Q8- Wanted: Workable Tools for Voluntary Paradigm Shifting

Today — the inauguration of President Barack Hussein Obama — is a big day for the people of the United States of America; many people including me are proud of them. The big event today started in 1954… but let us back up a bit first.

This quotation from Gregory Bateson summarizes the previous blogpost (Q7- We Found the Enemy: Our Own Concepts!?)

“The major problems in the world are the result of the difference between the way nature works and the way man thinks.”

We have a big problem: it takes so long for mankind to change the way it thinks on important issues:

It took more than half a century to get the American people to where they are today from Rosa Park’s refusal to give up her bus seat to a white man in Montgomery City, Alabama — a landmark refusal that dramatically initiated the Civil Rights Movement in the US.

Notice that two factors result to very long periods of time to change people’s thinking about important things: (1) institutionalized vested interests and/or (2) institutionalized rules to prevent members from thinking freely. The technical jargon for important changes in people’s thinking is “paradigm shift” from Thomas Kuhn’s “The Structure of Scientific Revolutions”. The religious jargon is “conversion” or “metanoia” (=from Greek word that means fundamental change in thinking). Equivalent laymen terms are “change in perspective”, “reframing” or “Aha! experience”.

Notice too that the data above shows that it takes about one average human lifetime to change how people think. So, does this suggest that you do not change how people think; you WAIT for them to die off?

Is there a faster way? We need workable tools for voluntary and conscious paradigm shifting. We need them ASAP (=as soon as possible)! The longer we wait, the more social costs (=human sufferings) accumulate.

Or, the longer we wait, the more people will forego enjoyment of benefits that would result from paradigm shifts. This was my motive when I wrote the book “99 Paradigm Shifts for Survival in the Knowledge Economy: a Knowledge Management Reader.” You can download the e-book for free from the CCLFI website.

How else can we help people undergo desirable paradigm shifts? Do you have other ideas to offer? What tools are on hand to help people change their thinking for the better?

Please share.

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Q6- KM for Development: a Triple(?) Bottom Line

The Chico River Dam proposed in 1973 in the northern Philippines with World Bank funding was a famous development disaster. The 1000 MW hydroelectric dam would have submerged large areas of Bontoc and Kalinga ethnic ancestral lands, including burial grounds and sites sacred and valuable to the cultural communities. It generated massive local and international opposition. Martial Law President Marcos sent in soldiers. Many died including tribal leader Macli-ing Dulag. The social crisis gave ammunition to the insurgent New Peoples Army. It united the traditionally warring ethnic groups in the Cordillera mountain ranges and triggered the organization of the Cordillera Peoples Liberation Army. After the famous 1986 “People Power Revolution” threw out President Marcos, the next President Cory Aquino completely stopped the project. So much was lost in terms of money, lives and goodwill of the people on the Manila government.

KM is learning from mistakes.

Similar development disasters all over the world led the World Bank to adopt “Safeguard Policies” to protect third parties from negative impacts of development projects (lower right box in the figures in the previous blogpost Q5- Market value and/or? development value). In 1978, the Philippine Government adopted a law requiring Environmental Impact Assessments prior to approval of big projects. The Indigenous Peoples Rights Act of the Philippines requires free, prior and informed consent (FPIC) from communities that would be affected by a project, to avoid, minimize and/or compensate for social and cultural costs [thanks to Ann Lily Uvero for pointing this out]. Finally, in the 1992 Rio Summit, 178 nations adopted Agenda 21 which enshrined “sustainable development” among the universal development values of mankind.

But a lesson has not been learned by the last two Philippine presidents: that military solutions to social conflicts do not work. So the killing continues: killing of people and killing of the goodwill of their kins and communities.

Learning has been slow and costly.

Let us reproduce the diagram in the previous blogpost (Q5- Market value and/or? development value), but replace “enterprise” with “project.”

The social and environmental costs (lower right box) do not enter into project accounts, and therefore they are not part of Go-No Go and other project decisions. This is another example of sub-optimization we saw in the previous blog. It is the source of social conflicts because people who suffer the external costs and who do not enjoy the project benefits will oppose the project.

The lesson is this: development of infrastructure/economic capital should not proceed at the expense of social capital and natural capital, and vice versa — this is the essence, stated in KM language, of sustainable development adopted at the Rio Summit in 1992. It asserts that a purely economic or financial bottom line is dangerous; we must adopt a “triple bottom line” embracing the economic, social and natural value domains.

Does this make sense to you? Tell us what you think (use the Comments link below).

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Q3- “The Customer is King”; But the King is Blind!?

In a free market economy “the customer is queen”:

• She decides what gets produced in the economy. The superiority of the market economy over centralized planning lies in the democratic decision making that millions of consumers make every day.
• Value is created whenever she decides to buy something. Her satisfaction (=consumer surplus) drives the creation of wealth (=net revenues of producers) in a market economy. Net revenues of producers are added up in the computation of Gross Domestic Product.
• Widening and freeing her choices is the reason why governments seek to increase competition by freer trade (e.g. lower tariffs and less regulations) and freer entry (e.g. decartelizing or demonopolizing industries)
• Her judgments select the better products from the poor ones. As a result, products and services get better and better.
• Her decision, if correctly transmitted back to intermediate customers in a value chain, result in enterprise effectiveness and efficiency.
• Her values/choices are the ultimate criteria in various quality management tools: kaizen, business process improvement, Lean Production, Lean Six Sigma, etc.

That is also why good KM (and correct KM) starts with recognizing what internal and external customers want. That is why KM must be demand-driven.

There is an ugly flaw in this nice and neat economic arrangement: most consumers make decisions with practically zero knowledge of the human, social, environmental and cultural costs inflicted elsewhere while producing what she buys. This ignorance distorts the pricing of goods and services (e.g. social costs are often not factored into prices of goods and services) and continues to result in producing the wrong goods or producing goods in the wrong way.

Most production activities by the private sector generate unintended, unwanted or unexpected social consequences (economists call these diseconomies or externalities). I will make a stronger statement: ALL production activities by the private sector generate unintended, unwanted or unexpected social consequences. I remember a remark by a lady demographer friend: “the most private act (the sex act) results in the most public consequences (the many impacts of population growth)!” I think the only way to avoid externalities from production activities is to operate a factory in Mars or elsewhere in outer space sufficiently away from the earth.

Should the customer-king (or customer-queen) be dethroned? Or should the customer be assisted better? Providing adequate knowledge for making better decisions is a basic KM goal. Can KM correct this flaw and if so, how?

Did we miss anything in the above analysis? Are there other ways of looking at this flaw in the free market system? Is it really a flaw?

What do you think?

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