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July 23, 2007 
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| A Guide for Sustainable Business Innovators | |||
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Innovating for Sustainability to Satisfy Customer Needs
Let's face it: CEO's don't get excited about cost cutting (one of the four pillars of eco-value creation). They get paid to show growth, and top-line growth is the best kind. Of course the most basic way to drive revenues is to understand your customers' needs and satisfy them, or find entirely new customer niches to please. So the new focus of environmental thinking is on innovation in the service of satisfying customer green needs. In this issue (and more to follow) we'll take a look at a few of the approaches companies are using today to get their organizations focused on this worthy pursuit.
There are so many ways to approach innovation, it helps to narrow the discussion a bit. So let's pick one industry: technology. The green activity in Silicon Valley and other tech centers is impressive (and we'll publish another issue on the broader topic of "Greening IT" soon). These dynamic companies, working with the most advanced technologies known to man, are attacking these tough issues by playing around with a range of strategies.
I see four ways tech firms are setting themselves up for success in identifying and/or satisfying green customer needs:
~Andrew Winston, Founder, Winston Eco-Strategies, Co-author, Green to Gold (Read his "Eco-Advantage" blog here.) Comments or questions? Join Andrew and other readers online at the Eco-Strategies Forum. Creating a New Business Unit: Panasonic's Play 
Panasonic has identified some green trends that it feels it's best positioned to deliver solutions for. Last October the home electronics manufacturer booked a seat on the green-building bandwagon when it created the Panasonic Home and Environment Co., an independent group focused solely on developing a new line of energy-efficient ventilation fans (the most recent model debuting in May). With home heating bills on the rise, the company saw a strong consumer demand for healthier, more resource-efficient homes - and quickly focused its energies on developing new products to meet that need.
Setting Aside a Dedicated Budget: IBM's Green Agenda 
Big Blue's $100 million-dollar "innovation agenda" included a significant stack of cash for what the company inevitably dubbed "Big Green" - a new project focused on applying the company's tech know-how to solving emerging environmental opportunities. IBM is still working out the details, but the focus is savvy - water filtration/modeling and solar energy are two themes, and they happen to be solutions to two of the biggest environmental challenges, water quality/quantity and climate change/energy. The company followed up in May with a cool $1 billion for energy-efficient IT (and more on that later).
Focus on Design: Chasing Sun's Blackbox 
Sun Microsystems grabbed the IT world's attention earlier this year when it unveiled Blackbox, an energy-efficient, self-contained datacenter housing more than 250 servers. (Built inside a shipping container, Blackbox is said to generate a third more computing power without requiring any additional construction.) The company has designed a new product that satisfies a range of customer needs, including lower energy use, and don't think its competitors haven't noticed: Microsoft is in hot pursuit.
Working with the Value Chain: Climate Savers 
To tackle a big - but addressable - problem like PC energy use, you've got to think holistically. From manufacturers (designing efficient cooling systems) to software developers (offering power-down options) to end users (turning the machines off at night), success depends on cooperation up and down the value chain. Organizers of the new industry-led Climate Savers Computing Initiative, including power players Google, Intel, IBM, and Dell, among others, certainly see the big picture. The challenge in these situations is to know when to share knowledge, and when to compete. It will be interesting to see how the CSCI participants navigate their way through this tough strategic choice.
Final Word: Infotech Uses Its Own Tools 
Like IBM's innovative companywide Innovation jam, which led to its Big Green initiative, other tech companies, not surprisingly, are using Web 2.0 tools to create space for innovation. The blog Dave Douglas's Eco Notes, hosted by Sun's VP of Eco-Responsibility, offers a forum for company employees to share stories and compare technologies to create more eco-efficient products or keep tabs on consumer demand.
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Books & Media "No executive can afford to ignore the green wave sweeping the business world. [Co-authors] Esty and Winston show how to make sustainability a core element of strategy-and profit from it." -Chad Holliday, CEO, DuPont In Focus: Hewlett-Packard 
When it comes to product design, green computes. HP's product stewardship program has successfully integrated green design principles to meet market demand (particularly higher efficiency and lower toxicity). Read more...
Tools & Frameworks Tragedy of the Commons Product development has always operated at the intersection of business, technology, and people. Now, it is time to add one more factor to the equation: the environment. By Adam Richardson, frog design Solution Providers |
This work is licensed under a CreativeCommons License. Copyright Sustainable Life Media Inc. 2007
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