4. 1. Abstract
Innovation has been known to transform not just products and organizations, but even nations. So we
often talk about innovation as a culture, not just a concept or a mere framework. Be it innovation in
product, process or service, it brings along Change Management challenges.
On the other hand, issues of Sustainability for environment and social responsibility both from
regulatory compliance and customer awareness point of view have become key „Value‟ drivers,
especially for manufacturing organizations. Sustainability is finding the right balance of Social,
Financial & Environmental aspects of product & business as a whole. For both Sustainability and
Innovation, one has to deal with the difficult twins - Risk and Opportunity.
Project Managers often deliver projects on time and on budget. The question to be asked is, Is this
enough? It is not only about maximizing returns, but maximizing value. Managers have a knack of
identifying opportunities and managing risks. They will have to play the crucial role of Change Agents.
This will mean moving away from the organizational mindset and taking the larger perspective, setting
tough goals and achieving them.
This paper demonstrates a structured framework that can be leveraged by teams across industries to
achieve the parallel goals of Sustainability and Innovation. It also presents the possibility of fine
balance of long term Sustainability while achieving financial viability and vital positive societal impact.
Sustainability is a journey and can only be achieved through involved responsibilities across the value
chain.
2. Introduction
All along, man has incessantly challenged himself and in this endeavour man, communities, nations,
corporations and societies have emerged with path breaking solutions to transform the way of life. In
the process, they have taken decisions and built products that tend to endanger our very planet and
the ecosystem. Blame it on the undying spirit of wanting to outdo the competition and improve
profitability, enterprises have very often taken shortcuts that are not conducive to the longevity of the
planet. There are arguments and counter arguments on determining the genesis of all this mess and
how do we fix it going forward for our future generations. Across the globe, governments,
corporations and activists are involved in pitched battles to fix responsibility and restore sanity.
Regulations are being proposed to create deterrents as also incentives for influencing behaviors
towards the environment and sustainability.
The quest for sustainability is already influencing the industry landscape. To most, it means
constrained resources and constantly rising prices. It is forcing a transformation and compelling
organizations globally to approach business models, processes, technologies, products, services very
differently. Today companies are realizing that it is neither easy nor cost effective to change to a
sustainability approach in the short term. It will need a sustained mission and ruthless awareness
across all stakeholders to create an appreciation and alignment for environment.
Innovation is the engine of evolution. It is the key to making sustainability a reality using ideas and
methods that revolutionize the way we handle resources, especially natural resources. Let us take an
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5. example. Internal Combustion engines have not changed much over the last 100 years except that
the efficiencies have gone up to a certain extent. However, in the recent past, innovation in
automotive powertrain has taken some quantum leaps. What is actually driving all this? Rising gas
prices due to monopolistic behaviors, political crises, economic downturns and so on. Alongside, you
have the governments stepping in to implement stringent regulations, incentives for high efficiency
vehicles and penalties on fuel guzzlers.
Hybrid cars are now a reality, both technically and commercially viable. But are these cars really
driving sustainability? You still need to charge them using electricity that has been generated from
coal or nuclear energy. The coal stock is fast depleting, there is pollution from the power plants,
nuclear waste disposal, threat of catastrophic disasters and then there are transmission losses. In
effect, does it imply a sustainable solution or simply means shifting part of the problem. We are taking
rapid strides and there are many such questions that are emerging. Honestly, it needs a holistic,
objective evaluation and approach.
3. Key Challenges
Let us start with defining „Sustainability‟. What does it really mean and what is the scope? While
interacting with business managers from major corporations we found that globally multiple definitions
and interpretations exist. Majority of the definitions provide a narrow myopic perspective with limited
departmental or organizational scope and more importantly short term focus. This led to uncovering
the major challenges faced in embracing sustainability.
Lack of Awareness:
There is a lack of awareness about sustainability. Individuals and organizations do not understand the
full implications of their business activities, production processes and product‟s usage on the
environment and society. Small and medium scale business, especially in developing and
underdeveloped nations lack awareness about sustainability. How their products, processes and their
way of conducting business impact the environment and organizations?
Limited Focus:
The focus of organizations‟ is limited in terms of space and time. There is immense pressure on
managers to produce financial results quarter after quarter. This leads to creating local optima at
department level. Some mature organizations have been able to extend this to the organizational
level. So when a problem arises it is just shifted to a different location or pushed back to a later date
instead of taking effort and time to resolve it. Following this tradition, an organization‟s sustainability
initiatives have a limited departmental or organizational focus. Small and medium scale business,
corporations in developing and underdeveloped nations have their primary focus on growing their
business and are financially oriented. In such a setting sustainability initiatives have limited impact
and at times lead to shifting the problem to another person‟s plate.
Managing Cultural Change:
Sustainability today is treated as a compliance mandate to meet specific standards. Though this can
be treated as a stepping stone, most companies treat it as the final destination. Organizations‟ should
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6. treat sustainability as an evolution process. Sustainability should be imbibed in the core values of the
organization and integrated in the vision and mission of the organization.
Tracking and Tracing Sustainability:
Organizations across the world have matured their business performance measurement systems by
TM
adopting frameworks like Balanced Scorecard , etc. There are no frameworks or measurement
systems which tightly integrate sustainability goals with other organizational goals. Some mature
organizations have set sustainability goals at organizational level but translating these goals to
department and employee level is one of the biggest challenges. There is a clear void of adequate
tools to manage environmental compliance, impact on society, traceability and reporting.
New Product Development:
Portfolio management is a key management activity which decides the allocation of scarce
organizational resources to maximize results. Business cases are the basis for decision making in the
selection process. Business cases do not include impact on environment and society as decision
criteria. Huge investments and long development cycles weaken the prospects of sustainable product
development to emerge a winner. Hence, sustainability gets a secondary priority and is brought in late
in the product development process.
Lack of Adequate Incentives:
There are very few incentive programs initiated by governments to encourage organizations to adopt
sustainable practices and develop sustainability programs.
4. Framework
“Problems cannot be solved at the same level of awareness that created them." ~ Albert Einstein.
Let us start with understanding the scope of Sustainability. In a nutshell, it can be stated as
„Sustainable Environment, Sustainable Society, and Sustainable Business‟. A structured approach
and framework is required to manage the social, economic and environmental impact of the
organization‟s activities. Policies are being laid down by nations and industries. Industry standards
such as BS 8900, ISO 14000 have been created to enable a framework for organizations to manage
sustainable development. There are also private standards such as GRI, AA1000 and so on. These
standards and their compliance will act as a starting point and get society and organizations thinking
about sustainability. To have a deep impact and uncover the true potential, we will have to go down
the transformation path to sustainability. Such a paradigm shift will require a broad based approach
which is deployable for organizations, institutions, civil societies and so on.
Figure 1 shows an interesting interplay between social progress, economic growth and environmental
stewardship. As can be seen, there is a common ground for sustainability. However, for this sweet
spot to be significant, the innovation engine and culture change will have to kick in, as mundane ideas
will not yield the desired harvest.
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7. Figure 1: Sustainability
[www.envplanning.com/.../sustainability.html]
Managers will have to conduct their business activities and introduce products and services in the
market which will ensure profitable growth of the organization, upliftment of the society and positive
impact on the environment. Such a transformation requires a long term planning, business analysis,
cultural change management, risk management, tracking & monitoring. Program Managers with their
sphere of influence are best suited to act as owners and catalyst for the sustainability transformation.
Figure 2 shows the Sphere of Influence for Program Management.
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8. Figure 2: Program Management - Sphere of Influence
The various perspectives to be considered are given below:
Cultural Change:
Going down the transformation path of sustainability will require a complete change in individual and
organizational mindset. The values of caring for the society, nurturing the environment will have to be
imbibed in the value system of nations and organizations. Government leaders and senior
management officials should provide incentives to mould individual behavior. Ethics committee should
have stringent laws enforcing the sustainability policies.
Goal Setting and Performance Management:
Organizations should set goals and adopt performance management systems which integrate
sustainability goals with the traditional goals. These goals should then be translated down to
department and employee level. Accountability at the lowest level will drive bottom-up innovation.
When organizations adopt sustainability it will result into better branding, positive economic impact
and lower consumption of natural resources. Hence, success of programs should be measured not
only in terms of cost efficiency, time and quality; but also in terms of brand value creation, impact on
environment and value creation for society.
Supply Chain Management:
Today, organizations have launched initiatives to reduce the impact of their production processes on
the environment, reduce their carbon footprint, conserve natural resources, etc.. Companies should
move beyond the organizational boundaries and include the coverage to the entire supply chain.
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9. Companies should check the impact created by the entire supply chain starting from suppliers to the
end customer. Suppliers should be rated based on their adherence to sustainability standards.
Sourcing management teams should make their decisions based on these ratings. Customer usage
pattern should be analyzed and feedback should be provided to design teams to approve designs
which minimize usage of water, pollution, etc.. By extending the boundaries of coverage organizations
will be able to better collaborate and uncover new options to make their products environment
friendly.
Portfolio Management and Product Development:
Figure 3 explains the approach that should be adopted by organizations for their Portfolio
Management decisions and Product Development principles.
Figure 3: Portfolio Management
Impact on the environment should be a vital deciding factor in the portfolio management process.
Scope of the product lifecycle should span from concept till discard. From a Program Management
and Product Lifecycle Management (PLM) perspective, the orchestration between the key product
and process aspects has been explained in Figure 4. The fine balance between social, economic and
environmental factors can be achieved by conducting design analysis, environmental analysis &
financial analysis during early stages of the new product development process.
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10. Figure 4: PLM influence on Sustainability
Product and process innovations can not only bring effectiveness and efficiencies on an exponential
basis, but also support continuous improvement for sustainability on an on-going basis. These are
some of the enablers:
1. Tracking the material, substances & their weight management through the product lifecycle
2. Risk and hazard Impact analysis, thus reducing risk of legal litigations and related costs
3. Digital Manufacturing (digital simulation) to ensure
a. The optimum use of energy, material & other resource during manufacturing process
b. Optimized Plant layout with efficient material movements
c. Minimal Impact on environment by improving disposal requirements, analyzing the
use of Air, Water & energy requirements
d. Use of the best possible technology
e. Efficient automation thus reducing time, resource requirements of Processes
4. Support Virtual Collaboration, while reducing paper based information, travels & thus
contributing to Greener Earth
Information Availability & Transparency:
Organizations should focus on making the right information available to the right people at the right
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11. time. Information availability and transparency are key aspects that will aid effective decision making.
Each organization activity should be analyzed for its impact on the environment and metrics should
be devised. Systems should be implemented which measure these metrics and provide inputs which
can be linked with performance management systems. If this information is transparent and shared
with employees, this will generate awareness and motivate individuals to adopt alternate practices.
Data Management should ensure:
1. The right information is available to make the “trade-offs” or to make the “course corrections”
2. Analyze the impact of change to give better insight into cause and effect.
3. Traceability/Audit of the data (Capture, analyze, release with authorization, report, compile
and correlate the conformance data)
New Generation Tools:
New generation tools being pursued by leading organizations include:
Integration between sustainability and innovation
Open innovation or open sourced approach
Ideation Platforms
Industry-Academia-Government joint programs
5. Expected Benefits
So what do corporations have to gain in the process?
Corporations are able to meet their Social Responsibility not just in spirit, but in reality
As the real efficiencies go up due to innovation enabling sustainability, monetary savings
come about. Such savings when invested generate more jobs and keep the economy healthy.
Corporations save millions on what would have otherwise been spent on long, frustrating
legal battles
Elevates the brand image and creates Goodwill
People involved with such corporations, their product and services, have a deep sense of
fulfillment which leads to positive vibes
Sustainability oriented products, processes and services command a premium
• Creates a better planet for our future generations
6. Examples and Case Studies
In the recent years, we have seen a multitude of innovative solutions for sustainability. To name a
few, we have the Public transportation systems, digitization, virtual meetings, waterless urinals,
sanitizers, inverter based home appliances and programmable embedded systems. The sustainability
mantra is driven by three key words; reduce, reuse, recycle.
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12. Let us look at some real life examples-
Unilever is introducing dry shampoo in various markets. It is an attempt to halve the water associated
with the consumer use of its products by 2020. It is relying more on product innovation than on the
customer behaviors to meet its sustainability agenda. So, giving consumers a dry shampoo that
doesn‟t need water is a far easier way of reducing water consumption in the bathroom than educating
them to use less water.
Unilever is running a global program aimed towards reducing greenhouse gases, water and waste
associated with the consumer use of its products. It has embarked on a journey to not only reduce
emissions from its manufacturing plants, but has taken upon itself the responsibility of the entire value
chain, from suppliers, distributors to its consumers. Around 68% of the company‟s carbon emission is
directly related to consumer use, while the manufacturing process contributes only 3%. The efforts
have led to a sustainable sourcing model and better livelihood for farmers. Realizing the challenges of
this Herculean mission, the company is leveraging open innovation programs. Time will tell the results
but a job well begun is a job half done.
Waste handling - When we set aside something as waste, rag pickers engage in sorting to reclaim
reusable and recyclable materials. The process leads to creation of livelihood for the rag pickers, their
dependents as also ensures good use of materials which otherwise would have otherwise led to land
filling. Waste pickers may collect waste from households, community dumps and various other
sources. There have been efforts for indiscriminate automation of dumping grounds. This would only
mean depriving the livelihood opportunity for Waster pickers and sub-optimal recycling of materials.
On the other hand, one cannot ignore the safety hazards to the lives of the Waster handlers and
therefore a collaborative solution is necessary. This will mean waste pickers working as sorters or
processors in recycling centres.
Nike has taken up initiatives to figure out ways to incorporate materials in the products so that they
are not only great for performance but are also regenerative and recyclable. This approach has
virtually transformed their supply chain. Nike‟s Sustainable Clothing Coalition and GreenXchange are
already benchmark achievements. This establishes a clear case of sustainability driving innovation of
an organization‟s products and processes.
In our various engagements globally, we are enabling Customer Centric Innovation Models for
continuous improvement. These run various themes such as portfolio rationalization, legacy
modernization, etc. that help Clients in continuous improvements on time, cost, quality and
organizational dimensions. Value Stream methods are deployed to identify process wastages and
eliminate them resulting in sustainable processes. Major enablers include: Common Processes,
Bottom-Up Innovation, Best Practices, Objective evaluation frameworks, Traceability and
Accountability.
As part of Program Management, we have helped Clients with intuitive dashboards providing near
real time view of key performance parameters and predicative modeling. Technology has been a
great enabler of traceability and information management for effective decision making and
compliance management. We have participated in large programs involving overall of product
development processes, remanufacturing/reconditioning of parts, reverse logistics, network and
inventory optimization.
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13. 7. Conclusion
Bottomline, it simply means doing the right thing. It may seem to take time but as long as the path is
determined and the journey begun, you will get that sooner than anticipated. One might have the best
of intentions but if the approach and implementation is not holistic, it will never yield the desired
results. The roadmap will have to be skillfully crafted, tools and techniques meticulously nailed down
and a communication plan enabled to improve the chances of program success. All stakeholders will
have to do their bit without which any form of innovation for sustainability will be met with sub-optimal
results. Time will tell if we are able to make or break this resolve.
8. References
1. Changing Business Models to Change the World by Paul Murphy (Valid Nutrition) MIT Sloan
Management Review
th
2. Economic Times of India dated 25 April, 2012: Sustainability & INDIA INC.
3. Project Managers are Agents for Economic Growth Transcript Presented by Mark Phillips,
Fichtner
4. Project Management and Economic Growth: A 21st Century Competitive Strategy for
Technology-Based Industries John M. Aaron 11/19/05
5. The Sigma Guidelines – Putting Sustainable Development into Practice – A Guide to
Organizations
6. http://www.triplepundit.com/2011/10/nikes-road-integrating-innovation-sustainability/
7. http://hbr.org/2009/09/why-sustainability-is-now-the-key-driver-of-innovation/es#.T-
x_61MR5JQ.email
8. http://www.triplepundit.com/2012/07/ford-sustainability-new-nike/?dhiti=1
9. www.envplanning.com/.../sustainability.html
10. http://www.inclusivecities.org/waste_pickers.html
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14. 9. Author’s Profile
It should also include address for postal communication, name of the organization, email address,
photograph, phone and fax numbers.
Anurag Jain, 21 plus years of total experience with 11 plus
years of core industry experience and close to a decade spent in
Consulting and Advising multinational manufacturing
corporations.
Has worked on a variety of transformation programs spanning
across the entire Value Chain. Core focus areas is NPI & Supply
Chain
Email: anurag6.j@tcs.com
Edzil Gonsalves, 21 plus years of total experience which
includes 15 years of core industry experience in Product
Development, Supply Chain and Program/Project Management.
Has worked on a variety of large Consulting and Implementation
Programs in the area of NPI, Supply Chain and Customer
Experience Management in North America and Europe.
Email: edzil.gonsalves@tcs.com
Jimish Shah, 5 plus years of total experience in the areas of
Market Research, NPI and IT.
Has worked on multiple large Business Consulting and IT
programs across geographies for government agencies and
manufacturing clients.
Email: jimish1.s@tcs.com
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