In part 2 of our series on setting up a corporate sustainability program we’ll look at how finding the right reason for change will help sustain your efforts. We’ll also look at the remarkable story of one company’s focus on a single area of excellence—apparently far removed from productivity and profits—and how it built morale, discipline and ultimately, explosive growth!
So why bother with a sustainability program?
The obvious reason we hear time and again is that we all have a duty to take care of the environment, and that everyone, everywhere, needs to reduce waste and carbon emissions. But for the vast majority of organisations whose main businesses has nothing to do with taking care of the environment, this is a weak reason.
A surge of enthusiasm for the environment may be all it takes to get a program started. When everything is going well for an organisation, time and money spent on sustainability may give everyone a warm fuzzy feeling.
But what happens when times get a bit harder? But what happens a few years down the track when someone, perhaps a new manager, asks—“why are we doing things this way?” How will you answer “commercial realists” who think time and resources would be better allocated elsewhere, or that you’d be better taking shortcuts?
Ensuring Your Efforts are Not Wasted
If your program is to run successfully for years to come it will need to survive fluctuations in income, staff and management changes, expansions and contractions in workforce, changes in location and probably technology changes, too.
And if sustainability has nothing to do with your core objectives “taking care of business first” may well make what once felt so right become an unnecessary burden at some later date.
As such, it’s important to get clear on why it’s worth making all the effort before you start. And rather than just saying ‘our company has a duty to respect the environment’, it’s especially important to find ways of tying the rationale for your sustainability efforts in with your main business objectives.
Direct Benefits of Running a Sustainability Program
Here are a few ideas for marrying up sustainability goals with your organisation’s main primary aims, commercial or otherwise.
- Tangible cost savings through reduced consumption of water, energy and materials;
- It can make you more attractive as an employer, enhance your corporate image, reputation and help strengthen your connections with the community. Your environmental track record will be especially important here if you depend on a younger workforce;
- Your environmental track record can differentiate you from competitors, making your products and services more appealing to customers and foster customer loyalty;
- Another very compelling reason, especially for large, mature organisations with deeply entrenched cultures, and which may be resistant to change, is that it’s an opportunity to open up the entire operation to sweeping reforms.
It’s an opportunity to develop organisational discipline, long term planning and project management skills and the creativity needed to achieve more with less. As Alcoa showed this is not as far-fetched as it may seem.
The Amazing Story Behind Alcoa’s Profits Explosion
In his magnificent book, The Power of Habit, Why We Do What We Do, Pulitzer Prize winning author Charles Duhigg tells the story of Paul O’Neill, who in 1987 became CEO of floundering Aluminium maker Alcoa. To the financial community O’Neill seemed an unlikely candidate. Until that point he’d been a civil servant, working in the fields of healthcare and education.
In his first address to a gathering of Wall Street analysts, shareholders and reporters O’Neill began, “I want to talk to you about workplace safety”. He proceeded to spend the rest of the meeting telling his thunderstruck audience about his main intention as CEO, which was to focus workplace safety.
Many wrote him off there and then as an air-headed bureaucratic nut, promptly selling their Alcoa shares. It was a very expensive mistake. In the years that followed, while O’Neill focused relentlessly on making Alcoa one of the safest workplaces in the world, growth exploded.
When he left the company in 2000 to become US Treasury Secretary, Alcoa’s, profits had increased 460% and its market capitalisation had grown from $3 billion to $27.5 billion – quite an achievement for a mature company of Alcoa’s size.
What’s interesting is that while aluminium smelting is a dangerous business, Alcoa already had a pretty decent record for safety when O’Neill joined. So why did he focus on safety?
His objective all along had been to work relentlessly on creating one truly exceptional organisational habit – a habit everyone would be open to improving. It wasn’t that he had an unusually strong interest in safety when he started. Rather, he went looking for an issue around which to unite everyone and where they could all share an endless run of wins.
Cultivating that one discipline required workers, unions, administrators and senior management to embrace of a long series of beneficial reforms and disciplines. In the process Alcoa’s entire workforce and management learned to cooperate, innovate and trust each other. Days lost through accidents vanished, while morale, productivity and profits skyrocketed.
Can you see the connection between safety at work and sustainability programs?
Whether key people in your organisation believe sustainability is critical to its success or not, few will be so clueless and lacking in social conscience that they’ll actively argue against the need to safeguard the environment.
Therefore, sustainability has the potential to be exactly the kind of issue workplace safety was for O’Neill and Alcoa. As they proved, cultivating one such habit of excellence in an organisation rubs off on everything else and is transformational.
Just like workplace safety, sustainability makes a great focal point around which to develop organisational discipline and habits of excellence.
If you’ve been wondering how to create a more disciplined, better organised and motivated team adopting an uncompromising approach to sustainability may just be the solution you’re looking for.
In the next article we’ll be taking a look at ways to get team buy in and conduct your first sustainability audit.