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On Branco Schippers, Business of business

You mention the concept of a business not being human, but created by humans. I think this is a very interesting concept, posing the question "are we really in control of our businesses?". We would think that ofcourse the director/ceo/founder may be responsible for the business' actions. But also this is not always true, some forces from deeper inside a business that go around the director may be the reason for certain processes. I also agree that a loss of jobs or wages is not desired, allthough this has to be put in perspective. Maybe the company has irresponsibly hired too many persons? Maybe the wages where too high already?


On Branco Schippers, Kuznets explained

Thanks for sharing this interesting view upon the urge to reduce environmental pollutions outputs. I have not yet seen it as a pyramid where certain priorities are dynamic, bound to prosperity. In that sense, when we wished for mobility we could develop a (reasonably) functional system for private car transport. Than why can we not (yet) come up with a system that attacks CO2 as a pollutant? Maybe this takes time.


On Michelle Steenmeijer, the busines of business is to increase profit

I think overall what you say is correct and I can relate to your thoughts. I’m not sure if I understand “efficiency of a product” correctly in the blog. I would think of performance of the product, being able to do more, with less. Personally I am not sure if R&D and robots and such really increas the efficiency of a product. I think a lot of R&D and applying automated techniques is done to increase production rates; more & more, not better products per sé. However I do not know the facts of this. This touches upon another interesting topic; standardising life time of products. Do companies make products that on purpose last less long?

On Michelle Steenmeijer, Materialism and lonliness

I think you picked a very accurate topic (materialism) that relates to our every day lives and the choices we make on a daily basis. It reminds me of a documentary by Alain de Botton, called “Status Anxiety”. Here, he confirms what you are saying: In a civilization where everyone should have the same chances, then why do I drive a Fiat Panda and my neighbour can drive an Audi A8? It is exactly this discrepancy in material goods that we use to read someone’s status: rich or poor.

I find the idea of materials separating people interesting, it is true that some things like the community bbq seem to fade away. Just like kids playing online games instead of playing hide and seek outside. On the other hand, also consider the social connections that can be made thanks to these technological interventions (WhatsApp, Facebook chat, online gaming). I myself am in perfect touch on a day to day basis with my friends from high school who live in different cities thanks to whatsapp, before we didn’t really know what’s going on in eachothers lives. It’s not optimal, but it’s something :)

And just to add a sprinkle of “hope” towards a better consumer market; have you heard of Peerby.nl? It’s a platform for everybody to share everything with everybody! Maybe these things will become more common the next decade.

On Josefine Rook, Friedman Proposition

Hi Josefine,
I agree that consumers can change supply. Actually, I always believe in the idea that whatever products or services there are being sold is a mirror of society. No matter how weird, polluting or green a product is, it is only produced because there is groups of people that want the products. 

So far I can only agree with what you are saying, since what you describe is a personal devolopment that you have made since the beginning of this course.It seems you learned more about your personal opinion along the way which is good!

On Josefine Rook, Rational Decision making

Hi Josefine
I think you clearly described the steps of the RAM, using Obama's decision as an example. I think it is very well applied. 

I do miss the part where you where supposed to "Write an alternative, equally plausible account, showing how these actions might result from a boundedly rational organization (à la Jones 2003)".


On Ilonka Marselis: SES

You present the subsystems clear. Just wondering, how do the the systems together protect us from earthquakes? I personally feel that one part of the system tries to limit the amount of earthquakes, but they do not protect us from them.

I see how you propose to invest in order to have a safe extraction of gas. This itself leads to a sustainable gas extraction, in that sense that the extraction of gas can sustain itself. I must say that I interpret sustainability in this context as a process that does not contribute to the greenhousegasses. Burning fossil gas I think adds to greenhousegasses.


On Tim de Vrijer: SES

I think you touched upon some promising topics that will grow of importance the coming years. What I find interesting is that symbiosis's like recycling and waste stream  collection comes with dependency on other companies/organisations. There has to be a high level of trust in order for these kind of symbiosis to work: if one company shuts down, important streams may shut down as well,  leaving other companies with problems. 


On Paulina Criollo, Nokia

Hi Paulina,

Very good and extensive blog on the Nokia video. I agree with what you are saying. I have double feelings on this way of Nokia by showing their goodwill to improve the situation. It is good that they want to improve their supplying line, however, why did they build/hire this factory in the first place?

I think the coordination system you suggest is a good one, proposing companies to develop stronger norms. I am wondering though, if this can be developed the same way in China as in Western organisations. From what I know of China, the power is very ' top-down'. The government sets the rules and the economy has to follow. Maybe it is up to the government to sharpen the norms? Or better control?

On Rebecca Joubert, Nokia

Hi rebecca,

I think your analysis on the video is accurate. I am wondering if the correct incentives may still motivate the supplier to improve the situation. Maybe in that way Nokia can still keep the same supplier. 

I miss quite a large part from the assignment: 

Is the approach taken by Nokia an effective way of diffusing sustainability criteria?

How could another coordination mechanism improve on this?

I would like to see you view upon this as well.

Kind regards,

Daniël

On Romee de Blois, Resource networks

Dear Romée,

I think you picked an interesting case that is actually regional. I found that quite hard to find actually. The warmterotonde is a good example of a regional case. You analysis is done quite well and the list of stakeholders gives a good overview and also a notion on how large this project actually is.

Concerning the network, I think you are right when saying that it consists of cliques connected through some big/powerfull actors. On your remark:"Because the government is tightly involved the level of transparency is high, creating a lot trust in this stable assembly" I would like to ask you from what perspective it is transparant? For me, complete transparancy is achieved when the organisation or coalition can show a full overview on their activities and spendings. However, I do not see for example how the much the industrial companies are being payed for their heat, or what they have to invest in the pipes in relation to the municipalities? Ofcourse this is the beginning of this project, but I am doubtfull on how transparent this project will be in the end.

I understand that you say that the roundabout is dependent on one resource, heat. Ofcourse withot heat, the purpose of this construction would be absent. However, in this context I think transferring heat is the goal, and by reaching that goal you need many different resources. For one, you need to be able to finance the pipelines. Therefore capital is an important resource. You name investments from outside correctly (like banks). 
Another important 'resource' in this case is the network allignment. In order for a project like this to become a succes, the actors involved need to achieve a high level of trust, since they become dependent from eachother. (if one company quits/goes bankrupt, the network is greatly affected).

About closing the loop, I see that this project definently is an addition to the heating efficiency of companies. However I don't think that this really is closing the loop. In my opinion, closing a loop means reaching a circular system where materials that are discarded after use are used again in the beginnning of the cycle. I think the issue here is that this is not a network of material production, but a network of heat production. And unlike materials, one cannot store heat. In this network, heat is cascaded efficiently over multiple users, after which the heat is lost in the air. 

Also I think it would have been interesting to see how the network that you described reached this cascading energy system. Why could this network specifically reach their goal?


On Hsiu-chuan lin, Resource networks.

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On Jorine Vernooij, Sabatiers' Framework

Hi Jorinde,Very extensive analysis on the proposed measures. Your structure is clear and this makes the text comfortable to read. I do not have any comments for the rest.Kinds,Daniël

On Vigil Yu, Sabatiers' Framework

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Coercing by NOKIA; dark marketing.

This blog post is based on the documentary "A decent business", shown in the SSPM course lecture on thursday 9th of october, 2014. The documentary is available online as well. To be able to understand the this blog post, I advice you to watch the documentary. 

I was quite amazed by the English speaking fellow who guided the ethical assessors of Nokia through the factory and was so open and even laid-back about the situation the factory was in. People being payed under minimum, fining them for being too late and not even having set up contracts with every single employee. He was telling all this, looking as if he doesn't care at all. This observation gave me the idea that this guy would get fired immediately after this documentary aired.

So why would the bloke be so indifferent about the situation? The first thing that comes to my mind, is the helpless situation the factory manager is in. He knows that whatever he says, true or false, it is somewhere on paper and can be checked. So better be honest, at least the guy knew what he was doing, as his body language suggests when exposing the factory's (illegal) activities. He does not take on the role of the victim, I give him that.

Then why is the situation so helpless? Well, NOKIA, probably your biggest client, is on your doormat with a camera crew and they insist that you open up your doors to an ethical assessment. Appearantly NOKIA strives for legitimacy. The documentary aids NOKIA in this in three different ways from my point of view:

1. Obviously NOKIA aims to spread the message "we care" to the rest of the world.
2. Appearently, they are not too scared on showing their inside practices. They even show their naked managers in the very first seconds. Literally a companies being transparent, living up to a word that in my opinion is used a lot but the definition takes many forms.
3. They even criticise themselves. In order for NOKIA to be "fair", start with yourself. This is quite the statement, practically saying nobody's perfect, but we are working on it.

The factory management also strives to be perceived as legitimate. Even the simple things as the big boss saying "all these workers are my friends" with a big smile. A few moments later the guy picks out some workers from the floor for an interview, not even bothering in asking their names. Their numbers suffice. Another way of striving for legitimacy is trying to keep the factories operations within the legal boundaries. "We can't offer our workers legal working conditions? Then we make sure that technically speaking, they all don't work here" (by not giving them contracts ofcourse).

Seems like some harcore marketing by NOKIA, right? Nokia becomes the advocate of sustainability criteria within supply chains (for mobile phones). On the other hand, why did NOKIA choose this factory in the first place? Is it not a bit shady that this ethical check is being done now? Why didn't they check the factory before they started doing business with them? Or why didn't they aid in developing the factory in such a way that all of these circumstances would have been different? This does not become clear from the documentary, so I cannot judge. However, I think the sustainability criteria are "end of the line" criteria. I think there should be clear criteria on what line you set in motion. What factory are you going to do business with and why. These are the sustainability criteria that I would like to see.

Nevertheless, Nokia strives for legitimacy and does this by applying coercive pressure on their supplier by knocking on the door with an assessor. It seems from the documentary that Nokia is the factories only buyer, since they seem to have a lot of power when walking around the factory (demanding information, interviews and meetings).

Other ways of reaching legitimacy for Nokia's supplier are mimicry and normative pressure (DiMaggio & Powell). Mimicry is a way of characteristics transmission among suppliers when a growing number of suppliers in China adopt the operations criteria that comply with Nokia (and probably more companies), resulting in other suppliers to follow this trend, mostly fueled by growing uncertanty. Normative pressure can cause characteristics between organizations or organizational fields to change from within the organisation or field. Education of more sustainable ways of operating production facilities brought along by new employees can start changes for example. A possibility would be that Nokia becomes active in the hiring process of managers of the suppliers factory in order to stimulate normative pressure by hiring persons that bring along the desired norms.

A smelly basement (week 41, Social Ecological Systems)

I work in the Science Centre of Delft, a place that people of all ages can visit and get acquainted with TU Delft technologies. When walking through the building, we can see high tech innovations such as superconductivity trains, live flying simulators and 3D printers and scanners. In the back corner of the building something weird is going on. This corner is a bit smelly, like a trash can that has been left open. If you follow the smell, you would climb down the stairs, to the basement, where it is dark and moist. Open a door and you will find something very exciting: a Do It Yourself Bio fermentation installation. Here, biogas is won through the fermentation of bio waste. Ofcourse, this causes the smell.

This Social Ecological System (SES) is quite simple: The installation is being fed with all different kinds of biowaste (Resource units such as lunch leftovers) from all different faculties of the whole campus (Resource system). Unfortunately, there are no constant users at the moment, except for the occasional exhibition by the Science Centre itself (sometimes they extract a bit of biogas to torch a small flame). The Governance System is the TU Delft, of which the Science Centre belongs to. In the end, the TU Delft would posess the power to get the Biogas installation at full speed. They could make sure that Sodexo, the operating catering service at all faculties collects the biowaste and transports it towards the Biogas installation. It is important to know that at this stage, the system is not "running", in the sense that almost no waste is being collected from the campus because the resulting biogas cannot be used or sold yet. 

Now, how can the Friedman principle be put to use in order to sustainably manage this SES? Friedman argues that companies only strive for profit maximization and that social values are not their responsibility. In case fo the Science Centre, which is largely funded by the TU Delft and the Municipality of Delft, striving for profit maximization is not their core business. However, in order to receive the funds, they have to convince their funders that what they do is usefull and within the Science Centre's scope of desired achievements. And in that sense, it will be very difficult for the Science Centre to become a large biogas production station. Funds to the Science Centre are meant to be spent on education of children, students and promotion of the TU Delft, not to be spent on becoming a competitive energy supplier. So, in order for this SES to grow larger, the Science Centre is not a good platform.

Then how can this SES be managed to grow into a large scale system where, say, all TU Delfts waste is used to make biogas? A better platform would be an organization with goals and material flows that allign with the biogas system. A farmer may be an interesting platform, since their material flows consist of bio-products and they have the space to increase the capacity of the system, whereas the Science Centre basement will become to small.

# 4 friedman Proposition

I have to say that my first post on the business of business has little to do with the Friedman proposition, it was more an anecdotic way for me to express myself on the business of business to maximize profit. However I expressed my opinion in a strong way and I have to revoke or re-discuss some of the earlier statements after reading the Friedman article.

First of all, I stated that investing in smaller, local facilities (workshops, art galleries) may socially be more rewarding than for example investing in a fund, where the money is untraceable and thus impssible to assess the social gains as a result from the investment (unless if the companies attached to the fund are 100% transparent). However, possible profit from investing in the fund may be of much larger capital than an investment in small local facility. If this profit is used to support a social goal, the effects may be very powerfull as a result from a larger investment.

Secondly, it is indeed very difficult to define "social responsibilities" of companies. Say a director would spend money that belongs to the company on social ends, what ends should this be? Should this be something related to the company? Or can this be random? How can a director justify this choice? And how would this money be spread equally? So it is too easy to say that companies should respond to their social responsibility, without presenting a system that would actually work, both socially and economicaly.

However, there are examples to be named where companies externalize their costs. The most famous example is ofcourse exploding factories in India, owned by western companies. Or CO2 production in developing countries as a result from industrial activities by western companies. I personally feel that these go in the category "social responsabilities" of companies. And actually, these externalizations are very easy to trace, when these externalizations are defined. Defining them is more difficult though.