Managers once could count on water. Diverted rivers and pumped aquifers supplied all businesses with that ultimate liquid asset. Turn the tap and water flowed: cheap, abundant, and reliable. Companies turned currents into currency, governments secured infrastructure  , and few felt exposed to risk. But lately that sense of immunity is evaporating in our "flat, hot, and crowded" world.
Goldman Sachs recently warned investors that global water consumption had attained an "unsustainable" rate of growth. Two in five executives now say a water shortage would be "severe" or "catastrophic" for their global industries, but less than 17 percent are prepared for that calamity. The World Economic Forum in Davos, Switzerland, predicted that civilization faced no "limits to growth" -- with one exception: scarce fresh water.
That exception has proved the rule from Asia and Africa to southern Europe and the U.S. The cause of global water scarcity is threefold: a global population of 6 billion to 9 billion increasingly affluent people, their exponential increase in consumption, and a fast-changing climate.
The Intergovernmental Panel on Climate Change recently confirmed that global warming is not coming to America; it has arrived. Less rain and higher levels of evaporation have stressed regions with the fastest growth. In drought-struck Atlanta, for example, industries have been forced to react to water shortages. UPS scrambled to install dry urinals and Coca Cola killed its water fountains at the head office. Others have shut down branches or fired landscape workers.
Managing with Little Water
Effective managers go beyond damage control and adapt. They "climate-proof" their businesses. How? Success leaves clues. As we head into an era hotter and drier than the past 30,000 years, insights come from experienced managers who have thrived for an even longer span of time with almost no water: the Bushmen of the Kalahari Desert.
Bushmen may at first seem unlikely role models for the corner office. After all, they don't manage money or people; just themselves. Many are non-literate; some can't count. And while their DNA makes them the closest genetic relatives to an anthropological Adam and Eve, they are not physically or ethically superhuman. They feel envy, fatigue, hunger pangs, and thirst, just like the rest of us.
But out in the desert, without government subsidies or enforcement, they manage to convert self-interest into self-regulating interdependence. They soften tension into laughter. They transform water, however sparse, into their cohesive social glue. (continued...)
© 2009 Business Week Online under contract with MarketWatch. All rights reserved.
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