Metanoic Organizations in the Transition to a Sustainable Society

Two distinct, long-term dynamics are now merging to create unique forces for social change: One is the life cycle of industrial growth; the other is the economic long wave. The life cycle is a one-time phenomenon, based on depletion of finite natural resources such as land, oil, natural gas, water, and the capacity to dissipate pollution. Abundant resources, often at diminishing real costs, gave rise to a period of unprecedented industrial expansion with little attention to the longer-term consequences of growth for the environment. During the transition to a postindustrial society, the interdependencies between the economic system and the environment become clear, with a concomitant shift in attitudes and values. The Limits to Growth by Meadows et al. and subsequent studies point to the present as a time of unprecedented stress, where the attitudes, values, and expectations of the industrial-growth era are challenged for the first time. Pitirim Sorokin, founder of the department of sociology at Harvard University, forecast over a half-century ago that industrial society would become increasingly disillusioned with its materialistic goals, decline, and then perhaps reemerge as an “integral culture” characterized by a balance between material and spiritual values. With 20 years of survey evidence, Daniel Yankelovich today sees just such a shift. He argues that “instrumentalism,” which views material possessions as the instruments for generating satisfaction, is gradually being supplanted by a “sacred” outlook that seeks the intrinsic value of human experience in the family and the workplace. The transition to a postindustrial economy spans probably 30–50 years. What makes the 1980s a period of particularly rapid change is the concurrent cresting of the economic long wave or Kondratieff wave. This is historically a period of economic stagnation, as the major depressions of the 1830s, 1880s–1890s, and 1930s show; but it is also a period of experimentation and innovation. Economic growth since World War II has been built primarily on a series of remarkable innovations—television, jet propulsion, digital computation—that came to light in the 1930s and 1940s, that is, during the last long-wave transition. The long-wave transition is a period of great stress for private business. Bankruptcies are high, particularly in older, traditional industries. Pressures to cut costs and maximize flexibility handicap the top-heavy bureaucracies of the former period of relatively stable growth. Economic conditions favor more resilient organizations that can adapt to complex technological and market changes. The convergence of the life cycle of industrial development and the economic long wave is causing fundamental changes in the business environment. The life cycle is creating fundamental shifts in values and attitudes. The long wave is creating extreme economic stress. A small but significant number of American corporations are emerging as prototypes of a new kind of orForeword When we wrote this article more than 17 years ago, its ideas made great sense to us. Moreover, they arose from approximately 10 years of experience from consulting and workshops with senior and midlevel managers. However, to say the least, they were “on the fringe” of management theory and practice. Looking back now, we are surprised to see how widely some of these ideas have spread—such ideas as vision, alignment, empowerment of people, systems thinking, and more decentralized organization designs. None of this, however, means that the notion of metanoia, a fundamental movement of mind, is either well understood or widely embodied in today’s organizations. In some ways, the more that basic ideas become familiar to CLASSIC