecting mechanisms to safeguard
fossil fuel interests. Failing to work towards solving wicked problems now will exacerbate their
long-term consequences. How long can these comparatively short-term interests remain
insulated from the macro-economic systemic effects of these wicked problems? Aiming to
protect outdated business models will cause us to miss out on great opportunities for growth.
Ultimately, only the adaptable survive and thrive.
• Maximising shareholder value is the sole purpose of business
For decades there has been the long-held notion that the responsibility of business is to
maximise value for its shareholders. Our focus on quarterly returns, coupled with financial
metrics that favour quick gains, have exacerbated our need to perpetuate a recurring pattern
of immediate returns. This is the crux of the Capitalist Dilemma pointed out by Clayton
Christensen. Tackling wicked problems requires long-term investments that tie up capital for
years. More specifically, as Christiansen writes, ‘companies use capital to create more capital
The Leadership Vanguard Theme Report
Systems thinking, collaboration and resilience
CHAPTER 2
WHAT IS THE INCUMBENT THOUGHT
THAT IS OBSTRUCTING THIS
POTENTIAL?
7. and consequently the world is awash in capital but the innovations we need to advance us aren’t
there.’ Although short-termism isn’t all bad (the ability for business to act rapidly, for example, is
a source of strength), we must aim to adopt a longer-term approach to value creation.
• Sustainability belongs to marketing and public relations
Being ‘sustainable’ has long been the domain of well-intentioned marketing and public
relations strategies. CSR units, for example, are often not housed within a company’s strategic
department. Systems thinking, however, easily pinpoints the immediate and gradual economic
burdens the impacts of climate change create for businesses: rising sea levels affect coastal
settlements and infrastructure; natural disasters disrupt global food systems, damage
properties and displace whole communities; increased commodity prices impact consumer
spending power; etc. Additionally, in an age of radical visibility, it has become easy to discern
superficial from authentic action. Sustainability shouldn’t be about marketing ploys; it should
instead be about identifying new opportunities, and allowing companies to attract and retain
the best talent in the world.
• Tackling climate change will compromise our quality of life
It is widely perceived that tackling wicked problems will come at the expense of jobs, economic
progress and our overall quality of life – for example, the switch away from cheap fuel will drive
up our utility bills and the cost of goods we purchase. In actuality, tackling climate change is
about improving our quality of life by mitigating great systemic problems. Undoubtedly, we will
reduce the quality of life if we choose to keep the status quo.
• Wicked problems will be solved by ‘silver-bullet’ solutions
An often short-sighted thought is that wicked problems can be solved with ‘silver-bullet’
solutions. There are two assumed scenarios in this respect: someone will come up with a
solution while we wait; or, all we need is for society to compromise. Both will yield disappointing
results. Rather than hope for isolated breakthroughs to occur, we should look for opportunities
locally that can encourage change, and support intermediate solutions that can generate a
groundswell of ideas and actions across sectors and regions. A collective of actions that can
enact changes to the system will accelerate progress. Wicked problems are real and present
dangers. They are systemic and cannot be solved by a single person, company or government.
The Leadership Vanguard Theme Report
Systems thinking, collaboration and resilience
I KNOW A LOT ABOUT FINANCIAL RISKS—IN FACT, I SPENT NEARLY MY WHOLE
CAREER MANAGING RISKS AND DEALING WITH FINANCIAL CRISIS. TODAY I SEE AN-
OTHER TYPE OF CRISIS LOOMING: A CLIMATE CRISIS. AND WHILE NOT FINANCIAL
IN NATURE, IT THREATENS OUR ECONOMY JUST THE SAME
Former US Secretary of Treasury Henry Paulson
8. What if we perceive wicked problems as integral, economic issues? Traditionally, tackling the likes
of wealth inequality, resource scarcity or poverty has been the remit of governments and NGOs. But
these very same wicked problems are essentially integrated economic problems. Sao Paulo’s worst
water drought in 80 years, for example, appears to be a resource scarcity issue on the surface, but
is, in fact, a game-changing issue for Brazil’s economy. Sao Paulo is Brazil’s richest state: an industrial
heartland that is the engine for the country’s economic growth – producing one-third of Brazil’s GDP.
But if water and electricity (80 per cent of which is generated by hydropower) start running out, the
consequences for the economy and its industries could be dire.
Business can create change with pace and scale. Creating governmental and political momentum
to enact substantive change is often an arduous and drawn out process. Business and industry,
however, have the resources, capacity and legitimacy to carry out big systemic changes. Imagine how
much faster systemic solutions can be developed when businesses compete to capitalise on new
growth opportunities? Evidence continues to emerge that business has an opportunity to convert
wicked problems into long-term added value.
We don’t need to make trade-offs in order to succeed. We’ve made natural assumptions that
trade-offs are necessary between: man and nature; our current interests and those of future
generations; and the advantaged few over the many. But what if we rejected that thinking?
Businesses too often try to eliminate complexity to succeed, when in reality we exist in a world of
accelerating complexity and exponential change. Business opportunities often prove to be fickle,
but wicked problems are stable and long-standing. So it stands to reason that rejecting the need for
trade-offs and accepting the existence of - and trying to tackle - wicked problems may very well be a
commercial opportunity to capture new types of values.
We need a common set of values if we’re to successfully collaborate. Breakthrough ideas will likely
require a shift to new business models. This will require genuine collaboration across industries and
regions. But before we can even consider the ‘what’ and ‘how’ of collaboration, we need to determine
the critical, yet often overlooked, first step – the ‘why’. What is a common set of values that can unify
and mobilise industries to work together? This was a recurring issue brought up in our conversations
with Paul Gilding, Carol Sanford and Kevin Noone – with opinions coming from the NGO, business
development and science communities respectively. Collaboration isn’t just about bringing together
stakeholders with obvious interests (eg, parties along the supply chain), it’s about bringing together
stakeholders with no obvious interests but who are impacted by the same wicked problems. To
illustrate, looking back at the Sao Paulo example – what might genuinely bring together a farmer,
automotive manufacturer, power utility and the scientific community?
The Leadership Vanguard Theme Report
Systems thinking, collaboration and resilience
CHAPTER 3
WHICH NEW IDEAS ARE DEVIATING
FROM THESE INCUMBENT THOUGHTS?
9. What if we just started doing something, anything? A final thought, which isn’t exactly novel but
is one worth emphasising! For breakthroughs to wicked problems to take place, we need to innovate.
However, getting started seems to be the biggest hurdle for big business. All too often, we see great
ideas whittled down by rigid decision gates and strategies to mitigate risk. How can big business
adopt a more entrepreneurial spirit of iterative testing and prototyping great ideas? “Failing fast” may
be a business cliché but creativity is a consequence of sheer productivity. Not acting on big ideas in
this context is worse than failure itself.
The Leadership Vanguard Theme Report
Systems thinking, collaboration and resilience
10. We see clearly that the business imperative to act is the key vehicle for transformational
change. Below are four initial conclusions from our exploration so far.
Growth is top of mind for business. It is clear that the moral debate on being sustainable has
reached a plateau. Carol Sanford rightfully pointed out that sustainability as we know it today is
primarily about ‘doing good’ and ‘doing less harm’ – using fewer resources, polluting less, harming
fewer people. This essentially is a reductive approach that does not incentivise action. Businesses
are fundamentally motivated by opportunities for growth. Therefore, to enact the substantive,
systemic changes we would like to see happen, a fundamental change will be for businesses to shift
their sustainability focus away from ‘responsibility’ and towards growth – a new era of economic
growth that expands the scope of choices and opportunities for business. This growth will drive the
improvement of human welfare, and empower current and future generations to define and pursue
their own conception of ‘the good life’.
Leading the way away from the status quo. Too often we ‘fail’ into collaboration because it is
human nature to seek the path of least resistance. To break away from business as usual and old
habits, we need to re-examine and reconnect with what is truly most important. As the business
leaders of today and tomorrow, it is not what we do that is important. It is why we do it. Purpose-
driven mindsets and actions will lead us away from the status quo.
We need to act, no matter how certain or uncertain we are. There is no one right way to lead
and there probably will not be one perfect solution to the wicked problems we face. Yet businesses
and governments all too often choose to wait until a strategy is near perfect before execution.
This hinders action. As Kevin Noone pointed out, we need to embrace complexity rather than try to
pretend it doesn’t exist. Coming up with new ideas on how to build resilient systems will require radical
innovation. This requires an iterative process of testing, failing and testing once more. Transformative
ideas will come from leaders able to embrace failure in all its forms so that we can figure out what it
is we’re working towards, come up with new ideas, and try and try again until we make the leap into
something substantive.
We need each other. Period. The solutions of tomorrow won’t come from one person or one entity.
We need to build up our collective knowledge and experiences. However, genuine collaboration
will only happen if and when we share a common purpose. Our interests and perspectives may be
different, but we are all affected by the same wicked problems. Whether it is climate change, poverty
or education, the systemic nature of these wicked problems means we cannot afford not to work
together.
The Leadership Vanguard Theme Report
Systems thinking, collaboration and resilience
CHAPTER 4
ON THE BASIS OF EXPLORATION, WHAT DO
YOU THINK NOW? WHAT ARE YOUR KEY
INTERIM CONCLUSIONS OR HYPOTHESES?
11. Based upon our exploration to date, we have identified five areas for further exploration:
1. What makes businesses collaborate - in order for them to do it does there need to be an
upside beyond purpose that adds to the growth of the business? We need to meet and talk
to a few selected companies that have linked their purpose to collaboration and sustainability,
placing both centrally in their business model, delivering stellar consistent growth. How has this
changed their business (consumer’s behaviour towards them/perception of them, their cost
structure, ability to source capital, etc.)?
2. What are the true barriers hindering companies and organisations from collaborating with full
transparency around shared values? There are a lot of companies who wants to work with other
companies, but something is stopping them. We need to understand why.
3. Quite a lot of smaller entities that have already managed to find ways to sustainably lead their
businesses, enabling them to grow at rapid pace – what we can learn from them? How can we
help mobilise more of this sort of positive action?
4. Are there any networks or forums that collaborate around the topic of reigniting growth and
sustainability? Can we tap into these to share and generate tangible ideas and progress?
5. How can we accelerate leadership as a catalyst for change? Why can’t more companies take
up Unilever’s approach (a disruptive business model that values collaboration)? How can we
measure the value of collaboration (particularly when it benefits the system)?
The Leadership Vanguard Theme Report
Systems thinking, collaboration and resilience
CHAPTER 5
IN WHICH DIRECTIONS WOULD YOU
LIKE TO CONTINUE EXPLORING?
12. 01phase
Bringing together companies from a diverse
range of industries (joining us in this first year
are Unilever, DNV GL, Woodside, Keppel,
MasterCard and the Singapore Economic
Development Board), as well as major thinkers
and disruptors from a diversity of fields, the
programme seeks to build a deeper bench of
leaders participating in the transition to a more
inclusive and sustainable growth model.
At the core of the initiative is a ‘chemistry’ of
interaction among four groups: future leaders
from the six partner organisations (catalysts),
CEOs from partner companies and other
leaders of global organisations (mentors),
recognised thought leaders (beacons), and
potential disruptors with transformative ideas
who have yet to attract the world’s attention
(pathfinders).
Each group will be challenged and stretched
through exposure to the others, with CEOs
being able to tap into new insights on growth,
catalysts engaging with CEOs from other
companies in challenging two-way mentorship
sessions, and pathfinders and beacons building
connections with people who can help them
scale their ideas. As the Leadership Vanguard
moves forward it will also incubate project ideas
designed to advance future-fit growth.
The Singapore meeting is one of three global
vanguard exchanges taking place over the
course of 2015. It marks the transition between
phase 1 (exploration) and phase 2 (identifying
and refining project ideas). The second and
third exchange will take place just before The
Performance Theatre in Lisbon in June and in
connection with the Global Projects Exchange in
New York City in November, respectively.
ABOUT
THE LEADERSHIP VANGUARD
For further information visit:
www.theleadershipvanguard.com
The Leadership Vanguard is a growth initiative. It aims to accelerate the transition to a future-fit
growth model by strengthening the world’s leadership capacity. This leadership needs to come
from many places – civil society, government and business. That is why the Vanguard brings
together leaders from across sectors, disciplines and geographies.
