Tag Archives: sustainability

Sustainable Supply Chain Management: Making Blue Jeans Green

The first session that I attended at the 2011 Net Impact conference was entitled the Past and Future of Sustainable Supply Chain Management: A Critical Reflection. The panel featured three representatives from different organizations in the garment industry.

Sustainable supply chains is one the topics that I find most interesting and most important. Making the business case for sustainability is critical to convince businesses to mitigate their impact on the Earth. Since most consumers are not willing to pay more for an item because it is marketed as being “green,” the best place to make the business case for sustainability is to find savings and opportunities within the supply chain.

One of the takeaways from the session was that when it comes to greening supply chains it comes down to what I would call the 3Ms: measure, mitigate, and motivate. Measure the impact of the product or service on the environment through a life-cycle assessment. With this information mitigate the environmental impact by changing the activities in the process that have the largest eco-impacts. Finally, look at the organization’s strongest spheres of influence within the supply chain and motivate those outside of the organization to also mitigate their impacts.

The most pertinent example from the session was Levi’s Water<Less jeans. Levi Strauss Co. conducted a life-cycle assessment on its jeans and determined that overall the largest impact its jeans have on the planet occurs post-purchase though the washing and drying of the jeans. Pre-purchase the largest impact is from the production of cotton. Levi’s therefore developed an initiative to reduce the water and pesticide use in cotton production and made changes to its production process to use less water. Finally, to address the post-purchase impact, Levi’s developed a campaign called “Dirty is the New Clean” advocating that consumers wash their jeans less. Levi’s is successfully greening its supply chain through using each of the 3Ms.

Another key takeaway from the session was that there is a limit to the savings you can get out of a supply chain. While improved processes reduce can reduce waste, inputs or logistical costs, there is only so much an organization can do before its “greening” starts costing money.

So where is the business case for sustainability in all of this? Over the next 10 years water is seen as one of the biggest risks to the garment industry. The industry is reliant on an increasingly scarce resource. In the short-run industry companies need to reduce their water footprint throughout the supply chain. However, this only achieves going in the wrong direction slower. Therefore, in the long-run, companies need to develop new business models. One possible model is to develop closed-loop systems so that used garments are used as inputs for new ones. Another is to reimagine the business such as Patagonia has done this in its partnership with eBay in developing the second hand market for its clothes.

Supply chains will remain the focus when incorporating the tenants of sustainability into business. However, in the long-run, tweaks to cut costs will need to give way more innovative strategies.

Psychological Traps in Sustainable Thinking

I am going to build on Matt Wilson’s excellent post about cynicism. I agree that overcoming cynicism is the first step – but what a big step it is! In this post I’ll talk a bit about leaving cynicism behind, about the psychological traps that are inherent in this decision, and how I personally experienced this at Net Impact in Portland.

My communications background spawned my interest in how people organize themselves and work with information technologies to make good decisions. I picked workshops at Net Impact that related to my areas of greatest interest – how to measure the impact of business decisions and how to share impact information with stakeholders to best support the common good. I went to workshops on integrated reporting, employee engagement, impact investing, organizational learning, innovative balanced scorecards, and other things on that theme. The results were mixed.

I’ll start with my cynic hat on: the workshop on employee engagement featured a rep from Southwest Airlines, whose much-studied rise to success was based on the competitive niche of getting people out of cars and into planes, massively increasing the carbon footprint of intercity travel in the US. The most sustainable thing Southwest could do is get people out of planes and back into cars again, but they don’t engage employees who think that way… I disappointedly snuck out of that session before it finished. I also left part-way through the workshop on creating a personal portfolio of “social impact investments” when I realized the gaping disconnect between the workshop content about evaluating the impact of the investments themselves from the systemic impacts of the personal investment goals brainstormed by the audience: fly to the tropics every winter, buy that second vacation home, the fancier car, and other first-world consumer fantasies. Investing money “in an impactful way” does not validate your wasteful lifestyle choices, people! There was a broader understanding of systemic issues decidedly missing here.

I don’t want to be a cynic or contribute to the cynicism of others – I agree with Matt Wilson (and Lord Hastings) that it is a huge barrier to progressive action. But my experience of Net Impact was that a relentless tide of positive optimism competed for attention with critical, realist discussion, and from my examples above I think there are legitimate reasons to be critical. Without a real, critical discussion of Southwest’s role in the carbon economy, or of the lifecycle costs of our investment/consumption habits, we ignore “the elephant in the room” and it becomes easy for people with dissenting views (like me) to feel isolated and cynical. Substituting “everything is great” for “everything is hopeless” hardly strikes the balance that is required to tackle the complexity of sustainability problems.

The important point I want to make is that giving up cynicism doesn’t have to force a personal choice between full blown cynical gloom and an obstinately positive attitude. Blind positivity is the first psychological trap when you try to get over your cynicism. For a really excellent summary of the trap that positive thinking sets for us, see Barbara Ehrenreich’s (brilliantly animated) talk here: https://www.youtube.com/watch?v=u5um8QWWRvo. In this respect I think Net Impact could offer more value to participants by offering structured “360° feedback” sessions to companies, organizations, or individuals to help them broaden their understanding of how to improve, rather than the panel discussions where everyone is applauded for making an upbeat presentation about whatever positive work they want to highlight.

On the bright side, my best experience at Net Impact was attending a workshop on organizational learning hosted by Libbie Landles-Dowling of Bridgespan consulting group. The focus was on how to systematize the incremental learning and critical feedback process in every project and consulting engagement, and make this information available to an organization in an accessible, searchable way. It was the most useful angle for tackling the psychological traps I have described here – it allows a whole organization to make critical reflection a core part of project work, and help make decisions based not just on our belief that we are doing the right thing, but on the best data that we can muster about what has worked well in the past. This workshop, and other sessions that focused on how to engage with stakeholder groups in ways that allow you to get at the root of problems, made the conference worthwhile for me.

However, once you start down the critical appraisal road, the complexity of issues can become overwhelming, and we fall into the next psychological trap: “analysis paralysis”. An MBA-friendly analogy is the case competition – you have to start with research and get all your issues sorted out before making a plan of action. Experienced case crackers warn about “analysis paralysis” – getting stuck on trying to find the “perfect”, mutually exclusive, collectively exhaustive set of issues that describe the problem at hand. Cynicism in daily life comes from a sort of “analysis paralysis” – it is very easy to dwell on all the reasons why different ideas haven’t worked in the past, and to wait around for the “perfect big idea” to come along. To get past this stage you have to hold your nose and take the best course of action you can with the information that you have available. Be prepared to work iteratively, fail many times successively, and keep learning on the way (this is what Design Thinking is supposed to help with). This trap gets me the most, and I blame that on an undergrad steeped in marxist economic critiques and post-modernist cultural studies: heavy on the criticism, but light on decisive plans of action!

Cynicism is rooted in fear that leaders of social change or sustainability movements are inappropriately positive about their missions – perhaps naively, for lack of experience; perhaps deliberately, to hide a personal interest in attracting funds and followers; or perhaps because they are blinded by their own ideological beliefs. Ideology is the most common, and most insidious cause for cynicism – the most passionate, zealous leaders, no matter how well intentioned, seem more prone to be fundamentally misguided or blind to the shortcomings of their vision. Cynics think that uncritically taking direction from these leaders will lead to a disappointing or destructive outcome, far from the ideal of “doing good by doing well” or whatever other catchy phrase Porter and Kramer have coined that motivates us to get on the sustainability train.

It’s difficult to keep far enough ahead of the torrent of writing on the subject to critically appraise anyone’s claims to being progressive or sustainable. Sometimes you have to go with your gut and hope for the best. As a result of attending Net Impact and reflecting on my experience there, I now feel much more focused on what I am looking for in a potential employer, and how to ask them about it. I know not ask really soft-ball questions like “what do you do about sustainability”, because most companies now have a well-rehearsed ‘elevator pitch’ about how green they are (I guess I remain cynical about these elevator pitches). I will ask “how will you get me involved, as an employee, in finding out where the problems are in the sustainability of your strategy? How will the company incorporate this learning at every level into its strategy? What sustainability problem are you facing now that you expect to still be working on in twenty years?” These are the questions that will get a bit more real information about their future vision. Overall I would recommend Net Impact to anyone who is ready to roll up their sleeves and take action, and perhaps even inspire some die-hard cynics to do the same.

Get out of Sauder for your eco-MBA

The other night at the MBA Gala, I found myself talking to a first year about how I wanted to get more environmental courses during my MBA. Perhaps because I did not get out of Sauder to take courses before completing my MBA, I wanted to provide this somewhat incomplete guide to some of my ideas for getting more environmental rigor and knowledge into your MBA. If you are interested in getting a more sustainable education experience from your MBA, you might consider taking courses outside of the business school.

Here are three ways to start to explore options outside of Sauder:

  1. Contact Bill Rees and get his thoughts on how to make the most of your MBA experience at UBC. He is facility at SCARP—the school of community planning at UBC. He is a bit of a celebrity. He has a particularly challenging way of seeing the world. Just having a conversation with him and truly trying to understand what he is saying is a learning opportunity. But he might also have a suggestion or two for you on how to make your own degree while also fulfilling your MBA requirements.
  2. Perhaps the most relevant school at UBC for interdisciplinary environmental studies is the Institute for Resources, Environment, and Sustainability (IRES). Their graduate program is very well regarded. You should talk to some of the professors, like Kai Chan for example, and see whether there is an appropriate course or two. These will be more difficult classes than your MBA courses. They are a full semester instead of six weeks, so one course is the equivalent of two MBA modules. The MBA office recognizes this and will allow you up to 3 credits for one course instead of the usual 1.5 credits.
  3. Check out the UBC Organic Farm. This is not a course, but is a great way to get relief from some stress while you reconnect with nature. You can buy produce at the farm stand on Wednesdays at the bookstore during the summer and early fall. Also, you can always volunteer at the farm. I helped out with a friend who had a job picking up and cleaning the eggs from the hens once a week. There are dozens of other volunteer opportunities on the farm too.

Remember to check in with the appropriate person in the MBA Office and make sure to clear whatever requirements they have for courses taken outside of Sauder.

Hhhmmm… I think I’m in the wrong room!

One of the things that I loved about the Net Impact Conference this year was that I didn’t have a real ‘strategy’ per se in my approach to choosing which panel discussions I’d attend. Instead of only seeking out Green Marketing or Sustainable Supply Chain Management I took a peek at the program and went to discussions on whatever happened to interest me most. One of the ones that caught my eye was a case study on blending environmental, social and business sustainability in a Mexican Indian Reserve. Now, the ironic thing is that I thought this was about First Nations, presuming that ‘Indians’ was just our friendly neighbours’ way of being colloquial… so I was kind of surprised when the moderator started introducing three latin panelists.

To give you a quick rundown of what the session was actually about…

The man describing the case study, Fredo Arias-King, is the President of T & R Chemicals, a company that manufactures pine oil from pine resin. The pine resin from the particular pine tree that the company uses is grown in only a couple of areas of the world, one of which is in a relatively remote part of Mexico. Pine resin is an incredibly common component in a variety of products, the breadth of which we take for granted. While it’s a very lucrative industry for the major chemical companies that process it, it can also be very lucrative for the native population if they harvest it efficiently. This last caveat is particularly poignant in Mexico because the system just doesn’t work well. Much like in the rest of North America, the First Nations population has been marginalized to the point of abject poverty. Mr. Arias-King has started a social initiative designed to help alleviate this poverty by monetizing pine resin harvesting for the Indian population. The initiative, called ‘Resinas Sinteticas’, is a major reforestation project in Mexico that aims to plant 1 million trees per year for a decade, in the process providing the local population a source of sustainable income. T & R Chemicals, Inc. is financing the entire project…

Throughout the entire session social innovation and community development were the main focus of the discussion. It only came out at the end that there’s an underlying reason for T &R Chemicals’ vested interest in their supply of pine resin. It seems that the largest producer of pine resin in the world is also its greatest consumer. China’s consumption of pine resin is set to exceed its supply in 2020; this project, it would seem, is a subtle form of risk management. What better way to ensure your input supply than by ingratiating yourself to its growers. Pretty slick, if you ask me, and at first glance it appears contrary to the point of the Net Impact Conference.

But this is where I find myself realizing that I may be thinking a little too hard. I mean, really, who cares what the company’s motivation is? T & R’s risk management strategy is turning a reforestation project into a social innovation success story. What’s more, it’s accomplishing it sustainably, which is more than anyone could really ask for considering that industry practice suggests otherwise. If you’ve read my other posts you’ll know that it seemed to be a common theme for me this year; having one epiphany per session, realizing that the destination can be more valuable than the means by which a company gets there… within reason, of course!