(Community Design) Anti-Fragility, “Keystones,” Diversification, and Up-Cycling

Let’s talk about a few complementary concepts in systems design, including anti-fragility, “keystones,” diversification, and up-cycling.

This is a tree

To begin, let’s return to an article I wrote a year ago about the role failure plays in building resilient systems.

Specifically, I talked about the crowd-sourced creation of a dam in the middle of an Austin, Texas-area creek.

Resiliency is defined as the ability to withstand or recover from difficult circumstances, and the way you create resilient systems is by building them while they are in a state of constant stress.

Sometimes resiliency is good, but not good enough.

With the world in a state of disruption, where systems were already unsatisfactory, I would suggest that we go a step further, into the domain of anti-fragility.

Anti-fragility is defined as the ability to improve and strengthen relative to exposure to difficult circumstances.

Bones serve as a great example of something which boasts an anti-fragility; when you break one, it heals stronger than before.

I fell a couple stories and broke both feet as a child, and yet 35+ years later, my bones are stronger than what would have normally been the case, because in the years since I ran competitively, and rode skateboard, jumping down stairs for fun.

Going back to the example I wrote of last summer: let’s consider the creation of a resilient dam which crosses a small stream. What does it take to make it resilient?

The dam was created to provide a shallow wading area for small children.

To be resilient, the stones need to remain generally in the same area year-round, which is fine if one wants to continue restoring the dam after each flood.

To deliver this quality of resiliency, we simply piled a number of large stones across the stream.

But let’s consider an anti-fragile dam that would maintain the same shallow wading pool, year round.

An anti-fragile dam would actually strengthen under the stress of flood waters, forcing the rising water to take another course, while still allowing the flow necessary to preserve the stream’s original path.

We’d probably not do this to a small stream, so let’s shift gears and talk about fences.

Imagine building a fence that lasts for thousands of years?

Hedgerows in England

Hedgerows are not bushes; they are something like a weaved arrangement of trees which serve as fences, some of which date thousands of years to the Roman era, or before.

Hedgerows impose a distinctive quality upon the English and European countryside, and might be considered a fascinating example of anti-fragility which enriches the environment, and delivers what could be called a “halo effect“ in the benefits provided to other species.

In terms of anti-fragility, a hedgerow “fence” only becomes stronger as the centuries pass.

Which brings to mind the benefits provided by “keystone” elements to the broader ecosystem.

In my example, the hedgerow serves as a keystone element in the ecosystem of the English and European countryside.

Its “halo effect” is one that provides cover and concealment for countless species of animals, as well as access to sources of food.

Halo effect

In biology, “keystone” species play disproportionately large, important roles in their ecosystems, and some studies suggest that a re-introduction of keystone species draws about eight additional species back to the area.

That’s a fairly interesting multiplier effect if you think about it, right?

By re-introducing a single keystone species, one might expect a number of additional species to return to the environment, thereby magnifying the aggregate benefit through re-diversification.

Go back and read that last paragraph, and reconsider what I just said through the lens of fiscal portfolio management.

Allow me to quote myself: “thereby magnifying the aggregate benefit through re-diversification.”

Let’s talk business.

Volatility / variability = eventual death

The same thing that kills small businesses kills large ones: insufficiently diversified revenue streams, coupled with fiscal variability.

You see this happen all the time: a business (small or large) becomes addicted to a single source of revenue, but when that revenue source becomes unpredictable or dries up, the business falls, because they had failed to invest in diversification.

Retailers refer to the beginning of the Christmas shopping season as “Black Friday” because it’s the first time all year some have operated “in the black,” which is to say: turned a profit.

The same is true in some restaurants, and if the economy tanks and consumers stop consuming, these businesses close their doors, because they failed to diversify their revenue streams.

As you might recall, this example of business failure is frequently compared to ecological lack of diversity, and for precisely the same reasons.

I don’t like to over-complicate things, so let’s reiterate the points made thus far in very simple terms:

If you own a business, and you are dependent upon revenue generated by that business to survive, you will likely want to make sure money doesn’t dry up.

One of the very best ways to do this is to curate and maintain a sufficiently diversified revenue model.

In other words, make sure you don’t put all of your eggs in one basket.

This happens with municipalities all the time, by the way: they become addicted to a certain form of revenue, and that works…until it doesn’t.

One of the most common forms of fiscal addiction within municipalities is real estate; it’s tediously common for elected officials and bureaucrats to curry favors among wealthy real estate and finance entities, and the city frequently monetizes these relationships through property taxes.

Like I said, this works…until it doesn’t, and frequently the result is catastrophic.

Guess what? Recessions happen.

The last major recession was in 2008, and if history is any guide, (and it always is): there will be another recession before long, and then another, etcetera.

Suddenly the calculus which informed decisions and policies away from fiscal diversification no longer makes sense, and the system struggles to keep its nose above water, so to speak.

This is not a good example of an anti-fragile system.

Indeed, this isn’t even a good example of one that is very resilient.

Any system that fails to diversify renders itself subject to the gale winds of variability, to the detriment of the most vulnerable.

Let’s shift gears and talk about upcycling.

Q: have you ever heard of the book Cradle to Cradle?

Cradle to Cradle — novel

Imagine I hand you a copy of the book, and it accidentally falls out of your automobile and lands next to the highway.

The paper and the ink will quickly decompose in such a way that brings greater nutritional benefit to the soil.

Additionally, the paper features seeds, so plants will thrive in the place where the book used to be.

The premise of “Cradle to Cradle“ is exactly that: let’s not just build systems that are resilient, and let’s not even bother with recycling, because that methodology is literally garbage.

Recycling takes things like plastic bottles and turns them into plastic benches that last for thousands of years, with no actual benefit to the environment.

However, upcycling improves the quality and benefit each time the resource is reused.

In the book “Cradle to Cradle,” the author cites one example after another of systems that are designed to elevate the value of what’s created each step of the way.

For example, one automotive manufacturing facility takes in tap water, and outputs water that’s cleaner than when it was first received, and does so in a cost-effective manner.

In another example, the inks used in all-natural textile clothing not only upcycle the supply chain and manufacturing itself, but also decompose in a beneficial manner.

Returning to the original example at the beginning of this article, we may not merely want to create a resilient structure (a dam that sustains a shallow wading pool for young children).

We may want to create a structure that is anti-fragile, which only becomes strengthened when exposed to stress and difficulty.

Additionally, we want to create a structure that remains true to the philosophy of upcycling, which means that it continues to improve and enrich its benefit in each cycle.

Of course, the dam at Austin’s Bull Creek is metaphor, because we’re talking about the rich wealth available to hyper-local communities.

Why?

Because my company provides human-based professional services and software to help communities reclaim their dignity on their terms, and manage their own money and their own affairs by keeping it local.

This is why we talk about the importance of helping communities “reclaim their productive capacity,” because not everybody can be a consumer, right?

In practice, that means that we would help people leverage program such as the Texas cottage food law, which enables people to launch and sustain a homegrown food business without the need for permits or licenses or inspectors.

Why?

Similar to the benefits provided by keystone species within an ecosystem, or keystone elements within a system; those that embrace their own productive capacity deliver a multiplier effect to the overall local economy.

Consider this:

If you have 100 people in a community, not everybody can remain a consumer.

If one of those people transitions to become a producer, and if they primarily keep their business local, it delivers a “halo effect“ that introduces the conditions necessary to create more producers.

This economic multiplier effect begins to resemble an economic stimulus from the bottom-up.

In practice, this might be a person who decides to brush off their grandmothers cookbook and make the best salsa in East Austin, available only from them.

Let’s assume that the quality of this salsa is only really possible when it uses tomatoes grown by local farmers, literally raised in same soil.

Just like that, one consumer becomes a producer, and stimulates the creation of a second producer.

It’s not resilient; it’s anti-fragile.

It’s not recycling; it’s up-cycling, elevating the benefit in each cycle.

It’s an economic stimulus from the bottom-up, introducing an anti-fragile upcycling model that thrives on external stressors that normally devastate communities.

A majority of our services involves work with people in the community itself to make this necessary transition, growing leadership from within the community.

But we also provide a mobile app that delivers a marketplace that is exclusive to the local community.

So if somebody wants to purchase the high-quality salsa, they have to be part of the marketplace community.

Almost all of the transaction fees are kept by the community’s governing committee itself, which means that the community can reinvest in transitioning more of its own into producers, and evolving those producers to become better and more enmeshed within its own community.

This dynamic is discussed in further detail in this article.

Most marketplaces charge anywhere from 10 to 15% transaction fees (eBay, Amazon), but let’s assume that the community charges just 5%.

If there were 1,000 people in the community that are mostly operating as consumers, the community itself would generate a little over $6,000 a month in revenue, which is not a bad start.

Let’s assume that the community’s governing committee chooses to use that money to help transition some of the neighbors into becoming producers. Call it an earn/learn opportunity.

Not only will participating neighbors start generating more money for themselves, they get higher profits, because they are not paying exorbitant fees to other marketplaces (eBay, Amazon, etc).

They also experience a lower rate of fraud, because the marketplace is exclusive to people in the community, and no fake accounts are allowed.

And further, any transaction-based revenue generated by the community’s marketplace actually goes towards educational resources that are designed to benefit the neighborhood itself, thus creating more producers.

Suddenly, the neighborhood is not generating $6,000 a month; it’s generating $12,000 or $18,000 a month, or more.

The design is not resilient; it’s anti-fragile, because it only becomes more rooted and enmeshed within the community, even as a recession gets progressively worse.

The community association provides educational, vocational, and work opportunities, delivering more revenue, and more community benefit, simply by investing in regenerative economic practices.

Let’s dig in a little bit more on regenerative models.

The neighborhood itself might not have a lot of land for farming, but they can borrow from farming practices embraced by indigenous cultures for millennia to deliver greater bang for the buck, even within a limited footprint.

In this manner, the system is anti-fragile, and delivers greater benefit each cycle.

Does this sound utopian?

Actually, nothing is technically utopian, because “utopia“ describes something that (by definition) will never exist.

However, let’s consider protopia.

Protopian systems are ones that improve just a little at a time, on a consistent basis.

Just a little bit at a time, things are perceived to become progressively better, which actually contributes significantly to elevated morale and community well-being.

Importantly, protopian systems are not pipe dreams. They’re not imaginary, and they’re not escapist.

They are real, accessible, and actionable.

But you don’t get to protopia from the top down, and you don’t do it for everybody in the whole country or the whole world.

Protopia is typically only accessible when you focus on bite-sized increments, such as your neighborhood.

Start small, fine-tune, and extrapolate.

Lather, rinse, repeat.

Anti-fragile up-cycle protopia is not impossible, and we will help you make it happen.

It begins with a single person, and perhaps that person is you.

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Kent Dahlgren

Kent Dahlgren

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Product management fix-it guy. World-famous people skills. Extremely small hands. (edit) marketing lady says I’m also supposed to say “CEO of software company”