Analyzing and Implementing Sustainability


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Overview of the key elements, and some of the opportunities and pitfalls of implementing sustainability programs.

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  • Here is a sample – modified to remove any specifics for the company – of a strategic plan…
  • For each of the sections, you can develop a metric of what activities you can engage in each of the elements that make up the plan.
  • Bertrand Collomb, Global Agenda Magazine in 2003: “ A very one-dimensional view of business, with considerable importance given to short-term value creation as measured by immediate stock market performance. The crisis of 2001-2002 showed the limits and the excesses of this approach. Markets do not always give an accurate forecast of the economic and business situation. Long-term shareholder value requires a stakeholder approach. This crisis, which we are still experiencing, highlights the inconsistencies between short-term shareholder value and true stakeholder value. It has made civil society and companies even more aware that sustainable development is the only way for a company to thrive in the long run. Companies have to take into account their impact on the societies in which they operate and the environment that surrounds them.”
  • Analyzing and Implementing Sustainability

    1. 1. Analyzing and Implementing Sustainability Solutions in Global Businesses July 15, 2009
    2. 2. “ Shocking” Fact # 1 Many companies and organizations are really bad at communicating what it is that they actually do.
    3. 3. The Key Question: What Does Your Company (or organization) REALLY do? <ul><li>It is not the products you make </li></ul><ul><li>It is not the services you provide </li></ul><ul><li>It is the IMPACT or VALUE they have on peoples’ lives that really counts </li></ul>
    4. 4. The Key Question: What Does Your Company (or organization) REALLY do? <ul><li>“ Lafarge does more than make cement, concrete, aggregates, and gypsum building products. We make the materials that are used to make the roads we all drive on, the offices where we work, the schools in which our children are educated, and the homes in which people live.” </li></ul><ul><li>Sodexo </li></ul><ul><li>Provides the nutrition that enables students to learn effectively </li></ul><ul><li>Helps patients in hospitals to heal </li></ul><ul><li>Seniors to enjoy a healthy and active retirements. </li></ul>
    5. 5. The Key Elements of a Successful Program <ul><li>Aligns with your Core Business Model </li></ul><ul><li>Integrates Sustainability into Day-to-Day Operations </li></ul><ul><li>Employees are Actively Engaged and Empowered </li></ul><ul><li>Provides tangible (Local) Benefits </li></ul><ul><li>Maximizes Stakeholder Engagement </li></ul>
    6. 6. Alignment with Core Business Model <ul><li>Successful businesses must be adept at determining market changes, trends and expectations. </li></ul><ul><li>They cannot be in such a rush to embrace the “new” trend that they abandon their fundamental and core purposes. </li></ul><ul><li>Do not rush headlong into activities or partnerships that are not aligned with their long-term interests. </li></ul><ul><li>Recognize that for any program to be valuable to a business, it must further the goals of that company. </li></ul>
    7. 7. “ Shocking” Fact # 2 Actually, most companies and organizations do have a long-range plan and are not only concerned the next quarter’s financial returns.
    8. 8. Our Vision 2020 Financial Objectives <ul><li>Expand premium offer to capture higher profit sales </li></ul><ul><li>Increase sales volume of existing customers </li></ul><ul><li>Improve margins </li></ul><ul><li>Reduce DSOs </li></ul><ul><li>Ensure compliance </li></ul>Operational Objectives <ul><li>Identify best practices </li></ul><ul><li>Integrate best practices throughout company </li></ul><ul><li>Increase market share </li></ul><ul><li>Reduce raw materials costs </li></ul><ul><li>Reduce transportation costs </li></ul><ul><li>Reduce lost time accidents </li></ul><ul><li>Reduce fines/mediation </li></ul>Sales Objectives <ul><li>Expand share of business with existing clients </li></ul><ul><li>100 percent retention of existing clients </li></ul><ul><li>Win new business </li></ul><ul><li>Competitive analysis </li></ul>Cultural Objectives <ul><li>Attract / hire / retain the best talent </li></ul><ul><li>Culture of continuous Improvement </li></ul><ul><li>Align HR processes and incentives with desired outcomes </li></ul><ul><li>Increase productivity </li></ul><ul><li>Reduce turnover </li></ul>
    9. 11. “ Shocking” Fact #3 Not everything you do will be ‘green’ or ‘greenable’ – and that’s okay.
    10. 12. Integrate into Day to Day Operations <ul><li>From a Vision to a Culture </li></ul><ul><ul><li>Communicate consistently </li></ul></ul><ul><li>Identify and build on “quick hit” benefits </li></ul><ul><li>Reduce Costs </li></ul><ul><ul><li>Tax advantages/incentives </li></ul></ul><ul><ul><li>Risk Management </li></ul></ul><ul><ul><li>Building Credibility </li></ul></ul><ul><li>Increase Opportunities </li></ul><ul><ul><li>Social marketing and co-branding </li></ul></ul><ul><ul><li>Employer of Choice: values-based companies are winning the war for talent </li></ul></ul><ul><li>Identify Longer-term Benefits </li></ul><ul><ul><li>Corporate reputation and image. </li></ul></ul>
    11. 13. Employee Engagement And Empowerment <ul><li>Align incentives with desired outcomes </li></ul><ul><li>Empower employees at all levels </li></ul><ul><ul><li>Make them a part, give them something to do/contribute </li></ul></ul><ul><ul><li>Leverage their unique skills </li></ul></ul>
    12. 14. Employee Engagement And Empowerment <ul><li>81 percent of MBA candidates believe businesses should work toward the betterment of society </li></ul><ul><li>89 percent said business professionals should take social and environmental impacts into account when making business decisions </li></ul><ul><li>79 percent indicated they would seek employment that is socially responsible in the course of their careers </li></ul><ul><li>59 percent said they would do so immediately following business school. </li></ul><ul><li>October 2006 NetImpact Survey </li></ul>
    13. 15. “ Shocking” Fact # 4 They (customers/consumers) don’t always know what you think they know.
    14. 20. Tangible (Local) Benefits <ul><li>Measurable </li></ul><ul><li>Credible </li></ul><ul><li>Appropriate </li></ul><ul><li>Demonstrable </li></ul><ul><li>Visually ‘obvious’ </li></ul>
    15. 21. Maximize Stakeholder Engagement <ul><li>Accurately define and identify stakeholders </li></ul><ul><li>Effectively engage stakeholders </li></ul><ul><li>“The New PR” </li></ul><ul><ul><li>Transparency instead of spin. </li></ul></ul><ul><ul><li>Forthright and forthcoming. </li></ul></ul><ul><ul><li>Transformation from communicating to people to dialogue. </li></ul></ul><ul><ul><li>Increasing prevalence/importance of new media. </li></ul></ul>
    16. 22. Examples that are ‘on’ message
    17. 23. “ Shocking” Fact # 5 Large size does not make you a leader. It just means you have the opportunity to have a bigger impact (both positive and negative)
    18. 24. When Size is an Advantage <ul><li>Sodexo announced today that after only one year, its switch to recycled napkins in 1,300 foodservice operations nationwide has resulted in saving nearly ten million gallons of water, more than 23,000 trees, half a million gallons of oil and five and a half million kilowatts of energy. The company began using two types of recycled napkins last year as part of a commitment to leadership in sustainability and to providing environment-friendly practices. </li></ul><ul><li>Energy was saved because less power is used to recycle paper products than to create them from virgin material - enough was saved through the napkin program to power 600 American homes for an entire year! In addition, more than half a million gallons of oil were saved - 38 tanker trucks worth - and 41 tons of pollutants were kept out of the environment. Further, 4,131 cubic yards of paper were diverted from landfill space. This is enough to cover an entire football field with a two and a half feet deep stack of paper. </li></ul><ul><li>The calculations are made by the Recycled Products Cooperative (RPC), which says that each ton of 100 percent post-consumer recycled paper that displaces a ton of virgin fiber paper saves 7,000 gallons of water, 4,100 kilowatt hours of electricity and prevents 60 pounds of pollutants from entering the atmosphere. </li></ul>
    19. 25. The Supply Chain
    20. 26. What Does It Take To Be A Leader? <ul><li>Leadership by Influence </li></ul><ul><ul><li>Purchasing power </li></ul></ul><ul><ul><li>Requirements of your suppliers </li></ul></ul><ul><li>Leadership by Actions </li></ul><ul><ul><li>The manner in which you conduct your business </li></ul></ul><ul><ul><li>Your commitments and practices </li></ul></ul><ul><ul><li>Your transparency and reporting </li></ul></ul><ul><ul><li>Stakeholder engagement </li></ul></ul><ul><ul><li>Actions you encourage by employees </li></ul></ul><ul><li>Leadership by Expertise </li></ul><ul><ul><li>What you teach your customers </li></ul></ul><ul><ul><li>Expertise you share with the community </li></ul></ul><ul><ul><li>Show others how to live your mutually aligned values </li></ul></ul>
    21. 27. “ Shocking” Fact # 6 It’s not always that simple to do the ‘right’ thing.
    22. 28. Hallmarks of Global (Large/Decentralized) Organizations <ul><li>Strengths </li></ul><ul><li>Size – breadth and depth </li></ul><ul><li>Expertise </li></ul><ul><li>Client relationships </li></ul><ul><li>Community relationships </li></ul><ul><li>Corporate culture provides common culture </li></ul><ul><li>Challenges </li></ul><ul><li>Communication/ technology </li></ul><ul><li>Information exchange </li></ul><ul><li>Customization </li></ul><ul><li>‘ Silos’ </li></ul><ul><li>Cultural issues </li></ul>Who defines what the ‘right thing’ is?
    23. 29. Considerations/Thoughts for Discussion <ul><li>Does a company/organization have an obligation to bring its values to an overseas location, or does it have a responsibility to be respectful/protective of the local indigenous culture? </li></ul><ul><li>How and who should resolve a conflict between protecting the environment and providing economic opportunity? </li></ul><ul><li>How does globalization affect what we think of as capitalism? </li></ul><ul><li>Is American-style capitalism ‘dead’ and if so, what will take its place? </li></ul>
    24. 30. On the Wealth of Nations <ul><li>Adam Smith </li></ul><ul><li>An observed economic reality (people act in their own interest). </li></ul><ul><ul><li>Did not argue that self-interest is always good but that the alternative is worse: </li></ul></ul><ul><ul><li>&quot;By pursuing his own self interest he frequently promotes that of society more effectually than when he really intends to promote it. I have never known much good done by those who affected to trade for the public good.” (p. 456). </li></ul></ul><ul><li>If markets were free and open, how does a nation keep its capitalists from moving their capital out of the nation and into other countries where labor could be bought more cheaply. </li></ul><ul><ul><li>“ (By) preferring the support of domestic to that of foreign industry,&quot; the capitalist will in a sense be &quot;led by an invisible hand to promote an end which was no part of his intention.&quot; </li></ul></ul>
    25. 31. How to Get Started <ul><li>Identify those areas that matter to your stakeholders </li></ul><ul><li>Identify those areas for which your company is well positioned to have a direct impact </li></ul><ul><li>Identify those areas for which your company can have an indirect impact </li></ul><ul><li>Inventory your existing efforts and capacities (including employee skills) </li></ul><ul><ul><li>Identify internal experts and create a ‘community of practice’ </li></ul></ul><ul><li>Set and rank your priorities </li></ul><ul><ul><li>Need to take the time and build consensus/agreement/buy-in </li></ul></ul><ul><li>Educate, Inform and Engage </li></ul>