In my previous post, I talked about why it might be time for you to consider embracing the principles of business sustainability. Let me be crystal clear right up front. I’m not talking about hugging trees, kissing owls on the beak, or making your packages out of recycled tractor-trailer tires. I’m talking about operating your business using fundamental business common sense. It’s my feeling that the concept of sustainability should not be thought of in just the “impact on future generations” sense but also in the literal sense of ensuring survival of your organization. As CEO, that’s your job. And if you do it right, you’ll automatically address the morally appropriate economic, social, and environmental issues in a business-justifiable way.  

In your personal life, the benefits of living a healthy life style, maintaining good relationships with family members, treating neighbors with respect, and being involved in your community are irrefutable and broadly accepted. It’s also understood that sometimes you have to suffer short-term pain for long-term gain. By doing these things you are not really sacrificing for the benefit of others, you are simply optimizing your own long-term happiness and health.

The same holds true for a business. Short-term decisions have long-term implications. Sometimes you have to regress before you progress. And, no business is an island. Every company’s actions impact the “system” in which it operates and are impacted by the same “system”. Embracing sustainability is nothing more or less than making sure your business model is designed and updated with the benefit of a long-term and system-wide view. To do otherwise is to be haunted by unintended and unanticipated consequences and to put your company at unnecessary risk. Well-managed companies have always been concerned about sustainability in the literal sense. What’s relatively new is an increased recognition of potential negative economic, social, and environmental consequences of business activities and an urgency to reflect that knowledge in your business model design.      

Here are some suggestions about how you can incorporate this concept of sustainability into the steps of a standard, typically annual, business model improvement process:

Step 1: Reconfirm your business’s PURPOSE
When reviewing your company’s Purpose, identify not only your customers but also your key stakeholders (non-customers who can affect or be affected by your business to a significant extent). Typical stakeholders would be investors, employees, suppliers, communities in which you operate, government agencies, etc. 

Step 2: Reconfirm your LONG-TERM VISION
Again, include both customers and key stakeholders in your vision of the ultimate role you want to play and the affect you want to have including what you want your reputation to be. For example, you might want to be the company most respected for awareness of parent/child needs. You may want investors to consider you to be very cost-efficient. And, you may want to be a respected and treasured company in your community.

Step 3: Reconfirm your VALUES
Make sure your documented Values will create a culture that supports your updated Purpose and Long-Term Vision. Based on the vision elements above, you may want values related to customer focus, continuous improvement, and community responsibility.

Step 4: Identify current and likely medium-term future REALITY
Conduct your “SWOT” analysis of internal strengths and weaknesses and external opportunities and threats maintaining your new, broader perspective that includes customers and all key stakeholders. Data gathering should include soliciting feedback from both. Make sure you specifically include issues related to economic efficiency (innovation, productivity, material usage), social equity (employee health, impact on local communities, transparency), and environmental accountability (pollution, land use).

Step 5: Create a MEDIUM-TERM VISION
When you imagine what you’d like things to be like 3 or 5 years from now (qualitatively and quantitatively), think in terms of how much progress you’d like to make along a path from your SWOT-defined Current Reality towards your Long-Term Vision. Based on the possible long-term elements mentioned earlier, your Medium-Term Vision might include new products that respect parental environmental concerns, redesigned packaging that reduces package and packing costs, and internal programs that encourage employees to be active in local community charity events.

Step 6: Identify your priority ONE-YEAR PROJECTS
For each Medium-Term Vision element, what can you accomplish in the next year to make the most progress?

Step 7: Ensure successful project IMPLEMENTATION
Of course, I’d be remiss in not reminding you that all previous steps are worthless if you don’t ride the One-Year Projects through to successful implementation.  

By using a business model development process to address sustainability issues, you can ensure that you are acting responsibly while adopting only those initiatives that make true business sense for you.   

In my next post, I’ll explore the role that trade associations like JPMA could play regarding supporting their members’ sustainability initiatives.

Disclaimer: No warranties, express or implied, are contained herein. Purchasers, or users, of this information acknowledge that any errors or omission in the performance of the material contained herein or, any injuries resulting from its use, are the sole responsibility of the purchaser or user, and not JPMA or the author. Opinions expressed are those of the author only.