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HELICAL CAPITALISMa new solution to an old
problem
Simon Walker
© Human Ecology Ltd 2011
based upon Human Ecology Theory
© Human Ecology Ltd 2010 2
Simon P Walker, Revd. MA Oxon, MTh, BTh◦ Works as a consultant, speaker and advisor to businesses
and charities in the UK and internationally and is the founder of Human Ecology Ltd and The Leadership Community.
◦ Author of Human Ecology Theory and its applications to organisations, behaviours and markets, The Undefended Leader Trilogy and The Undefended Life.
◦ Ordained Anglican minister who taught at Wycliffe Hall for seven years.
Author
© Human Ecology Ltd 2010 3
Helps us understand the behaviour of social systems
Helps us understand how ideas are adopted and move through society
Helps us understand the psychology of buying and selling- e.g. the market
Human Ecology Theory: a theory of social space
© Human Ecology Ltd 2011 4
1. Presentation and Reservation (P/R)◦ Presentation: newsletter, classrooms, happy kids, results◦ Reservation: planning, assessment, health and safety
2. Expanding & Consolidating (X/C)◦ Expansion: New curriculum, new markets (Far East)◦ Consolidation: Better teaching, fewer exam fails
3. Strong and Weak force (S/W)◦ Strong: Rules, discipline, standards, uniform◦ Weak: Respect, encouragement, friendships, pastoral care
How does Human Ecology do this?
Isolates 3 essential movementsfound all populations e.g. A school
© Human Ecology Ltd 2011 5
Presentingnewsletter, classrooms,
happy kids, results
Movement 1:Presenting and Reserving
Reservingplanning, assessment,
health and safety
© Human Ecology Ltd 2011 6
ExpandingNew curriculum, new
markets (Far East)
Movement 2: Expanding and Consolidating
ConsolidatingBetter teaching, fewer exam
failures
© Human Ecology Ltd 2011 7
Strong forcesRules, discipline, standards,
uniform
Movement 3: Strong and Weak Forces
Weak forcesRespect, encouragement, friendships, pastoral care
© Human Ecology Ltd 2010 8
A social ecologyof a school
PSC Head, exams, uniform
PSX Role models, icons, success stories, targets
PWX Opportunities, coaching, learning relationships
PWC Belonging, friendship groups, teams
RSC Rules, values, boundaries, expectations
RSX Vision, inspiration, knowledge gain
RWX Service, support, struggle
RWC Failure, absence, drop out, loss
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Human Ecology Theory describes the ecology of any population
PSC Dominant norm
PSX Iconic celebrity
PWX Aspirational population
PWC Mass population
RSC Stabilising groundrules
RSX Radical innovators
RWX Frustrated and impotent
RWC Discarded
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So What?
In order to understand why capitalism is broken we need to
understand how the market functions within a population
© Human Ecology Ltd 2010 11
The monetising of the adoption of an idea
across a population
The Market: A Definition
© Human Ecology Ltd 2010 12
PSC Dominant norm
PSX Iconic celebrity
PWX Aspirational population
PWC Mass population
RSC Stabilising groundrules
RSX Radical innovators
RWX Frustrated and impotent
RWC Discarded
The adoption pattern is a wave moving
through our social ecology
Essential Idea:
© Human Ecology Ltd 2010 13
Enjoy a cuppa this morning?
© Human Ecology Ltd 2010 14
The adoption of the Tea Bag
PSC Domination 96% in 2003
PSX Loose leaf tea Expansion 128 million/year!
PWX Demand 1960’s Life get’s faster!
PWC Adoption Tetley adverts: Cheap, quick
RSC Stabilisation Tetley Perforated tea bag 1964
RSX Origination Silk tea bag 1903, paper, perforated
RWX Frustration/desire Too slow, too much work in fast world!
RWC Discard/Depletion
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The Rise of Windows
PSC Domination 2000Explorer
PSX Mainframes Expansion 1995Office
PWX Demand 1990 Windows
PWC Adoption 1981IBM partnership
RSC Stabilisation 1980MS DOS
RSX Origination: 1979 BASIC
RWX Frustration/desire: 1970’s Mainframes
RWC Discard/Depletion
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Evolution by Natural Selection
PSC Domination Secularism 1980’s-
PSX Lamark, 7 day creation Expansion Public education 1960’s-
PWX Demand Politics of 1930’s
PWC Adoption Mendel rediscovered 1902
RSC Stabilisation Huxley inter al. 1860
RSX Origination Darwin 1859
RWX Frustration/desire: Geology/Paleontology 1820’s
RWC Discard/Depletion
© Human Ecology Ltd 2010 17
Entrepreneurialism follows the same pattern
PSC Domination
PSX Expansion
PWX Demand
PWC Adoption
RSC Stabilisation
RSX Origination
RWX Frustration/desire
RWC Discard/Depletion
© Human Ecology Ltd 2010 18
The Adoption
wave has two phases
Phase One Phase Two
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Phase One happens beneath the surface (R=
Reserved)
•Hidden•Investment phase•Growth and development
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Phase One has three distinct stages
Stage 2:Origination of the novel idea
Stage 1: Frustration with the current situation
Stage 3: Stabilisation of the technology
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e.g.Tea Bags
PSC
PSX
PWX
PWC
RSC Stabilisation Tetley Perforated tea bag 1964
RSX Origination Silk tea bag 1903, paper, perforated
RWX Frustration/desire Too slow, too much work in fast world!
RWC Discard/Depletion
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Phase Two happens above the surface (P=
Presented)
•Visible•Return on Investment phase•Scale and Duration depends on base of Phase One
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Phase Two also has four distinct stages
Stage 7: Saturation and domination
Stage 6: Expansion of delivery
Stage 5:Demand for the technology
Stage 4: Adoption of the technology
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Phase Two for Tea Bags
PSC Domination 96% in 2003
PSX Expansion 128 million/year!
PWX Demand 1960’s Life get’s faster!
PWC Adoption Tetley adverts: Cheap, quick
RSC Stabilisation Tetley Perforated tea bag 1964
RSX Origination Silk tea bag 1903, paper, perforated
RWX Frustration/desire Too slow, too much work in fast world!
RWC Discard/Depletion
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What causes a wave’s decline?
BREAK: Weakness in the neck of the wave
DROP: Over-weighted head of wave
DRAG: Under-weighted base of wave
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DRAG: Under-weighted base of wave
Structure begins to fall apart
Idea lacks originality Idea solves old problemIdea increasingly discredited
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DRAG- can create collapse
Lack of Strong Regulatory Foundation (RSC)◦ Contributed to financial collapse
RSC phases (regulation) too thin to support wave above
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BREAK : Weakness in the neck of the wave
Adoption not extensive
Technology not ready Idea is ahead of its time
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BREAK: Overhyped market
Failure for market to be ready (PWC) e.g. Dot.com
PWC too narrow: market not ready for acceptance
RSX broad: online retail the future solution
RSC too narrow- broadband and online stores not robust enough
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DROP :Over-weighted head of wave
Suppression of critique/supreme overconfidenceSaturation of technology
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DROP: Collapse of investment banking
Over-extended PSC phase of wave through financial technology hubris
Expected wave profile if PSC not overextended
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Are waves a good thing?
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Waves are inevitable: It is how human creativity progresses
PSC Domination
PSX Expansion
PWX Demand
PWC Adoption
RSC Stabilisation
RSX Origination
RWX Frustration/desire
RWC Discard/Depletion
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Problem : Dominance often results in suppression rather than support
PSC DOMINATION- King!
PSX EXPANSION- Rich fool!
PWX Demand
PWC Adoption
RSC Stabilisation
RSX Origination
RWX Frustration/desire
RWC Discard/Depletion
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This is both unjust and unproductive
PSC
PSX
PWX
PWC
RSC
RSX
RWX
RWC
Lack of growth zone
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It is driven by the twin emotions of fear and greed
PSC
PSX
PWX
PWC
RSC
RSX
RWX
RWC
FEARGREED
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But this is the history of Western Capitalism
38© Human Ecology Ltd 2010
Structural engineering could change this outcome
PSC DOMINATING PHASE
PSX EXPANSIVE PHASE
PWX Demand
PWC Adoption
RSC Stabilisation
RSX Origination
RWX Frustration/desire
RWC Discard/Depletion
Power of PSC and PSX used to pull up RWX and prevent RWC
39© Human Ecology Ltd 2010
From wave to helix
PSC INVESTING PHASE
PSX INSPIRING PHASE
PWX Demand
PWC Adoption
RSC Stabilisation
RSX Origination
RWX Frustration/desire
RWC Discard/Depletion
© Human Ecology Ltd 2010 40
The Jubilee follows this pattern
Jubilee = a system of interlocking waves or helices preventing social abuse
Jewish society
Period of service for slaves
Slave release
Slave ownership
Period of release for slaves
Blue waves and green waves tied to each other
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Microfinance: strengthening the core
Microfinance get’s close placing social trust at heart of banking
High strength core of accountability and social cohesion and dignity
Pay back loans and can apply for more
Lenders invest
Entrepreneurs borrow
Loans recycled
Lenders reinvest
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NFL: An example of for-profit market
The league
Superbowl
The draft
Profits from bowl back into league
Salary cap
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Helical Capitalism Key Principles
•Trust + generosity not fear + greed•Long term lending – several cycles•Close proximity between investor and business•Investor takes stake in business
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Fastest growing bank in UK
•No bonuses•Only local relationship between lender and business•Long term rewards for executives
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When fear and greed drive adoption, the resulting wave pattern is inevitable
The Kingdom is a place in which fear and greed have no place
Kingdom people have the freedom to break the cycles of the market
The church must embody a different economic if it is to witness to the Kingdom
The Economics of the Kingdom
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Further Reading
www.undefended.org
© Human Ecology Ltd 2010 47
Disclaimer
The trademarks and service marks contained herein are the property of Human Ecology Ltd.
This report or any portion hereof may not be reprinted, sold or redistributed without the written consent of Human Ecology Ltd.