Three teenage girls are at a shopping mall looking for sunscreen. It’s an impulse purchase, and it has to be an all-natural choice. They think they’ve found what they’re looking for at one store, but on the way to the register one of the girls takes out her phone and swipes it by the barcode of the product they’ve selected. Moments later, as she’s pulling out a credit card at the register, her iPhone announces an incoming e-mail. It’s a short message informing her that the item she is about to purchase contains compounds that are linked to the decimation of coral reefs. Moreover, the plastic container is difficult to recycle. Because her phone has pinpointed her location via GPS, she also learns that another store in the mall carries a “greener” sunscreen that has neither of those two problems. The girls leave the register and make a beeline for the other store.
This scenario is not a pipe dream. In fact, the technology needed to make it happen is already in place. Retailers like Wal-Mart are developing sustainability indexes; one day soon comparative product ratings will be posted next to price tags. The website GoodGuide.com provides a free iPhone app that rates and compares tens of thousands of products on their environmental, health and social impacts. Because of such technologies, the guiding principle for many companies, increasingly, is caveat venditor: Let the seller beware. As many markets become ever more “transparent” to environmentally conscious customers, the pursuit of sustainability will shift from a choice that companies make to a sheer necessity of survival. It will affect the de facto “license” of a business to operate–a license that customers won’t hesitate to revoke.
Many executives understand how these dynamics will fundamentally alter their businesses, and they understand that sustainability is, ultimately, about the sustainability of their own organizations. But they often stumble in making the transition because of basic misconceptions about what it will take to transform their companies. Many make the mistake of treating sustainability like any other large corporate initiative; it’s actually different in several crucial ways. Or they assume that it will require a steady, constant effort over years. In fact, it entails three distinct phases, each requiring different leadership skills. When implementing a business strategy that commercially incorporates sustainability, managers must first recognize how such efforts are unique and then understand how best to advance through each major stage of a sustainability initiative.
Phase 1: Making the Case for Change
When an organization is largely unprepared to address sustainability, the key challenge is to make a clear and compelling case for change. Because the organization is at best reactive to the challenges of sustainability (and usually unaware of the opportunities), the sustainability leader must be adept at collaborating and influencing others in the course of the transition from unconscious to conscious reactivity. At the end of Phase 1, sustainability emerges as a powerful mandate that is pervasive throughout the organization.
Phase 2: Translating Vision Into Action
When companies emerge from Phase 1, commercial orientation becomes the key competence in aligning sustainability initiatives and value creation, a point that cannot be emphasized strongly enough. Now the task is to translate high-level commitments into a comprehensive change program with clearly defined initiatives and hard commercial targets. To make this happen, sustainability leaders in Phase 2 must excel at delivering results, and they must have a strong commercial awareness. At the end of this phase, the organization is consciously proactive on sustainability across its footprint and tracks economic, environmental and social metrics over the business planning cycle.
Phase 3: Expanding Boundaries
The need for commercial orientation continues unabated but is now matched by a strong strategic orientation. As the organization continuously raises the bar and leverages sustainability to create competitive advantage, it increasingly views sustainability as a strategic opportunity and gauges its progress with metrics that reach beyond the short and medium term. As such, the sustainability leader must be adept at anticipating and evaluating long-term sustainability trends, spotting new opportunities and developing strategies to reposition the organization to benefit from them. The goal is to embed sustainability in the organization’s DNA, much like quality or financial control, such that it is a core value and the organization is unconsciously proactive about it.
This brings us back to the mall, where the three teenage girls have just purchased another brand of sunscreen at a different store. One is now texting her friends, another is sending a message on Twitter and posting a note on her Facebook page, while the third is logging a comment on Digg. Maybe it’s something about the cool new brand of sunscreen they’ve found; or perhaps it’s about their disgust at the product they abandoned. With social networking, radical transparency will go viral, vastly multiplying its impact in the marketplace.
So, to paraphrase the novelist William Gibson, the future is already here; it’s just not distributed evenly yet. Today, young consumers like these teenagers are buying products, intuitively using an emerging set of tools. Already, those among them who know the most about social responsibility issues are so eager to work for companies that embrace their values that they are willing to take a significant pay cut.
And while they’re buying products today, they will be running businesses tomorrow. In the meantime, companies that want be around when this happens must find leaders with the right competencies to build a bridge to the future.
After reading the article answer the ques:-
What areas in the sustainability change management process do you think are emphasized more or need to be focused on more? Why is this?