Here is an excerpt from an article written by Andrew Winston for the Harvard Business Review blog. To read the complete article, check out other articles and resources, and/or sign up for a free subscription to Harvard Business Review’s Daily Alerts, please click here.
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I normally write about companies navigating their way toward sustainability, covering topics such as how to save money or drive green innovation. But I like to step back periodically and look at why companies need to go green. Besides the inherent business logic of creating value by getting leaner or innovating to solve customer problems, what are the forces propelling this movement? Understanding this explicitly can help companies think about solutions systematically.
I’ve developed a new tool to help myself, and I hope others, think about these forces in a way that helps drive strategy — and I’d like to get your feedback. The Sustainability Forces Wheel (see chart below) is an attempt to capture what I see as three big buckets of interrelated forces.
Along the outside run the big sustainability challenges we face as a species — these are the issues that society increasingly expects business to deal with and help find solutions for. They include climate, water, biodiversity, waste, and chemicals on the environmental side. On the social side, which could include a limitless list, I’ve boiled it down to the challenges of social equity, labor (both developing skills around the world and avoiding forced or child labor), and freedom (to associate, for example).
These issues affect companies directly of course, but importantly they also pass through a prism of magnifiers. These are the tectonic shifts in how the world works (think Thomas Friedman’s ideas in The World is Flat and Hot, Flat, and Crowded.) I’m including here three biggies:
• Technology and the transparency it enables
• Resource constraints, driven in large part by the rise of the consumer around the world
• Globalization, which creates new forms of competition and forces companies to incorporate different cultures and mores into operations and strategy.
In the third wheel I’ve placed key stakeholders that pose questions about a company’s social and environmental performance. These people put a face on the larger forces and concerns. Of the long list of possible stakeholders, I highlight four here:
1. Governments at all levels and the regulations and pressure they apply
2. Business customers that are greening their supply chains
3. Employees who want more than a paycheck and expect to match their values to their employer’s
4. Consumers who want it all — sustainable products at the same price and quality
The way I picture using this framework is to “spin” the wheels and match up the forces. In this way, executives can think through what the combinations mean for an industry or company.
Follow Andrew on Twitter at @GreenAdvantage.
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To read the complete article, check out other articles and resources, and/or sign up for a free subscription to Harvard Business Review’s Daily Alerts, please click here.
Andrew Winston is the co-author of the best-seller Green to Gold and the author of Green Recovery. He advises some of the world’s biggest companies on environmental strategy.