What Sri Lanka and the world at large are currently facing is a simple and repeated story. According to IMD Business School in Lausanne, there have been 469 country recessions between 1988 and 2020 – approximately 1 every 25 days! The American Enterprise Institute states that 88% of Fortune 500 companies went down in the last 60 years. And Innosight expects 50% of S&P 500 companies will be gone in 10 years. Most of these companies have been and will be swept away because of their inability to adapt and reinvent themselves as a wave of technological innovation unlocked a world of Abundance. Companies that had based their business models on the concept of Scarcity could not compete with new competitors who had built their business models on Abundance. While companies are still grappling with this first wave of disruption, there is a second wave that is breaking. A wave of “Consciousness” that is being driven by an increased understanding of the intensified Climate Crisis, grassroots communities being increasingly left behind in global value chains, the rise of conscious consumers, the best talent from Gen Z choosing alternative ways to work, and deep changes in the global regulatory landscape will mean companies will need to evolve even more rapidly to remain relevant going forward.
In the context of the current economic and political crisis in Sri Lanka, organizations are encouraged to be more and more “resilient;” pushing us to continue to hang on and do business as usual and get back to “normalcy” and “stability” as fast as we can. Doing business as usual is not going to take us out of an economic collapse nor is it going to get us out of an ecological collapse. While the tech wave made many companies go under, the next wave is already here and that is the way of conducting business consciously to give back more than you take or to course correct. To thrive through the crisis and flourish in the future, businesses need to open up to a new Regenerative mindset that changes everything from how we re-design and operate our businesses to how we address the ecological and social divides among us.
Being “Regenerative” means recognizing that more value comes back to us when we act with the knowledge of living systems in mind. This can be in the form of financial returns, agility and resilience, innovation, and joyful, abundant and inclusive ways of unlocking untapped potential. It’s a major mindset shift combined with a new way of operating which embraces lateral thinking instead of linear ways of solving problems and actively seeks to put back more than you take out.
In this new paradigm, the very existence of your business or venture regenerates and enriches the living economic, environmental, and social systems in which it operates, rather than extracting the life and health of the system.
Being Regenerative requires a mind shift towards consciousness, and a commitment to continuously innovate and redesign ways of doing business. Regenerative flourishing is a mutually enhancing, dynamic relationship between the external environment of the organization as well as its functions within. The essence behind regeneration is that every person and organization is a living, whole system and is also part of a wider living whole system.
At Good Life X, we have worked with over 100 entrepreneurs and founders who are at the forefront of a conscious wave. While each has taken on a different social or market problem to solve, we recognized four common traits among these wonderful consciousness warriors.
The regenerative mindset calls for a reframing of critical business questions based on these four elements: joyful, agile, abundant and inclusive and it all operates as a cycle in which one element unlocks the other. The more joy or positive energy you have in your business and its purpose, you unlock an organizational culture of freedom which allows you to be more agile. The more agility you have, you can create and harness abundance in the most unexpected places. When you have unlocked abundance, you have the ability to be inclusive because inclusivity is not prevalent in a world of scarcity. These are the driving principles at the core of the new Regenerative business model canvas “THRIVE” designed by Good Life X and launched in March.
We were motivated to design a tool to create tangible action and deep business transformation because we have seen SMEs in Sri Lanka fighting the good fight even with ad hoc approaches to be regenerative from the goodness in their hearts. On the other hand, we’ve also seen larger companies recognize the need to follow a more sustainable growth path, and make some efforts that are perfunctory and not holistic. There is no meaningful consensus around the growth path to be followed and this results in confusion, waste of resources and limited impact. Such entities are either following the rules to comply with international standards because they want to sustain or at the other extreme, to greenwash. In this approach, CSR, SDG, and ESG frameworks have become the new ‘trend’ and another set of boxes to tick.
This unfortunately is still a game of the past and attempts by organizations to conduct “business as usual” to maximize growth and profit without actual regard to the cost to the greater social and environmental systems.
Sustainability goals, while well intended, are usually about trying to stop making things worse, and the same is reflected in the push for resilience. But businesses which are Regenerative understand that their entities are living systems within larger ecosystems. They recognize they must continually redesign their own way of doing things, transform and regenerate themselves as they spiral upward to greater value creation and positive impact on themselves as well as the world. This Regenerative mindset will eventually replace the past “business as usual” paradigm. The solutions of one generation if not regenerative become a problem for the next generation, which is the very core of the crisis we are facing today in Sri Lanka.
In order for us to get out of the crisis, we have the opportunity to go beyond resilience and thrive – to #buildbackbetter! To use business as a vehicle for change and embrace innovative models that can shape consumer behaviour over the next decades and make important contributions to solve ecological and social challenges by regenerating the bountiful resources we have in hand. How we get through this crisis determines how we shape our futures and it’s time to design, reclaim, restore, renew, and re-present systems that manage the social and economic needs, and preserve the integrity of nature for generations to come.
The GLX “THRIVE” BMC proposes to do exactly that by deeply (re)designing and transforming companies from extractive to regenerative. Organizations which will embrace this mindset and way of operating to their advantage will flourish in the emerging new era. Those that ignore the opportunity to create transformation within will miss high-potential market opportunities and will be out of step with future customers.
A few ways to shift our perspectives into a new paradigm, with regenerative practices at the core is to unlearn the old ways that got us here and arrive at new solutions from unapparent places. In short, to move from an ego system to an ecosystem.
How does this apply to a business? Honour the best practices of the company but also recognize what’s no longer working, and work to transform and regenerate.
It begins with moving beyond Vision and Mission statements (part of the ego system) to defining a Purpose for the organization that makes life better in a profitable way. A clearly articulated “Why?” for being in business, the shared values that will guide them, and authentic stories that will differentiate the company. All activities undertaken to reduce the negative impact on the environment, society/ community, and heritage, and possibly to enable repair and regenerate the damage caused. Leveraging resources made abundant by advances in technology, in an agile manner to create value for all stakeholders. The inclusive networks and relationships built with key stakeholder groups enable the company to create the largest positive impact. Investments the company has undertaken to ensure a better quality of life for its stakeholders. These are viewed as investments rather than costs. Rather than levels of service and types of relationships, we look for transparent relationships across the value chain built on visibility, mutual respect and accountability, with collaboration as the foundation. Use of digital channels, along with traditional channels, and relationships with market intermediaries that enable fair access to conscious consumers and brands. Experimentation to unearth unapparent markets and non-traditional ways to reach them. Focus on serving conscious consumers and buyers who will resonate with a regenerative value proposition, and making it accessible to them. In addition to regenerative premiums and margins, the benefits derived by all stakeholders from the company’s operations are well beyond traditional metrics of revenue and profit.
Being Regenerative is a choice and it’s also important to note that systems today are not adequately structured to make it easy for companies to work in a circular and regenerative way. However, there are already signals coming from the marketplace demanding organizations address these issues in their strategic plans and tangible actions which go beyond marketing campaigns and ticking the boxes. The regulatory landscape is evolving to now incorporate the protection of biodiversity, environment, and human rights as prerequisites for market access. Being regenerative is no longer a nice-to-have, but a requirement for those with global ambitions.
Being Regenerative is highly strategic as it pays off by attracting customers who are ready to pay a better price for the work you put in, engaging the best of next-generation talent, and positioning your company to be future-proof. Consumers today want to do business with companies who care about their holistic impact and a new breed of investors are stepping up who want to know the most accurate risk assessments for failing to address these issues.
The emerging futures are led by millennials and Gen Zs who have all grown up experiencing the reality of the ecological and social crises and are deeply aware of the consequences to life that are ahead of us. These generations are rejecting the old extractive, exploitative approaches to business and refuse to do business with and work for companies that engage in these practices. They are leading a shift in the market and they are increasingly influential entrepreneurs, consumers, employees, and investors. While they have lost faith in government and NGOs, they still believe that businesses have the resources and skills to address our most challenging problems.
A Regenerative approach produces solutions that don’t just optimize one thing, but optimize the effectiveness of the entire system and enables it to regenerate and evolve. It moves a company from the point of being good for me, to good for all.
Once a company makes this conscious shift, it is better equipped to respond to larger challenges facing our industries and society which makes the company and the entire ecosystem reach beyond resilience to becoming a connected, thriving organism.
Randhula de Silva and Arj Wignaraja are Partners and Growth Alchemists at Good Life X.
Good Life X (GLX), is an innovation and development catalyst, geared to build a new wave of life-enhancing companies in South Asia. The company provides critical knowledge and expertise to rapidly advance the prospects of startups, SMEs and investors focusing on regeneration and innovation through their solutions.
In operation since 2019, GLX has facilitated 100+ Sri Lankan businesses to #scalethegood and build a regenerative economy to thrive through change