The Most Practical Path to Growth
In the last few decades the word sustainability has been used a lot. Completing a quick internet search will generate an overwhelming amount of information. There are many nuggets to glean from this material and twice as many opinions on how to incorporate this concept into your business. Sustainability can be a hard concept to grasp, much less apply. So why should you invest your time reading this article or learning about this subject?
The practical application of sustainable principles is one of the most effective means to growth. The concept of sustainability could be likened to a skeletal structure on which all of the other body parts find their place and function. Without the purpose and form dictated by the skeletal structure the other parts of the body would function less efficiently at best and to the detriment of the system at worst. The use of methodologies like Lean, Six Sigma, TRIZ and many others can find their place, proper form and function when guided by the foundational principles of a firmly established sustainability mission. These methodologies can then inform actions taken by individuals to move everyone forward in the same direction and towards a growth oriented and opportunity rich future. The organizational impact of applied sustainability can be defined in three distinct arenas which are social, environmental and economic.
Social impacts are the most impactful of the three. Ideas originate with individuals not teams or groups. Collaboration within groups can improve ideas but you need a motivated individual to provide the spark. So why would someone go out of their way to create a spark? There are as many motivators as there are people but a common one is mission. Does your company have a mission that engaged individuals can pursue? Selling more stuff is not a mission. Neither is making more money. Creating a more sustainable world for our children is a mission. Boldly proclaiming an aggressive target and doing what hasn’t been done before is a mission. People are drawn to passionate idealists. Does your company have a passion for something?
The concept of sustainability could be likened to a skeletal structure on which all of the other body parts find their place and function
Environmental impacts should be a no brainer in this day and age. Does your company proactively pursue strategies that improve your impact or even better restore the environment? If not, you’re a target for your competitors who do. The work of understanding the environmental impacts of your business can be completed in many different ways. Some common methods to gain an understanding of these complex systems are Life Cycle Analysis (LCA), SWOT and Value Stream Mapping (VSM). There are many more methodologies that can provide insight for those who put them to use. In the end your company’s approach to the environment will be a competitive advantage or an Achilles’ heel. There’s no middle ground.
Economic impacts are resultant of positive social and environmental actions as well as the application of the competitive advantages created by sustainable strategy. There are many sustainability strategies designed with the purpose of stretching the marketing dollar by creating a good story. That’s not necessarily a bad thing but that’s not what I’m talking about. I’m talking about individuals passionately executing a sustainable strategy in their functional areas to further a mission in which they are invested. At its core, economic growth is based on providing your customers with something that is uniquely better than your competitors. A clear sustainability strategy aligns the actions of individuals into a positive social, environmental and economic movement. Growth in each of these areas and new opportunities are therefore a resultant of your mission and the pursuit of sustainability.
Practical application of sustainability principles can create opportunities that aren’t possible for your competitors. Many have heard enough sustainability greenwash to last them two lifetimes. I’m one of them. However, I have put the principles that Ray Anderson passionately promoted to the test and they are powerful. If Lean and Six Sigma methodologies are a magnitude 5 earthquake then sustainability is a 10.
The holistic application of the structural framework that is sustainability allows for the creation of wholly new business models as well as the ability to create dramatic improvements in existing ones. By systemically applying these principles I have been able to incorporate all of the following attributes into a single business model:
• Improve gross margin by 30 percent
• Reduce cycle time by 85 percent
• Improve system capability by 1,100 percent
• Improve custom design friendliness by 500 percent
• Improve floor space efficiency by 400 percent
• Improve capital expenditure efficiency by 60 percent
• Decrease operational cost by 65 percent
• Reduce existing inventory by 50 percent
Considering your approach to sustainability is the best place to start when searching for new and innovative ways to bring your product to market. In my opinion, it is the only strategy that can impact the engagement of your stakeholders, transform environmental regulations into a competitive advantage and create new hyper-competitive economic growth engines.