Tag Archives: sustainability

GPM Calculator

In June, I blogged about Fuqua professors Rick Larrick and Jack Soll and their push to improve fuel efficiency and consumer behavior by simply changing the measurement from MPG to GPM.  Today, Duke Research Advantage blogged that this work was featured in the New York Times Magazine’s “Year in Ideas” issue.  They’ve also launched a new GPM calculator to find your current GPM, compare cars, or see the GPM for all 2009 cars.  More information about this research, including an interactive fuel-efficiency quiz and a video of Larrick and Soll discussing their work is available at mpgillusion.com.

Staying pure after selling out

This week’s HBS Working Knowledge newsletter starts off with an interesting proposition: what happens when a well-known socially responsible business is acquired by a multinational?  Professors James E. Austin and Herman B. “Dutch” Leonard discuss their recent research, which examines such acquisitions as Ben & Jerry’s by Unilever, Tom’s of Maine by Colgate and Stonyfield Farms by Dannon.  Their work suggests that it is possible for a company to stay true to its social mission after acquisition, presented in a working paper asking “Can the Virtuous Mouse and the Wealthy Elephant Live Happily Ever After?”  

The discussion touches on some great questions, including why the elephants would want to acquire mice with a conscience and why it could be a good deal for the mouse (they’re not selling out – they’re scaling up).

An excerpt is below, but it’s totally worth your time to read the entire (brief) HBS interview with Austin and Leonard:

Q: How can elephants protect the mouse’s social value and brand integrity?

A: The more effective large companies have recognized that preserving the social icon’s distinctive culture and business approach is essential to preserving its key success factors. Consequently, they retain a large degree of organizational independence so as to prevent “contamination” of the social technology.

This stands in contrast to the common approach in acquisitions to integrate and rationalize the assets into the new owner’s systems, structure, and culture. Some of the specific mechanisms used in successful mouse-elephant agreements include governance structures and processes that give the “mice” review and even veto power over actions by the “elephants” that might jeopardize those elements that are deemed essential to the social values underlying the brand’s integrity.

Retaining the social entrepreneur in the joint venture is highly desirable

Going Negative with Green Messaging

Struggling for years with a decreasing market share and tumbling stock price, Nortel is going negative with a campaign against Cisco.  This Wall Street Journal article details their PR blitz utilizing bloggers, YouTube, anti-Cisco websites, and trade show demonstrations.  The message?  Use Nortel to avoid “the Cisco energy tax.”

Nortel is countering with the argument that Cisco’s technology, as successful as it has been in the marketplace, is an energy hog. In its ads, Nortel claims that Cisco’s data networks “are costing you 100% too much.” At trade shows, Nortel staff attach wattage meters to comparable Nortel and Cisco gear in an effort to show that Nortel’s gear is much more energy-efficient. The company posted a film of the demo on YouTube.

Energy prices are finally rising to a point where being energy-efficient is not just something to make a consumer feel good, but something that affects purchasing decisions by price-sensitive customers.  That Nortel is taking this message to large corporate customers is evidence that at least some people in corporate purchasing departments are concerned with cutting costs by conserving energy.

In a previous post, I talked about the strategy of going negative with marketing, and why it’s rarely done.  This is one of those cases where a very small company with much to gain and little to lose takes on the market leader with a campaign aimed at gaining some awareness and hoping to steal just a bit of the leader’s market share.  Or, as pointed out in the WSJ article, survive and keep their current customers as their competition makes persuasive presentations to switch.  It’s not unusual for a smaller company to paint the larger one as evil, and it’s not that unusual to use an environmental rationale to make that argument.  What might be unusual is that with the price of energy rising so quickly, customers might listen.

And frankly, Cisco’s response that “there are no industry standards to measure “green”; and Cisco’s gear meets the environmental requirements of the product-testing company Miercom” falls a bit flat with me.  Not a counter-argument about green manufacturing or building initiatives, but a lack of industry standards? No pledge for improved performance or details of why the additional energy usage creates a superior product?  This lack of rebuttal leaves me thinking Cisco either isn’t taking Nortel seriously or isn’t taking energy efficiency seriously –  either case may not be a big mistake now, but could be a huge mistake in the future.

Aspen Institute’s FIELD on Microfinance and Social Enterprise

Just learned of this nifty resource from the NP-Enterprise listserv: a new article called “Social Enterprise and MicroEnterprise: Understanding the Connection” posted at the Aspen Institute’s FIELD homepage (a program of the Aspen Institute focused on microenterprise as an anti-poverty strategy).  It’s a great brief on the basics of social enterprise, social purpose businesses, and micorenterprise.

Also on the homepage are links to a webinar on how microenterprises are using social enterprise to increase sustainability (free registration required, 90 min – unfortunately not able to be downloaded and saved, and I haven’t had time to listen to it in full yet) and a recent FIELD forum (their newsletter) focused on social enterprise.  Both of these resources include a case study of Mountain BizWorks, a project right here in North Carolina (up in Asheville) that I was previously unaware of.  Great reading!

McKinsey on Strategy – First Quarter Newsletter

I think I’ve mentioned before that I find the McKinsey Quarterly’s free resources available by signing up for their newsletter to be top notch.  This quarter’s entries for top strategy articles are no exception.  The descriptions below are taken directly from the e-mail newsletter.  I’ve deleted the ones that are only available to premium (paid) subscribers.  I’ve only read the climate change and Brad Bird/Pixar ones so far, but both were excellent.

Business strategies for climate change
April 2008
The value at stake is huge. The winners will be companies that reposition themselves to take advantage of a low-carbon future.

Dissecting global trends: An example from Italy
March 2008
Executives should examine the impact of trends on subindustries, segments, categories, and micromarkets before placing their bets.

The promise of prediction markets: A roundtable
April 2008
Prediction markets draw together information dispersed across the company, but they face organizational and legal challenges.

Innovation lessons from Pixar: An interview with Oscar-winning director Brad Bird
April 2008
His approach to fostering creativity among animators holds powerful lessons for any executive hoping to nurture innovation in teams and organizations.

Voluntourism Discussion Happening Now

An interesting discussion is happening on Social Edge about “Travel with a Conscience” and includes not only the more familiar eco-tourism/sustainable tourism, but also “voluntourism” and/or philanthropy tourism.  My positive experience with Solimar Marketing, which is eco/sustainable tourism-based, makes this discussion particularly interesting to me.

Virgin biofuel flight planned

The New York Times reported today that Virgin Atlantic will conduct a test of one of its Boeing 747s using biofuels. The most interesting thing to me is that there seems to have been a lot of thought put into both the sustainability and the business aspects (even though this first step is actually a blend of 20% biofuel and 80% conventional jet fuel).

Sustainability: Virgin spokesman Paul Charles is quoted as saying the company rejected fuels derived from crops like palm oil because of the land that would be needed to cultivate such crops, and that the biofuel production would not compete with food or freshwater resources.

Business: This joint project between Virgin, Boeing, and GE Aviation splits the costs of innovation among several companies, and had smart business requirements. For example, the test plane will use one of GE Aviation’s CF6 engines as a “drop-in solution,” meaning the use of biofuel requires no modification, and will not affect the engine’s performance or range.

I recently read a New Yorker article about Branson and his work with Al Gore to create the Virgin Earth Challenge with its $25 million prize.  I’m impressed that he’s so intent on solutions that are market-driven, commercial, and don’t require major lifestyle changes, as I believe that these are the ones that are truly scalable.  An excellent article that shows that for Branson, business is very personal.  I just wonder whether he’ll consider himself eligible to win his own prize?