Stop! Reboot and Change for Circular and Economically Competitive, Sustainable Growth

The lesson that the pandemic leaves us is evident: we must break traditional patterns and redesign our organizations under new guidelines

We would be naive if we thought that the post-COVID-19 (PC) era will only generate an adjustment to the conventional indicators that for decades have marked the economic growth and social development of the planet.

The pandemic has unbalanced the natural ecosystem; the PC era will have to deal with the consequences of a social, economic and environmental disaster of universal dimensions. The transition will be a breaking period, under a destabilizing crisis that will impact all social, industrial and governmental sectors. And we have never adequately prepared for this.

Experts agree that the PC world will be characterized by change, for example:

  • Industry will operate under the guidelines of the 4th Industrial Revolution and 5G technologies.
  • Business models will have supply chains relocated to where they are most convenient.
  • Globalization will continue to squeeze and destroy natural and human resources wherever they are cheaper or easier to extract.
  • Consumerism will largely migrate to electronic commerce, to digital services, which will supersede the outdated standards of customer service, marketing and quality of the last century.
  • Cities will try to reduce the bottom of their pyramids and the gap in wealth distribution.
  • Emissions are likely to be lowered with electric vehicles and good recycling practices.
  • Legendary education systems will probably become knowledge trading companies.

Although these trends are possible, there are two situations that could alter their performance. First, any growth and innovation will be limited, as these will stress nature to new maxima and cause more drastic reactions than they did in the past. Second, due to the long months of economic recession, the PC middle class will be more vulnerable and more disposed to protesting against bad government decisions, creating a toxic environment for growth.

The reality is that there will be no return to the before-COVID-19 (BC) indicators.

But humanity's innovation and adaptation present a window of great opportunity, complex, but hopeful, as described by K. Schwab, founder of the World Economic Forum (WEF): "This age will make us rethink, reimagine and restart - reset - our world.”

Indeed, we need a “Great Reset” (named after R. Florida) similar to what happened in the 1930s in the US, which was the most technologically progressive decade of the 20th century, and, according to some economic historians, surpassed the technological revolution of the end of the century. The challenge is enormous, since our current organizational, technological and cultural structures operate almost in the opposite way: all components of the growth equation want to expand without limits in a disarticulated fashion on a planet with finite resources.

It is impossible to continue growing without two key fundamental factors: a systemic vision of inclusion and articulation of all the components of the natural ecosystem, and a new dynamic of integration and regeneration, the circular economy.

These two concepts will be needed if we are to eliminate the reductionist and linear approach to growth. An industry that is growing linearly generates more garbage, toxic waste, obsolete products, inequality, stress on the population, violence, insecurity and migration. Acting in a reductionist manner produces solutions that are limiting, myopic, focused on small nuclei of power, non-transparent and determined by electoral timeframes.

This complex equation, wherever it is seen, has no simple and sustainable solution and must be rethought with greater reason in the new PC era. It must be solved in a more creative, systemic and innovative way.

If everyone wants to prosper, economic growth and social development must be decoupled from the damage and consumption of finite environmental resources; linear chains must be "circularized"; flows and "systems" focused on the generation of sustainable wealth for all stakeholders in all regions must be created and articulated.

The new proposal should replace natural resources, reusing, re-manufacturing, regenerating and redesigning the linear supply and production chains into multiple zero-waste structures, and then integrating them into clusters of extended value circular systems. In these clusters, new businesses, new jobs, new zero-emission opportunities will be created and, simultaneously, soils, water, the atmosphere and biodiversity regenerated in a responsible way. This will result in the creation of a new economy, focused on the creation of sustainable, conscious and distributed wealth, which is socially equitable and inclusive, environmentally recoverable and, of course, economically viable and competitive.

EGADE Business School recently published a Decalogue for the Economic-Business Refounding of Mexico, where a call was made to reimagine, reinvent and rebuild a new beginning in our country, through “Leveraging economic recovery on the basis of sustainability and innovation,” an activity closely aligned to this approach.

The lessons that COVID-19 leaves us are evident: we must break traditional schemes and redesign companies, institutions, societies and governments under new guidelines: start from scratch, defining new approaches, norms and goals; decouple economic growth from environmental and social impact; and grow in harmony with nature.

The pandemic, global warming, ocean acidification, national debt and social inequality have all been signs that we have not heard or capitalized on. That is why this reboot must be disruptive, conscious, ethical, fair, systemic and resilient in order to generate sustainable prosperity for all mankind.

Article originally published in Forbes.

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