A sustainable value proposition is the value proposition embedded in a bigger ecosystem.
An ecosystem
No business is self-existent and self-explanatory. Each and every business exists by virtue of someone else. They are all parts of an ecosystem.
An ecosystem is essentially the interdependence that brings all things together. This interdependence sustains each entity which in turn sustains the overall system.
Nonetheless, many businesses decide to decouple themselves from an ecosystem and engineer an artificial one instead.
An engineered system is forged when a business takes out natural entities, cancels out natural relationships, and removes an ecosystem altogether. It replaces natural entities with artifacts, natural dynamics with engineered mechanisms, and a natural ecosystem with an artificial system – all for the benefit of the focal business itself.
Topsoil
Take agriculture for instance.
Yield is a key concept in agriculture. Sustainable yield depends heavily on healthy, nutrient-rich soil, especially the topsoil – the top layer of soil where mineral particles, organic matter, and microorganisms concentrate.
Topsoil is vital to agricultural yield as most of the agricultural activities occur on this layer. Yet its importance reaches far beyond that – it defines a nation’s economic and ecological health and wealth as well.
Just as President Franklin D Roosevelt put it vividly in his letter to all State Governors in the USA in 1937, “The nation that destroys its soil destroys itself.”
Ultimately, it’s for the benefit of all to preserve topsoil.
However, topsoil is hard to come by. It takes a tremendously long process for topsoil to form – normally 100 years for every inch in natural settings. It also takes the whole ecosystem to keep it up, which involves sunshine, water, air, insects, microbes, cover plants, animals, and their by-products.
It is within this ecosystem that living topsoil is sustained.
Conventional agriculture, however, broke this ecosystem with its single-minded goal: “yield” – to maximize crop yield.
With that goal in mind, farmers are encouraged to practice monoculture – a farming practice that takes out animals, plants, insects, and microbiome, and replace them with synthetic fertilizers and biocides just so to optimize the yield of a single produce.
The optimal yield, however, does not come without cost. Every time when farmers practice aggressive overplowing, obsessive monoculture, and intensive chemical toxification of the field, they break the ecosystem and kill the topsoil. As the topsoil dies out, farmers have to add more fertilizers and biocides to get things going. That triggers the bad cycle within which the cost keeps on skyrocketing, the soil keeps on deteriorating, and the produce keeps on losing its nutrients.
Brown’s Ranch
Having been there and done that, the farm Brown’s Ranch decided to practice regenerative agriculture.
Regenerative agriculture is to bring animals, plants, insects, and microbiome back to the land.
By bringing insects and microbiome back to the land, farmers get to recycle, reserve, and restore the carbon and other nutrients in soil. By bringing diverse cover crops back to the land, farmers get to enrich soil organic matter (SOM), soil structure, and soil nutrients. And by bringing diverse animals back to the land and slowly rotating them across the field, farmers get to fertilize the soil and allow diverse plants to naturally regrow and replenish, which further revive the topsoil.
Together, regenerative agriculture eliminates the need for biocides and fertilizers, cancels out the engineered system, and restores the natural system upon which things can thrive again the way they are supposed to be.
A value proposition embedded in an ecosystem
So, bring things back into perspective.
The difference between regenerative agriculture and conventional agriculture is that one involves a value proposition embedded in an ecosystem and the other one involves a value proposition decoupled from an ecosystem.
When a value proposition is embedded in an ecosystem, it takes a free ride on the ecosystem.
An ecosystem itself is self-organizing. It works all things around for the benefit of all. Via symbiosis, complexity is absorbed and order is established. In leveraging on the dynamics and momentum of the greater ecosystem, the focal value proposition gets to deliver optimal customer values with the least amount of effort. That creates sustainable values that are effective, simple, and good for all involved.
When a value proposition is unplugged from an ecosystem, however, it has to reinvent its own wheel. This wheel, in isolation from the bigger ecosystem, is unfortunately not self-organizing and self-sustainable – it has to be managed to get things going. That means it has to generate its own dynamics and garner its own momentum – that’s an engineered system sustained at its own cost. Value propositions of this sort do offer values that work for the moment, but they also complicate things over time and across space. Even if the business gets away from the immediate cost, someone somewhere else may have to pay the cost if we bring the whole ecosystem into perspective.
On the one hand, we have value propositions that are riding with the bigger ecosystem. These value propositions offer things that are sustainable, reliable, intuitive, and harmonious. On the other hand, we also have value propositions that are moving forward on their own wheels. These value propositions gain momentums by offering quick fixes, but they are hardly sustainable. And their ramifications may unfold into greater complexity on a wider scale that only time can tell.
In the end, if we could borrow the metaphor of the 80/20 Principle, we could project that a value proposition embedded in a bigger ecosystem is to shift toward the 20 side – 20% of effort lead to 80% of sustainable values, metaphorically; and a value proposition decoupled from an ecosystem is to dwell on the 80 side – 80% of effort lead to 20% of sustainable values.
Bear in mind that the longevity, or sustainability, of a business is not defined by how profitable it is – how much value it extracts from the ecosystem, but by how much value it creates – how much value it brings to the ecosystem. Sustainable value is the ticket to remain relevant in an ecosystem, and an ecosystem will always have the final say and reassert its correction power sooner or later.
80 or 20, which side to take?
Think twice before proceeding with business as usual.