corporate environment strategies

7/28/2019 Corporate Environment Strategies

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Green and CompetitiveEnding the stalemate


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The Dilemma

to be less competitive?


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Opposing Views

Costly

Responsibility

reven ve measures

Implementation cost

Non compliance cost

oc a ene s

Social responsibility

Sustainable growth


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Traditional Views On Going Green

Stricter regulations mean higher costrequired to achieve compliance.

Environment concerns imit irm s ree omwhen coming up with innovations.

It raises production cost and generate noprofit to the business.


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The Current Situation

traditional view?


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Survey Results

Sa reen issues have

become more importantto their organizationstrategy.

*Source: KPMG Labour Market Outlook summer 2007 survey conducted on 1,000 HR professionals


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Survey Results

prefer to work for firms witha strong green stance.



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Survey Results

environmental policy inplace.



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Green Energy Projected Growth

1.4

20.5

15.6

80.9

Fuel Cells

Biofuels Market growth from 2006 to 2016(In $US Billions)

55.4

17.9

15.6

226.5

60.8

69.3

0 50 100 150 200 250 300

Total

Wind Power

Solar Power2006

2016

Source: Clean Edge, 2007


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Change Factors: The 6 Cs

CostsCosts

CapitalCapital

ompet t onompet t on

ChinaChina

ConsumersConsumers

ClimateClimate


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The Green Advantage

Generate cost savings.

Promote innovation.

Command premium pricing.

Enhance the brand image.

Differentiate from competitors.


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Putting It Into Action

gain the green advantage?


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Competitive Environmental Strategies

Eco-EfficiencyEnvironmental Cost

LeadershipwerCosts

antage

Beyond ComplianceLeadership

Eco-Branding

Competitive Focus

Organizational Process Products and Services

Differentiation

L

Com

petitiveAd


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Strategy 1: Eco-Efficiency

Savings through eco-efficiency practices.

This strategy generates savings in virtually

every rm.

It is an internal initiative as consumers will

not pay for environmental protection.


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Strategy 1: An Example

Over 50% in savings by changing from

incandescent light bulbs to energy saving light bulbs


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Strategy 2: Beyond Compliance Leadership

Acknowledgement from public and

customers for their efforts.

u s an a nves men requ re or

certification and publicity efforts.

Beyond compliance practices can

give suppliers an edge over others.


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Strategy 3: Eco Branding

Consumers must be willing to pay for

the ecological differentiation.

Reliable information about product

environmenta per ormance must eavailable to consumers.

Differentiation should be difficult to be

imitated.


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Switzerland hailed Toyota Prius as the worlds greenest

car. The Prius has sold over 1 million units worldwide


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Strategy 4: Environmental Cost Leadership

Production of cost competitive

products with environmental

attributes built-in.

Ra ica pro uct innovation suc asmaterial substitution, packaging, etc.

Better product design results in more

efficient use of resources whichtranslates to lower price.


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Cost savings and waste reduction through packaging design


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Strategy Framework Review

Boundaries between the strategies

are hypothetical.

s nc on owever a ows e er

analysis and helps in finding

opportunities beyond the low lying

fruits.


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Conclusion

Change factors have increased attention

on environmental practices

Change factors have increased attention

on environmental practices

Being green can be a new competitiveadvantage.

Being green can be a new competitiveadvantage.

Firms can adopt different strategies to gainthe green advantage.Firms can adopt different strategies to gainthe green advantage.


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Questions

We do not inherit the earth from

our ances ors, we orrow rom

our children.

Unknown


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References

Ron Pernick, Clint Wilder. (2007). The clean tech revolution. New York (NY)

Lucy Phillips. (2007). Go green to gain the edge over rivals. People

Management, 9.

Michael E.Porter, Class van der Linde. (1995). Green and competitive.

. , - .

Renato J.Orsato. (2006). Competitive environmental strategies: When does

it pay to be green? California Management Review, Vol 48, 127-143.

corporate environment strategies

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