New Economy Business

Seven windows of opportunity

Marga Hoek

Amsterdam, 2016

Editors: Amie de Jeu, Felix de Fijter

Colophon

Recycled paper

Made from recycled materials.

This publication is fully CO2 and climate neutral.

Author: Marga Hoek

Editors: Felix de Fijter, Tekstbureau Vakmaten & Amie de Jeu, AdeJeu English Language Services

Translator: Amie de Jeu, AdeJeu English Language Services

Design, cover and illustrations: AnneMarie Adriaans, I AM creative

Infographics and figures: Dorus Galama

Printing: Ecodrukkers

Publisher: New Economy Publications, 2016

ISBN 978 90 8237 852 8 (folio)

ISBN 978 90 8237 853 5 (e-book)

New Economy Business is licensed by the innovative American licensing organization Creative Commons under the license: Name registration – Non-commercial. This particular license was purposefully chosen in order to permit and encourage readers to share the visions, thoughts, knowledge and examples presented in this book. This also applies to the written text, figures and infographics. High resolution images may be obtained by writing to: info@neweconomypublications.world

Readers are requested to consider the intellectual integrity of the author. For further information on the license terms and conditions, please visit: www.creativecommons.org.

The editors and publisher are fully aware of their task to ensure accurate information. Nevertheless, they may not be held responsible for any inaccuracies which, given the current and explorative nature of the book, are bound to occur.

© 2016 New Economy Publications, Amsterdam

New Economy Business

“Creating a new theory is not like destroying an old barn and erecting a skyscraper in its place. It is rather like climbing a mountain, gaining new and wider views, discovering unexpected connections between our starting point and its rich environment. ”

ALBERT EINSTEIN, THE EVOLUTION OF PHYSICS (1938)

Watch the introduction movie

‘New Economy Business’ on our website www.neweconomybusiness.world

Table of contents

Forewords: Paul Polman, Dan Hendrix, Peter Bakker, Bertrand van Ee, Ton Büchner, Dr Maurits van Rooijen, Jens Birgersson, Frank Heemskerk, Gunter Pauli

Preface:

Chapter 0 The New Economy

Introduction

1The new economy revolution

2The new economy; all assets count

3Three assets

4Interacting transformative trends shape the new economy

5Trailblazers on the forefront

6New economy business

7Seven windows to success

8From theory to practice

Chapter 1 Window of Opportunity: Customers

Introduction

1.1Farewell to the ownership model

1.2Product types: the difference between property and food

1.3Four stages of de-ownership

1.4New starting point: usage, financing, and cost price

Wrap up

Chapter 2 Window of Opportunity: Value cycle

Introduction

2.1Why the supply chain is obsolete

2.2Maximum value creation in the value cycle

2.3Three rules of thumb

2.4Creative financing in the value cycle

2.5Adapting the organization

Wrap up

Chapter 3 Window of Opportunity: Scale

Introduction

3.1Glocalization: maximum global, maximum local

3.2Symbiosis through cooperation

3.3Markets: breaking open and creating new markets

Wrap up

Chapter 4 Window of Opportunity: Innovation

Introduction

4.1From improvements to collective creation

4.2Creating markets through innovation

4.3Expanding the innovation playing field

4.4Intellectual property, back to Venice

Wrap up

Chapter 5 Window of Opportunity: Business case

Introduction

5.1Ingredients for an adaptable business case

•   Content

•   Funding

•   Parties

5.2The business case parameters: longer and broader

Wrap up

Chapter 6 Window of Opportunity: Financing

Introduction

6.1The Trias Pecunia, effective financing

•   Step 1: Limiting demand for financing

•   Step 2: Long-term, sustainable financing

•   Step 3: Effective borrowed capital

6.2Renewal of the financial sector

6.3Shift towards value management

Wrap up

Chapter 7 Window of Opportunity: Leadership

Introduction

7.1Profile: from transactional to transformational leadership

7.2New Leadership: six key characteristics

7.3New definitions for old roles

Wrap up

Epilogue

About the Author

References

Endnotes

Icons

The content of this book is enhanced with illustrations, infographics, details, examples, and business cases. They are shown clearly using the following seven icons:

Case

More than 50 business cases are presented in this book to give practical examples of the content discussed in the different chapters.

Facts & Figures

Relevant background information giving quantitative support to the content presented.

Infographic

The infographics give informative, visual background information.

New Framework

In each chapter, we introduce one or more new practical management models.

Quote

Citations from CEOs, scientists or other experts enrich and clarify the information presented.

Shortcut

The shortcuts concisely show contrasts and differences.

Wrap up

Each chapter ends with a Wrap up. A succinct summary of the chapter.

Forewords

Forewords: Paul Polman, Dan Hendrix, Peter Bakker, Bertrand van Ee, Ton Büchner, Dr Maurits van Rooijen, Jens Birgersson, Frank Heemskerk, Gunter Pauli

Paul Polman

We all have a role to play

In this timely new book, a new form of business is advocated, i.e. one which serves the needs of the world and the population at large. As Marga Hoek succinctly puts it, “The economy is there for the world, the world is not here for the economy.” This is a principle I strongly believe in.

The necessity for transformation is supported by simply looking at the numbers: we are currently producing and consuming at rates which are not sustainable. This challenge needs to be addressed, and we all have a role to play.

My company has therefore adopted ‘The Unilever Sustainable Living Plan’ which forms the foundation for a new sustainable business model focused on creating long-term value. New and great business opportunities are presenting themselves as a consequence.

At the same time however, it is clear that the current group of frontrunners is still too small. We therefore need to form coalitions and partnerships with other businesses, governments and civil society to scale-up.

This book will provide ample inspiration to everyone willing to join this important journey.

Paul Polman

CEO Unilever, England

Dan Hendrix

So right and so smart

Twenty years ago, when Interface began its bold climb up what our founder and visionary pioneer called “Mount Sustainability,” we did so without a compass and without a map. Today, with tools like Marga Hoek’s book, businesses that wish to engage in the sustainable economy need only read this book.

New Economy Business contains a rich history and is written in an accessible style. Hoek makes a compelling case for not only pursuing sustainable goals in sync with the environment, but also aligned with our social, intellectual, and financial assets. She makes a relevant argument for the idea that the new economy revolves around value creation. Hoek also advocates for ‘glocalization’ which is focused localization in a context of global connectedness. Additionally, she makes a strong case for an increasing need for corporate transparency, an attunement to changing consumer values, and adaptation to the ever and quickly-evolving digital and mobile revolutions.

Looking at your company through the lens of a new paradigm –this new economy – will give you a new and profound way to view not only what you do, but how you do it, with whom you partner and employ, and where you invest your capital and R&D/innovation funds. If that is not the recipe for building a unique value proposition that will rapidly become a competitive advantage, I don’t know what is!

In memory of our late founder and chairman, Ray Anderson, I would propose to you that the ideas shared in New Economy Business are, in his words, “so right and so smart.”

Dan Hendrix

Chairman & CEO Interface, USA

Peter Bakker

Fascinating frame of reference

This book’s title, New Economy Business, implies we are about to encounter economic changes leading to a truly new economy. Is it a correct prediction? There’s no doubt about it as far as I’m concerned. However, the road leading to this new economy is not an easy one. We have to work towards a new form of capitalism in which we secure, as Marga Hoek rightly states, financial, social and ecological assets.

Businesses, leading ones especially, have a huge impact on the transition to that new economy. An impact that, for the most part, is not being utilised. The fact that this book addresses doing business in this new economy is, of course, progress. Hoek presents a fascinating frame of reference for doing business that will inspire every entrepreneur. I also urge scholars, politicians and other interested parties to read this spectrum of new insights and, more importantly, to let it sink in.

The interpretation of an economy based on the creation of value for the three assets must be made on all system levels. This is elaborated on in the book. What fascinates me is the power of accounting. As I often argue: this is the ideal place to realize and secure the vision of the new economy. Marga Hoek introduces the concept of the Chief Financial Officer becoming the Chief Value Officer which is logical, yet innovative at the same time.

This ground-breaking management book translates a clear vision into solid management models, with over fifty specific cases. And all of that in a very readable book which I strongly recommend.

Peter Bakker

President World Business Council for Sustainable Development (WBCSD), Switzerland

Bertrand van Ee

It is vital to spread the word

The world is moving at a pace that’s unprecedented. The internet has made the world more accessible, global and local at the same time. In her book, Hoek provides a razor-sharp analysis of classic theories that are no longer applicable in our present times.

The book offers a stimulating overview of current innovation and relates it to a paradigm shift in the global economy, giving illuminating examples of business models that are flourishing. The broad sector and geographic coverage is impressive and educational to executive thinking. But this book is not only for corporations, it is a must-read for a larger audience including NGOs, policymakers, academics and the public sector, as the solution to our global challenges is often in co-creation.

Climate-KIC, EU’s initiative focused on climate change and largest public-private partnership, supports collaboration across countries and companies by providing ground-breaking ideas and technologies. We also work with graduates from top universities to create a legion of change agents, and invest in start-ups through our Acceleration Program, where Hoek chairs the jury of the best cleantech ventures from across Europe.

To meet our global challenges, leaders must think differently and creatively about risks and continuity, combined with a broader responsibility to build awareness of the challenges and the solutions. It is therefore vital to spread the word and engage more companies in order to achieve greater impact. This book will help set the wheels in motion. It is a feast for the mind and for the boardrooms and is bound to provoke some disruptive executive thinking.

Bertrand van Ee CEO Climate-KIC, England

Ton Büchner

Lead the change

At AkzoNobel we believe businesses can inspire and lead the change that’s needed. But radical transformations are needed across a range of industry sectors if the planet is to be able to support the lives of nine billion people by 2050. Businesses need to be bold, think differently and act differently. Thanks to Marga Hoek’s book, New Economy Business, companies now have a fascinating guide to do just that.

New Economy Business is written in an accessible way and contains the kind of practical examples that we at AkzoNobel believe are so powerful. Hoek makes a compelling case for a new economic model based on value creation. According to this model, businesses should not only pursue goals that are sympathetic to the environment, but should also take into account social, intellectual, and financial aims.

Perhaps more importantly though, Hoek takes readers back to the core element of business – the customer. And she reveals how companies can grasp the opportunities of the sustainable economy to create business success.

As we say as part of our Planet Possible strategy, just because the world’s resources are limited doesn’t mean businesses have to limit their ambition and limit their chances of future success.

Ton Büchner

CEO AkzoNobel, The Netherlands

Professor Dr Maurits van Rooijen

A new economy based on a new education

In this book Marga Hoek presents the reality of an emerging new economy, based on innovation and sustainability, and the need to challenge old paradigms. The old economy, by definition, is not fit for the future. We may not like it, but new challenges at macro level and new opportunities demand a new economy. This book provides the reader with valuable insights on how the new economy could – and should – look like.

As an educator, this is of crucial importance. The new economy is not a concept, it is an action plan, to be created by a new generation of leaders. This is where education plays an important role. We need to prepare new generations to function effectively and responsibly. The new economy is at the core of this challenge. But the education task is not just about teaching new generations. It is equally about implementing education as part of the ongoing transformation, also at organisational level. In addition to providing learners with work-integrated learning opportunities, our task as educators is to also supply working professionals with learning-integrated work. Sustainable innovation and organisational transformation cannot happen without learning.

All this needs to be approached with a truly global mindset. I am very pleased to be working with Marga Hoek on the development of a new academic programme completely based on the findings of this book. We not only applaud the author for such an insightful work, but we want to be an active part of the emerging global society and help graduates to be a force for good in that process.

Professor Dr. Maurits van Rooijen

Chief Academic Officer Global University Systems, England

Jens Birgersson

Social value requires a different mindset

The insulation industry has a clear and pressing target: significant improvement of energy efficiency. It is a high priority because of the environmental impact of using 40% of the world’s energy to heat and cool buildings.

With her book New Economy Business, Marga Hoek sets the focus on another important opportunity: the social value. As she says, it is one of the most unchartered areas.

The World Green Building Council (in their 2014 report) explains that 90% of operating costs for an office building are related to staff; 9% are building related costs such as rent, and only 1% are energy costs. It goes without saying that every effort should be made to reduce energy consumption, but attention should also be given to the impact of the building’s design on users. As an example, if more attention is paid to the acoustics, thus improving speech intelligibility, this could have a positive influence on stress levels and absenteeism.

This approach requires a different mindset when designing and renovating. It also requires the building industry to be able to justify the investment. It is, in other words, one of the epitomes of value creation, as illustrated by Hoek in this book.

The ambition of ROCKWOOL is not only to keep improving our own processes but also to support our stakeholders in order to create a sustainable society. We have at least one element to investigate further - the social impact, and we will certainly use this book as a source of inspiration to help us deliver the benefits of the triple bottom line.

Jens Birgersson

CEO ROCKWOOL Group, Denmark

Frank Heemskerk

We need to scale up

Marga Hoek has been dedicated to sustainable entrepreneurship for years. She consistently shows how sustainability can be profitable for business and society by conveying her vision and translating it into concrete examples.

In this highly accessible business book she clearly describes both analytical frameworks as well as many best practices. She gives examples of entrepreneurs and successful companies that are both driven by sustainable values as well as creating them.

Unfortunately, sustainable business is still not common. The number of progressive leaders is still too low. We all need to do more so we can remain sustainable. We need to scale up. It is therefore crucial for pioneers in this movement to share their insights with other business leaders, politicians, scientists and consumers.

I am convinced that entrepreneurs and all other readers will gain knowledge and inspiration from New Economy Business. If companies, investors, citizens and consumers take actions in the spirit of this book, we will be able to hand over a better and fairer world to future generations. Because that is what it is all about.

Frank Heemskerk

Dutch Executive Director World Bank, USA

Gunter Pauli

Back to the basis of the economy

There is no doubt about it, our current economic system cannot be sustained. More of the same, less of the bad, tightening the belts and hoping for a decrease in unemployment… this is not the way to sustain our society. This is not a plea for rebellion or the building of barricades, but a recognition that things could be a lot better. To answer the question, “How?” Marga Hoek offers a clear vision which is more than welcome – it is essential.

She brings us back to the basis of the economy: The customer. Philip Kotler argued that companies should sell what the client wants. This principle has been adopted by business studies, but not in the business world. In practice, companies sell what they make, what they invent and what they want to promote by large scale production and standardization. They are always looking for a better profit margin and cash flow. The sale of inventory – based on supply chain management – leaves little room to guarantee added value to the customer.

The idea of transforming the Chief Financial Officer into the Chief Value Officer is not only refreshing, it shows how bold the transition to the new economy would be when the customer is king once again.

Gunter Pauli

Author of The Blue Economy and Chairman Novamont, Japan.

Co-creation and Cooperation

This book was not created by me alone. It was in fact the result of a collaborative effort by many people. When the book won the Management Book of the Year award in the Netherlands, many people won, which was truly a great achievement.

The development of this global book has been a co-production with an international team. It has been enhanced from intensive crowdsourcing, numerous interviews with CEOs and input from leading scientists and opinion leaders. This process is in accordance with the integral vision of the new economy, and I am truly grateful for the time over 325 people have spent contributing to this publication, and for the trust given by sharing their insights, sources and knowledge.

Global businesses and knowledge networks were crucial in the development of the content and the identification of business cases throughout the world. They will be just as crucial in helping to spread the messages and knowledge provided here. Since this book is a means to a higher end, I am thankful for their help in giving this book its impact and for their commitment towards realizing the higher goal of making ‘business for good’ the norm in today’s new economy.

Sharing the knowledge

The content of this book is meant to be shared with as many as possible. For this reason New Economy Business is licensed by the innovative American licensing organization Creative Commons under the license: Name registration – Non-commercial. This particular license was purposefully chosen in order to permit and encourage readers to share the visions, thoughts, knowledge and examples presented in this book. This also applies to the written text, figures and infographics. High resolution images may be obtained by writing to: info@neweconomypublications.world. Readers are requested to consider the intellectual integrity of the author. For further information on the license terms and conditions, please visit: www.creativecommons.org.

Global business & knowledge networks

Preface

Every entrepreneur should want to save the world. Businesses should aim to make a positive impact on our planet and protect our primary assets. I feel very strongly about this mission as it touches me deeply when I see the damage that our current economy and business models have caused, and continue to cause. Our resources are becoming more scarce while we continue to waste them, the climate is changing and threatening us all, health and prosperity is being chipped away at while we export health threatening food around the globe. I cannot ignore the oceans becoming more polluted with plastics and chemicals, nor deny the ongoing deforestation and destruction of land. I cannot close my eyes to the dramatically inequitable way capital and wealth is divided with one percent of the poplulation having a hold on 99 percent of the total wealth, or the way debts and underlying values are separated, threatening our economy and well-being. Neither business nor the world can survive this unsustainable global business model. There is just no future in it. It is a dead end street for business and the world.

Therefore, I have endeavored to reinvent myself and redefine my business. As an entrepreneur, I feel the call to change the world. In that quest, I speak and write about the new economy and new economy business based on an economic model that takes all assets (ecological, social and financial) into account, and strives to make a positive impact. It is a journey. The insights and urgency for this transformation sank in over time, to the point where I recognize that we must aim for nothing less than conducting business as a force for good. It has also become clear that businesses who set out to contribute towards finding solutions to our major global challenges are on a mission. And mission driven businesses are more successful and connect better with customers. Business for good is, in fact, a profitable proposition.

Our world needs this transition and we need to combine these high ambitions with scale. The planet’s assets are in the red, therefore positive impact must be made on a large scale to stabilize and restore our climate, natural resources, public health and to ensure safe living conditions for nine billion people. Since over 50 of the world’s top 100 economies are in fact corporations, if businesses grasp the opportunities and follow the path of positive impact, these challenges can be met rather quickly. Large and small companies around the world are already showing the courage and innovative leadership to move in this direction. Thousands of innovative start-ups appear every day, bringing in transformantive ideas with great potential. Large multinational corporations are able to create impact on a large scale. Unilever, for example, has announced that they are aiming for a CO2 positive result in operations by 2030. Imagine the impact. That goes for all our challenges. Consider that 750 billion dollars’ worth of food is wasted each year while it would take just 80 billion dollars to feed all who go hungry. The costs resulting from the damage to the world are also tremendous. In the last decade alone, the world economy suffered an estimated loss of 2.7 trillion dollars because of natural disasters. It is quite clear that things need to change. And they need to change on a large scale.

The turning point is there. It is not a matter of if but when. The climate deal in Paris at the end of 2015 marks that tipping point. The world has chosen the direction towards an economy that is there for the world. Leaving behind a world that merely served the economy. The message from the climate conference in Paris and from leading entrepreneurs is that it is time to undertake the biggest business challenge ever, to fight climate change and venture to restore all other assets in keeping with a mission and vision towards the future. Thus, initiatives and collaborations are emerging all around the world. Politicians are also starting to realize that there needs to be a tremendous system change: what we called externalities - the price for resources, pollution and damage - will have to become internalities, consistent with the asset approach I describe in this book. Profit and loss will be about value creation and devaluation of those assets. Public policy and tax systems will need to be transformed accordingly.

Aiming for a positive impact on our world is not only the moral thing to do, it is good business at the same time. The low carbon market is worth more than 5.5 trillion dollars today. Innovations in energy efficiency have the potential to reach 18 trillion dollars by 2035. The circular economy shows the potential to produce 1.8 trillion dollars’ worth of revenue and create two million jobs in the EU alone. This potential is demonstrated by investors buying green bonds and it is predicted that this will triple by 2018 to a total of 300 billion dollars. Investments in sustainable businesses have seen a rise of 61% in the last two years and impact investing has also gone up by 132% in just two years.

I am both grateful and hopeful to say that the momentum is there and the course is clear to redefine and repurpose business and our economy. This book is intended as a road-map to help guide and outline the path to the new economy. In the near future, business for good will not be an exception, but the norm. I believe this with all my heart, mind and soul. Let the pioneers in over 50 cases around the world inspire you to take this journey yourself and take with you as many people as you possibly can.

Enjoy the book. Spread the word, but most importantly, spread the deeds.

Let’s get down to business.

Marga Hoek

“ The economy is there for the world, the world is not here for the economy.”

Marga Hoek

Chapter 0

The New Economy

In the new economy our primary assets and transformative trends interact, creating significant opportunities for sustainability.

Value is created for all our assets: ecological, social, and financial.

Transformative trends including disruptive innovative technology, glocalization, and changing consumer values are shaping and accelerating the new economy.

Introduction

The global challenges of our time require a radical shift in our economic perspective. The linear take-make-waste paradigm is no longer valid. We must bid farewell to the traditional economy built on exploitation and short-term perspectives. A new economic design must emerge if we are to build a sustainable future. It is not enough to strive towards minimizing the ‘bad’, the new economic model must boldly aim towards achieving good.

The new economy is a broadly defined economy, including all assets, in order to create maximum value and growth. Our assets are utilized in the new economy but without permanently exhausting them. Instead, they are cherished, and value is added when possible. This new course is changing the face of the economy in a way that cohesively corresponds with the current transformative trends and the new economic order.

Transformative trends including disruptive technological advances, glocalization, and changing social values have a huge effect on our world and our economy. Societies are utilizing innovative technology and new socio-economic movements are emerging. It is the integration of these transformative trends, together with the creation of value for our three primary assets, that form the essence of the new economy.

The current socio-economic developments present opportunities to integrate sustainability in daily practice. While civic society and the scientific community play pivotal roles in moving our world towards a sustainable future, it is business explorers that will lead the way towards the new economy. Businesses are, after all, unique in their ubiquitous nature; they can transcend borders; they can be local and global at the same time; and they have far-reaching networks and enormous power. Therefore, in New Economy Business, we zoom in on this group and explore how businesses are engaged in the new economy.

Businesses are working towards creating a positive impact on the world in the new economy. They recognize that the economic transformation creates great opportunities. There are new markets and customer propositions to explore and greater continuity can be achieved.

Seven windows of opportunity

To demonstrate where these opportunities can be found and give example cases depicting successful business endeavors, the chapters in this book are divided into seven management themes that are as old as business itself: Customers, Scale, Innovation, Business Case, Financing, and Leadership. Although the chapter on Value Cycle may seem unknown, this is the new economy approach to what has been known as the supply chain. While these themes are familiar, the approach may not be. This book will guide you through the familiar terrain and show you how the landscape is changing.

Illustration 1

Seven Windows of Opportunity

Business can be profitable and sustainable at the same time. We do not need to exploit people and the environment in order to succeed. We can learn lessons from the economic models that are outlined in this chapter and incorporate the positive motives with practical methods to achieve sustainability for our environment, population, and economy. As Robert F. Kennedy Jr. recently said in a presentation, “The premise that you need to choose between economic prosperity on the one hand and environmental protection on the other is a false choice.” With innovation, appropriate leadership and the drive to promote a value-adding perspective, we most certainly can achieve both.

This chapter sheds light on the foundations of the new economy and the way the various players within it operate. The following points will be discussed:

1. The new economy revolution

The new economy is the culmination of the evolution of economic revolutions and sustainability revolutions.

2. The new economy; all assets count

The new economy is comprehensive and focuses on all our assets: ecological, social, and financial. At its core, the new economy is value driven, sustainable, and circular.

3. Interacting transformative trends shape the new economy

Current transformative trends, including digitalization and global internet use, as well as changing consumer values, harmoniously interact with the principles of the new economy.

4. Pioneers

Today’s trailblazers are shaping tomorrow’s economy. Visionary business owners, politicians, scientists, and consumers are preparing the frontlines for the rest to follow.

5. New economy business

The title gives it away; this book zooms in on one group at the forefront of the new economy – entrepreneurs. Why? Because it is the business world that is at the heart of the new economy revolution. In a revolution for a sustainable economy, it can be no other way.

6. Seven windows of opportunity

New economy business is more entrepreneurial than ever before. The following chapters will expand on this and show how opportunities in the new economy relate to seven classic management areas. These management themes are undergoing a completely new and disruptive makeover. The seven chapters describe seven windows of opportunity that give a whole new outlook on business and the economy. It is a view to success.

7. The new economy; all assets count

The new economy is comprehensive and focuses on all our assets: ecological, social, and financial. At its core, the new economy is value driven, sustainable, and circular.

8. Interacting transformative trends shape the new economy

Current transformative trends, including digitalization and global internet use, as well as changing consumer values, harmoniously interact with the principles of the new economy.

9. Pioneers

Today’s trailblazers are shaping tomorrow’s economy. Visionary business owners, politicians, scientists, and consumers are preparing the frontlines for the rest to follow.

10. New economy business

The title gives it away; this book zooms in on one group at the forefront of the new economy – entrepreneurs. Why? Because it is the business world that is at the heart of the new economy revolution. In a revolution for a sustainable economy, it can be no other way.

11. Seven windows of opportunity

New economy business is more entrepreneurial than ever before. The following chapters will expand on this and show how opportunities in the new economy relate to seven classic management areas. These management themes are undergoing a completely new and disruptive makeover. The seven chapters describe seven windows of opportunity that give a whole new outlook on business and the economy. It is a view to success.

Illustration 2

The old economy versus the new economy

1    The new economy revolution

You only need to flip through a few business magazines or check out some recent management books to see that the new economy is a popular theme. If you were to Google the search term “new economy” you will get more than 125 million hits and you would find more than 8,000 books on Amazon.com.²

Each one of these publications revolves around significant economic revolutions. Until recently, the term, ‘new economy’ was primarily connected to the technological changes and globalization since the 1980s. Time magazine spoke about the new economy in their May 1983 issue as the transition from the industrial age to the technological era. Kevin Kelly’s bestseller in 1998 outlined strategies suited for the new connected economy and the enormous growth of information technology (IT) and the internet. A revolution that, to this day, continues to evolve.

It is noticeable that the publications regarding the new economy all have a positive undertone. Authors appeal to the opportunities and the potential of the new economy. For example, you see titles such as: 51 Marketing Strategies to Dominate your Competition in this New Economy! (Kasten, 2013); Agenda for a New Economy: From Phantom Wealth to Real Wealth (Korten, 2009); Financial Fresh Start: Your Five-Step Plan for Adapting and Prospering in the New Economy (Olefson, 2013).

The economic revolutions of the previous decades have dominated the conversation. They were not simply revolutions on paper, they permeated the heart and soul of society. They were visible and pervasive. Sometimes the revolutions flew quickly by, such as the internet bubble in the 1990s, while other times they were more resilient such as the continuing digitalization, mobilization, and globalization.

Sustainability is also one such resilient revolution. When we think about the relatively short history of the sustainability debate, we can see that apart from the economic revolutions, we can also pinpoint a number of ‘sustainability revolutions’ on our timeline. Although the following paragraphs outline the inception of the various revolutions and they were, admittedly, on a small scale, these ‘wake-up calls’ were the catalysts of an explicit, societal debate.

For the first wake-up call, we need to step back in time to over forty years ago. In 1972, the Club of Rome (a global think tank dealing with a variety of international political issues) spoke about “The Limits to Growth.” They were concerned about economic and population growth and the effects on finite natural resources and pollution. Unfortunately, the seriousness of the situation only got through to a few scientists and experts at the time. (Club of Rome, 1972).

The Environmental Protection Agency (EPA) was founded in America around the same time (1970) in response to the budding concern about the environment, although only incremental changes were implemented. The United States and Europe did put several regulations in place to deal with these issues but they were not linked to a shift in economic strategy.

The next marking point came in 1987 when the World Commission on Environment and Development made the connection between ecology and the economy. The World Business Council for Sustainable Development (WBCSD) was born and companies started making an effort to develop a more environmentally friendly production process and recognized the business advantages of doing so. The pioneers of that time increased the support within the business world by spreading the word that environment and economics can go hand in hand.

Illustration 3

Economic revolutions, sustainability revolutions

Then more recently, Al Gore presented the third marking point with his film An Inconvenient Truth.³ In his film and with his speeches, he clarified a number of connections. Namely, the rapidly growing BRIC countries (Brazil, Russia, India, and China), the exploding world population, the alarming studies regarding global warming and the downturn of biodiversity. From that moment, many people began to realize that the only way to solve the question of sustainability was to construct a sustainable economy. It was also a trigger for many companies to develop their Corporate Social Responsibility, but even so, sustainability fell short of becoming a leading economic driver.

Two things stand out while considering these wake-up calls and revolutions. The first is that the economic debate had not made a real connection with the wake-up calls relating to the environment and sustainable developments. The second is that the positive undertone from the management publications had not, until recently, reached the sustainability debate. Economics and sustainability have been separate issues. Additionally, the perspective towards each has been different. The publications about the new economy have outlined the possibilities and the renewed prosperity, while threats and obstacles have dominated the sustainability debate. This is understandable, of course, and in a way it is justified as the prediction of doom of our very existence is hardly a positive message. The opportunities that this new economic order would provide in terms of sustainability had not been adopted as a driver for change. Although the connection has been made more often in recent years, the wake-up calls were not the trigger for a revolutionary way of thinking about the economy (See illustration 3).

Illustration 3 shows the historical lack of balance between economic renewal and environmental sustainability. Despite scientific breakthroughs, a variety of studies, and numerous attempts by sustainability pioneers, the wake-up calls have not heralded a new economic era in the way that technological advances, globalization, and the digital revolution have done.

I am absolutely convinced, though, that the new economy, tomorrow’s economy, is a revolution in a sustainable and