A Sustainability Strategy
Fossil fuels and other limited resources have spawned many ideologies concerning sustainable practices. Often these practices are aimed at reducing the use fossil fuels through measures such as recycling and energy reduction. These various practices for reducing energy waste and preserving the environment have come to be known as sustainability initiatives. Sustainability is a growing practice of adopting ‘green’ or environmentally friendly practices that serve all dimensions of the environment such as social, cultural, and economics. The following plan outlines a method for companies large and small to achieve significant and measurable sustainability levels for the benefit of society and the environment.
Is 100% sustainability possible?
One of the best-known examples of a successful sustainability strategy can be seen in the carpet company Interface. Not only did Interface successfully design and implement a strategic business plan based on environmental sustainability, but also proved that sustainability could be a profitable initiative. In 1994, Ray C. Anderson, the founder and chairman of Interface Inc., one of the largest carpet manufacturers in the world, was inspired to alter his business practice to become a model of ecological sustainability. Anderson describes his decision as an epiphany and redefining of what is successful. In short, is being successful at the cost of the earth and the environment truly successful? Anderson realizes that success needed to be redefined which by doing so would ultimately transform Interface. Much of the early realizations that Anderson had begun as questions such as “What is your company doing for the environment?” When Anderson realized that he could not answer many of these questions he began dedicating himself to creating a new mission and set of corporate values for Interface.
The New Mission and Values
In order for Anderson to recreate Interface as an ecologically sustainable company, he would need to alter the company values and refocus the corporate mission. The company mission became: “To operate this petroleum-intensive business in a manner that takes from the earth only that which is naturally and rapidly renewable — not one fresh drop of oil — and to do no harm to the biosphere.”
The completion of this new mission would be gauged by the accomplishment of zero environmental footprint by the year 2020. In order to reach this goal Anderson would need to create a business plan that incorporated sustainability objectives at the core of its competencies.
Anderson refers to this process of change as climbing “Mount Sustainability”. The concept of this metaphoric initiative was to divide the mission of the company into seven areas or faces of a mountain, leading to the goal of zero footprint. In order to accomplish this mission the sustainability issues needed to be defined. The strategy for sustainability management practices begins with the realization that the organization is not just as an entity operating in the environment but as an entity which is directly impacting the environment. From this understanding, the sustainable leader becomes responsible and holds the company responsible for ecological damages.
What one learns from Anderson is that if a company such as Interface (which was a company that had almost no concern for environmental issues other than following regulations) could transform itself to be a model for sustainability; then any company could follow this example. Interface further shows that sustainable management practices are not optional choices today and are necessary if companies desire to remain competitive and profitable in the future.
A Blueprint for Corporate Sustainability
In order to implement a sustainability strategy at the company level, the issues impacting the environment need to be defined. To accomplish this part of the strategy, an environmental scan or SWOT analysis can be conducted. This form of analysis will reveal the challenges, trends, threats, strengths, weaknesses, and opportunities pertaining to the company in question with regard to sustainability issues. From these issues goals and objectives can be designed. The following SWOT analysis shows these issues.
*Waste Generation and Removal
*Air Emissions such as greenhouse gasses or methane
*Refrigerants such as Freon and other gasses
Innovation and technological advances such as low powered appliances and computers Generational shift in values seeking sustainable goods and services than unsustainable. Globalization and ever increasing interconnectedness of business with communities throughout the world Political and regulatory policies changing to inspire green business practices e.g., tax reductions for solar power
Social trends such as rising consumer demand for goods that are not environmentally friendly such as cell phones. market forces such as competitors, economic downturns that create a demand for less expensive goods that may not be environmentally sustainable. Increased cost of doing business makes sustainable practices more difficult to implement
Increased demand for green products Increased demand for low priced products that are sustainable Increased demand for reduced resource usage such as water and fossil fuels
Strengths Create brands that attract green consumers Marketing to those that seek sustainable practices creates long term customers. Create and sell products and services that can adhere easily to sustainability goals Maintain relationships with local businesses and manufacturers to decrease cost and lessen carbon footprint.
*The size and scale of the business could mean that it is difficult to control sustainability practices consistently throughout the entire organization.
*Supply chains are difficult to control and may contain unsound environmental practices.
*The need for competitive pricing may mean that some businesses are more difficult to make environmentally sound due to higher costs for providing green products.
Using the general information derived from the SWOT, a strategy for sustainability can begin to evolve. By linking the needs of the environment with the goals and practices of a company, a practical plan of action will present itself. The use of the SWOT information also provides part of the means for prioritizing sustainability goals.
Natural resource conservation, management theories and practices play a large role in the creation of sustainability strategy. Because sustainability attempts to create businesses, communities, and other practices, that are able to be productive and noninvasive to the ecology, sustainability policies must be designed to promote these goals. For instance, state and federal governments play a large role in fostering alternative energy sources through tax credits. In the same manner businesses foster recycling practices through it consistent and required participation.
To formulate sustainability strategies there is a need to create sustainability polices which take into account the conservation of natural resources because these resources are limited. While there is considerable debate over the level of scarcity of natural resources, there is no argument as to the fact that these resources are scarce and will run out because of consumption (Krautkraemer 2005).
Due to the fact of scarcity in natural resources, strategic sustainability must be designed with the idea of prioritizing urgent and future resources needs. With this in mind, a framework for deriving strategic goals can be designed using the information from the SWOT. The method for prioritization is framed by linking the Sustainability Challenges with Opportunities and Trends that leverage company Strengths. For example, energy consumption for a grocery store is a common environmental problem due to the use of refrigerators and machinery that use large amounts of energy. New trends in refrigeration have made the energy consumption for refrigeration much lower than in the past. By linking these concepts in this manner, the opportunity to build competitive advantage and increase ‘green’ brand value can be actualized.
The linking of SWOT information in this manner is a practical means for formulating which issues can be dealt with as well the priority of the issues. Some issues such as air quality should be dealt with before other issues especially in businesses that are located in pollution sensitive areas such as California. For companies that have multiple locations throughout the United States, this means that sustainable strategies should be prioritized in accordance with geographic needs as well as scarcity needs.
As the most important portion of the strategic management process, implementation is the actual placing into operation the plan. This typically requires the resources of the entire company working in concert. This means instilling these concepts into the corporate strategy and processes of the company. In order to manage company resources, managers and owners must design objectives and procedures with environmental sustainability at the core of their objectives.
Evaluation and Control
Implementing sustainability management practices will be ineffective unless there is some form of oversight to ensure that they are being properly implemented. Evaluation will take place in the form of achieving the goals designed from the strategic plan. Evaluation will not be limited to the outcome of interventions and single evaluations but will also measure the ongoing outcomes of the strategic plan. This evaluation will attempt to assess the organization to see that new concepts and goals are being implemented and practiced in an ongoing fashion (Wheelen & Hunger, 2010).
One of the most effective ways to gauge the effectiveness of sustainability management and practices is through feedback. Both negative and positive feedback can produce data that can be useful. Feedback can be collected through the comparing of objectives with the outcomes of situations. If lowering CO2 emissions is the objective measurements will be needed to track this objective. Having an evaluation and control plan will allow companies to maintain their focus on objectives as well.
Sustainability strategies are economically feasible and if applied properly they can build competitive advantage. This position is evidenced by companies such as Interface. Sustainability practices also seem to work best when values are the driving force. When one looks at recycling practices in the United States, there are many people who recycle and do not question or resist the practice because they value conservation. This is a large change from 30 years ago in which very little recycling was being done. This change was due to a large shift in public values and opinion concerning environmental safety and conservation.
One of the major components of building sustainability policies is the inclusion of considerations such as ecosystem services and societal benefits. For example, when policies attempt to create jobs this is a social benefit that can help drive value in sustainability policies. Any time policy can influence or inspire these types of changes, this helps build value in sustainability practices and makes the organization highly competitive.
Anderson, R. (2010). Business lessons from a radical industrialist. (1 ed., pp. 32–302). New York NY: St. Martins press.
Coelh, P.R. (2002) The Social Responsibility of Corporate Management: A Classical Critique Retrieved from http://web.bsu.edu/cob/econ/research/papers/bsuecwp200201coelho.pdf
Krautkraemer, Jeffrey A. Resources for the Future, “Economics of Natural Resource Scarcity: The State of the Debate.” Last modified 2005. Accessed April 23, 2013. http://www.rff.org/Documents/RFF-DP-05-14.pdf.
Wheelen, T. L., & Hunger, J. D. (2010). Concepts in strategic management in business policy Upper Saddle River, NJ: Pearson Education
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