In business is it more important ‘what you do’ or ‘how you do it’?
“Assessing your environmental strategic planning in preparedness for ISO 14001:2015”
Having written previously about the changes to ISO 14001, due to be published in 2015, which are likely to include increased focus on the supply chain, ecosystems, adaptation, and products and services, in this paper I will consider one aspect in more detail, which is giving consideration to environmental performance in strategic planning: ‘what you do’ – compared with an organisation’s direct environmental impacts: ‘how you do it’. I will use the Green Operations and Strategy Assessment Tool (GOSAT) to illustrate these ideas throughout, which may be used by organisations to develop a high level strategy in this area:
In the past, quality management systems (ISO 9001 and its predecessors) got a bad name, because there was a view that you could specify rubbish and make rubbish; conformance with specified requirements was key. To a greater or lesser extent this changed with the publication of the 2000 edition, which placed much greater emphasis on monitoring processes, products and customer perception, thus driving improvement in all areas of the organisation that contribute to meeting customer requirements. This in turn encourages innovation.
ISO 14001 suffers from a similar image problem today in some quarters, as 9001 did pre-2000, but in this case the customer could be seen as the environment. As long as the organisation complies with legal and other requirements, improves in some areas, and prevents pollution (normally considered to be from its direct activities) it can continue do what it does, or making what it makes, without considering its ‘raison d’être’ and overall life-cycle impacts.
As an example let’s consider a hypothetical manufacturer of patio heaters that has ISO 14001. Their environmental policy includes a commitment to ‘greening the earth’, although perhaps ‘warming the earth’ would be a more realistic objective given the product. Such a manufacturer could have a spotless factory, use solvent-free paint, and operate a fleet of electric delivery vehicles, but it will still be making a product that many see as unnecessary and highly unsustainable. Its position on GOSAT would be in the top left-hand corner.
If the 2015 version of ISO 14001 contains a requirement for the organisation to ‘consider the result of the evaluation of significant environmental aspects as input into the design, development or change of its products and services’ it would be interesting to see if the organisation readily retained ISO 14001 with no changes, dropped that product line, redesigned it, or substituted it for something that provided an equivalent service, such as thermal underwear. Redesigning the product could include partially addressing the core issue of heating outside air, such as we saw with the electric patio heater pitch by Eddie Middleton on Dragon’s Den in 2009. They may consider ‘improving’ the product through de-materialisation or perhaps increasing its life expectancy. One way of doing this might be by switching to solvent-based paints that may be more durable, but have a greater environmental impact at the production stage. Another might be by providing a take-bake service for the product at the end of its life. The company could use GOSAT to help plan their overall environmental strategy.
Our patio heater company is not alone in this journey; there are many well-documented examples of organisations that are beginning to, or have already, re-imagined themselves along more environmentally sustainable lines. The late Ray Anderson described in his book Business Lessons from a Radical Industrialist how his flooring company, Interface, re-engineered its process to harvest used carpet tiles, thus reducing fossil fuel dependency and waste to landfill. Other organisations, such as Green and Black’s, embedded sustainability principles in their businesses from the very beginning. Green and Black’s founder, Craig Sams, always believed that organic farming was not only essential for soil quality and ecosystem integrity, but that it also resulted in tastier food. With rising resource prices, climate instability, and degradation of ecosystems there are many sound business reasons to take a long-term holistic approach to running a business.
However, does this mean that all organisations who have strong environmental credentials from a product and service point of view (what they do), have also eliminated environmental compliance and pollution risks from their business (how they do it)? My counterintuitive theory is that this is not necessarily the case, and in some areas the opposite may be true. Before reading on can you think of any examples?
I will explain by considering a different hypothetical organisation: a recycling company that specialises in diverting food waste from landfill, capturing methane, and producing renewable electricity. Its core business model is aligned with sustainability principles. It does not have ISO 14001, possibly because it is considered to be unnecessary, and such controls would be an added cost and constraint. However, while it has grasped the green opportunity, it is less competent with regards to operations. It does little in the way of process monitoring, and frequently has problems with waste deliveries backing up in its yard. Odour from one of its plants is so bad that local residents often feel trapped in their homes, which is having a direct effect on their quality of life, health, and wellbeing. The regulator has received hundreds of complaints, and despite having contacted the plant, residents are taking legal action because they are convinced the problems will continue. The recycling company’s position on GOSAT would be in the bottom right-hand corner, and they could use the model to consider improvements to their overall business strategy, thus closing the gap to the ideal greener trajectory.
I won’t give specific examples here but the Environment Agency’s Sustainable Business Report for 2011 states that the number of serious pollution incidents per 100 permits issued is actually highest for the biowaste sector at 5.5; ironically this is well above the landfill sector, which only had 0.3 serious pollution incidents per 100 permits issued.
Therefore, while some organisations have made a logical progression from pollution prevention and compliance to an all-encompassing green business model, the two do not necessarily go hand in hand. Increasingly we will have to rely on diverse and novel technologies to solve critical challenges that we face, such as resource scarcity, adverse weather, food shortages, increasing migration of pests, rising CO2 emissions, and degradation of ecosystems. These technologies will not necessarily be risk free, and in some case may have greater safety and environmental operational risks than their predecessors. I have always said that there is no silver bullet when it comes to environmental management.
In summary I believe that ‘what you do’ and ‘how you do it’ must go hand in hand in order to solve global problems, prevent local pollution, and preserve the overall reputation of an organisation or brand.
The increased emphasis on environmental sustainability in the 2015 version of ISO 14001 will encourage many organisations to embed it into their business model, not only raising the profile of environmental management with the organisation but engaging leaders with opportunities presented by the green economy. Organisations exploiting new technologies however, large and small, would be advised to consider pollution prevention and neighbourhood impacts in equal importance to the bigger picture.
Please use the Green Operations and Strategy Assessment Tool (GOSAT) presented in this article to assess your organisation referencing the source. For more detailed analysis and guidance Bidwell Management Systems provides an ISO 14001:2015 Preparedness Service; contact Marek Bidwell (firstname.lastname@example.org) for more details.
By Marek Bidwell (2013)