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Sustainability: A Competitive AdvantageKenneth George, MBA, MSAM
Concordia University Irvine
909-576-8375
Opportunity with Sustainability“Every single social and global issue of our day is a business
opportunity in disguise”
Peter F. Drucker – Concept of the Corporation
“You cannot manage other people unless you manage yourself first.”
Peter F. Drucker – The Effective Executive
Sustainability Business with Balance Corporate Social
Responsibility Sustainability is Business
Strategy 2013 – 80% of CEO say
sustainability is a critical to competitive advantage 2003 – 25%
Cost Profit
Source: SVP Survey (2003); MIT SMR and Boston Consulting (2011): UNGC – Accenture (2013)
Sustainability as Value Creation
Value Transfer
Sustainable Value
Value Destruction
Value
Transfer
Source: Laszlo, C (2008) Sustainable Value, Standard University Press
Midsize Private CompanyGojo - Private family businessInventors of Purell
Reduce water usage
by 30%
Reduce solid waste
by 25%
Reduce greenhouse
gases (GHG) by
5%
Mid-Size Private Company
$300 Million SalesIndustrial Sands
Launched 200540% Annual Growth
Planet
Prosperity
People
Public Traded Company
Tennant – Chemical Free Cleaning Company
FORTUNE GLOBAL TWO COMPANY
"We save people money so they can live better."
“If we work together, we’ll lower the cost of living for everyone…we’ll give the world an opportunity to see what it’s like to save and have a better life.”
Difference they can make
Year: Stores:
1962: 1
1979: 276
1987: 1,198
1996: 2,943
2005: 5,289
2011: 8,970
Walmart - Mission
Connection
Does Vision and Mission Fit
Why does mission care?
Why does a vision matter?
Frontline employeesPartnerships
How to think BIG
• Become SustainableB
• InnovationI
• GrowthG
Paint a new futureChose any product, service or organization
What is the business strategy?
How can it differentiate itself in ways that good for business and society?
S&P 500 Market Value197583% of the stock price was based on tangible assets
200919% of the stock price was based on tangible assets
Stocks today are based off intangible assets
Source: MIT SMR and Boston Consulting (2010)
What future do you want? Sustainability TodaySustainability in the future
Sustainability TomorrowEmbedded StrategiesRadical InnovationNet Positive ImpactSocially inclusive Scaling system change
Funny Ways to Sustainability
Incremental to Radical
Incremental change to radical innovation Doing less harmIncrease profits
The Next Competitors“The biggest threat for U.S. multinationals is not existing competitors… It is going to be emerging market
competitors.”
The Wall Street Journal
:Year In Millions of Dollars1974 $1,3001984 $3,6331994 $9,3952004 $31,3932008 $61,475
Source: MIT SMR and Boston Consulting (2014)
Disruptive Innovation
BOP
1 Billion People
1 Billion People
4 Billion People
1 Billion People
Income > 12,200 Per Year
$12,200 > Income > $4,000 Per Year
$4,000 > Income > $1,000 Per Year
Government andNon-Profits
Source: National Geographic 2011
New Market Capability
Next?Sustainability
Strategic Environmentalism
Regulatory Compliance
What is missing for business to be able to leverage sustainablyfor profit and world benefit?
Source: Andrew Hoffman, Ross School of Business
Insufficient but Change Wanted
67% of CEOs do not believe that business is doing enough to address global sustainability
2013 survey of 1,000 CEOs
Sustainability is re-framed as flourishing
Source: The UN Global Compact-Accenture CEO Study on Sustainability, (2013)
Next - Personal Flourishing
Centers on the basic feeling of being connected with one’s complete self, others, and the world around you
“Society needs a return to spiritual values – not to offsets the material but to make it fully productive”Drucker – Landmarks of Tomorrow 1959
Source: Based on research by Mitroff, I. and E. Denton, Sloan Management Review
Reason for Being
Well Being Being Well
Connection
People who experience a greater sense of connectedness to self- others and the world around them are more likely to incorporate care for others and for future generations.
FlourishingInspired every day to solve complex business problems that benefit society and the business
Wisdom Workers
Source: Laszlo, C. and J Brown, et al. Flourishing Enterprise
Why Are We The Way We Are
Mental ModelsWhat ones do we hold today?
Which ones might enable flourishing?
Source: Senge, Peter (1990), The fifth discipline
Foundations in Spirituality
To understand why we hold our mental models and to develop the capacity to change them we can turn to spirituality
It reveals our deeper assumptions about the nature of reality
Appreciative Management
1. Appreciate “Best of what is”
2. Imagine “What might be”
3. Design “What should be”
4. Create “What will be”
Mission and value statement that you live by
