Archive for December, 2011
Busting Through the Fear Barrier
Alex Pollock
The innate human drive to defend our territory can make us do strange things. At work, this instinct may compel us to protect the things we feel we’re entitled to, such as salary, headcount, budget, responsibilities, etc.
But imagine what it would be like to belong to an organization where people worked seamlessly together; where leaders collaborated, rather than competed, with one another to achieve their individual agendas?
In his book, “Breaking the Fear Barrier: How Fear Destroys Companies from the Inside Out and What to Do About It,” author Tom Rieger explains that the impediments to this kind of organizational utopia are rooted in fear. Fear creates barriers, he says, which manifest themselves inside companies as bureaucracy, organizational inefficiency and inertia. The top three barriers Rieger says we must overcome are:
- Parochialism: This is the domination of local needs. Standards within a function take precedence over creating engaged customers and business success.
- Territorialism: Some examples of territorialism in the workplace are hoarding headcounts, resources or decision-making authority.
- Empire Building: Assertion of control over other functions and resources to gain enhanced influence are symptoms of empire building.
The following is a list of the advice he offered that I found particularly useful for busting through these barriers.
- Eliminate rules that prevent more than they protect
- Purge administrative tasks that prevent employees from tackling mission-critical work
- Give people the freedom to make decisions, access information and resources, and encourage them to innovate and demonstrate moral courage
- The decision of whom to grant ownership or control should be based upon improving financial performance, improving the workplace, strengthening customer relationships, limiting liability and avoiding catastrophic failure
What forms of parochialism, territorialism and empire building have frustrated you in your work? What barrier busters have you effectively deployed? Any you need help with?
Improving the Efficiency of Sustainability Reporting Assurance
Lisa Barnes
When you make the decision to seek third-party assurance for your sustainability reporting, you have a range of options on how to proceed. There are various standards, but no single accepted and prescriptive approach for assurance and verification. So how can you know the best way to proceed? Despite the lack of a single, accepted approach, there are a few important elements of an effective approach that organizations can use to achieve their assurance and verification goals.
Define your Objectives. Clearly defining your goals for assurance will help you determine the scope, including the level of assurance and the boundaries of both the reporting and external review. If you have specific stakeholders to satisfy for all or part of your reported information, be sure to discuss this with your assurance provider before starting the process. For example, if you plan to submit your assurance letter to the Carbon Disclosure Project (CDP) as evidence of verification of your greenhouse gas (GHG) emissions data, the assurance must be conducted in accordance with an acceptable standard, as defined by CDP. If your stakeholders are interested in a particular aspect of your reporting, then you may want to consider an in-depth assurance of this subject area.
Plan Ahead. An assurance plan will define what, when and where various assurance activities will take place. Developing a detailed plan that can be worked on with your assurance provider, will help ensure that you allow sufficient time to complete the process before your reporting deadline. Coordinating schedules with the assurer, site contacts, data and text owners, managers and others involved in the process is an essential part of your planning. Many companies have found it useful to conduct site visits early in the process rather than waiting for an entire year’s data to be submitted. Since the assurer is examining processes as well as data, a full year of data is not typically needed for a thorough review at the site level.
Use a Collaborative Approach. Your assurer will want to fully understand the processes used for gathering data and other information, from the site level through to final consolidation and reporting. Open communication helps ensure that issues are discussed as they arise to allow time for appropriate corrections to be made. Generally, the more open the reporter is with the assurer, the more they get out of the process. Likewise the assurer also should encourage an open channel of communication for this purpose.
Learn from the Process. Effective third-party assurance will ultimately result in increased credibility, greater reliability of the information contained in the report and increased efficiencies in the reporting processes. The assurance statement provides your stakeholders with information on the process and the conclusions of the assurance. A more detailed management report combined with interaction with your assurer throughout the process will often provide further insight on continuing to improve your sustainability reporting process.
Based on your experience with third-party verifications what other advice do you have for ensuring an effective assurance process?
Lisa Barnes is Technical Director of Climate Change Services for Bureau Veritas North America. She is a registered professional engineer, certified industrial hygienist, and a Lead Verifier for Greenhouse Gas Emissions and Sustainability Reporting. She has more than 25 years of experience in environmental, health and safety.
NAEM Forum 2011: Lessons of an Emerging Leader
Kealy Devoy
I recently had the opportunity to attend the NAEM Forum in Tucson, Ariz. My primary motivation for going was to learn about trends in corporate sustainability and start feeling out the job market. As a member of NAEM’s new Emerging Leaders program and a masters student at Duke University’s Nicholas School of the Environment, the Forum was a great way to learn about what sustainability professionals do, and to network with some folks. I heard a lot of bright, innovative people speak throughout the event, and each session was nothing short of inspiring.
With the increased interest in sustainability, companies are faced with tough decisions about how to be competitive. Many companies are improving operational efficiency. Other companies are taking innovation to the next level by making significant and sometimes controversial changes to their operations. Why risk, for example, telling consumers to use less of your product to reduce the lifecycle carbon footprint of the product? One speaker summed it up like this: “If not us, then who? If not now, then when?” If there are unaddressed inefficiencies in the way a company operates, they are essentially creating opportunities for other firms to win out.
As a future EHS and sustainability professional, I believe my generation has a lot to offer in the way of innovation and creativity. We are young, enthusiastic and have a fresh perspective — a combination of traits that can help us see a business differently. But even experienced professionals sometimes have difficulty convincing upper-level management to try something new. So what can newcomers do to get taken seriously without stepping on toes?
I asked this very question during one of the keynote sessions at the Forum. The three-member panel had a lot to say on this topic. After listening to them discuss solutions to my dilemma, I came away with several great ideas that all Emerging Leaders should know:
- Don’t be afraid to step on toes. Just because you don’t have as much experience as your supervisor doesn’t mean that he or she will be offended if you bring new ideas to the table. And if someone does get miffed that the new kid is trying to make a meaningful contribution, don’t let it get to you. Firms these days need new ideas to stay competitive. Don’t shy away from your desire to be heard.
- Do your homework. Have an idea? Get out there and find out as much about it as you can. Are other companies doing it? Will it help your firm gain competitive advantage? What do experts have to say about the issue? Whether it is a simple efficiency improvement, a new product, or a drastic change to the business model, you should have as many details about it as you can. If you can get in front of upper-level management to pitch the idea, they are going to have a lot of questions, and you need to be prepared.
- If at first you don’t succeed: try, try again. You may have heard this a lot growing up, and it is no less applicable now. When you’re new to an organization it might take time for those around you to realize the value of a fresh pair of eyes. Don’t let one (or two or three) “no’s” get you down. If your idea is sound and makes good business sense, you can make it happen. Try finding someone else in the organization that has been there for a few years. Ask them about how different managers like to get information, what questions they might ask, and what their primary concerns are. A more seasoned professional can guide you to the right person and help you collect the information they will want.
With these tactics, any young professional can pioneer a new process or project. I continue to be amazed by some of the initiatives being announced by NAEM member companies, all due to creative problem-solving on the part of their internal environmental leaders. The private sector has the opportunity to make serious changes in the way that they operate with no losses in the quality of their products and services. All it takes is the courage to be unconventional. What other advice might you have for Emerging Leaders?
Kealy Devoy is a second-year at Duke University’s Nicholas School of the Environment pursuing a Master of Environmental Management in the Energy and Environment concentration. She is originally from St. Louis, Missouri and received a B.A. in Environmental Studies at the Center for Interdisciplinary Studies at Davidson College. After earning her degree, she worked as the first Sustainability Coordinator at Davidson. Most recently, Kealy was a Climate Corps Public Sector Fellow with the Environmental Defense Fund, where she helped the Town of Cary, NC identify energy efficiency upgrades in fire stations, water and wastewater treatment facilities, and municipal buildings. At the Nicholas School, she is an Energy Improvement Management Intern with the Duke Carbon Offsets Initiative.
Small Companies Can Make a Big Difference
Mark Posson
I recently had the pleasure to speak with Larry O’Connor , the CEO of Other World Computing and I came away with a stronger realization that leadership is arguably the largest factor in an organization’s environmental performance.
The company, which was started by Larry at age 14, has been providing quality hardware products and support to the computer industry since 1988. It provides peripherals for Macs and PCs with a focus on higher performance, energy efficient solid state drives to give computer users faster, more responsive systems with battery life approaching that of today’s increasingly popular tablet computers. Since its beginning, OWC has focused on developing innovative products that also meet the organization’s environmental concerns.
Under Larry’s leadership, OWC also has achieved sustained business growth, profitability and environmental excellence. The company’s environmental philosophyis elegantly simple: doing the right thing for the most effective utilization of natural resources makes for good business. And for a small firm, OWC has made a big environmental difference.
How has this enlightened leadership philosophy translated into specific actions? Here are just a few examples:
- When designing a new 37,000-square-foot headquarters and warehouse building in 1998, OWC chose to followed Leadership in Energy and Environmental Design (LEED) criteria. This included the use of porous pavers led to smaller storm water retention basins, allowing for more space for future development. The company also used natural light to lower energy use and boost employee morale. The headquarters building houses the product development and customer s support teams, keeping the jobs in the United States. The attractive work environment has undoubtedly allowed OWC to attract top talent.
- A geothermal heating, ventilation and air conditioning (HVAC) system, which produced lower long-term operating costs
- The company installed a 500-kilowatt wind turbine to meet all of their present and planned power needs. Long-term thinking? Absolutely. It’s expected to pay back in 10 to 14 years, a hedge against escalating energy costs, energy self-sufficiency and alternative technology, all of which are good long-term sustainable business strategies.
- OWC also doesn’t rest on their laurels, but rather looks for ways to continually improve its environmental performance. As an example, OWC is in the process of upgrading the efficiency of its conveyor system, its largest production power user. The upgrade is projected to yield a 70 percent reduction in energy usage and increase product through-put.
During my conversation with Larry, I kept coming back to ‘Why? What was driving this desirable business behavior?’ He summed it up for me like this:
“At the end of the day, we work to do as much right as we can for all concerns. By being long-term, we can look at the long-term win-wins for both conserving our resources and with a competitive long-term cost benefit as well. As I had said – very arguably, if there isn’t a long term cost-benefit to a technology in the current time, there is likely something to question about the real net conservation benefit of the technology as well.”
Enlightened leadership: it’s a beautiful thing.
Mark Posson is the former Director of Environment, Safety and Health at Lockheed Martin Space Systems Company and the current Chair of the city of Pleasanton’s Energy and Environment Committee. He will be teaching environmental and sustainability management at University of California, Davis in the Spring. He recently began offering consulting services to help organizations improve their environment, safety and health performance.
Gaining a Competitive Advantage Through Improved Risk Management
Jeff Ladner
Most executives are convinced that they have a suitable risk management program in place. They maintain that mindset until something unexpected happens. I see it time and time again.
Usually, at some level, workers and managers have summarized their perceptions of risk to some standard or methodology, and produced reports that are collated and provided to senior decision-makers. Executives then make decisions based on purely subjective data, with little formality for studying and assessing operational risks as they apply to the entire organization.
When considering the size and scope of an enterprise risk program, managers and executives often have the same questions: Where do we start? How do we prioritize which risk studies are performed first? How do we realize benefit without waiting on the final study to be complete? How do we know we are measuring, ranking risk and managing risk to the same standards?
Every company knows its most profitable or impactful product, customer, location, or line of business. Unless there is a regulator or customer driving your organization in another direction, this is the first place to focus risk management efforts. As your company builds a larger sphere of knowledge libraries and risk assessment studies, the speed at which other areas will develop risk assessments and adopt the processes will increase exponentially with an operational risk platform. Knowledge from one operation can be shared with others and previous controls or workarounds can be passed from one manager to the next.
Commonalities in processes exist in every organization. The basic elements of any risk program are typically at hand, but largely underutilized; employees’ personal experience is hard to scale without a mechanism for knowledge management.
Widespread adoption of an enterprise-wide operational risk management programs is just beginning. Almost all finance organizations have implemented some form of GRC (governance, risk, compliance) tools to manage financial controls. Many process manufacturers focus on environmental, health and safety (EHS), and have adopted OSHA 1910.119 for Process Safety Management. Too often, however, little is done beyond meeting minimum compliance standards.
Observing a deviation or investigating an incident and performing a root-cause analysis, is a top-down, rear-view mirror approach to risk. Only with a ground-up predictive approach, using a cross-functional study of risk to address a particular product, process, or location with proven hazard and failure mode methodologies, can operational risks be mitigated or eliminated.
Industry leaders are able to go beyond using risk management to prevent disasters and leverage their risk programs as a competitive advantage. They are able to make more capital available to their real business priorities, and strategically align the available resources to initiatives that will benefit the top and bottom line, customers, employees, and shareholders.
All companies take risks. Their appetites for risk need to match operational reality. In order to gain true competitive advantage and act more strategically, companies must move from a compliance culture to a proactive strategy of risk prevention.
What are your strategies for risk assessment and prevention? What tactics have you used to focus the conversation about risk management at your organization?
Jeff Ladner, is the Senior Director for EHS and Sustainability Solutions at IHS.
Reflections on the 2011 EHS Management Forum
For me, this year’s EHS Management Forum provided perspective on how the field of corporate environmental management has matured. My biggest takeaway was the repositioning of environment as central to corporate management and the clear opportunities for Environmental Managers to take a leadership role in this transition.
Environment can move from a largely reactive role aimed at keeping the company out of trouble to a proactive role that will reshape whole companies. I was struck by Andrew Winston’s assertion that in the next decade a sustainability manager might become CEO of a major company. This comment reflects the changes in the perceived role of environment and that transformations in our companies, our country and our world are literally happening right now.
There were indicators of opportunity in every session I attended at the forum. Here are a few:
- The demand for environmental, sustainable, and social responsibility reporting is growing and is not going away. Interest from investors and retailers in these issues is increasing in tandem. The chaos and lack of standards in the reporting arena are working toward a more cohesive metric system. Customers’ demand for transparency and companies’ interest in protecting their brands and reputation will continue to replace government regulation as the largest driver of corporate interest in these issues.
- There has been a permanent shift in corporate concern regarding resource prices, availability, and demands. The commodity-related challenges companies are facing now are not temporary. Demand will continue to outstrip supply, not just for fuels, but for minerals, metals and other materials. Major companies are making resource issues a priority; their suppliers will have to adapt over the coming years. Companies that don’t act to manage resources will find it harder to respond as the situation tightens. The focus for businesses will increasingly be on finding ways to deliver more value or benefits to customers with minimum resources required in manufacturing, the entire supply chain, and in the products themselves.
- The right talent is hard to find. Companies are finding it hard to attract new talent that have a well-balanced understanding of technical environmental issues, challenges of resource management and sustainability, and the business implications. Employees who attain capabilities in these areas will be positioned to play a larger role in corporate decision-making.
What are some of the lessons you learned from this year’s Forum? What ideas do you plan to put in place in your business?
Howard Brown is a noted entrepreneur and educator with expertise in aligning environment and business strategies. He recently founded dMASS.net, an organization focused on helping businesses improve resource performance. Howard is also chairman of o.s.Earth Inc., a company that delivers live simulation games on the global economy and its relationship to the environment. For more than 20 years, he was CEO of the consultancy RPM Systems, Inc. (Resource Planning and Management), through which he helped define the emerging field of sustainable business. He worked with such major corporations as International Paper, Mobil, BP, Duracell, Avery- Dennison, Whirlpool, SaraLee, and Wrigley, earning a worldwide reputation for developing practical strategies that merge environmental and business goals.
