The challenges HU was created to address are complex and systemic. While we are committed to the areas where we work, it can be difficult to understand how we can make an impact and effect change.
To this end, almost four years ago, we began a deliberate process to better understand the systems that enable these challenges to persist. It wasn’t easy, but we have been working ever since to become a systems-enabled organization. In this report, we have attempted to reveal the almost four-year progress of our journey, providing details and explanations of systems thinking, pulling back the curtain on how this process took shape around one of our portfolios of work, and revealing the challenges and frustrations for our work, our partners, our staff, and our organization.
This journey has tested many of our assumptions and made us fundamentally rethink our approach and what “expertise” means in the face of persistent challenges to human rights and dignity. We don’t presume to have discovered answers to these challenges, but we are on a new path—enabled by systems thinking—with the hopes of finding and bringing new solutions to our work.
In years past, we have produced an annual “performance report,” framed largely around our work for that calendar year. These have been useful reporting tools for our programmatic activities, but not necessarily for our performance as an organization. This year we wanted something altogether different—a report reflecting on our performance on a particular topic.
In 1966, Karl Popper, a philosopher of science, observed that some problems worked more like clocks: mechanical, finite, predictable, controllable. While other problems worked like clouds: infinite, ever-changing, unpredictable, hard to control. Humanity United was created to address cloud problems.
I am pleased to share with you this report on our performance becoming a systems-enabled organization. Our hope is that it is illuminating, both for our partners as well as other organizations that may be considering such a change. As always, we welcome your thoughts and feedback and invite those who are interested to contact us at firstname.lastname@example.org.
With warm regards,
President and CEO
In 2014, we began a deliberate journey at Humanity United. After many years working in some of the most complex environments on the planet, we wanted to step back, reassess some of our past work, shared beliefs, and strategies, and ultimately uncover new perspectives.
In short, we sought to create enduring, positive social change more effectively than we ever had before.
Developing and implementing a practice of “systems thinking” has provided us an opportunity to deepen our understanding of the environments we seek to change and strengthen our capacity to create enduring impact.
Systems thinking is a general term for viewing the world as a series of complex interconnections that each influence one another. A systems practice uses this approach to better understand complex environments in order to address important, though intractable, social problems over time.
A systems practice involves deep exploration and detailed mapping of the key components of a given system as a way to identify leverage points, which have the potential to yield positive impact at scale.
This approach helps us answer complex, critical questions about the environments in which we operate, make more informed and effective decisions about how to adapt effectively, and make the most impact with our resources.
“A systems view stands back just far enough to deliberately blur discrete events into patterns of behavior.”
One of the first steps in the systems journey is the development of a holistic understanding of the environment in which you are operating, which usually takes the form of a dynamic systems map. As teams explore the forces and core story of an issue, key points and relationships are identified that are used to create a visual representation of the environments they seek to change.
There are many parts that make up a complex system—just think of the human body and all the interdependent sub-systems it contains.
Mapping out these various elements, along with how they connect and engage with other parts of the system, is a valuable way to identify the key forces that create the problems we care about. And, it is affecting these key forces that will, in turn, improve the problems we target.
The mindsets, tools, and processes we use to navigate complex environments are what we call our “systems practice.” Our practice gives us a common approach and shared language that helps us describe our diverse challenges, test our assumptions, fortify our thinking, and give context to our outcomes.
As the use of systems thinking expands across The Omidyar Group and throughout many of our partners, our own systems practice is strengthened by the support and collaboration of a broader network of systems thinkers we call a “community of practice.”
While the tools, mindsets, and processes of a systems practice can vary, there is a universal set of outcomes the approach aims to deliver, including:
An understanding of the environment in which we are working as a complex, dynamic system.
An exploration of the most promising opportunities that could have high impact on the system.
An approach that exploits opportunities for leverage to make sustainable social change.
Continually learn and adapt accordingly to increase our ability to foster enduring social change at scale.
Perhaps the only thing more difficult than bringing about change is responding to it in our own lives. When we began our systems journey in 2014, we knew the immersive process would include many challenges—not only for the people within our organization, but for the partners we work with around the world. But, despite the hurdles that lay before us, we fully committed to the process because we believed in its potential to expand our understanding and increase our capacity to effect positive change.
The earliest stages of our systems implementation were challenging. The adoption of the systems thinking approach required us to master a new vocabulary to talk about and understand the systems we wanted to address. The process challenged us to revisit many of the deeply held beliefs that had served as the foundation of our thinking for years. We had always viewed strategy development through a systemic lens, but developing an organization-wide systems practice presented the opportunity to identify which of our existing assumptions held promise for creating measurable impact and which required reframing to uncover new approaches. In short, the process required us to be humble in the face of our work.
Developing a systems approach can feel like building an airplane while trying to fly it, and, in many ways, this was true of our experience. We found ourselves working across teams to begin the process of discovery and mapping while, at the same time, creating many of the customized tools and methods needed to build our maps in real time.
We were faced with the significant challenge of introducing systems thinking to our existing teams, beginning an intense period of learning and adjustment for all of us. The rollout of this new and foreign approach was not without some setbacks. We were, after all, asking people to transform the way they had approached their work for years.
Almost immediately, we recognized that this new approach was more inclusive and even democratic in nature. Whereas the program teams closest to the substance of our work had historically led our strategy development, we now made it a priority to include a cross-functional set of people in the systems mapping and exploration work. Reflecting the core of systems thinking, this process inspired collaboration among staff members of varying seniority, perspectives, backgrounds, and expertise, as well as external partners and stakeholders.
While systems thinking moved our teams closer to deeper understanding and more precise strategies, it also carried with it significant implications for our staff and partners. Within our organization, we needed to facilitate operational changes to align with our new approach. From hiring the right talent, to enhancing established teams, to adjusting our grantmaking process, many of these changes had to be addressed as we were still “building the plane.”
With all these changes, we had to remain mindful of the impact it was having on our organizational culture. The success of onboarding systems thinking was dependent on a culture that would embrace the hard and messy aspects of the work ahead and could find shared joy in the opportunities surfaced by our new practice.
While this process tested our culture, commitment, and patience from time to time, it also highlighted the resilience, agility, and creativity at work across our organization.
At HU, we have always recognized that we belong to a committed community of organizations and people seeking to create lasting change. As we were going through this process, we were acutely aware that our systems practice would also have an impact on our partners—many of which represented longstanding relationships with established strategies already in play. Communicating our new direction to our partners was an important step in our process.
As our journey uncovered more insights and helped us articulate strategies, it also became evident that our grantmaking process—including some existing funding—would need to be realigned. At the same time, this process often solidified established relationships as we began moving away from year-over-year commitments and focused instead on longer horizons. In many instances, our partners joined us in this process, providing perspectives, expertise, and support.
Our systems practice has already brought about many changes and enhancements—both large and small—to the way we view and address our target issues. But, in many ways, we’ve only just begun our journey. We still have much to learn, but we believe our refreshed approach and strengthened direction will lead us to even greater understanding and impact in the years to come.
As we continue to apply systems thinking to all facets of our work, we’re also finding ways to expand the reach of our practice beyond HU, drawing collaboration and inputs from other organizations of The Omidyar Group as well as from our external partners. Together, we’re building a global community of practice equipped to tackle some of the most complicated and important issues facing our world.
Throughout our systems journey, we’ve gained countless insights about our work, our organization, and our world. The following are a few of the lessons we’ve learned along the way and some advice we’d offer others beginning a similar journey.
To truly understand a complex environment, you have to be willing to acknowledge and challenge all of your beliefs and assumptions, and humbly approach this work. It’s human nature to rely on our past experiences to inform our future decisions, but systems thinking requires us to consider alternative world views, explore diverse perspectives, and move beyond preconceptions to expose ourselves to the realities—and opportunities—of a system.
Just as the issues we work to address didn’t develop overnight, our work to understand and address their driving factors takes considerable time and patience. Systems thinkers should be prepared to settle in to the process and understand that their journeys will likely include trying times and moments of doubt.
Once completed, a detailed systems map provides a helpful overview of a complex environment and highlights the leverage points that might be manipulated to bring about change. But the map is just the beginning of a systems journey—the real work is in developing a robust systems practice using the tools, mindsets, and methodologies that will lead to new discoveries and potential strategies.
Incorporating systems thinking is not unlike learning a new language. There will be missteps, frustration, and times when you feel vulnerable and inept. That’s why it’s important to cultivate an environment that embraces the collective learning process and creates a safe space for taking risks.
A case study of HU’s strategy to address forced labor in corporate supply chains.
As we continue developing a systems practice, we’re uncovering valuable insights to inform new and enhanced strategies across our portfolio teams. A prime example of this work in action can be seen in our ongoing efforts to address forced labor in corporate supply chains.
The International Labour Organization estimates that there are approximately 21 million victims of forced labor in the world, generating illegal profits of $150 billion per year. As more reports emerge of labor abuses in the supply chains of major brands, companies are under mounting pressure from consumers, investors, media, and governments to maintain responsible and transparent supply chains.
People in poverty: less than $1.25/day
Source: The World Bank (2013)
People are victims of forced labor around the world
Source: International Labour Organization (2012), Global Estimate of Forced Labor
Percentage of victims of forced labor exploitation are in the private economy
Source: International Labour Organization (2012), Global Estimate of Forced Labor
Number of countries where forced or child labor occurs to produce goods such as electronics, apparel, shrimp, palm oil, coffee, and chocolate
Source: US Department of Labor (2014), List of Goods Produced by Child or Forced Labor
Historically, we had focused our strategies to eliminate forced labor on specific commodities, such as seafood in Thailand and palm oil in Southeast Asia, where labor exploitation and abuses are particularly severe. We had also supported documentation and advocacy efforts—from investigative journalism to document and raise awareness about the problem to the implementation of California’s Transparency in Supply Chains Act, a law requiring thousands of companies to publicly disclose what they are doing to address this issue in their supply chains.
We learned a great deal about this issue through the years, and have come to better understand the geographies and industries in which it exists. But forced labor in corporate supply chains is a systemic issue that manifests itself globally across many different industries and commodities. While our previous work was fruitful, we were becoming increasingly aware of a broader normative shift occurring that we believed presented the opportunity for even greater impact at scale. Engaging in systems thinking allowed us to assess drivers of forced labor regardless of sector or location.
In April 2015, we assembled a cross-functional team of individuals within industry and among our HU colleagues to gain a deeper understanding of the root causes and drivers of labor exploitation and find new ways to influence the system that produces forced labor in supply chains.
The team began its process by defining both a “Guiding Star” (a preferred future state of the system) and a “Near Star” (a significant outcome towards the Guiding Star, but which may take a decade to realize).
The eradication of the worst forms of human exploitation in corporate supply chains.
A new standard of corporate supply chain practice that will increase responsibility and decrease the risk of labor abuse.
The methodology included documentation of lessons learned from years of work, in-depth research, conversations with more than 60 corporate, nonprofit, government, and academic stakeholders, and the creation and analysis of a detailed system map.
While forced labor is a pervasive and complex problem, certain bright spots emerged as we began to examine each relationship within the system. The process revealed—and elevated—key dynamics to help guide our path forward.
These realizations, vetted by deep systems exploration, highlighted some of our existing assumptions to be false and confirmed some as accurate, ultimately, signaling a need to pivot some of our existing strategies to create deeper impact. Our new approach helped us identify areas where momentum was building within the system and enabled us to develop a strategy that would allocate our resources where we were most likely to have an impact.
More specifically, we began building an approach that centered more on direct leverage points with corporations and investors.
We developed a new three-year strategy for the Supply Chains and Forced Labor portfolio to leverage momentum around the opportunities we had uncovered. In creating our strategy, our systems practice made the mutually reinforcing nature of our approaches more explicit.
Our new strategy aims to generate the motivation for corporations to pay attention to forced labor through corporate benchmarking, investigative journalism, and policy advocacy, while investing in the means—new technologies and services—that will enable them to address the problem.
Tools for Corporations
Brand and Reputational Risk
Corporate Legal Accountability
At the core of our systems map, we surfaced an entrenched “deep structure,” illustrating a corporate “race to the bottom,” which we believe perpetuates a system that enables forced labor to thrive…
Corporations are under pressure to be profitable and responsive to market demand which leads them to outsource production. In order to produce goods faster and more cheaply, suppliers increasingly rely on subcontractors to complete work. The result is complex, multi-tiered supply chains that are difficult to monitor, making workers more vulnerable.
… but fundamental normative shifts in the system have created the opportunity to build a strategy that leverages on existing momentum.
Corporations face legal, reputational, and regulatory risks that are intensified by documentation and the public’s increasing expectation of supply chain accountability. Many corporations are also joining the conversation about what can be done to prevent and address forced labor and are looking for solutions.
Our three-year strategy for the Supply Chains and Forced Labor portfolio seeks to alter the corporate risk/reward calculus and reduce barriers to better corporate practice. This new strategy is built with four key pillars.
Supporting the development and deployment of new tools to help corporations mitigate forced labor.
The tools and approaches available to corporations to mitigate extreme labor abuses in supply chains have not had impact at scale. This presents an opportunity to accelerate the development and deployment of tools to make supply chains more transparent.
Strengthening investor awareness and differentiation by benchmarking corporations across sectors.
The absence of a labor focus in Environmental, Social, Governance (ESG) investment criteria presents an opportunity to benchmark the standards and practices of corporations on the issue of forced labor against their peers. We can thereby expose companies that are not doing enough and highlight exemplary practice.
Increasing corporate brand and reputational risk by continuing to document and build awareness of labor abuses.
There is an opportunity to increase research and journalism linking forced labor to corporate supply chains thereby continuing to build public pressure, catalyze corporate leadership, and strengthen government enforcement.
Heightening corporate legal accountability by continuing to advocate for laws that reinforce corporate responsibility.
We also identified an opportunity to build on the momentum toward increased government scrutiny which may stimulate corporate action at scale.
The new systems-based strategy allowed us to better examine our environments and, ultimately, to effectively explain the how and why behind our recommended approach.
At HU, we are committed to working with the business community to address forced labor in corporate supply chains. We believe markets and businesses can be a powerful force for positive social change. We also know that global businesses have an opportunity to meaningfully contribute to the eradication of forced labor within their supply chains. Now, with an evolving systems practice in place, we believe we can enable a new standard of responsible corporate practice, eventually leading to a reduction in labor exploitation of the most vulnerable around the world.