What is Holistic Value Creation? A Holistic Approach

What is Holistic Value Creation? A Holistic Approach

Characterized by the belief that the parts of something are intimately interconnected and explicable only by reference to the whole. The theory that the parts of any whole cannot exist and cannot be understood except in their relation to the whole and has been applied to ecology and mental states.

Defining Holistic:

Holism  ὅλος | holos

This Greek word means all, entire, or total. This is the idea that all the properties of a given system cannot be determined or explained by its component parts alone. Instead, the system as a whole determines in an important way how the parts behave.

The Principle of Holism by Aristotle in the Metaphysics: “The whole is more than the sum of its parts”.

The idea has ancient roots. Examples of holism can be found throughout human history and in the most diverse socio-cultural contexts, as has been confirmed by many ethnological studies.

The term was introduced by the South African statesman Jan Smuts in his book, Holism and Evolution. Smuts defined holism as: “The tendency in nature to form wholes that are greater than the sum of the parts through creative evolution.”​

Holistic Value creation:

A growth mindset.

Understanding that stakeholders are interconnected.

A leap to meet the needs of this world in a way that is positive, lasting and strong.

Principles of Holistic Value Creation

Edward Freeman, professor of Business Administration at Darden School of Business, discuses the Interconnection and No Trade-off Principles to describe shared values.
No Trade-Off Principle
We try to never trade off the interest of one stakeholder versus the other continuously over time
The Interconnection Principle
Because stakeholder interests go together over time, we need solutions to issues that satisfy multiple stakeholders simultaneously. Or win-win-win-win-win solutions.

A Holistic Business Approach

Adopting this approach means that the entire company is considered, in contrast to only on specific departments.

To implement a holistic business strategy, the entire company staff needs to get involved.   It is fundamental that the company with its market position must be considered to achieve success. This is only possible if all the departments share in the same vision and functions on the same level.

A holistic business approach allows all departments to work together towards the achieving the same goals. Good communication skills within each department and at senior level will be needed to succeed. Each department should understand how their work adds value to the company as a whole.

WHAT ARE THE BENEFITS OF A HOLISTIC APPROACH?

There are many reasons why a company would adopt a holistic approach.  In the end the  goal is usually growth. This approach can be used to look at a company’s current and potential market and audience.

It is important for companies to understand  cultural context, pursuing growth with the specific needs of the culture and expansion in mind. Strategies will be different based on demographics, but being able to empathise with clients, we understand the their wants and needs.

Probably one of the most important factors is that it allows us to see which sections of the company are underperforming and missing targets.

Even though we look at the company as a whole, it is not necessary to merge departments. We simply need to align our company  vision. Each department shares the same importance and purpose and can therefore ensure that a company reaches its goals.

IMPLEMENTING APPROACH IN YOUR BUSINESS.

Bring together departments regularly. 
Connect with staff throughout, not just management.

Use the appropriate technology.
Provide department-relevant tech and software. Understand what each department is doing and how it works.

Respond to what you learn.
Take action when discovering an underperforming department. Dedicate sufficient time and resources. This allows you to resolve, learn and grow.

The earth does not belong to man, man belongs to the earth. All things are connected like the blood that unites us all. Man did not weave the web of life, he is merely a strand in it. Whatever he does to the web, he does to himself.