A recent Harvard Business Review (HBR) indicates researchers have finally proven a critical Requisite concept – that complexity, work and time are linked. Good piece of work. The article claims:
* Companies deliver superior results when executives manage for long term wealth creation and resist focusing on market quarterly earnings (eg Unilever, AT&T, Amazon)
The article talks about a long term mindset – in Requisite terms the companies they describe are all operating in Work Themes of Corporate Citizenship (Work Level VI) that requires a mindset of up to 10 – 15 years. The leadership themes for these types of companies is wealth creation and tolerance (we need value creating outcomes.
*Executive feel balance between short term accountability and long term success are out of whack– The world needs long term thinking because long term thinking is by definition connected up thinking and this drives out short term gains to please the market. Requisite is clear – the more comlex the work, the longer the time required to judge the outcomes.
*Resilience – during the 2008-2009 GFC, these companies not only saw smaller declines in revenue, but also continued to increase investment in R&D- on average 8.5% – compared to 3.7% for others. Economic profit increased by 64% in comparison to peers over 15 years. Long term companies added 12,000 jobs on average from 2001 – 2015.
*Unable to measure the cost of short-termism – the article believes an additional 1$1 trillion has been lost in the US economy – but this is a bargain at the prize. Think of the true picture of short term gains and long term losses – think biodiversity, limits of growth, poverty and climate change!
Thinking long term is not ONLY good for business, its good for the entire PLANET.
This graphic, from my 2003 book, shows how Work, Civilisation and and Nature interact -the linking factors are time and decision making and how few companies work in the long time.