Running Lean and Green
Continued
The Business Circle
A Chinese government policy called the Circular Economy might provide a framework for thinking within a company. By viewing the business as a circular process, targets can be established for periodic review and redesigning, if necessary, and every stage in the circle can be used to track progress—product design, purchasing of raw materials, production, sales, use and maintenance, and finally, end of life as the product, now used up, becomes raw material for a succeeding process. A company can begin with small steps that, taken alone, would only be tokens. But in the context of the company's commitment to sustainability, small steps are seen as vital contributions to reaching the ultimate goals. The circular economy, as an image of the company's business, gives all decision-makers a basis for a complete vision from start to finish and on to start again—and a way to measure progress over the entire range.
The results? Stakeholders understand and support the company. Government environmental regulations no longer inspire fear. Stockholders' support of management's policies tends to grow, and the increasing number of socially responsible investors takes an interest in the company. Frustration on the part of shareholders, NGOs, environmentalists, and other potential targets of bad publicity tends to disappear. And best of all, the company gains a reputation as a leader, and that can be translated into market share, stock prices, and profitability. A recent article in Profit (see "Forward Thinking," August 2005) pointed out the value of corporate responsibility by citing a study indicating that "85 percent of executives and investors rank corporate responsibility as a key consideration in investment decisions." They also noted, "That percentage is almost double the figure from a similar survey five years ago."
Furthermore, if based on clear corporate sustainability goals and the Lean organization structure, if innovation bubbles up from the bottom to meet good corporate prioritization from top management, the results can reinvigorate a company, stimulate productivity, and motivate workers. There may be some companies that don't care if they have eager, responsible workers, or product innovation, or lower costs of production, but we have been unable to find them. Maybe that's because they are disappearing.
Dr. Jim Newcomer is a partner in ConfluencePoint, a collaborative consulting group in Portland, Oregon, that specializes in applying principles of sound management, productivity, and financial gain to designing a process to become sustainable. Learn more at
www.confluencepoint.org.
