Magazine article Industrial Management

Planet First

Magazine article Industrial Management

Planet First

Article excerpt


Strategic planning is normally hierarchical, starting at the top and breaking each major strategy into sub-strategies, tactics and detailed departmental objectives. The strength of a strategic plan depends on the validity of its ultimate goals or objectives and the strategic planning process itself. In both of these areas, sustainability can provide dramatic improvement over the current methodologies. In that respect, sustainability is like lean - it offers a new way of seeing a business and its processes, a new way that provides superior results.

The goal of strategic planning is to define an integrated set of strategies that will enable a company to achieve its objectives - e.g., profits and market share. Three different studies of total return to shareholders over a 10-year period confirm this allegation:

1. Living asset stewardship (LAMP) vs. conventional companies. The LAMP 60 companies operate quite differently from conventional companies; they mimic life. These companies have instilled a revolutionary management approach and exhibit the following traits:

* Highly networked, both internally and externally

* Manage by means, rather than objectives or results

* Optimize their use of physical and financial resources

* Foster exceptionally open corporate cultures, creating a culture of mutual trust between management, workers and their communities

* Recognize that they are a living system and that they are embedded in living systems so they intentionally nurture those systems

These companies are highlighted in a monograph, "Profit for Life," by Joseph Bragdon, which summarizes the book by the same name. The fundamental message from thé teachings is that firms that aim to profit for life must respect life and that profit is not the primary goal but an asset to ensure higher ends of service to people and the planet as a whole. It reinforces a type of capitalism that is emergent and inspirational rather than self-destructive and increasingly corrupt.

2. "Better than great" - Servant-led companies. James Sipe and Don Frick, in a book titled The Seven Pillan of Servant Leadership, studied 11 servant-leadership companies. Over a 10-year period, these 11 companies substantially outperformed the 11 companies featured in Jim Collins' book. Good to Great, by the same margin in which the Good to Great companies outperformed the S&P 500. This book was published in March.

3. "Firms of endearment." These companies, which earned the title by endearing themselves to their external stakeholders, also dramatically outperformed the companies noted in Good to Great Over a similar 10-year period. This is. documented in the book. Firms of Endearment: How World Class Companies Profit from Passion and Purpose, by Rajendra Sisodia, David Wolfe and Jagdish Sheth.

People, planet, profit

So what is sustainability. and how does it produce results like these? Unfortunately, sustainability has many definitions instead of one single definition that everyone agrees on. Here are three of the most common'.

* An activity is sustainable if it can be continued indefinitely

* The Golden Rule, applied across generations. The Golden Rule, which is a foundation of all major world religions, is that we should do tó others what we would have them do to us.

* Meeting the needs of the current generation without compromising the ability of future generations to meet their own needs. This is the definition by the Brundtland Commission to the U.N. (1987).

No matter which of these definitions you choose, sustainability is a lot more than just recycling, òr even "green." It is a wholesystems view of life on our planet and how people (both current and unborn generations) and companies participate in that life. Thus, it is a radically different way of viewing the world and a company's role in that world. It is that radically different viewpoint that frames the strategic planning of a sustainably oriented company and enables them to produce the results they produce. …

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