The Holistic Investing Approach: Making Better Decisions

The Foundation of Holistic Investing:

Holistic Decision Making is a framework for making decisions which do not have unintended consequences and which are simultaneously financially, socially, and environmentally sound. Making decisions in this way does not come naturally for us as humans, which is why we so often create unexpected problems for ourselves. The “law of unintended consequences” can be avoided if we learn to think Holistically.

Holistic Decision Making does not dictate what decisions we should make, instead it suggests how we should make decisions. There are no right or wrong decisions in Holistic Investing. Each individual and each situation will call for different actions. Holistic Decision Making will dramatically increase our chances of making a good decision, no matter the circumstances.

I have omitted significant portions of Holistic Decision Making in this article for the sake of brevity. I highly recommend you read the book “Holistic Management: A New Framework for Decision Making” to fully understand Holistic Decision Making.

Why Is Holistic Decision Making Important For Investors?

Holistic investing can help any person or organization, whether they are managing their personal lives, an entire nation, or anything in between. However, it is especially important for investors:

  1. As investors, you have to make very difficult decisions every day. Holistic Decision Making helps you to make good decisions more consistently. It will also reduce your stress when making decisions. If you follow the Holistic Decision Making Framework you will be more confident that the decisions you make are the right ones.

  2. As investors, you have more money than the average person, but your inner happiness and quality of life may not be where you would like. Holistic Decision Making will help you to improve your quality of life, without compromising your professional efficiency.

  3. As an investors, you have more influence over the well-being of society than any other group of people. If one investor starts to make better decisions (decisions which take into account their personal values, relationships, environment and finances all at once) it will have a much larger impact on the world than if even a hundred middle class citizens were to do the same thing. With power comes responsibility.

A Step By Step Guide To Holistic Decision Making For Investors

  1. Define your Holistic Context

    • Who are the Decision Makers? Who has veto-power? (if you are a solo-investor this may just be yourself, if you are a group be sure to include every group member)

    • What is the resource base being managed, what resources can you leverage to help you achieve your goals? Money? Assets? Creativity? Etc.

    • Keep it short, but precise.

    • This stage is a prerequisite to forming your Holistic Goal.

  1. Define your Holistic Goal

  • If you are doing this process as a group it would be well worth your money to hire a facilitator. Someone who has experience with applying Holistic Management in group settings. For a list of qualified facilitators, look here.

    • Creating a Holistic Goal can be a very long process. Initially, however, you should attempt to create a temporary Holistic Goal in a single day. You can then immediately start to make better decisions; there is no need to wait for a perfectly polished Holistic Goal.

    • Your Holistic Goal can be a few short sentences. But, at the beginning it will probably be a page or more in length. That is okay. It is better for it to be too long than to be too short and omit something important.

    • As you are writing your Holistic Goal, make sure you are not writing how you are going achieve a goal. Just write the goal itself. Try to think of why you want something. For example, instead of writing “I will be rich” write about why you want to be rich “I will have security”, “I will leave wealth for my children”, “I will make the world a better place”, “I will enjoy all the pleasures life has to offer”, etc….

    • Steps to writing your Holistic Goal:

    1. Quality of Life: Define your ideal quality of life. You must really try to figure out what your deepest values are. When you figure out what it is you really want from life, write it in your Holistic Goal. Make sure you include your goals for the following areas of life: economic well-being, relationships, challenge/growth, and purpose/contribution. In a group, the Quality of Life statement should be an expression of the deepest values that you all share. When your values differ you should seek to accommodate each other, without compromising your individual values. Keep talking until the goal is right for all of you. This is where a facilitator is most useful.

    2. Forms of Production: Next define exactly what you will need to produce in order to achieve your desired Quality of Life. What is missing from your life right now that is preventing you from having the quality of life you desire? Examples: Free time, financial security, self awareness, a supportive community, healthy habits, etc.

    3. Future Resource Base: Next define what the future will need to look like in order to sustain your Quality of Life and Forms of Production. Specifically, you should include a description of the future landscape (the physical environment), and future community.

    4. Put all of the things you wrote onto a single sheet of paper; this is your Holistic Goal!

  1. Generate Ideas

    • Now that you know what you are working towards, your Holistic Goal, you need to use your creativity to think of some actions which might help you move towards your goals

    • Use all the resources at your disposal to generate ideas: books, the internet, mentors, peers, children, creativity exercises, etc.

    • Do not dismiss any ideas yet, no matter how ridiculous or unrealistic they may seem. The next stage is where you will sort the good ideas from the bad

  1. Decision Testing

    • Test every decision, every idea, every potential action, using the following Testing Questions (Try to spend only a few minutes at most on each question. Some questions will not always apply, use your judgment.):

    • Please refer to the “Holistic Management” book for more a more in-depth guide to these Testing Questions.
    1. Weeding Out The Really Bad Ideas = If taking this action will move you away from your Holistic Goal then you do not need to go any farther: do not take this action.

    2. Cause and Effect = (if the decision involves solving a problem) Does this action address the root cause of the problem?

    3. Weak Link

      1. Social = If you take this action, will you encounter or create a blockage to progress (consider prevailing social attitudes)?

      2. Financial = Does this action strengthen the weakest link in the Chain of Production? The Chain of Production has three links: Resource Conversion, Product Conversion, and Marketing.

    4. Marginal Reaction (when comparing two or more actions) = Which action provides the greatest return, in terms of your holistic goal, for the time and money spent?

    5. Gross Profit Analysis (when comparing two or more enterprises/investments) = Which enterprise/investment contributes the most to covering the overhead costs of the business?

    6. Energy/Money, Source & Use = Is the energy or money to be used in this action derived from the most appropriate source in terms of your Holistic Goal? Will the way in which the energy or money is to be used lead toward your Holistic Goal?

    7. Sustainability = If you take this action, will it lead toward or away from the Future Resource Base described in your Holistic Goal?

    8. Society & Culture = How do you feel about this action now? Will it lead to the Quality of Life you desire? Will it adversely affect the lives of others?

    • Train yourself to briefly consider all of these questions throughout your day whenever you are making a decision. Eventually the process of making decisions Holistically will become automatic and easy.

    • All group members should be involved as much as possible in decision testing.

  1. Plan, Monitor, Control, Re-plan

    • When you make a “Plan”, automatically assume it is wrong. Then, figure out what the earliest indication will be that the plan is failing. Constantly “Monitor” your results. When you see the first indication that the plan is not working: “Control”: Take immediate action to stop the problem from developing further. Finally, return to the drawing board for a fresh try: “Re-Plan”. Repeat.

The most important point to remember is that every investment decision you make must lead you closer to your Holistic Goal. 

Specific Investment Opportunities

I have a unique view into the world of agriculture which most investors do not, simply because agriculture is where I focus all of my time and energy. Although I am not an investor and I am not qualified to give investment advice, I see tremendous opportunity right now in Holistically Managed land and agriculture. I encourage you to consider the information with an open mind, and try to see past my lack of investing knowledge to the amazing, untapped value of Holistic Management. Do not forget the Holistic Investing guidelines discussed above, you must test every investment decision against your Holistic Goal.

Watch these two videos first:

Allan Savory’s TED Talk

Tony Lovell from SLM Partners

This is what Holistic Investing can accomplish. Invest in Holistic Management and literally "green the world".
This is what Holistic Investing can accomplish.

 

If I had capital I would be investing it in the following areas:

  • Land Regeneration

    • The Potential Of Holistic Management

      • Holistic Management is simply Holistic Decision Making applied to land management and agriculture. It includes several tools beside the decision making process, such as Holistic Planned Grazing, Holistic Financial Planning, and Holistic Land Planning.

      • Holistic Management has been proven to be able to regenerate degraded landscapes more quickly and economically than any other environmental restoration system known

      • Holistic Management, specifically Holistic Planned Grazing, can reliably restore deserting areas, pure deserts, and even mine sites, to lush and productive grasslands in a reasonably short period of time. It can accomplish this over huge areas of land while also producing marketable food in the form of meat.

      • Holistic Management can even improve already productive agricultural land. Typically livestock producers in humid areas of North America, for example, can double their production in less than ten years, and triple production in twenty years.

      • Holistic Management can build topsoil rapidly… increasing the agricultural value of land.

    • Real Estate

      • Desert land is currently very low in value; it produces almost nothing of value.

      • Holistic Management can turn deserts into productive range lands which are many times more productive than the original desert.

      • This is a relatively recent discovery, and so far no land-investors that I am aware of have discovered this opportunity

      • Imagine if you owned the worst desert land in Arizona, but you could choose to transform your land into East-Texas land for no cost… wouldn’t you do it? Wouldn’t every investor in the country be doing it?

      • There is no shortage of desert land in the world which can be transformed into lush grasslands. Your potential returns are essentially limitless.

    • Community Investment

      • What will happen to existing desert communities when the surrounding areas start to become much more productive, beautiful and hospitable?

      • Restoring deserts requires livestock managers, these people will need a place to live and buy stuff. They will probably go to the nearest existing community

      • Isn’t it reasonable to expect that desert communities will experience significant growth if the surrounding areas are regenerated with Holistic Management?

      • Who else in the investing world is aware of this opportunity? No one.

  • Holistic Ranching

    • Cattle and Beef

      • Conventional beef and cattle production is already a popular and safe investment

      • Holistic Management simply improves upon the profitability, safety, and sustainability of conventional beef and cattle investment

      • There are already two investment companies that I am aware of who are investing in Holistically Managed Cattle Production:

  • Holistic Cash Crops

    • More profit, less risk

      • Many investors lease their land to grain farmers/cash crop farmers

      • Holistic Managers have developed methods of producing cash crops which are far more profitable, and less risky, than conventional farming techniques

      • These methods also happen to regenerate landscapes, instead of degrading them

      • These methods increase profits primarily by radically reducing expenses: no fertilizers, pesticides, GMO seeds, irrigation, or cultivating machinery are required.

      • These methods reduce risk because the crops produced are much more resilient in the face of drought, storms, cold weather, hot weather, disease and pest damage, and fluctuating oil prices

    • Gabe Brown is the pioneer of these innovative techniques

Holistic Managers are people who follow the same Holistic Decision Making process outlined above. Most Holistic Managers in the world right now are primarily involved in agriculture.

Can you see the benefits of investing in a business in which all decisions are made Holistically? Can you see how this might be a safer, and more profitable, investment than investing in a business where decisions are made haphazardly?

If you are investing in land or agriculture you should be demanding Holistic Management of your investment. There are thousands of highly skilled Holistic Managers around the globe, don’t settle for less.

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