Strategy for Sustainability: A Business Manifesto Hardcover – Jul 6 2009
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About the Author
Adam Werbach is Global CEO of Saatchi & Saatchi. He was the youngest-ever (at age twenty-three years) National President of the Sierra Club at and is the author of the widely circulated speech, Is Environmentalism Dead?"
Top Customer Reviews
Readers will appreciate the fact that Werbach is a diehard pragmatist. He bases his observations and recommendations on a wealth of practical experience, on an abundance of empirical evidence, and is almost wholly preoccupied with understanding and then explaining what works, what doesn't, and why.Read more ›
Most Helpful Customer Reviews on Amazon.com (beta)
The author's frustration at not being able to persuade New Orleans' leaders of the risks of a hurricane inspired this book. I appreciate the passion. However, I came away confused, feeling that perhaps the passion was driving his writing faster than he could evaluate what actually reached the page; that perhaps there were more thoughts behind the words than were actually communicated by the ink on the paper.
p7: "Innovate differently, and win, or continue to innovate narrowly, and lose." Has Werbach not read The Innovator's Dilemma? "Innovating differently" is an enormous challenge to established companies and isn't going to be solved by exhortation.
p. 20: "Nature obsesses over protecting its young." No, only for some vertebrates. Not for oysters, or pine trees, or any of the bazillion R-strategist species, which have better survival profiles in unstable environments than the K-strategists that invest heavily in gestation and nuturing babies.
p. 20: "Integrate metrics. Nature brings the right information to the right place at the right time. When a tree needs water, the leaves curl." Huh? This is the place where I began to wonder whether there was some major additional thinking behind the words because the words didn't make sense to me. How on earth are curling leaves metrics information to the tree? Curling leaves are a survival "behavior," and perhaps metrics to someone with a watering can. But I don't water trees...
(There's actually a whole lot more on this particular page that leaves me scratching my head, pondering how the author's view of nature-as-business-model is different from mine. Population explosions in many species, followed by famine-driven die-offs, are pretty common in the nature I know.)
The story about Circuit City's failure on p. 26: "The company's human resource strategy failed." Did the strategy fail, or did they fail to follow the strategy? Maybe it's a nit, but this is a book about strategy.
Strategy #7: "Only the truly transparent will survive." OK. I'll allow that as a premise. However, the example provided is how the totally opaque functioning of AIG and its mortgage-backed securities drove the collapse of the company. I don't see that this example proves the point.
Enough already. I think this book makes an important contribution, and I wish I didn't have to work so hard to figure it out. Being sustainable is hard enough.
If you are a business executive with a disposition to sustainability, this book will speak to you and is a must read. He does a pretty good job comparing his perspective to other thinking, such as that of Jim Collins (Built to Last, Good to Great, How the Mighty Fall).
But he opens with an anecdote of how he couldn't reach the leadership in New Orleans before Hurricane Katrina and he feels professional regret about not being able to frame his argument in a way it would be received.
I think that's noble and he has tried very hard to be persuasive--speaking in the language of the receiver--in this book, but he almost overly does so, pulling every business and societal buzzword (down to transparency) as conditions to be successful in meeting business and sustainability goals. Heck, actually, sustainability itself is a buzzword these days.
So, what comes out is a well-thought thesis for action, and, despite my headline, a potential roadmap. But, it's potential in that it is theoritical. I think he knows this--hence, the "Manifesto," in the subtitle. "Manifesto" worked for Jerry McGuire, though, and this author evokes similar passion.
Temper your expectations, and I think you'll be impressed with the book and retain--even apply--many of the ideas. Look to this at the ultimate prescription for sustainability in business, and you'll be disappointed.
* Diversify across generations
* Adapt to the changing environment
* Celebrate transparency
* Plan and execute systematically, not compartmentally.
* Integrate metrics
* Improve with each cycle
* Right-size regularly, rather than downsize occasionally
* Foster longevity, not immediate gratification
* waste nothing
Unfortunately his organization could use some work. His best definition of sustainability actually comes in the conclusion of the book! (Sustainability means meeting your needs now, while not compromising your ability to meet your needs in the future). There are also a few acronyms he invents that he doesn't define until after they've been used.
The most glaring omission in the book is that while he has loads of examples and ideas, he focuses almost exclusive on the manufacturing sector of the economy, and ignores the service sector. He does mention that his ideas can be applied to the service sector too, but it would be nice to see him give more than just lip service to that notion.
Overall I don't want to dwell on the negatives too much, because there really are some great ideas in this book, and I'm convinced that enterprises which follow his roadmap will certainly be better off in the long term, as will our society as a whole. He celebrates transparency and encourages enterprises to listen to their outside critics as well as work with their partners to mutual benefit. I would certainly recommend this to anyone who is thinking about the future of their enterprise and is ready to think long term instead of just to the next quarterly earnings report.
Readers will appreciate the fact that Werbach is a diehard pragmatist. He bases his observations and recommendations on a wealth of practical experience, on an abundance of empirical evidence, and is almost wholly preoccupied with understanding and then explaining what works, what doesn't, and why. He is also an idealist in that he passionately believes in what can be accomplished if a sufficient number of principled and determined people work together in a movement (actually a mission, if not a crusade) to achieve sustainability in all dimensions of humanity that include but are by no means limited to business activities. He identifies and then discusses what he characterizes as "Nature's Simple Rules" as a basis of strategy and execution. They are:
1. Diversity across generations to support long-term species survival.
2. Adapt and specialize to the changing environment with precise navigation and adjustment to changes of climate, food, and predators.
3. Celebrate transparency by knowing where and what are dangerous as well as where and what are not.
4. Plan and execute systematically, not compartmentally, by devising solutions that optimize the entire system rather than individuals.
5. Form groups and protect the young by developing strengths and resources that are sufficient to the threats.
6. Integrate metrics as Nature does by obtaining the right information, applying it in the right situation at the right time.
7. Improve each cycle because evolutions can be harsh "but it's a strategy for long-term survival."
8. Right-size regularly, rather than downsize occasionally, because "organisms adjust to be as small or large as necessary."
9. Foster longevity, not just immediate gratification, because Nature "does not support unlimited growth or inefficient use of resources, but it does foster longevity."
And then one of Werbach's most valuable insights:
10. Waste nothing, recycle everything, and borrow little. "One organism's waste is another's food. Some of the greatest opportunities in the twenty-first century will be turning waste (inefficiency, underutilization, energy waste) into profit."
He also identifies and then discusses what he characterizes as "Seven Tenets of a Strategy for Sustainability":
1. Natural resources will become increasingly scare and expensive. Companies need to take full advantage of ecosystems services that are already available.
2. Massive demographic change is occurring. There will be three billion more people on the planet by 2040, mainly where humanity has not yet achieved a stable standard of living. There is a compelling need to alleviate "global inequities that destabilize business and society."
3. People are the most important renewable resource. "When nature right-sizes, it tends to weed out the weakest, not those with the most wisdom and experience." Organizations that achieve sustainable success are meritocracies.
4. Cash flow matters more than quarterly earnings. Companies must not focus on earnings because they do not account for the cost of capital, because there are so many acceptable ways by which to calculate them, and because they do not include additional capital that a company will need for future growth.
5. Every organization's operating environment will change as dramatically in the next 3-5 years as it has changed in the last five. Werbach notes that the process "for developing strategy must accommodate nonlinear, lockstep change. Traditional strategy making and execution is linear."
Note: He recommends a five-step process: First, Discover: Assess the business context, establish a mission, vision, and values. Next, Define: Define competitive advantage and establish goals. Then Plan: Translate the strategy into an operations plan with measurable objectives. Next, Execute: Execute with cult-like passion and excellence. Finally, Measure: Measure, review, and refine.
6. A chaotic external world requires internal cohesion and flexibility. "Organizations with high initiative fatigue frequently suffer from the failure to build a powerful leadership coalition and lack an engagement effort that connects the initiative to the daily routines of the affected employees."
7. Only the truly transparent will survive. "Opacity is the enemy of sustainability (and, as we have witnessed lately, an incubator of managerial paranoia, incompetence, isolationism, and corruption). You must have pertinent, accessible, and engaging information available inside and outside the organization."
Through his narrative, Werbach makes brilliant use of reader-friendly devices, including checklists such as these as well as mini-commentaries such as "Does `Built to Last Mean' Sustainable?" (Pages 38, 41-42) and Tables such as "Comparison of a built-to-last strategy with a strategy for sustainability (Pages 39-40). He explains how to formulate a different way to formulate a business strategy, how to map available opportunities, how to "set a North Star" and initiate the "TEN" cycle, how to use transparency to execute strategy, engage individuals throughout (and beyond) the given enterprise, how to establish and strengthen a "network of sustainability partners," and how to develop leadership at all levels and in all areas. My frequent use of the phrase "how to" is intentional, correctly emphasizing Werbach's pragmatic approach throughout the book.
He concludes with an especially appropriate excerpt from Douglas Adams' The Hitchhiker's Guide to the Galaxy series: "If you try and take a cat apart to see how it works, the first thing you have on your hands is a non-working cat. Life is a level of complexity that almost lies outside our vision; it is so far beyond anything we have any means of understanding that we just think of it as a different class of object, a different class of matter; `life,' something that had a mysterious essence about it..." Given that, what does Adam Werbach suggest? "When a situation seems too complicated grasp, grasping it isn't always necessary or even possible - so do what you can, when you can. Act now."
Those who share my high regard for this brilliant book are urged to check out Werbach's Act Now, Apologize Later as well as Mark Gottfredson and Herman Saenz's The Breakthrough Imperative: How the Best Managers Get Outstanding Results, Dean R. Spitzer's Transforming Performance Measurement: Rethinking the Way We Measure and Drive Organizational Success, and Enterprise Architecture as Strategy: Creating a Foundation for Business Execution co-authored by Jeanne W. Ross, Peter Weill, and David Robertson.
Warbach argues that, with ecological crises and internet technologies creating instant communication, the world is changing in ways that corporations will need to address. First, he says, with their command of capabilities and power to execute, multi-national corporations are uniquely positioned to take action, such as the great accomplishments of Wal-Mart to bring supplies to devastated communities in the wake of Hurricane Katrina. Second, there is a new focus on sustainability, that is, managing resources better, with an eye to future generations as well as critics and stakeholders. Third, a handful of smart corporations are beginning to bring sustainability concerns into the heart of their business models, not as philanthropy or PR, but as the basis for new strategies that will ensure their futures as well as preserve the resources of the planet.
These are, in my view, the assumptions at the heart of the book: if you accept them as valid and believe that corporations can actually do good (i.e. promote sustainability) and well (i.e. make money) at the same time, then the middle section will interest you a great deal. It is about the techniques that companies are employing to pursue these win-win-win strategies.
Most important, Warbach argues, is to set a "north star" goal, an over-arching strategy that will connect sustainability to the core business of the company. This is certainly possible, in my view. For example, Clorox created a new "green" brand that was better for the environment, just as P&G created detergents that can be employed at far lower temperatures for better results. Warbach stresses that companies should systematically map out their sustainability opportunities.
In addition, Warbach argues that companies must become genuinely transparent, not as a way to promote themselves as good guys, but by really opening up to allow meaningful collaboration with critics. This will, he believes, enable corporations to get better information via a kind of bottom up network of critics whose ideas will feed into the core strategy of the company. Companies must admit mistakes quickly, celebrate successes, etc. Finally, companies must engage their own employees through such techniques as contests, "personal sustainability projects", and the like. He provides many examples that are interesting and appear convincing.
That being said, I remain unconvinced that the whole sustainability movement represents either a revolution in the ways companies will formulate their strategies or that, even if they do, they can make as much of a difference as Warbach hopes. It is, I think, far too idealistic about what corporations are willing and able to do. In my experience, I think it is very difficult to distinguish between PR, greenmailing, and genuine accomplishments that help the environment. Moreover, I wonder how many companies will be capable of merging their business models with sustainability concerns: the examples Warbach chooses may represent isolated cases that are hard to repeat or scale up.
Indeed, from my own work, I think that Warbach accepts the point of view of corporations a bit too easily. For example, he quotes a man with whom I worked for over 8 months (I was an independent case writer not in his employ), who boldly claims his company has embraced "transparency" as a core component of its modus operandi. Now in the work I was doing with him at about that time, I know that he lied to me during the entire project, taking the decided-upon PR explanation for a key change in company policy. His boss cheerfully admitted as much to me at the end of the project. This points to a key problem at the heart of the book: it lacks the skepticism that a journalist would have and at its worst ends up rather self-congratulatory, as a consultant's manifesto.
Nonetheless, even with my skepticism and doubts about the ultimate impact of these ideas, there are definitely people within companies that will want to apply these ideas. They will, in my view, be able to accomplish some very good things, however far they may be from saving the planet. These people are worth cultivating in the search for windows of opportunity to accomplish complex social and environmental goals. For example, I have investigated several stakeholder-corporate collaborations that taught both groups a great deal about how the other thought and even opened up opportunities for both. We should not cynically dismiss this or everything that corporations try to do to make the world better.
Recommended. This is excellent food for thought even if in need of some hard skepticism.
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