Hi, everyone. Kumar Dattatreyan here with Agile Meridian, and we are back with our, next episode of the XSCALE series. And in this episode, we'll be continuing our discussion on permaculture principles and their relationships to ecosystem thinking principles. So we got lots of words there, permaculture, ecosystem. I'm just gonna remind viewers what we talked about last time. So permaculture principles, and Glenn will have a better description of what they are. they describe a set of principles to sustainably farm, natural resources, you know, food and crops and things like that. From the earth, much more so than we do today. And there's a set of principles that manifest how humans can sustainably farm the earth without without throwing things out of balance. And Peter Merel wrote a set of ecosystem thinking principles that are inspired by them. And so in our first episode, we compared and contrasted of the first 2 permaculture principles with the first two ecosystem principles. Watch that video, it was on about a month ago. And today, we're gonna attempt to, break down the next two permaculture principles. So before we get started, I didn't do a I don't think I did a very good job, Glenn, of describing permaculture. You wanna take a stab at that? sure. The the key thing that jumps out to me about permaculture is, the the permanent nature of it. Both organizationally and agriculturally, we tend to go and do things in a non in a non sustainable way, as you said, artificial fertilizers, monocrop cultures, the things that deplete the soil in, you know, 40, 50 years, and and require replenishment. And, gosh, wouldn't it be a much better idea if we just look at the way nature does it? Nature has a diverse set of uh-uh plants. and the and and as long as we stay out of the way, they keep growing. They keep replenishing themselves. You know, there there's a profound principle there that that is efficient saves saves the earth itself, but they're also very energy efficient. And humans tend to bring in these very energy inefficient systems that, as you said, are not sustainable. And there's something profound there. And a disturbing the same principles in industrial agriculture do seem to be applied to corporations. Industrial corporations, if you will. And it all all these bankruptcies, you know, it it's painful. It's disruptive, and it's very wasteful of capital. You make a bit of money in the short term, but why not go and have a more sustainable foundation? Inspired by nature where where an awful lot of good ideas come from and and and have something that's durable and that will adapt to changes in the environment changes in the market. that that's sort of that that's my take on it. I like that. So the 3rd principle, permaculture principle is very simple. All it says is, and it states is obtain a yield. And so from a permaculture standpoint, what that means is really, sustainable design solutions need to provide rewards and yields that encourage their growth and replication. Obviously, in nature, a farmer isn't gonna plant something if it doesn't obtain a yield. Right? It has to be a, a meaningful yield or they will stop planting that crop. And so, in in modern societies, of course, you know, we've sort of upset the balance. We pump fertilizers into the ground and we get more yield because of that. But in the process, we strip the the the top soil that the the ground, the land of its ability to support further yields. Right? And so in permaculture , it's about obtaining a yield but in balance with what nature can provide and what nature can, can yield. And it's also go ahead. Sorry. And it's also adaptive. if you're in a particular area where the soil is dry, you won't just blanket go and and do the same thing you did somewhere else, it it will adapt, in real time to the conditions. And there's some plants that like drier soil, some plants are like more moisture. Nature figures it out. We've always seen to apply a one size all model and and and that really doesn't work very well. Right. And and I I think that, you know, at its core, obtaining a yield needs to be balanced with ecological rationalization rather than economic rationalization is not all about the economic benefits of of obtaining the yield. It has to be in balance with the ecological impact of obtaining that yield. Otherwise, you're you're you're eating your seed corn and you're depleting things and bad things are gonna happen. Right. Exactly. And so how do how does this what does this have to do with the ecosystem principle of work on outcomes. I'm I'm reading this verbatim. this is Peter Merel's 3rd principle of ecosystem thinking. Work on outcomes, teams continuously quantify their contributions to business throughput, prioritize the current bottleneck and minimize work in progress. What does that have to do with obtaining a yield? So many organizations are focused on measuring outputs, not outcomes. that, again, is a very short term, focus. Rather similar to a a farmer just focusing on how how many bushels of of wheat they got without looking at, what they're doing to the soil and what will they need to go and spend to replenish that soil? corporately, if you are looking at outcomes, you're looking at at the the the values and the things that are important and you're focusing on them as opposed to a a short sighted metric. You're also the other key point that jumped out at me, in this, principle was focusing on top line business throughput. Mhmm. You should affect the top line. It should apply to to to, revenue. And if not, why are you doing it? Yeah. That makes a lot of sense. Yeah. Some of the things actually make make me think about how these things relate. You know, both of these principles emphasize designing systems as you put it that generate useful yields or outcomes, not about the outputs. Yep. Permaculture focuses on productive environments. Ecosystem thinking focuses on teams, producing quantifying, quantifiable outcomes. To business throughput as you put it top line business throughput. Right. So in those in that way, they're very, very much aligned. There's a couple of common principles thrown in there as well. Fook, focus on bottlenecks, eliminate them, and minimize work in progress. I have clients that that don't seem to get this notion of minimizing work in progress. you you have 10 things going on if they're all if you're treating them all as equal priority, well, you're you're not gonna get the done until the last one is done. Like, surely, they're not a equal priority. Yeah. That's a that's a good point. Ecosystem thinking, or, actually, I should say, permaculture opposes dysfunction from capital expenditure. Right? That's that's something I I just read here that's in the definition of what e permaculture principles talk about. What do you suppose that means? Permaculture opposes dysfunction from capital expenditure. That sounds like a a a neat way of talking about, about WIP having 50 things going on. you're throwing away capital when, really, you should figure out what you wanna focus on. What's the highest priority? Where are you gonna get the biggest ROI? Focus on that. Right. Right. Ecosystem Thinking minimizes WIP. So teams can optimize throughput. So very, very analogous to, and the Permaculture principle. Exactly. If, you know, if it's not high ROI, why are you doing it? Right? And both systems, both principles, I should say, encourage, feedback loops, positive feedback loops, and replication. In permaculture yields, encourage growth of successful systems. Right? You get yields, and you're gonna be interested in sort of replicating that over time without, again, keeping an ecological balance in ecosystem thinking, achieving outcomes, reinforces, and propagates effective team workflows? There there's something that's implied here that's very powerful as well, though. and we see this in ecosystems in the in the natural natural when when the environment changes, the the ecosystem changes, it adapts in real time. So the things that are working well, you'll get more of them. Things are not working well, you get less of them. And and and it's important to have this this dynamic feedback loop recognizing what is working, and it is going to change. So just just mechanically doing the same thing again and again is not gonna end well. You have to be responsive to the market. And when it changes and it will, because that's what markets do, you have to change or you'll be left behind. Yeah. And I think both of these principles share, share the emphasis on designing for tangible yields. Right? It's not just about superficial outputs. It's about tangible yields and and and both share a systems view focused on total productivity and flow. So in that way, they're also aligned. But don't but don't forget the dynamic nature. They will adjust based on changing conditions. Right. Good stuff. So, that would be principle 3. Anything to add anything that we missed? Obtain a yield. There there's some subtly in that. I I I think it it the the notion of dynamically respond could be emphasized a bit more, but I think we covered that off. Okay. Well, then the next, ecosystem principle is let me look it up here real quick. apply self regulation and accept feedback. Now from a ecosystem thinking, sorry, from a permaculture thinking perspective, you wanna take a stab in describing what that means, Glenn? run that by me again. I was I was reading my notes as well. Apply self regulation and accept feedback. That that leads into what, we we kind of pushed into, principle 3. Well, I can take, I can take a stab here, from from what what the little analysis analysis have done. So feedback is essential, right, to all systems. We thrive. We need feedback to live. In fact, just the simple act of walking requires feedback from we don't realize it, but we're getting feedback all the time so we can stay in balance and not fall over. and so feedback is essential to maintaining balance and health just as predators keep prey populations in check and nature. That's a form of feedback, right? If you have too much, too many deer, or, you know, sort of, or, or, or, or, or, or, or, or, of course, eating the plants and so on and so forth, you need something to take to to keep their population at bay so that it doesn't overpopulate and basically turn the Savannah into a desert. Exactly. And and which is somewhat analogous to what, some industrial farming is doing. Exactly. Right. Because we are we are, over farming. maybe I'll let you talk. Tell me more about that. Because it's not a ecosystem, it's a monoculture. We're we're depleting the soil, artificially. We're acquiring a lot of external inputs and it and and it's not sustainable. Whereas in nature, every everything flows dynamically. If there's a, I think you said it well, if if there's too many deer, eating all of the the grass, the, that that will not end well. The the, the the the they'll have more the the deer will reproduce on, without bound. deplete all the grass turned into a desert. That that's a bad thing. But if you had, predators in there that would keep the deer in check, the deer would would, you, you know, not not be so so brazen, and and there's a great video on this for, on, around wolves and, and Yellowstone. I was just gonna say that. Yeah. and and the the the wolves were eliminated from Yellowstone and and the Herbawar population went was out of control, and it was destroying the the rivers, because they were eating all all of the the Marsh. the, the with with wolves, they they they they stay away. They're more cautious and and allowed the river to go and and flow. When the wolves were introduced, they had to modify their behavior, and they wouldn't go into more of these exposed areas around the river, and and it allowed the river to replenish. So there there's all there's an there's an I was gonna say, unknowable. That might be a bit strong, but there's a lot of subtle things going on, the deer don't know it. The deer are aren't checking with with to to see if there are how many deer they're supposed to have every year, but neither are the wolves. They just do what they do. They don't really know about the other other than, deer watch out for wolves and wolves eat eat deer. Yeah. But it it just takes care of itself, and and none of the parts need to know about the big picture. It just works. Yeah. So relating this to, the 4th principle, ecosystem thinking principle, which says align small groups of teams into self managing business streams that continuously adapt their work priorities to changing market feedback. So if we take the the 4th permaculture, a principle of feedback, and let me just read that, one more time just so that we're all all on the same page. And the principle says apply self regulation and accept feedback. And the ecosystem thinking principle is align small groups of teams into self managing business streams that continuously adapt their work prior priorities to changing market feedback. There are a lot of parallels here that we're talking about. Both emphasize creating self regulating. That's the key right there. Self regulating, you know, in a natural system, The wolves aren't thinking, I need to go eat more deer because there's too many of them. They just do what they do. It's a self managing system. Your deer don't say, I better stop reproducing. There's too many of us. We're not gonna have food. No. They're not. They're gonna keep eating until there's nothing left to eat, and they all die. Right. Exactly. And so the the point here is that both of these principles emphasize creating a self regulating, self managing system, So you got plants and you've got livestock and there's enough of each, so that they don't overpopulate the other. Right? And ecosystem thinking organizes teams into self managing business streams. Now what does that what does that mean to you? It means that they're gonna adapt in real time to market conditions. If something is working well, they'll do more of it. If something working well, they'll do less of it, or they'll figure out what's wrong with it and change it so that it does do well. Feedback. Right. Exactly. There there is one key point that that I would like to add to this principle, and that is, reward models and funding. In order for this to truly be effective and efficient, the the streams should be funded directly. They should have a P and L. That's a good point. one of the points that I that I sort of researched, is this alignment alignment on goals and, ethics. Right, from a permaculture perspective, it prioritizes, the community, if you will, for feedback. You know, how is the environment responding to planting of, certain crops and and, what sort sort of livestock to be around to keep that in check or in, in the case of agriculture, what combination of plants should be planted together so that it doesn't deplete the soil too much. In fact, it may even enhance the soil because they work in concert. Streams business stream should align to some a set of business ethics and goals. And to your point, there should be some rewards that, and reinforce the the behavior that that, leads to a sustainable pace of deliver, value delivery. I'm saying something even stronger, not just give people a a bonus if they go and achieve certain numbers, but actually allow the team to go and and make business choices with their own budget, with their own P and L, and, adjust the value stream when necessary. So this does imply that the value stream is gonna have all of the proficiencies on it. there's gonna be marketing people. There's gonna be salespeople. Gonna be financial people, legal people, everything, but the the stream is kind of like a a business entity in a way. With a P and L and and and and pivots and adjusts when when necessary, but, of course, aligned to to a high level corporate objective. particularly including things like goals and ethics, as you mentioned. Yeah. I think that there it it relies on a certain level of autonomy in in that case, Right? So the business stream is, has its own P and L. it has teams that are, self reliant and autonomous to a large degree. And and this autonomy is what makes, I would say, makes these business streams robust. Correct? They're also cross functional. Yeah. yes, they are autonomous, but let's also not forget from our one of our earlier talks they're autonomous, but they're aligned to the corporate objectives. So it's autonomy with alignment. These are not people going rogue. They're they're still aligned. They just have the the freedom to go and pivot when things on the ground change, and they change very quickly these days. Senior leadership doesn't have a chance to hear about these changes, but the people on the ground do, and and they can pivot quickly where senior management inherently cannot because they're because they're not on the front line. Right. I mean, I think the 2 go hand in hand, the alignment and autonomy. Right? So the alignment is provided by the goals, the ethics, the autonomy is afforded, by those goals and ethics because now everyone's aligned to those goals and ethics, and they can operate more or less autonomously, in a self regulated, self managing manner so that they are these teams are producing a yield, in a way that, that they're that these teams are very aware of the feedback that they get from the market. And and in, you know, the the analogy, of course, would be in nature. The feedback would be coming from nature. Right, from the soil, from the plants, from the the livestock, and so on and so forth. In a market, the feedback's coming from the market. Yep. And and if they have their own P and L, trust me, they're gonna be focused. Yeah. So, really, in summary, both of these principles Principal 4, permaculture principle 4, and ecosystem principle 4, which is really about self regulation and feedback. The the aim is to create organic self managing systems that rely on feedback to adapt and thrive to changing conditions and and the environment or the market. Right? They they rely on decentralized control. While guiding alignment through shared purpose and values. Anything to add to that, Glenn? These these 2 are are relatively easy to to to get your head around. Some of the other ones are a bit more difficult. They're a bit radical, but they are profound And absolutely necessary if you wanna have a sustainable, durable business that responds quickly and the market is is moving at a an accelerating pace. So people who do not, adapt this model are are not gonna be in a good place in in the fairly near future. Right. So in summary, we've got the 2 principles we covered obtain a yield, and, self regulating systems that rely on feedback. Yep. It'll From a go ahead. Yeah. And respond to that. Positive. And respond to that. Right. Exactly. And so in summary, you know, from a from a ecosystem thinking perspective, from a business perspective, It's about aligning teams to focus on what the most valuable things are that obtain a yield or obtain a result an outcome for the company. And, again, the teams are largely autonomous self regulated. aligned to a common mission mission vision purpose for for that business stream. And they're regularly monitoring feedback so that they can continue to to obtain a yield. Yep. Do you see any, and I know we're getting a little long here, but that's okay. Do you see, examples of this in in, in your travels as a coach, business coach out there? I I've always been a a fan of Apple in the Steve Jobs era, and they absolutely did this. so few companies are willing to go and cannibalize their own products. products have a market cycle. Products have a life cycle, particularly consumer products, the you could call them fads, but but things get popular and then technology changes or or or the market interest changes, and they go away. The example I I think of is the iPod, which is now they don't even make anymore, versus the iPhone? Well, if if people were very narrowly focused on on short term results and and protecting, and not responding to feedback, The iPod group would have gone and when the iPhone group was small, they would have gone and and and crushed them and not allowed them to go and be successful. But instead, they had some good leadership that looked at the big picture that recognized that that the iPhone is potentially larger than the ipod. And of course, we all know how that turned out. But that's an example of responding to feedback. Yeah. And I I think there's plenty of examples like that in in the more modern times. Apple is not what they were in the 2003, 2005, 2007, era, timeframe. But you see examples like this of companies that are very much part of their ecosystem, very much employing many or all of these principles to stay on the cutting edge. they're obtaining a yield for themselves. Also for society at large, and, they're doing so in a way that accepts feedback and and and and really thrives because of Right? They're able to stay on the cutting edge. In spite of changes and market changes in the environment, they're able to stay ahead of the curve and, and continue to, to develop, great products I guess what I'm wondering about is the whole ecological impact of, the products that we're creating and consuming and and all that stuff. I don't know that there are any companies that are really all that ecologically aware. Like, as as permaculture would have you be, but maybe that's a topic for another discussion. I don't know. But to think about that. Apple, some companies are trying to get there using recycled materials renewable energy and things of of that sort. are there are a couple of other good examples that come to mind, excuse me, for putting you on the spot here. It does concern me that it always seemed to go to Apple. I would like to have some other good examples of the of this kind of thinking, but, I I I'm struggling a bit to think of a few. Is there any that our of mind to you, or is that a a topic for later? Yeah. I'm I think I'm gonna have to think on this. You know, I think about how the permaculture principles focus on a balance, right, an ecological balance, so that we're not overusing, the resources that we have that we're that we're ecologically conscious, not just economically conscious. And I think for companies, most companies today, are are much more about the bottom line and the, the average tenure of a CEO is fairly short. And so they have to make their mark on the company. And And it's it's it's about returning more money to the shareholders and returning more money to the bottom line. And and and, I don't know that there are many companies out there that are thinking in terms of long term ecological impact. maybe Tesla. I don't know. I mean, you know, you never know with which way with Elon Musk, you know, what he's thinking, but at least his his aspirational goals are if if they're true are laudable, right, he's trying to create a a a carbon free economy for the future or at least get us on the road to a carbon free economy in the future. And that, to me, is a more ecologically sound alternative to what we're doing now with fossil fuels and and things like that. There's an interesting point here from economics. the the the fancy term is unfunded externalities. Basically, plastics are a good example. there's nothing because companies are not required to take back the product at the end of its life cycle, they're able to sluff that off to the government. That just encourages wasteful packaging and that sort. Whereas if if we we looked at a a so basically, the the externality in this case is waste and and it's not funded because the government takes care of it. the the the consequences of burning fossil fuels, There's a study at a Stanford. It costs $250 a ton. Well, the companies who are burning that don't pay that. You and I don't pay that. the government, well, and and society in general pays that. So really organizationally, in order to address this, we need to look at the external the unfunded external costs that we're imposing on society. And, this will be a major change, which is not gonna be having any time soon, but, really, the organizations should be bearing those costs so they can better align their behavior with the full life cycle of costs which is kind of like the ecosystem. but did this is just showing how our current structure is not set up to do that because those costs are simply not part of it. Whereas in a in a true permaculture system, everything is there. It's a complete it's a closed system. All the costs and all the benefits are within the system. But within an organization, there are external costs that are not. So naturally, the optimized behavior does not include those costs. And we're starting to see some some significant pain, in the case of, of climate, for example, right now. I would suggest that we table this for now and and sort of get through all of these principles and and draw some parallels between permaculture and ecosystem. And then, maybe we can do some research on companies that embody some or all of these principles and bring that as as maybe a case study of of companies that that do or maybe companies that come close and and what they look like, you know, what their their ethos is and and how they operate. And maybe you won't find any. I don't know. We'll see. Alright. Well, thanks for watching. Glenn, thanks again for, being for co hosting this with me. And we'll see you all in a month where we'll cover principals, Let's see. 56. And I don't know what they are, but you can always look up permaculture principles and see what they are. We'll have a link to the per both the permaculture and the ecosystem thinking principles in the description of this video if you'd like to do some more research on your own. Again, thanks for watching. Bye, everyone. Bye
