Haute Lumière
Commerce · I.01 · MMXXVI · daylight
ASSESSMENT · Chapter I.01 — The Ninety Days
Three instruments: a ten-point quiz, eight reflection questions, five essay prompts. The quiz checks comprehension rather than recall. The reflections are private and first-person. The essays are arguable from more than one side.
THE QUIZ — ten points
Four on recall.
1. Write the scarcity ratio and define each term.
S = D / (R · r)— demand per period over the product of standing stock and its regeneration rate per period. A resource is scarce when demand exceeds what the stock regenerates in the period. One mark for the expression, one for identifyingras the regeneration rate — that is the term conventional practice sets to zero.
2. Name the four Ds of Appreciative Inquiry, in order, and the fifth D this house adds.
Discovery, Dream, Design, Destiny — and Delight. Delight is not decoration; it is the adoption mechanism, the reason a model spreads without a mandate.
3. What is Charles Hall's proposed minimum system-wide EROI for an industrial society, and what does that surplus have to fund?
Approximately 11:1. The surplus funds everything that is not energy production — healthcare, education, the arts, childhood, retirement.
4. State the two constraints on pilot size.
The effect must exceed roughly three times period-to-period noise, and the cost must sit inside the discretionary authority of one already-persuaded person.
Four on application.
5. Your operations director proposes a pilot costing £180,000, requiring sign-off from her, the CFO and the group capital committee. The expected effect is about 1.4 times normal quarterly variation. Diagnose it.
It fails both constraints. The effect is inside the noise band, so the result will be arguable whatever happens; and three signatures means three opportunities for deferral. The stronger answer notes these are different kinds of failure: the first is fatal to the evidence, the second only to the timetable — and that if no candidate can satisfy both, the problem is sponsorship, not measurement.
6. A colleague says: "Solar delivers nine thousand times what we use, so energy scarcity is a myth." What is missing?
The distinction between flux and delivered supply. The constraint is EROI — the energy cost of capturing energy — and the margin between current system-wide EROI and the societal floor is thin. Full marks require holding both: the abundance is real and the margin is thin.
7. You find a maintenance supervisor who has rebuilt a press for eleven years instead of replacing it. How do you cost this, and what is the trap?
Cost the counterfactual: replacement cost amortised over its cycle, against the annual rebuild programme. The trap is costing only the visible line — the rebuild spend — without the avoided replacement, which is where nearly all the value sits. Credit any answer that also names capital deferral or the supervisor's undocumented knowledge as an unpriced asset.
8. Why does the shared-savings facility revert 100 percent of savings to the operating unit after repayment, rather than continuing to share?
Because it costs the balance sheet nothing once the facility is repaid, and it converts the operating unit from a reluctant host into a genuine beneficiary. They are not funding head office; they are funding a facility that eventually hands them everything.
Two that require the arithmetic to be done.
9. An extractive line declines 4 percent a year. A regenerative alternative starts 25 percent below it and compounds at 2.5 percent. In roughly which year do they cross? Show your working.
Solve
0.75 · (1.025)ⁿ ≥ (0.96)ⁿ, i.e.n ≥ ln(1/0.75) / ln(1.025/0.96).ln(1.3333) = 0.2877;ln(1.0677) = 0.0655;n ≈ 4.4— year five. Credit any method reaching four to five. The point of the question is that the answer is a date, and a date can be put in a plan.
10. A facility of £240,000 plus £15,000 verification and £10,000 annual admin returns verified savings of £62,000 a year. WACC is 9 percent. Does it clear?
62,000 / (240,000 + 15,000 + 10,000) = 62,000 / 265,000 = 23.4%. Against a 9 percent WACC, it clears by a wide margin. The stronger answer states the conclusion in the right register: this is not an ethical proposal, it is the cheapest capital available to the organisation.
REFLECTION — eight questions, for one person and a pen
These are not for a room. Write the answers by hand if you can; the slowness is the point.
- Think of something you have protected inside your organisation that you could not fully justify on paper at the time. What did you know that the paper did not?
- Where in your own work are you drawing down a stock faster than it regenerates — and what is the stock? Answer honestly about attention, health and relationships before answering about anything financial.
- Who in your organisation already thinks the way this chapter thinks, and has never been asked? What has it cost them to be right early?
- What is the number you have suspected for a long time and never gone and measured? What has stopped you — genuinely?
- Recall a time you won an argument numerically after losing it philosophically. What changed in the room when the number arrived?
- If you were to make one commitment this quarter that could not be quietly reversed, what would frighten you most about it — and is that fear information or habit?
- What would you want to still be running in this organisation ten years after you leave? Name one thing. Then ask what would have to be true this year.
- Where have you been asking a deficit question — what is wrong here — of a situation that would answer a different question more usefully? Write the appreciative version of that question now.
ESSAY PROMPTS — five
Each is arguable from more than one side. Each requires at least one source the chapter cites and at least one it does not.
1. The horizon mismatch. The chapter finds that regenerative options typically cross over in four to six years, and observes that this is longer than the tenure of most decision-makers. Argue either that this is a fixable governance problem — through compensation design, mandate length or covenanted commitment — or that it is a structural feature of managerial capitalism that no organisation can solve alone. Use Ostrom on institutional design, and one source on executive tenure or incentive horizons that the chapter does not cite.
2. Is EROI the right measure? Hall's societal-floor argument is contested — on boundary definition, on whether the floor is a real threshold or an artefact of method, and on whether energy quality is captured. Take a position on whether EROI should sit at the centre of a regenerative economics or be demoted to one indicator among several. Engage Hall and Klitgaard directly, and at least one published critique.
3. Appreciative Inquiry and the problem of the genuinely broken. The method insists on beginning from what is working. Argue whether this is a robust epistemology or a systematic blind spot — and in particular, what Appreciative Inquiry does when the honest answer to what is already working is very little. Use Cooperrider and Whitney, and one source on organisational failure or turnaround that the chapter does not cite.
4. Fagor. Mondragon's founding cooperative, Fagor Electrodomésticos, entered insolvency in
- Write the case as an argument against the claim that cooperative
structure confers resilience — then write the strongest rebuttal. Conclude with which you find more persuasive and why. Whyte and Whyte is the starting point; find at least one account written after 2013.
5. The measurement that creates what it measures. The chapter argues that regenerative practice is under-adopted largely because it is unmeasured. Argue the counter-case: that new measurement regimes reshape behaviour toward what is measurable, and that formalising these practices may degrade the very qualities — trust, discretion, craft — that made them work while they were informal. Use the chapter's Preston or Interface material, and one source on measurement effects, gaming or Goodhart's law that it does not cite.