Leading from the Emerging Future: From Ego-System to Eco-System Economies

Leading from the Emerging Future: From Ego-System to Eco-System Economies

by Otto Scharmer, Katrin Kaufer

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Our Time Is Now

We have entered an age of disruption. Financial collapse, climate change, resource depletion, and a growing gap between rich and poor are but a few of the signs. Otto Scharmer and Katrin Kaufer ask, why do we collectively create results nobody wants? Meeting the challenges of this century requires updating our economic logic and operating

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Our Time Is Now

We have entered an age of disruption. Financial collapse, climate change, resource depletion, and a growing gap between rich and poor are but a few of the signs. Otto Scharmer and Katrin Kaufer ask, why do we collectively create results nobody wants? Meeting the challenges of this century requires updating our economic logic and operating system from an obsolete “ego-system” focused entirely on the well-being of oneself to an eco-system awareness that emphasizes the well-being of the whole. Filled with real-world examples, this thought-provoking guide presents proven practices for building a new economy that is more resilient, intentional, inclusive, and aware.

Editorial Reviews

Publishers Weekly
If the title sounds a little grandiose, don’t be fooled: it’s a lot grandiose. This heavy-handed, confused look at life in the age of disruption from Scharmer (Theory U) and Kaufer, stakeholders at the Presencing Institute, is aimed at anyone trying to effect change: business, governmental, or societal. The authors distinguish between undesirable “ego-system awareness”—a worldview in which one cares only for oneself—and the ideal “eco-system worldview,” which expands to include everyone. The book provides intriguing examples of eco-system worldview shifts, such as the Arab Spring, but also includes loftily stated and too-vague worksheets and questions for self-improvement: “Where do you experience a world that is dying (in your society, in your organization, in yourself)?” Readers looking for a high-level way to reshape thinking around their companies may find this a helpful exercise in identifying the blind spots that block transformation, but most will find themselves playing buzzword bingo, frustrated by the lack of concrete strategy and chapter headers like “The Evolution of Capitalism as an Evolution of Consciousness.” The book’s good ideas are lost in a scrum of overinflated writing and self-importance. (July)
From the Publisher
“A watershed! An inspiring, practical weaving of the inner and outer dimensions of the systemic changes so many around the world are now working toward.”
—Peter Senge, Senior Lecturer, MIT Sloan School of Management; Founding Chair, Society for Organizational Learning; and author of The Fifth Discipline

“Scharmer and Kaufer have succeeded in writing the book that has the potential to transform civilization from one based on a rapacious, ego-driven economics to a viable, ecological, awareness-based model. This is a must-read for anyone who cares. It may well be the single most important book you ever read.”
—Arthur Zajonc, President, Mind and Life Institute, and author of Meditation as Contemplative Inquiry

“Scharmer and Kaufer provide a creative and practical approach to shifting our economies. I see business as a movement, and this book shares that movement with the world, offering us inspiration to tap into the deeper levels of our humanity and urging us to transform the crises of our times.”
—Eileen Fisher, founder, Eileen Fisher, Inc.

“The shift to an eco-system economy is emerging everywhere around us. Otto’s and Katrin’s clarity in identifying that this shift requires change-makers to expand our thinking from the head to the heart has helped me to be more intentional in designing processes to awaken the hearts of entrepreneurs everywhere. This is a necessary condition for the emergence of the new economy.”
—Michelle Long, Executive Director, Business Alliance for Local Living Economies

“The purpose of business is to enhance the well-being of society. The 4.0 framework for transforming capitalism matters because it addresses a blind spot in our current discourse: how to create institutional innovations that could shift our economy from ego- to eco-system awareness at the scale of the whole.”
—Guilherme Peirão Leal, founder and Cochairman, Natura Cosméticos

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Berrett-Koehler Publishers, Inc.
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From Ego-System to Eco-System Economies

By Otto Scharmer, Katrin Kaufer

Berrett-Koehler Publishers, Inc.

Copyright © 2013 Otto Scharmer and Katrin Kaeufer
All rights reserved.
ISBN: 978-1-60509-926-2



On the Surface: Symptoms of Death and Rebirth

This chapter explores the symptoms at the tip of the iceberg of our current reality. We move from the toppling of tyrants to an exploration of the deeper fault lines that keep generating the disruptive changes of our time. We also look at these disruptive events from the viewpoint of change-makers: In the face of disruption, what determines whether we end up in moments of madness or mindfulness?

The Toppling of Tyrants

In the fall of 1989, two weeks before the Berlin Wall crumbled, we took an international student group to East Berlin, where we met with civil rights activists in the basement of a church. At one point, the professor who was with us, peace researcher Johan Galtung, put a prediction on the table: "The Berlin Wall will come down before the end of the year." Everybody doubted that, including the people who were organizing the resistance against the East German regime. And we were all wrong. The Wall came down and the Cold War came to an end just months after that meeting.

Nearly two decades later, in the fall of 2008, the bankruptcy of Lehman Brothers, a global financial services firm, sent shock waves around the globe and within hours brought the financial systems of the United States and Europe to the brink of collapse. Today the remaining Wall Street megabanks and their European counterparts have survived because of massive taxpayer-financed bailouts from their governments. On October 11 of that year, the head of the International Monetary Fund (IMF) warned that the world financial system was teetering on the "brink of systemic meltdown."

In December 2010, Mohamed Bouazizi, a young fruit and vegetable seller in Tunisia, set himself on fire in protest of his treatment by police, who wanted to extract bribes from him and, when he refused, took away his merchandise and beat him. In January 2011, a twenty-six-year-old Egyptian activist, Asmaa Mahfouz, posted a video online urging people to protest the "corrupt government" of Egypt's president, Hosni Mubarak, by rallying in Cairo's Tahrir Square. With that video she sparked and inspired an uprising among the Egyptian population. A week later, on January 25, thousands joined her in Tahrir Square. Within days, the movement counted millions. At first the Egyptian police responded with brutality. But less than four weeks after Mahfouz had posted her initial video, President Mubarak resigned.

A month later, a 9.0 earthquake struck off the coast of Japan, generating a massive tsunami that killed more than twenty thousand people. The Fukushima Daiichi nuclear power plant was protected by a seawall designed to withstand a tsunami of 19 feet (5.7 meters). Minutes after the earthquake struck, a tsunami of 46 feet (14 meters) arrived, easily crossing the seawall and knocking out the plant's emergency power generators. As a consequence, the radioactive fuel began overheating and put the plant on a path toward catastrophic meltdown.

As the year went on, the Arab Spring spread across the globe. Muammar Gaddafi was toppled in Libya. The Occupy Wall Street movement, which took inspiration in part from the Arab Spring, staged actions in more than a thousand cities across the globe.

The collapse of the Berlin Wall, the demise of the Mubarak and Gaddafi regimes, the meltdown of the Fukushima Daiichi nuclear power plant, and the near-meltdown of the western financial system all share some features:

1. the end of an inflexible, centralized control structure, one that previously had been considered indestructible

2. the beginning of a spontaneous, decentralized grassroots movement of people letting go of their fear and waking up to another level of awareness and interconnectedness

3. the opening of some small cracks in the old system, followed by its crumbling and eventual collapse

4. the rebound of the old forces as soon as the memory of the collapse began to fade away; the old forces tried to obscure the actual root causes of the breakdown in order to extend their privileged access to power and influence (an example is Wall Street's financial oligarchy)

We believe that these kinds of events will keep coming our way. These disruptive changes mark the beginning of a new era that we have entered as a global community, an era of increasing disruption. Sometimes such movements will give rise to movements that bring about profound change, and sometimes they will falter and fail. In many cases, as we discuss later in the book, these disruptions are already on their way. It is too late to prevent all of them. So where is our point of control? It is in how we respond to the impact that these disruptions have on how we work and live.

A disruptive change affects not only our outer world, but also our inner self. Such moments bring our world to a sudden stop. They may be terrifying, but they also constitute a great blank space that can be filled in one of two ways: by freezing and reverting to the patterns of the past, or by opening us up to the highest future possibilities. The second response—leaning into, sensing, and actualizing one's emerging future—is what this book is about.


At the moment when we reach the point of meltdown, we have a choice: We can freeze and revert to our deeply ingrained habits of the past, or we can stop and lean into the space of the unknown, lean into that which wants to emerge.

This second possibility—to lean into and connect to our highest future potential—we refer to as presencing. As noted in the introduction, the word presencing merges the terms presence and sensing. It means to sense and operate from the presence of an emerging future field. As we connect with this field of heightened awareness, our attention morphs from slowing down, opening up, redirecting, and letting go to letting come, crystallizing, and embodying the new. Figure 4 (see the introduction) summarizes this process.

The process of connecting to our Self, our highest future possibility, and moving toward action can be a sequence that we go through in an instant or over a period of many years. It is an archetype of the human journey. It is a process of opening up, of allowing something new to land, to emerge, and to come into reality through us.

A real-life example of this process was sparked by the video that Asmaa Mahfouz posted on January 18, 2011, which inspired people around the world. In it, she speaks from a place that transcends the three primary obstacles—doubt, cynicism, and fear—that prevent us from connecting to our source of deep presence and authenticity.

Instead of expressing doubt, which government propaganda tried to perpetuate, she speaks with great clarity. Instead of expressing cynicism, she speaks from a state of deep connection and empathy. And instead of expressing fear, which would isolate her, she speaks from a place of vulnerability, commitment, and courage:

Four Egyptians have set themselves on fire to protest humiliation and hunger and poverty and degradation they had to live with for 30 years. Four Egyptians have set themselves on fire thinking maybe we can have a revolution like Tunisia; maybe we can have freedom, justice, honor, and human dignity. Today, one of these four has died, and I saw people commenting and saying, "May God forgive him. He committed a sin and killed himself for nothing."

People, have some shame.

I posted that I, a girl, am going down to Tahrir Square, and I will stand alone. And I'll hold up a banner. Perhaps people will show some honor. I even wrote my number so maybe people will come down with me. No one came except three guys—three guys and three armored cars of riot police. And tens of hired thugs and officers came to terrorize us. They shoved us roughly away from the people. But as soon as we were alone with them, they started to talk to us. They said, "Enough! These guys who burned themselves were psychopaths." Of course, on all national media, whoever dies in protest is a psychopath. If they were psychopaths, why did they burn themselves at the parliament building?

I'm making this video to give you one simple message: We want to go down to Tahrir Square on January 25th. If we still have honor and want to live in dignity on this land, we have to go down on January 25th. We'll go down and demand our rights, our fundamental human rights.

The first time Mahfouz went to Tahrir Square, she was, as she says, joined by three young men. The next time, a week after posting the video blog, she was joined by over fifty thousand protesters, and a week later, on February 1, over one million people protested peacefully. On February 11, the supposedly "unsinkable" regime was finished and Mubarak resigned.

This process of co-creating disruptive change is not a singular, isolated case. It is part of a much bigger picture that is starting to become visible now. We have seen similar efforts in several other sectors, systems, and cultures. The change-makers embarking on these journeys venture away from well-known paths and put themselves at the edges of the unknown. They are connecting to deep sources of knowing, sensing the future that wants to emerge. But more often than not, change leaders don't talk about this deep personal zone of change because there is no widely understood or accepted language for doing so.

Mahfouz is a very visible figure at the tip of an iceberg that may represent, in the words of the author and activist Paul Hawken, "the largest movement in all of social history." It includes grassroots civil society movements that have brought down the tyrant-led regimes in Egypt and Tunisia, the Communist-led regimes in Eastern Europe, and the apartheid regime in South Africa. The movement also includes a new breed of business entrepreneurs who create "hybrid" business enterprises that aim for a triple bottom line, combining profitability with a social mission and environmental objectives.

This new global movement has no name, no leader, no ideology, no single program, no single center. Instead people are sharing a new interior field, an emerging field of connection and consciousness, a collective concern about the well-being of all living beings, including our planet.


Of course, presencing doesn't happen if we are on autopilot. When confronting a moment of meltdown, instead of leaning into the future, we can also choose to revert to habitual patterns of the past. Mubarak did that on February 10, 2011, when he initially refused to step down. Erich Honecker and the East German Politburo did it in the early fall of 1989, trying to hold on to their crumbling system. The Wall Street banks did it on the brink of collapse, when they still couldn't resist further expanding their power through, in the words of former IMF Chief Economist Simon Johnson, "a quiet coup." The Catholic Church does it when, even in the face of the most heart-wrenching cases of child abuse, it holds on to its old institutional routines. But it's not just them. We all do this when we refuse to let go of what worked in the past but no longer does.

Whenever we respond to the inner space of emptiness by downloading the old rather than by leaning into the new, we are embarking on and co-enacting a journey of social pathology that looks roughly like this: downloading, denying, de-sensing, absencing, deluding, destroying, and (eventually) self-destroying.

As shown in figure 5 in the introduction, the absencing journey is the inversion of the presencing journey. Instead of opening the mind, heart, and will, the absencing cycle holds on tightly to the past. It does not dare to lean into the unknown, the emerging future. As a consequence, the space of absencing throws us into a trajectory of denial (not seeing what is going on), de-sensing (lacking empathy with the other), absencing (losing the connection to one's higher Self), delusion (being guided by illusions), and destruction (destroying others and ourselves).

A good illustration of absencing is what Hitler and the Nazis did to Central Europe and the rest of the world. Today, look at what we are doing collectively to our own planet. The fundamental pattern is the same.

Thus, being thrown into the space of absencing means getting stuck in the tyrannies of

1. One Truth (ideology)

2. One "Us" versus "Them" (rigid collectivism)

3. One Will (fanaticism)

The triple tyranny of "One Truth, One Us, One Will" is also referred to as fundamentalism. It's the structure that people rose up against in World War II. Whether we talk about the struggle for decolonization and independence in the global South, the struggles against the apartheid system in South Africa, or the struggle against tyrannical regimes in Eastern Europe, Latin America, and North Africa, the deeper struggle in all these places has always been the same: People keep rising and fighting against the same tyranny that emerges from the fundamentalism of One Truth (a closed mind), One Us (a closed heart), and One Will (a closed will). That rigid worldview has led to social structures defined by three key features:

1. unilateral, linear communication

2. low, exclusion-based transparency

3. an intention to serve the well-being of the few

The alternative is not well defined, but could be sketched as follows:

1. multilateral, cyclical communication

2. high, inclusion-based transparency

3. an intention to serve the well-being of all

How to achieve the second model is a central topic of this book. And what is striking today is that most people on the planet would probably reject the first model, which merely reproduces widespread structural and cultural violence.

The battle over the fundamentalism we are referring to here will not be won by defeating Al Qaeda. It's a battle for the future of our planet. It will not be won by dropping bombs on other people. The primary battlefield of this century is with our Selves. It is a battle between the self and the Self: between our existing, habituated self and our emerging future Self, both individually and collectively. It is a battle between absencing and presencing that plays out across all sectors and systems of society today.

Moments of Madness and Mindfulness

What determines whether we as individuals, teams, institutions, and systems operate from the state of absencing or the state of presencing? What is the lever that allows us to shift from one state to the other? What can we do to move from madness to mindfulness?

Let us look at a concrete example. On April 26, 1986, an accident happened at reactor number four of the Chernobyl nuclear power plant in Ukraine. As the worst-case scenario started to unfold, the children and citizens of the city next door, Pripyat, received no warnings. Citizens of the region, Russian and European, were exposed to a cloud of nuclear radiation that first traveled north to Scandinavia and then covered almost all of Europe and its 500 million inhabitants.

Not only were Europe's citizens not warned about the potential threat, even the top Soviet leaders in the Kremlin were in the dark. Mikhail Gorbachev, who at the time was general secretary of the Communist Party, recounts: "I got a call around 5 a.m. I was told there was some accident at the Chernobyl nuclear plant. The first information consisted of 'accident' and 'fire.' The information report was that everything was sound including the reactor.... At first, I have been told there was no explosion. The consequences of this information were particularly dramatic.... What had happened? A nuclear explosion, a cloud, serious contamination? It was Sweden that alerted us!"

Gorbachev was told that the accident posed no threat to the surrounding environment and was under control. No one, according to Gorbachev, told him in these early days that a series of explosions had occurred in the core of the reactor and had blown the twelve-thousand-ton cover of the reactor into the air, releasing a highly radioactive vapor into the environment. Later, high radiation levels set off alarms at the Forsmakr Nuclear Power Plant in Sweden, over a thousand kilometers away. The Swedish government alerted its population about radioactive dust.

Although radiation was still emanating unchecked from the Chernobyl plant, the evacuation of citizens living next to the plant did not begin until more than twenty-four hours after the accident. Only after Gorbachev formed a commission of nuclear experts and gave them access to unlimited resources, people, and technology did a full-blown crisis response begin.

Excerpted from LEADING FROM THE EMERGING FUTURE by Otto Scharmer. Copyright © 2013 by Otto Scharmer and Katrin Kaeufer. Excerpted by permission of Berrett-Koehler Publishers, Inc..
All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.
Excerpts are provided by Dial-A-Book Inc. solely for the personal use of visitors to this web site.

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