October 30, 2009 Vol. 2, Issue 10
Why do “greening” initiatives fail in some businesses and organizations? Daniel Esty and Andrew Winston identify the common pitfalls and successful strategies for avoiding them.
At the beginning of the decade, when Ford Motor Company sought to transform itself into a new kind of automobile company that embodied sustainable manufacturing principles, it hired a star designer to refurbish its Rouge River plant in Dearborn, Michigan. The new facility featured a 10-acre green roof, solar panels, and fuel cells.
Around the same time, Toyota introduced its Prius hybrid in the United States. The fuel-efficent Prius took off with customers, leading to months-long waiting lists and price premiums.
Which made a greater environmental impact? Which made better business sense? The answer to both questions is the same.
The desire to “go green” within an organization is often borne of good intentions, but good intentions alone will not go far. In Green to Gold: How Smart Companies Use Environmental Strategy to Innovate, Create Value, and Build Competitive Advantage, Esty and Winston look at the difference between environmental initiatives that fail and those that succeed. Drawing on dozens of case studies, they point out 13 common reasons for failure: misunderstanding the market; “seeing the trees instead of the forest”; expecting a premium price; misunderstanding customers; middle-management squeeze; silo thinking; “eco-isolation” of champions within the organization; claims outpacing action; surprises and unintended consequences; “perfect is the enemy of good”; inertia; ignoring stakeholders; and failing to tell the story. Esty and Winston also offer solutions and tools that can help address these common causes of failures.
As the title suggests, Green to Gold focuses on strategies for private sector companies. Even so, green advocates in any organization would be well served by its serious examination of the business of going green.