Sav­ing the world – and prof­it­ing from it

As soon as you in­ves­ti­gate the sus­tain­abil­ity dilemma from the dis­rup­tion per­spec­tive, in­ter­est­ing com­mer­cial op­por­tu­ni­ties start to emerge. By Suvi Nenonen.

NZ Business - - INSIGHT -

AFTER decades of sus­tain­abil­ity scares – record-break­ing tem­per­a­tures, ex­treme weather events, mass- ex­tinc­tion of flora and fauna, so­cial un­rest and even out­right wars – it is quite clear that some­thing has to be done. We just can­not con­tinue ex­ploit­ing our nat­u­ral and so­cial re­sources as there were no to­mor­row.

The good news is that most com­pa­nies are al­ready get­ting in­volved in a wide range of sus­tain­abil­ity ini­tia­tives. The bad news is that al­most as many firms are do­ing it in an out­dated way, hav­ing sep­a­rate cor­po­rate so­cial re­spon­si­bil­ity pro­grammes that lead rel­a­tively sep­a­rate lives from the core busi­ness strate­gies. if


I am not claim­ing that min­imis­ing print­ing, ban­ning bot­tled wa­ter from meet­ing rooms or spon­sor­ing a lo­cal sports club are unim­por­tant ac­tiv­i­ties – quite the con­trary. But for some rea­son the dis­cus­sion around sus­tain­abil­ity is markedly dif­fer­ent from the con­ver­sa­tions that re­late to dig­i­tal­i­sa­tion. The for­mer is all about threats whereas the lat­ter is all about op­por­tu­ni­ties – even though both are equally pow­er­ful dis­rup­tions fac­ing all busi­nesses.

As soon as you in­ves­ti­gate the sus­tain­abil­ity dilemma from the dis­rup­tion per­spec­tive, in­ter­est­ing com­mer­cial op­por­tu­ni­ties start to emerge.

For some com­pa­nies, sus­tain­able oper­a­tions are a syn­onym for con­sid­er­ably cheaper oper­a­tions. Take for in­stance Air New Zealand: in­vest­ing in a brand-new fleet helps the air­line to si­mul­ta­ne­ously curb its fuel costs and CO emis­sions. Be­cause sus­tain­abil­ity is all about be­ing as savvy as pos­si­ble with one’s re­source use, iron­i­cally it is of­ten able to de­liver much more sub­stan­tial sav­ings than the tra­di­tional “must achieve an an­nual 1 per­cent re­duc­tion” cost­cut­ting pro­grammes.

For oth­ers, be­com­ing more sus­tain­able is a dis­tinct com­pet­i­tive strat­egy. More and more con­sumers are ac­tively search­ing for op­por­tu­ni­ties to in­flu­ence through their con­sump­tion choices. So, if you have a more sus­tain­able prod­uct or ser­vice, build on it sys­tem­at­i­cally.

Brands such as Patag­o­nia and Eco­s­tore show that it can be a truly suc­cess­ful com­pet­i­tive strat­egy, both in New Zealand and in­ter­na­tion­ally.

Some com­pa­nies go even fur­ther, and build en­tirely new busi­ness mod­els that ad­dress dif­fer­ent as­pects of sus­tain­abil­ity.

Eco­log­i­cal and so­cial prob­lems are a ver­i­ta­ble gold mine for novel busi­ness ideas, as all suc­cess­ful busi­nesses are essen­tially about solv­ing prob­lems. And these new busi­ness mod­els don’t nec­es­sar­ily have to in­volve tech­no­log­i­cal in­ven­tions. For ex­am­ple, Buyme­once is an on­line store that fo­cuses on sell­ing ev­ery­day items that have a life­time guar­an­tee. From casse­role dishes to socks (yes, there are socks with a life­time guar­an­tee) these items fight the waste­ful dis­pos­able cul­ture one sale at a time.

Al­bert Ein­stein once re­put­edly said: “If I had only one hour to save the world, I would spend 55 min­utes defin­ing the prob­lem and only five min­utes find­ing the so­lu­tion.”

So, per­haps the best thing that we can do for our planet is to re­frame the sus­tain­abil­ity cri­sis to a sus­tain­abil­ity dis­rup­tion. Yes, it is an ex­is­ten­tial cri­sis if we don’t solve it, but most peo­ple are not re­ally at their most cre­ative when guns are be­ing held to their heads. The same logic ap­plies to teams and com­pa­nies: threats sti­fle, but op­por­tu­ni­ties un­leash in­no­va­tion.

Preach­ing about ethics doesn’t help ei­ther. What is needed is pos­i­tive the­o­ries and real-world ex­am­ples, show­ing com­pa­nies that they re­ally can save the world – in their own way – and profit from it. The en­tre­pre­neur­ial drive and the hunger for com­mer­cial suc­cesses are great mo­ti­va­tors, so let’s put them to work in this all-im­por­tant arena as well. As­so­ciate Pro­fes­sor Suvi Nenonen works at the Univer­sity of Auck­land Busi­ness School’s Grad­u­ate School of Man­age­ment and teaches in the MBA pro­grammes. Her re­search fo­cuses on busi­ness model in­no­va­tion and mar­ket in­no­va­tion.

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