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Sustainable Supply Chains in Chinese Factories

The SSC Team May 19, 2015 Tags: , , , , , , , , , Strategic Sustainability Consulting No comments
Enjoy this 2013 interview from the SSC archives: An increasing number of companies are implementing sustainable supply chain programs. These programs usually include requests to suppliers to fill out long surveys, track and report data, and develop internal management systems to improve factory-level sustainability performance. At Strategic Sustainability Consulting, we believe that effective supply chain engagement on sustainability is critical to manage risk and leverage opportunities, but we also know that suppliers are often overwhelmed at the requests they are getting from their customers. To get some insight into the challenges facing suppliers, we recently interviewed Nate Sullivan of Efficiency Exchange (EEx). We've worked with EEx, a provider of sustainability software and services to Chinese factories, for many years, and believe they have their finger on the pulse of the Chinese supply chain. SSC: You specialize in working with Chinese factories. What are you seeing in these factories with regard to supplier questionnaires? Nate Sullivan: Supplier questionnaires and worksheets are not a new thing -- factories have seen them for decades.  They've always had to fill out spreadsheets and word documents with tons of information about their facility -- from general company information, to detailed labor practices and customized quote sheets.  However, they complain that the only ones that seem to have a real impact are the quote sheets, because they're about price, and that's ultimately what customers care about in practice.  Now they are being asked to fill out sustainability questionnaires full of data, which requires a full time job to compile and document (around 40 hours a month).  Most of the time they don't even know why the customer is asking for the data, and they say that they rarely hear much back after submitting the information.  So basically it's another hoop to jump through that doesn't appear to influence purchasing decisions, and keeps factories from focusing on what they do well -- which is making stuff. SSC: What are the biggest obstacles to effectively measuring and managing sustainability impacts (like energy, waste, and water) at the supplier factory level? NS: The biggest problem, by far, is accuracy. People really need to realize that there's a tremendous amount of bad, inaccurate data out there that is useless no matter how you look at it, because it simply doesn't reflect reality. That's almost entirely due to how and why it's collected, which is usually through required self-reporting, without any incentive for suppliers that what they provide is true. Unless you're going to sit there in every facility, forever, and actively track what's happening -- which isn't practical for any retailer we've met, no matter how big -- you simply have to find a better reason for suppliers to track and truthfully report what's going on than "because I say so." And that doesn't even address the fact that suppliers have lots of customers who all have their own elaborate set of disclosure requirements, or that factories have no idea how to measure many of the things they're asked to report. SSC: Your company, Efficiency Exchange, has developed software and services that aim to overcome these challenges. Can you explain the 3-4 most important elements that supplier factories should be looking for in sustainability programs and tools? NS: The number one thing factories should be looking for is something that helps their business. Manufacturing is a tough gig; it's not like these guys have huge margins they can afford to cut into an order to look good for potential customers. So the most important characteristic of any kind of factory facing tool is that it provides direct business value to that factory. Any investment that is going to provide that kind of value to a factory needs to be easy to use, and inexpensive not only to buy, but to operate, understand, implement, etc. In our experience, what's missing from every tool we've looked at is simplicity and clarity. There are lots of systems that are really powerful and complex, but they're usually designed to be all things to all people -- utilities, retailers, manufacturers- and anybody who could conceivably buy it, really. With any kind of typical enterprise software, you end up buying this incredibly expensive, super-capable system, and then a bunch of consulting services, training, and support on top of that.  (Then you have to) whittle it down and customize it into something that's actually useful to you. Factories don't have the time or money or expertise to deal with any of that. So any tool that's going to make sense at the factory level has to strip away all of that extra nonsense, and focus on being something that's lightweight, useful, and solves a problem right out of the box. That means it can't necessarily be all things to all people -- it has to be built specifically for factories that need help with this kind of stuff, and it has to provide that help in a really direct way. If you're a factory looking at any kind of sustainability or operational improvement tool, just stop and think about how the tool is going to affect what you do all day. Are you going to get a dashboard or a weekly report? What are you actually going to do with that? Are you going to print it out once a month and put it in a file cabinet? If so, that tool doesn't make sense for you. Anything that's going to be useful needs to go from login, all the way to the part where you're saving money, or getting new business, or removing some obstacle that slows down your growth. Everyone talks about intelligence versus just data, but "actionable intelligence" versus just intelligence is just as important of a distinction, especially for factories. Whatever tool you're investing in needs to take you from software to actually doing something inside your facility that helps your business. How is sustainability saving Chinese textile mills money? Read about it here!

Seven Questions to Focus Sustainability Leadership

The SSC Team May 12, 2015 Tags: , , , , , , , , , , , , Strategic Sustainability Consulting No comments
Enjoy this 2012 article written by SSC president Jennifer Woofter that was featured in Environmental Leader: Sustainability leadership is a challenging issue I’ve seen crop up in a variety of situations recently, including:
  • Lower-level employees on a volunteer green team, trying to steer their companies down a greener path
  • Newly appointed Chief Sustainability Officers (CSOs) charged with the momentous task of integrating sustainability into the C-Suite
  • Sustainability consultants that have buy-in from the client’s leadership, but are struggling to push it down into individual departments
In many cases, the people involved are facing a leadership crisis. And as a result they aren’t clear about their role, able to generate momentum, or equipped to get others on board. Sometimes they are spinning their wheels, other times they are bulldozing their colleagues. They might be all talk and no action, or “all action” without an overarching story to tie everything together into a larger mission.  The list of symptoms can be endless and exhausting. I was delighted, therefore, to come across, “7 Practical Questions That Will Multiply Your Influence.” David Dye, founder and President of Trailblaze, Inc., argues that the stuff of leadership, “has nothing to do with the title that comes after your name or power to force people to act. It has everything to do with what is in your heart.” Touchy-feely sentiment aside, his seven questions resonated with me from the perspective of the sustainability leadership crisis. I’ve listed them below, along with my thoughts on each question’s pertinence to sustainability leadership. I hope that it helps to spark something in all the current and future sustainability leaders out there!

1. What do you really want?

“In the middle of a leadership crisis, nothing provides clarity like this question. What do you want to happen as a result of your leadership in this situation? Sometimes you’ll find that you’ve been acting from an entirely different set of motivations than what it is you want deep down, where it matters.” For Sustainability Leaders: Sustainability is a cross-departmental, cross-functional, cross-issue, cross-stakeholder endeavor – and the truth is that you can’t please everyone all the time. Be clear about what YOU really want out of the “sustainability leader” role. Is it to radically transform the company? Inspire the CEO? Show up the CFO? Execute the plan and make your targets? Show that going green can be profitable? Use this position as a stepping stone to another job? Be clear, specific, and honest with yourself.

2. Do you know (and are you working out of) your values and personal mission?

“Self leadership begins when you know your own values and understand your purpose – what make your heart sing and come alive in the universe. When you work from this energy, it’s naturally attractive to like-minded team members and you motivate almost without knowing it. If you haven’t done this work, I strongly encourage you to find a coach or mentor who can help you explore what matters most.” For Sustainability Leaders: Think beyond sustainability for a minute: what makes you tick? Do you love to collaborate, and work best in a meeting or team environment? Or do you love to be alone in a room, running the numbers a dozen ways to figure out the best way to optimize a process? Are you a voracious reader who thrives on big ideas? Or are you an “on the ground” details player? Understanding your values, working style, and motivation will help clarify your leadership style.

3. Are you choosing problems or trying to avoid problems?

“Solving problems is central to meaningful leadership, but many leaders fall into a trap of trying to avoid problems. We don’t get to choose whether or not we’ll have problems … but often we DO get to choose which set of problems we’ll have. Effective leaders don’t spend time trying to avoid problems. Rather, they put their energy into working on the right set of problems – the ones that get them closer to their vision. For example: Do you want the discomfort of learning how to address poor performance or do you want the discomfort of a team with poor morale and worse results? Do you prefer the pain of changing your strategy or the pain of discovering your team is no longer relevant? Do you risk vulnerability and apologize for mistakes or do you avoid taking blame and lose credibility?” For Sustainability Leaders: This is a crucial lesson that we need to learn over and over. Because sustainability is a complex issue, we can tackle it through a variety of lenses – and thus choose our problem set. Do you prefer to focus on pushing a more radical sustainability strategy and risk making no substantive progress for months, or focus on smaller, incremental steps that may not really change “business as usual”? Do you want to risk C-suite ire by pushing for ground-up employee engagement, or risk alienating lower-level employees by pushing a top-down sustainability plan? Each choice has pros and cons, so be thoughtful about which problems you choose.

4. Do you really want things to get better?

“In question #1, you looked at what you really want, deep down. Now it’s time to look at the cost. If you’re going to change things, it’s going to include risk, discomfort, being misunderstood, sacrificing other goals, etc. Are you willing to accept the consequences of pursuing your vision? If not, you can’t possibly expect your team to come along with you.” For Sustainability Leaders: If you push for a radical sustainability agenda, you may find yourself stalemated (or worse, fired) for being too aggressive. If you move more slowly, you may look back in 10 years and realize you haven’t accomplished much. Either way there are consequences for your leadership style, both for yourself and for the organization you are leading. Can you identify the risks you face as a result of your sustainability leadership? Are they acceptable? If not, what do you need to change?

5. Are you working for your team or yourself?

“Time to take a hard look in the mirror … no one will truly know the answer to this one but you. When your decisions are in your heart and your head, before you’ve given them a voice … are you filtering them through what’s best for you or best for your team? Are you saying “I” … or “we”? It’s okay to include your own well-being in your decisions (you are one of the team after all!), but if your team isn’t at the core of your leadership decisions, your credibility will quickly erode.” For Sustainability Leaders: I’d expand this question to include: whose sustainability are you working for? Is it your own (including having a job that pays the mortgage), your organization (including being profitable and competitive), or the world (including a radical transformation of our economy and social structure to account for natural and social boundaries inherent in a sustainable system). These goals aren’t totally either/or, but there are often trade-offs that need to be considered. For example, a sustainability consultant needs to consider whether they are working themselves out of a job by helping companies set up sustainability programs. (I believe that there will always be a role for sustainability consultants, but that’s another article altogether.) Sometimes, pursuing a radical sustainability agenda will NOT be in the best interest of a company – rather, a more strategic, leading-but-not-sticking-your-neck-out-too-far approach is best. Be cognizant of the trade-offs of your sustainability leadership approach. You’ll need to be able to address them with your colleagues.

6. What can I do to bring about the results I want to see?

“I love this one: it moves us from victim to leader. When you find yourself frustrated at circumstances, upset that people “just don’t get it,” or discouraged that things didn’t go as you hoped, you’ve got a choice: Bemoan the unfairness of the universe (which inspires no one!). Or look at the situation and see where you can take action. Just asking the question completely reframes the situation and can transform a gloomy attitude in seconds.” For Sustainability Leaders: This is a great question when you find yourself in a stalemate, frustrated by your lack of sustainability progress, or thwarted by a system that doesn’t seem to be moving in step with your vision. Take a different approach and ask yourself: what three actions can I do today to move the ball forward? Maybe it’s scheduling a meeting with your boss to discuss revamping your task list. Maybe it’s buying the latest sustainability book to get inspired. Or maybe it’s taking a day off to recharge your batteries.

7. Are my people better off as a result of their time with me?

“This is what James Hunter calls “the ultimate leadership test.” If the answer is yes, keep going. If the answer is no, examine the reasons why. Do you need to improve your skills? Do you need to wrestle with some of the earlier questions on the list?” For Sustainability Leaders: Sustainability isn’t just about reducing your organization’s carbon footprint or finding more eco-friendly packaging. At the end of the day, sustainability leadership is about people: are they engaged? Do they share a common vision of what the future looks like? Can they see their own individual role in the journey? Your job as a sustainability leader is to help people say yes to sustainability. So, how are you doing? What does it take to be environmentally sustainable in the retail industry? Find out here!

Workplace Movement Toward Environmental Sustainability – Pt. 2

The SSC Team May 7, 2015 Tags: , , , , , , , , , , , , , Strategic Sustainability Consulting No comments
By: Alexandra Kueller Two weeks ago, we introduced the Retail Industry Leaders Association’s (RILA) brand new Retail Sustainability Management Maturity Matrix. The Matrix hopes to be a tool that will be used by sustainability executives, individual companies, and industry-wide. We also noted that while the Matrix is designed with the retail industry in mind, we think that is has a wide applicability beyond just the retail sector. Last week, we discussed the first three sectors that are featured in the Matrix. Today we are focusing on the final four of the seven sectors. Hoping to provide a more in-depth look at how RILA hopes to benchmark across the industry in terms of environmental sustainability, we are going to look at what it would take for a company to become a leader in that sector.

Retail Operations

Environmental sustainability extends to all aspects of a company, including their retail operations. Whether it is a store or corporate offices, a company should be putting in effort to make these areas as sustainable as possible, such as having facilities be LEED certified. Other ways to make your retail operations more "green" can include incorporating green standards for all new warehousing and participating in the ENERGY STAR program. The Retail Operations sector has three different dimensions:
  • Store/Corporate Offices
  • Warehouses/DCs
  • Data Center & Applications

Supply Chain

Supply chain sustainability might not be the first aspect of a company's sustainability plan to come to mind, but it is no less important than any other aspect. To be a leader in the retail industry when it comes to supply chain sustainability, a company must demonstrate the reduction of environmental impact through the optimization of transportation, work closely with suppliers to help improve their sustainability metrics, and be more transparent when it comes to audit statistics (e.g., percent of non-compliant factories). The Supply Chain sector has three different dimensions:
  • Transportation/Logistics
  • Supplier Engagement
  • Supply Chain Transparency & Traceability

Products

When someone thinks of a retail organization and sustainability, often times their first thought is "how sustainable is the product?" RILA recognizes that product sustainability is a key component in a company's overall environmental sustainability and offers some suggestions on how to be a leader when it comes to making a company's product more sustainable. Some examples are using renewable energy sources during manufacturing, offering take-back services, and designing products with a "cradle to cradle" outlook. The Products sector has three different dimensions:
  • Product & Packaging Design and Development
  • Owned Manufacturing/Production
  • Product & Packaging End-Of-Life Stewardship

Environmental Issues

And finally, true environmental sustainability cannot happen if a company does not focus on the environmental issues at hand. How a company addresses these issues - energy, waste, recycling, etc. - in the context of the retail sector is telling, and some industry leaders are already paving the way. Some of these companies are implementing leading waste technologies and policies, establishing green chemistry programs that helps reduce toxins, recycling and reusing water, using alternative energies, and more. The Environmental Issues sector has four different dimensions:
  • Energy & GHG Emissions
  • Water & Wastewater
  • Waste & Recycling
  • Chemical & Toxics
Last fall we attended the annual RILA Sustainability Conference. Read about some of our thoughts on the conference here.

Five of the Best Sustainable Packaging Resources

The SSC Team May 5, 2015 Tags: , , Strategic Sustainability Consulting No comments
Enjoy this blog post from the SSC archives: There is a TON of really annoying packaging getting in the way of sustainability. (And here is a list of 12 great examples, just in case you needed a refresher.) To combat the problem, we're rounding up a list of our favorite smart packaging resources:

1. Consumer Goods Forum

In November 2011, the Consumer Goods Forum (CGF) released its, “Global Protocol on Packaging Sustainability (GPPS).” The 74-page guide on packaging sustainability not only aims to help companies reduce their carbon footprint but also serves as a step in the right direction to increase efficiency and effective communication by creating a common language that consists of a framework and a measurement system. (Read our complete review here.)

2. "Cut the Wrap!" White Paper

Cut the Wrap! Packaging Waste and Strategies for Mitigation and Reduction” is one of our most popular white papers, and for good reason.  Packaging waste is an issue that affects almost all businesses, from food and beverage to electronics. Unfortunately most of the materials used in packaging is discarded in ever-growing landfills or burnt, causing severe pollution. This paper explores the various ways businesses can reduce or even eliminate their packaging waste, make smarter and more sustainable packaging choices, and utilize packaging alternatives.

3. Sustainable Packaging Coalition

The Sustainable Packaging Coalition (SPC) is an industry working group dedicated to a more robust environmental vision for packaging. Through strong member support, an informed and science-based approach, supply chain collaborations and continuous outreach, SPC endeavors to build packaging systems that encourage economic prosperity and a sustainable flow of materials.  The SPC makes available a broad range of publications and resources to further the vision and ever-evolving implementation of sustainable packaging.

4. COMPASS

COMPASS (Comparative Packaging Assessment) is online design software that allows packaging designers and engineers to assess the human and environmental impacts of their package designs using a life cycle approach. COMPASS helps packaging designers make more informed material selections and design decisions by providing quick visual guidance on a common set of environmental indicators.  COMPASS provides consistently modeled data sets for USA, Canada and Europe as well as tailored for materials and processes used for packaging to allow reliable apples-to-apples comparisons of multiple scenarios. In addition, regionalized solid waste modeling provides a waste profile of each scenario to help understand the end-of-life (EoL) implications of packaging designs.

5. “Balance: Efficiency or Sustainability?

This article by Katherine O’Dea is a great article on the current "sustainable packaging" debate. "A couple of weeks ago, PricewaterhouseCoopers (PwC) released a report titled, “Sustainable Packaging, Myth or Reality.” It seems, however, the report doesn’t really debate the myth or reality question, but jumps right to the conclusion that “sustainable packaging is dead” and is being replaced by “efficient packaging.” How fortunate that would be for the “business as usual” crowd if it were true. But, having worked in the sustainability field for 20 years with a good deal of focus on sustainability in packaging for the past five years, I think PwC got it wrong." (Read the whole article here.) What are some of your favorite sustainable packaging resources? Leave a comment or join the conversation with SSC President Jennifer Woofter on Twitter (@jenniferwoofter).

Workplace Movement Toward Environmental Sustainability – Pt. 1

The SSC Team April 28, 2015 Tags: , , , , , , , Strategic Sustainability Consulting No comments
By: Alexandra Kueller Last week we introduced the Retail Industry Leaders Association’s (RILA) brand new Retail Sustainability Management Maturity Matrix. The Matrix hopes to be a tool that will be used by sustainability executives, individual companies, and industry-wide. We also noted that while the Matrix is designed with the retail industry in mind, we think that is has a wide applicability beyond just the retail sector. Today we are focusing on three of the seven sectors that are featured in the Matrix. Hoping to provide a more in-depth look at how RILA hopes to benchmark across the industry in terms of environmental sustainability, we are going to look at what it would take for a company to become a leader in that sector.

Strategy and Commitment

Before a company can begin their sustainability journey, they must first have some sort of sustainability strategy, right? And if that strategy is weak, how strong will a company's goals be? How well will the company show executives that sustainability is necessary? What this section hopes to capture is how well a company is addressing environmental sustainability at a governance level. A leading company in this sector will have a sustainability strategy that is aligned across departments and integrated into corporate strategy, has defined comprehensive and aggressive goals, incorporates executives from all relevant parts of the business, and more. The Strategy and Commitment sector has five different dimensions:
  • Strategy
  • Materiality/Risk Identification
  • Goals
  • Governance & Executive Engagement
  • Incentives

People and Tools

Sustainability cannot happen without people. Whether the people are stakeholders or employees, sustainability is a collaborative process that needs to have everyone involved from the beginning. While the people involved in your sustainability process is important, so are the tools you use. If you don't have the right set of tools and the right people, your company might be falling short in terms of their sustainability. According to RILA, in order to be leading this sector, a company must demonstrate that they have a dedicated team to creating and investing in sustainable innovations, incorporate feedback from key stakeholders into sustainability strategy, provide a collaborative forum for employees to engage in, and more. The People and Tools sector has four different dimensions:
  • Stakeholder Engagement
  • Employee Engagement
  • Funding Mechanisms
  • Business Innovation Mechanisms

Visibility

You have your sustainability strategy in place and have assembled a team of employees that have the right set of tools to tackle sustainability, so what's next? Choosing sustainability metrics focused on all material aspects. Using 3rd-party standards in your sustainability reporting. Having sustainability be a focus in marketing campaigns. Partner with other organizations to continue to identify room for improvement. These are just some of the ways RILA says companies can become better sustainability leaders while promoting their sustainability. The Visibility sector has five different dimensions:
  • Metrics & Measurement
  • Reporting & Communicating
  • Point-of-Purchase Consumer Education
  • Marketing Campaigns
  • Collaborative Involvement
Last fall we attended the annual RILA Sustainability Conference. Read about some of our thoughts on the conference here.

Choosing Sustainability Management Software for Your Business

The SSC Team April 23, 2015 Tags: , , , Strategic Sustainability Consulting No comments

This article was written as an expansion of our white paper “Choosing Sustainability Management Software for your Business” published in July 2011.  If you’re looking for information on how to make your software selection, check out the full article.  If you just want to make sense of this particular topic, keep reading. Enjoy:

Now that you’ve decided to purchase sustainability software, an important related decision is whether or not you want to do the implementation work in-house or if you want to bring on a consultant to help out.  Making the right decision will be critical to your overall project success as well as impact the total cost of ownership for your solution.  And depending on your specific situation, either answer can be the right answer.  This article covers four key considerations:  Culture, Cost, Capabilities and Confidence.

Culture

Your business culture is an important first consideration.  Either you are consultant friendly or you prefer to do projects internally.  Making a decision that fits your culture and is consistent with your values will be important throughout the project.  That’s not to say that you might not go in the other direction for a specific project, or even choose a hybrid approach to delivery; just be true to yourself, as that will contribute to project morale for the entire team regardless of who signs their paycheck.  

A hybrid approach may provide the best of both cultures for you without offending the purists on either side.  Bring in specific subject matter expertise that you don’t already have in-house and then match it up with the right internal members of your Green Team to deliver the project.  On a high performing team, your consultants should be looking to train the internal employees on all the ins and outs of the system so that eventually your people can take over and run with the operational system. A good consultant instills confidence that they provide specialized expertise and trust that you will feel comfortable to call on them for further assistance in the future, instead of keeping them on the project unnecessarily for extended or prolonged periods of time.

Cost

After culture, cost is a major factor in the DIY vs. consultant decision.  For many firms – large or small – the preliminary inclination is to try and do the work internally.  The general premise is that it will be cheaper to use people that you already are paying because there is no additional cash out of pocket like there would be with an external consultant.  Consultants seemingly come with a high, upfront, fixed cost as your employee costs are already embedded in your budget.  Don’t forget to account for the “opportunity cost” of your internal employees – after all, they would be working on something else valuable for your firm if they weren’t picked for this project.

Beyond the opportunity cost consideration, looking only at the incremental expense doesn’t address an important aspect of choosing your own internal people to do the work: Do they actually have time?  Presumably, all of your existing employees have a “day job” that brings them to work every day.  Some of them are probably even doing two or three different jobs during a regular workday.  Determining if you actually have the available slack time within your existing team members is an important determination.  After all, if you’re on a deadline and your employees just can’t carve out enough time to meet that target, it may end up costing you more money to bring consultants in later than it would have if you had engaged them at the start of your project.  If you engage them in the beginning, the consultants are competing for your business; if you wait to bring them in until later in the project, they know you are hiring them to help bail you out so the leverage has shifted into their favor.

A final cost consideration when hiring a consultant (or going the “cheaper” internal route) is that “you get what you pay for.”  This can be taken as advice that the lowest cost doesn’t always provide you with the best result – nor for that matter does the highest cost.  Just make sure that the cost is right for the work being performed and for your situation.  That brings me to the second aspect of “you get what you pay for” – which is to MAKE SURE you get what you paid for.  Pay your consultant based on their delivery of the results you are looking for on the project, not just because they send you an invoice.  If possible, get a consultant to sign up for a risk-reward component to their payment so that they will be incentivized to do a better job since some of their compensation is on the line.

Capabilities

One of the primary reasons to hire a consultant is that they have the necessary skills and/or expertise to perform the software implementation that you may not already have in-house.  Beyond the skills that they bring to the table, a consultant should also bring some other benefits to make a strong business case for hiring them.  Your consultant should bring the necessary tools, techniques, and methodologies to the table that their consultancy uses and which you don’t have.  This may be as simple as them showing up with their own laptops and software licenses that you don’t need to pay for, or them having the necessary data gathering systems to pull in all the info you need for your new sustainability software platform. 

As consultants, you are also expecting them to bring prior experience to the table.  Whether or not they’ve worked on a project exactly like what you are asking them to perform, you should be able to get veteran individual consultants and/or teams of consultants to come help you out.  And by teams, we don’t mean the kind where the senior partner sells the deal and then you don’t see him again except when he stops by infrequently to check on the team of freshly minted MBA’s that he’s actually assigned to your project.  We mean the kind of team where your senior (and junior) consultants are actively engaged on a daily basis to help you get the project done quickly and effectively – i.e. on time and on budget.

In addition to experience, your consultant may be able to offer a cost advantage, especially if their firm is already doing business with you and you can get any sort of bulk discount.  The discount opportunity may extend to software and/or hardware purchases as well since they may be able to aggregate purchases across multiple clients.  This discount opportunity may also arise if you are able to hire your software vendor as the implementation consultant.  While this may raise some concerns about “the fox guarding the hen house”, it may help keep your costs down. 

Confidence

There’s an old adage in the software industry: “No one ever got fired for hiring IBM.”  While this is generally an explanation of why you should hire a bigger firm over a smaller firm, it also illustrates the importance of having confidence in your choice.  Regardless of whether you feel the need for a big firm with vast resources, or if you prefer a smaller firm that provides a more personalized experience, the most important factor for you is that you find a good consultant that you can trust.  They should have a proven track record, have a solid network of resources they can draw on (regardless of whether they are internal or external to the consulting firm), and be able to instill the necessary confidence in you that they will deliver.  If they can’t do that, then you shouldn’t hire them.  If they’re the best solution to your need however, then by all means, hire away!

Now that you’ve read this article, tell us what you think!  And be sure to check out the full white paper.

Introducing RILA’s 2015 Retail Sustainability Management Maturity Index

The SSC Team April 21, 2015 Tags: , , , , , , Strategic Sustainability Consulting No comments

By: Alexandra Kueller

The Retail Industry Leaders Association (RILA) recently announced their brand new Retail Sustainability Management Maturity Matrix. The Matrix, which is based on Deloitte and RILA’s knowledge of the retail industry and its sustainability programs, hopes to be a tool that will be used by sustainability executives, individual companies, and industry-wide.

(Although this matrix is designed with the retail industry in mind, we think that it has a wide applicability beyond just the retail sector.)

While there are many aspects of sustainability, the Matrix focuses specifically on environmental sustainability. The Matrix has seven sectors that helps break down the different components of environmental sustainability:

  1. Strategy & Commitment
  2. People & Tools
  3. Visibility
  4. Retail Operations
  5. Supply Chain
  6. Products
  7. Environmental Issues

Each sector is then broken down by dimensions, and each dimension is ranked by five categories: starting, standard, excelling, leading, and next practice. RILA acknowledges that only a few companies are in the “leading” category, but hopes that over the next few years more companies can get to that level. The main goal of the Matrix is to identify all of the possible pathways to strong environmental sustainability.

Here are some of the ways the Matrix can be useful:

  • Identifying and assessing the maturity of your sustainability program and opportunities for improvement
  • Helping to facilitate conversations about your sustainability program’s development
  • Finding ways to access for funding for your sustainability program
  • Training employees to have more sustainability responsibility
  • Allowing internal, external evaluation of your program’s perception, gaps it might have

It’s RILA’s goal to use the Matrix to benchmark the industry in 2015, while annually updating the matrix.

Over the course of the next two weeks, we will be further breaking down the Matrix by sector to get a more in-depth look at how the Matrix will work.

Last fall we took an in-depth look at SSC's peer benchmarking system that we used against the athletic wear industry. Catch up here.

How Sustainability is Saving Chinese Textile Mills Money

The SSC Team April 16, 2015 Tags: , , , , , , , , Strategic Sustainability Consulting No comments

By: Alexandra Kueller

It’s no secret that China is not an environmentally progressive country. Beijing is plagued by air pollution, over 100 cities are facing water scarcity issues, almost a third of China’s rivers are too polluted for human contact, and to top it all off, as a nation China is one of the highest emitters of carbon dioxide. 

One of China’s largest polluters are their textile producers. Responsible for roughly 50% of the world’s fabrics, textile manufacturing is a very environmentally un-friendly process that results in high energy and water use. The industry is responsible for the being the third largest dischargers of wastewater and the second largest user of chemicals in China. 

All hope is not lost, though. With the help of the National Resources Defense Council’s (NRDC) Clean By Design program, Chinese textile manufacturing facilities are using green tactics to not only reduce energy and water consumption, but also help them save money as well.

The NRDC recently released a report stating that the 33 textile mills that are using the Clean By Design program are saving an estimated $14.7 million annually. By going after the “low-hanging fruit” – the low-cost, easy to implement projects – the textile manufacturers are helping to make a strong business case for sustainability.

Here are some of the ways the Chinese textile mills have not only reduced their environmental impact, but also saved money along the way:

Electricity Reductions

10 of the 33 textile mills went after projects that helped reduce electricity consumption. While the average reduction was only 4%, some of the more impactful projects yielded a 9% reduction with over $21,000 in annual savings. As a bonus, this project paid for itself in only a month!

Water Reuse

31 mills implemented 53 projects that resulted in an average of 9% water savings, with some of the top mills reducing water consumption by 20%. A lot of the reuse efforts focused on targeting process water and grey water, because those tended to yield the largest and most cost-effected reductions. Some mills installed a water treatment process, and that initial investment of $7,600 paid for itself in three months.

Energy Recovery

Through 173 projects that focused on electricity reduction, every participating mill saw an average reduction of 6%, with the top mills seeing a 10% reduction in energy. A majority of the projects saw efforts to recover heat from exhaust gas, water, and oil due to the fact that they produced that largest, most cost-effective reductions: a $500,000 investment yielded roughly $650,000 in annual returns.

Looking for ways to reduce your company's carbon footprint? Learn more by checking out our white paper!

10 Steps to Building a Better Business Case

The SSC Team April 9, 2015 Tags: , , Strategic Sustainability Consulting No comments
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This article was written as an expansion of our white paper “Choosing Sustainability Management Software for your Business” published in July 2011. Enjoy:

As part of your decision making process, you need to make a business case – in financial terms (and maybe some softer measures) – in order to make sure you that you are on the right track.  The outline below should help guide your thought process in fleshing out what the benefits might be for your firm.

1. What’s your overall strategy?  

Is it a cost savings approach?  Do you want to just provide better reporting to stakeholders?  Or are you generating revenue from a green product line and therefore need to track how green it is?

2. What can you actually measure?  

Are you saving labor/time?  Do you have fewer errors and better data quality?  Is it a reduction in risk of losses due to litigation?  Or are you able to increase sales revenue by having better data on your environmental impact?

3. What are the baseline values for those metrics?  

It might take a 100 hours per month of staff time to produce your current report.  Maybe you average $50K in legal fees yearly.  Or you are currently selling $100K per month in your new product line.

4. What supporting research do you have?  

This could be clear internal documentation of your baseline metrics as well as competitive research on your competitors, your region, your industry, etc.  This research will tell you how your data in number 2 and 3 above stacks up against a larger pool of data.

5. What incremental percentage change do you expect to drive in your metrics?  

You should be able to estimate this based on your answer to number 4.  Are you going to be 5% better yearly?  10% lower yearly?  50% higher monthly?  Just make sure you document your assumptions on how big a percentage change you are going to drive, which direction that change is in and what time period that change will cover – i.e. monthly metric, yearly metric etc. Does the change all happen in the first year or does it happen steadily for the entire period of your business case? 

6. What volume change in your metrics results from the incremental percentage change?  

Does a 5% decrease in labor hours equate to 5 hours a month or 500 hours a month?  You need to be able to convert from percentage to number.

7. Translate your percentage/number value into a monetary amount.

Now you have to put on your quantitative hat as you churn through the numbers.  This is where you weed out the quantitative benefits from the qualitative benefits.  Both are desirable, but you want to be able to show the monetary value that you are going to save or earn as a result of your purchase.

8. Decide how you are going to measure it.

You know what you are measuring, how much it is going to change and what your end result is expected to be.  Now you need to determine how you are actually going to measure your progress from start to finish.  If you can’t put a firm description around how you are going to specifically measure the change – i.e. maybe your product revenue will increase for reasons besides its greenness – then you’ve found a soft benefit.  It’s still worth tracking, but you may need to share some of your business case benefit with another department or project.  If you’ve got a very specific way to track your benefit realization, then you’ve found a hard benefit.  The hard benefits, are the kinds that your accountants will like – try to get as many of these on your list as you can.

9. Write it up. 

You’ll need to present your business case benefits to somebody – whether it is your bank when asking for a loan to purchase the software, or to your executives to convince them to support your purchase decision.  Tell them why your purchase is going to be a big success for the company, how much it will contribute to their triple bottom line, and how you are going to come back in a year or three and show them how well things went. 

10. Measure it.

After you implement the software, you have to go back and do the things you said you were going to do in number 9.  Many companies don’t actually close the loop today with projects – they just move on to the next thing and go on their way.  If you want successful business results, it all comes down to measuring it, if you want to manage it.

Now that you’ve read this article, tell us what you think!  And be sure to check out the full white paper.

Sustainability Consulting: One Size Does Not Fit All

The SSC Team March 31, 2015 Tags: , , Strategic Sustainability Consulting No comments

Here is a blog entry from the early days of the SSC blog. Enjoy!

To remain competitive in an increasingly global marketplace, companies of all shapes and sizes and from different industries and sectors are introducing sustainability programs to gain a competitive advantage. Companies are expected to react to these changing dynamics and to address the changing consumer preferences for environmentally and socially sustainable products and services. The ideas of corporate social responsibility and sustainability are no longer fringe issues or passing trends, but are topping the list of strategic issues of executive management at Fortune 500 companies. Most multinational firms have incorporated some sort of sustainability initiative within operations, such as ethical sourcing, measuring and reducing carbon usage and recycling initiatives. 

However, small- and medium-size companies are in a unique situation when it comes to sustainability. These firms don’t necessarily have the time, money or other resources to lead a full-blown, comprehensive sustainability program. Because of these differences, it is important to realize that sustainability consulting cannot be a “one size fits all” approach. What works for a Fortune 100 company most likely will not be a good fit for a small business. This is why it’s so important to hire consultants that really understand the process of developing and implementing sustainability programs, the resources available and constraints to expect, as well as the stakeholder “buy-in” necessary to execute a successful sustainability strategy for a small- or medium-size company. With these pieces in place, professional sustainability consultants can successfully navigate companies through the sustainability arena. 

Sustainability consultants must remain flexible and adaptable, and should be competent in assessing the feasibility of programs and identify long-term opportunities and constraints. Consultants should recognize that a company typically cannot make one isolated change without addressing the impact of that change on other issues in the business. This “results-oriented” thinking ignores the complexity of execution and implementation of programs and does not provide opportunities for the necessary reflection and evaluation of the sustainability initiatives.

One of the key factors contributing to success of a sustainability plan is the level of collaboration and engagement among employees and other stakeholders during the planning process. This balance of top-down and bottom-up planning increases the likelihood of the plan gaining support and advocacy from stakeholders during the implementation phase. Finally, consultants should work with companies to plan long-term sustainability programs that are tied into business objectives, which will deliver a more integrated approach to sustainability. This is critical, as most “knee-jerk” programs that are not well-thought out, planned or executed have not proven to be very successful or sustainable.

Feeling like your sustainability plan isn't getting as much attention as it deserves? Read about how to fix that here!