Business Strategy and Global Sustainability Issues MIM 511/BA 548 Winter 2010 Scott Marshall

Sustainability-based Strategic Theories and Frameworks  “Coevolutionary theory argues that the concurrent operating of adaptation and selection explains the processes of [organizational] change and renewal.” Flier, Van Den Bosch and Volberda (2003, 2164)  Competitive success depends on External situation analysis Strategic planning Core competency focus Innovation and Organizational Change Resource efficiency And, Luck! Know what to adapt to… Figure how to adapt… Adapt based on strengths… Change products, processes, systems, structures, etc.… Do it well.… So, hope for some luck along the way.…

Sustainability-based Strategic Theories and Frameworks  Stakeholder Theory Successful adaptation depends on being aware of and responding effectively to varied, often conflicting needs of multiple stakeholders. Stakeholders include customers, shareholders, employees, regulators, suppliers, competitors, activists and advocacy groups, etc.

 Transformational Leadership Adopting MINDSET Creating VISION Implementing STRUCTURES, GOALS, POLICIES, PROCEDURES Establishing INFORMATION & COMMUNICATION SYSTEMS Setting up EMPLOYEE MOTIVATION & LEARNING SYSTEMS Sustainability-based Strategic Theories and Frameworks

 Transformational Leadership Accomplished through…  Charisma and Inspiration  Intellectual Stimulation  Individual Consideration

Sustainability-based Strategic Theories and Frameworks  Transformational Leadership Four Core Strengths  Self-Mastery. Often the greatest barrier to success in not others, not the environment, it is ourself.  The Transformational Mind-set. Action is supported by a set of beliefs or one has mindless impulses.  Influence. Mangers rely on authority, leaders rely on influence. Enough said.  Skills Development. Few know how to build a skill, so they waste countless hours in futile effort. One cannot build a skill by reading about it.

Strategic Frameworks Sustainability-based Strategic Theories and Frameworks

Sources of Creative Tension on Each Axis Strategic Frameworks

In a sustainable society, nature is not subject to systematically increasing: 1. concentrations of substances extracted from the earth's crust; 2. concentrations of substances produced by society; 3. degradation by physical means and, in that society human needs are met worldwide. Sustainability-based Strategic Theories and Frameworks Strategic Frameworks

Sustainability-based Strategic Theories and Frameworks  Focus on company’s competencies Resources, Assets, Capabilities  Seek ways to enhance competitive advantage Long term investments  Reputation built on legitimate and actual practices Reputation to Brand to Revenue Linkage

Transparency and Innovation Transparency

 Ecological and Social Label Systems Reduce ‘information asymmetry’ throughout the value chain by revealing ‘credence attributes’ ‘Credence Attributes’ – characteristics of processes and products that a buyer is not able to determine before purchase and during use. Transparency and Innovation Transparency

 Process Certifications ISO 9000 / ISO Transparency and Innovation Transparency

 Product Certifications Transparency and Innovation Transparency

Transparency and Innovation  Corporate Affiliations Transparency

Transparency and Innovation Innovation

Transparency and Innovation  What is Innovation? Change that creates a new dimension of performance.  (Hesselbein, 2002) A creative idea that is realized.  (Frans Johansson, Harvard Business School Press, 2004) Innovation

The more disruptive, the more Stakeholders involved to make viable Transparency and Innovation Disruptive Incremental Higher Viability Lower Viability Electric/Petroleum Hybrid Vehicles High Occupancy Vehicle Lanes Telecommuting Disruptive – changing industry and business models Incremental – changing products and product features Low Viability – Limited mass appeal and impact High Viability – Significant mass appeal and impact Fuel Cell Vehicles Innovation