Or: you can't keep an elephant healthy one bit at a time.

We know how to make systems efficient and, when we want to, sustainable. Uncharacteristically, we are much more capable in this area than we give ourselves credit for. Contemporary cutting-edge manufacturing systems are extremely sophisticated, from complex designer materials to powerful monitoring, simulation, and optimization systems. And we are getting better at an increasing pace, too: many current and near-future frontier technologies have, besides often exaggerated claims about new product classes or even economic paradigms, direct, practical, and, over time, exponentially more significant applications in industry and logistics.

Then why are our economies as a whole getting less sustainable? That is the important question. A sustainable organization in an unsustainable economy will sooner or later crash with the rest of its environment.

Part of the answer is politics in the general sense of the always-shifting balance of power, goals, and values. But even where we genuinely want to do this, our efforts often fail in the aggregate — sustainable processes inside an organization interact with outside processes and infrastructure in a way that ends up becoming unsustainable.

A simple but powerful framework to understand this comes from organizational theory: organizations can effectively apply technology and know-how to improve their efficiency thanks to the (relatively) unimpeded internal flow of information, effective capital allocation, and coordination infrastructures. Interactions between organizations often take place across interfaces much less permeable (one notorious exception being predatory oligopsonies, which is a different matter). An organization and one of its suppliers or customers can both have sophisticated technology and control systems, but in the aggregate have an inefficient, and certainly slow-improving, relationship. Price signals and supply-demand curves, as fundamental as they are as coordination elements, aren't always sufficient — which is why companies have become such an ubiquitous structure.

There are some ongoing developments to tackle this problem: improvements on supply chain traceability, ecological impact reports, etc, but I'd like to pull together a general meta-trend in the following model:

• For a host of reasons (shifting cultural preferences, supply chain instability, long-term dwindling resources, etc) many organizations are attempting to various degrees to improve the sustainability of their operations and the systems they are part of.
• More precisely, they have a non-zero budget of effort (profit margins, available capital, strategic prioritization, etc) to increase sustainability.
• Investment of that budget in internal processes, while not guaranteed to succeed (after all, very few organizations exploit existing technological capabilities as they could, even accounting for capital limitations), has clear and proven potential.
• On the other hand, investment on external processes, constrained by narrow or nonexistent flows of information, coordination, and investment, are very prone to fall into futile PR actions as a checklist item of being pro-sustainability as everybody else, but otherwise failing to increase systemic sustainability (and, interestingly, failing to change societal perceptions).
• Wherever the budget of effort allows for it, organizations then try to surmount these constraints by increasing the flow of information and coordination through traceability, different sorts of accountability reports, etc.

In this model, many technological and process innovations — including (often abortive) gestures at blockchain-based traceability — are relatively uncoordinated efforts to improve efficiency at the current systemic bottleneck, which is not intra-organizational but between-organization process efficiency.

(It's worth repeating that this bottleneck happens at the current frontier of organizational efficiency; most organizations still have huge and untapped potential for improvement, whether because of lack of capital, not having access to know-how, or not having made the strategic decision to seek that form of competitive advantage.)

Understanding this somewhat unconscious trend provides a framework to organize seemingly unrelated initiatives into a single overarching development frontier.

We can identify four layers in this development:

• At the level of the strategic framework, organizations at the cutting edge are expanding their locus of concern from their immediate operations, suppliers, and customers to a much larger systemic view that also includes upstream and downstream ecological sustainability, social impact, etc. This is different from the simple intent to not do (much) harm. These organizations understand the health of the systems they are part of as a condition of possibility for their own profitability and growth, and plan their actions in consequence. (For some organizations this is empirically untrue as they are effectively predatory: their success is by definition tied up with and helped by the systemic deterioration of their environments. Naturally, they fall outside the scope of this analysis, and arguably outside the scope of legitimate activities.)
• At the level of organizational interoception, the way an organization understands itself, they don't just capture a much larger, detailed, and well-organized set of data about themselves than equivalent organizations, but they also frame this data into detailed quantitative models of their own functioning. A common characteristic of these organizations is that they are able to simulate themselves under varying internal and external conditions, including hypothetical technologies, processes, market conditions, etc. They don't measure and report as much as refine their own self-models with new data.
• Their inter-orgnizational interactions are data- and model-rich, in the sense that they offer and demand from their external partners data and knowledge that fully represents their understanding of their own relevant aspects of the process, and using their partner's to expand their understanding of systemic sustainability beyond their own area of operations. In other words, organizations interact in information-rich negotiation environments to coordinate processes, from the manufacture or purchase of an specific product or service to the direction of a line of development, to maximize both mutual economic grains and the health and sustainability of the wider environment.
• At the systemic aggregate level, then, this increases the effectiveness of sustainability efforts by a sufficiently detailed understanding of states, processes, and constraints flow through the system and help short- and long-term decisions. Interacting pairs or sets of organizations can then improve (as a whole) as fast as each one can improve on their own, compounding the effect of technological improvements.

In short, while price signals and supply/demand curves allow, under certain conditions, markets to work as emergent optimizers, upgrading inter-organizational relationships to leverage much richer system-level information increases the flexibility and cognitive power of the aggregate system.

This is not, on itself, new. Historians and economists have long understood the way the interactions of trade, as well as more informal contacts, help establish and disseminate technological advances. Export-led development, when it succeeds, does so as much because of the way it helps import, test, and integrate new capabilities to a country as it does because of the income from the exports themselves. What the new developments we're discussing aim at making possible is to accelerate this improvement path to match the increasingly fast pace of the frontier of intra-organizational improvements.

To put it another way, while total transparency might be counterproductive, the entire scientific, economic, and even social history of the last couple of centuries shows that the tactical advantages of opacity pale against the strategic gains from more open interaction.

We can already see the outlines of possible technology stacks going all the way from geo-ecological systems to post-consumer logistics, including ubiquitous sensor platforms, differential privacy algorithms, smart contracts, increasingly powerful AI-driven system modeling, and cryptographic protocols. Understanding how these, others, and future technologies fit in what we are trying to do, understanding what we are trying to do, is one of the key ongoing themes in sustainability efforts and long-term economic development — which are, under any sufficiently ambitious and humane agenda, one and the same issue.

The earlier an organization learns to better understand itself, and the earlier it joins in collaborative knowledge-building interactions with their environment, the larger their potential role in a viable future economy, and the higher the chances of one ever existing.