The Necessary Revolution by Peter Senge & Bryan Smith & Nina Kruschwitz & Joe Laur & Sara Schley

Author:Peter Senge & Bryan Smith & Nina Kruschwitz & Joe Laur & Sara Schley [Senge, Peter & Smith, Bryan & Kruschwitz, Nina & Laur, Joe & Schley, Sara]
Language: eng
Format: epub
Publisher: Nicholas Brealey Publishing
Published: 2010-05-21T12:00:00+00:00

FIGURE 14.3 Harnessing the “Snowball Effect” of Cost Savings and Reinvestment

FIGURE 14.4 Harnessing the Reinforcing “Snowball Effect” for Sustainable Growth

Of course, reinforcing loops can create negative snowball effects as well, as Figure 14.5 demonstrates. Responses of NGOs to what they see as irresponsible corporate behavior can lead to a spiral of negative publicity and boycotts, defensive company communications, and still more aggressive NGO attacks. This tends to be especially likely when companies are either unable or unwilling to take external criticisms to heart and, regardless of their own view of the issues, truly take in the external critics’ perspective.

For example, when Coke first found itself being criticized for using water in water-depleted areas, it could have defended itself by technical analysis—arguing, for example in southern India, that it was drawing from deeper water sources than those that were depleted. Instead, it realized that the technical analysis really missed the point. Water was scarce in regions where it operated, and Coke had a social responsibility to step forward and try to contribute positively to the problem. In so doing, it averted a vicious spiral that would have led to a protracted escalation between lawyers and activists.