Friday, August 14, 2009

IMD invites to a Business Forum on Sustainability

What are you doing in your company to manage your social and environmental risks? What are you doing to integrate complex sustainability issues relevant to your company on the corporate strategic agenda? During the financial crisis, are you being forced to do more with less?

These questions were addressed at the recent IMD Business Forum in Stockholm, Sweden on June 16th, 2009. The event was well received as more than 100 people had signed up to attend.

Interestingly, the event took place during the famous Volvo Ocean Race that was docking in Stockholm the following day. The participants gathered at Nybrokajen around 4 pm in order to take a boat from central Stockholm to the beautifully located forum venue, where Dag Richter, CEO of Bricad and an initiator behind the event welcomed the attendees. He said the following about how the event had come together:

“As an MBA alumni from IMD and a small shareholder of Skogshem- Wijk, I thought it would be interesting to create an event that combines the practical sustainability and management work at Skogshem- Wijk with the insights of leading thinkers from IMD, WWF and the sailing community.”

After the short introduction it was time to hear from one of Sweden’s celebrity yachting skippers, Gurra Kranz, talk of the teamwork involved in competing in such a challenging race. He pointed to key success factors: having similar mindsets (“being on the same page”), and the importance of balancing of risk with reward. He said:

“In teams, everyone has to understand where their own personal actions are leading and why they are doing something; from a goal, to a strategy, to a commitment.”

IMD Faculty Professor Corey Billington linked this introduction to the corporate strategic agenda on corporate social responsibility (CSR). He said that teamwork transcends projects or activities and there are leveraging points in organizations that allow people to get more done with less. Professor Billington suggested that in all companies there are “hidden armies” of people that, on the basis of goodwill, are potentially willing to work on a CSR agenda. It is important to leverage this opportunity.

Organizations often need to change the way they work to “get stuff done” more efficiently. However, in the area of CSR; the value is often perceived as less than the cost, and there are identifiable “pain points” that often impede progress in this area, such as fixed mindsets, or knowledge gaps amongst managers in key business units. So how can you best overcome the pain points?

Traditional project approaches where teams invent solutions are slow and unreliable. More often than not, open source innovation will present a perfectly appropriate solution to a problem. This means using already available intellectual property and networks to achieve goals cheaply and efficiently without “reinventing the wheel”. E.ON UK, the energy company, is a case in point. With a shoestring budget and using an IMD Booster program based on open source innovation, concentrated teamwork got a sustainable procurement process into place in short order. Using team-based action learning, the E.ON UK team improved the company’s corporate sustainability performance, and in the process learned how to use open innovation processes to tackle problems faster, and more cheaply. By using this approach “stuff can get done” at 1/10th of the cost, taking 1/20th of the time. More than this, if a team learns a tried-and-tested open innovation process, it can be implemented over and over again. Another way of doing more with less.

Lasse Gustafsson, Secretary General of WWF Sweden, emphasized the critical need for companies to stop living beyond their means and to take environmental and social issues more fully on board as an integral part of business models. However, with 75% of companies still living beyond their means, they are not yet part of the One Planet Living paradigm supported and promoted by WWF. There is a need for investment in serious innovation and technology transfer. Markets need to work better so that resource conservation makes business sense. The current model of consumerism is increasingly being questioned at all levels of society. For true One Planet Living, some one billion people on the planet will have to reduce consumption.

There is no doubt that business has started to actively address critical environmental issues such as climate change:

“Companies can be split into three categories”, Gustafsson said, “the “losers” that will not change their business model under any circumstances, the “savers” that are working on going beyond compliance on carbon saving, and then, the most interesting group for WWF, the “solvers”. “Solvers” are the companies that are winners in introducing low carbon technologies because they are building a business model based on One Planet Living. These are the companies living within their means!”

The forum event was rounded off by a Göran Garberg, marketing expert and co-owner of the event venue, Skogheim & Wijk, an eco-friendly conference centre near to central Stockholm yet surrounded by woodland and natural landscapes. He talked about efforts made by his company to “do more with less” and adapt the conference facilities to WWF’s principles for sustainable development. By working on more efficient energy sourcing, bringing in clean technologies, using sustainable transport and eco-friendly materials, sourcing food locally and aiming for zero waste, his business was making its contribution to One Planet Living. These were not customer driven innovations, he said, but were an effort by Skogheim & Wijk to be part of the process of creating a more sustainable planet with the realization that innovation would have to be part of this. But along the journey, the company learnt through experience that to innovate gives competitive advantage and leads to sometimes substantial savings.

“The key for companies”, said Billington, “is to just get started with whatever CSR initiative is important for the business. It can then leverage the hidden army and move towards breaking down mindsets and filling knowledge gaps in different ways. Whilst there is no “cookie-cutter” approach to getting CSR projects done, organizations can customize the processes and ideas of others. Through working with multiple teams and companies, IMD has witnessed knowledge brokering and open innovation processes being used by organizations time and again with very effective results.”

After learning from the many speakers it was time to learn from each other. A beautiful barbecue buffet had been prepared and the participants were able to enjoy fantastic food and whine while continuing the discussion amongst themselves.

“Million thanks for organising this wonderful event. It was a good inspiration for my work. I truly enjoyed it,” said Tatiana Solodko, Business process optimization manager at Kuoni Travel Group

At 10.30 the captain of the boat signaled that was time to return to the city and as we walked down towards the dock it was clear that we would have to do this soon again.

Learn about IMDs Sustainability initiative

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