[CASE STUDY] August 26, 2010

Issue Diagnosis

Going green is a popular term used to describe the process of changing one's lifestyle for

the safety and benefit of the environment. People who "go green" make decisions about their

daily lives while considering what impact the outcome of those decisions may have on global

warming, pollution, loss of animal habitats, and other environmental concerns. Talking about

going green, this concept wouldn’t be an obvious choice some decades ago and most

entrepreneurs wouldn’t have opted to the issue but due to some aggressive leadership from

companies like Bank of America, Dupont, Walmart, Ceres etc. there has been an drastic change

with the declining rate of consumption of natural products and increasing number of eco-friendly

products nearly about 500%. Along with fulfilling its organizational objectives the organization

is responsible to fulfill its social obligations and protecting the environment is one of them.

Companies which had once been outclassed due to competition have been able to recover

due to the concept of conserving the nature. For instance: Soon after its launch, in 1987, Clorox’s

Brita water filter seized a leadership position among pitcher filtration systems, and by 2002 it

controlled 70% of the market. But over the next five years, as the market contracted, Brita’s

share declined. Management’s patience with the brand soon wore thin, and in May 2007 Clorox

CEO Don Knauss told shareholders that Brita had two years to improve or it would be sold off.

“When I got on board,” Knauss remembers, “the question was, how quickly we can sell this

thing?” Then came a remarkable turn: Brita recovered its momentum within months, achieving

double-digit growth and leading the brand back with a vengeance.

Some of the major companies which have implemented green strategies include Bank of

America, General Electric, Dupont and Home Depot. There are many more, but these are worth

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mentioning as they have been most resistant to change. Today, Bank of America uses much less

paper than it has traditionally used and the best part is that the customer base of the company has

not reduced at all, rather it has increased. Moreover, they recycle paper internally and the best

part is they offer employees a cash back offer to a certain limit if they buy hybrid vehicles.

On its part General Electric have started developing environmental friendly product,

especially, solar panels and has successfully generated billions in revenue. The company was one

of the worst polluters, but has today taken steps to clean up the areas in which their plants are

located.

Environmentalists over the last several years criticized Dupont due to their ways of not

caring for the environment. However, due to government regulations and people's sustained

pressure, the company has taken steps to drastically lower its emissions of polluting greenhouse

gases. Moreover, it has appointed an eminent environmentalist as its advisor on its board and the

best part is they have successfully reduced pollution by more than 50%.

Home depot is another company which has taken recent steps to implement green

technology. They were the largest retailer of old-growth wood products in the world, but the

people started objecting to what they were doing, cutting down trees to make their products.

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Problem Identification

Entrepreneurs know saving the environment is essential, but the problem lies how they

can achieve this feat by changing their existing technique, technology, available resources, and

marketing strategies. The problem “going green” is related to the conservation of the nature for

the sustainability of the humans on the earth. These changes are made by the following the

concept of reduce, reuse, recycling.

Reduce comes first for a good reason: it’s better not to create waste then to have to figure

out what to do with it i.e. if we do not consume a product unnecessarily we do not have to think

about reusing or recycling the product.

Reuse is process of using the product without altering its physical components. Reuse

comes secondly as, if the product can be reused where there is no need of recycling the product.

The purpose of reuse is to reduce cost, time, effort, and risk; and to increase productivity,

quality, performance, and interoperability (ability to exchange information often on computer

systems or programs).

Recycling is the process of re-using a given product (beyond its intended use) or

producing a new product from a recyclable material. And recycling, like any other form of

manufacturing uses energy and resources while creating pollution and green house gases which

is not desirable for the environment.

So, a company should make products more durable, lighter, more energy efficient, and

easy to repair rather then replace. For doing this the company can follow the following strategies:

i. Accentuates: An accentuate strategy involves playing up existing or latent

green attributes in our current portfolio. Of the three strategies, it’s the most

straight forward to craft and implement and thus is a good place to start.

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Considering the experience of ‘Arm & Hammer’. Promoting the environmentally

friendly attributes of the product was easy, but the company overlooked a major

liability: it used animal testing. Activists took to the blogosphere and called on

customers to switch to the cruelty-free and equally green Bob’s Red Mill Baking

Soda. Although such complaints won’t necessarily reach or resonate with all the

customers, anticipating and heading of criticism will strengthen our overall

greening efforts. Transparency in plans and authenticity in execution and

important elements in the long term success of any green strategy. Most

companies lack a green heritage; there products were developed before

sustainability was a concern. Nonetheless, the best approach to achieving green

growth isn’t always clear.

ii. Acquire: If our portfolio has no obvious candidates for accentuation, a good

alternative is to buy someone else’s green brand. In such deals the buyers channel

and distribution capabilities are often expected to substantially broaden the green

brands customer base. Within a year after ‘Unilever’ acquired ‘Ben & Jerry’s ’,

for example, sales had increased by 70% and Ben and Jerry’s had displaced

Haagen--Dazs as the leading premium ice cream brand. Successful green brands

are attractive targets because they have loyal customer bases and because they

come with specialized knowledge about eco-friendly innovation and

manufacturing, sustainable supply chain management, and green market

development.

iii. Architect: Although architecting can be slower and more costly than

accentuating or acquiring, it may be the best strategy for some companies,

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because it forces them to build valuable competencies from the scratch. Toyota

has also successfully transferred its hybrid expertise and green know- how to

other brands in its portfolio. In 2005 the company became the first to establish

green credentials in the luxury-car space when it produced a hybrid version of the

Lexus. The development of green works induced Clorox to accumulate a range of

new competencies, including specialized knowledge about eco- conscious

consumer’s preferences and expertise in the supply chain for natural-products

sourcing and procurement.

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Major Change

When a company decides to go green or not it totally depends upon the choices and

preferences and opportunities that the decision had to offer. The company must be ready to adopt

changes if it decides to go green, it must adjust fast because activists, customers and the public

won’t see the green initiatives as independent of the other activities and offerings. Rather they

will view the effects as part of the organization’s overall approach i.e., the companies that

ultimately succeed in growing green will be distinguished by their commitment to corporate

wide sustainability as well as the performance of their green products. Whenever a company

decides to go green it is directly contributing towards the well being of the environment i.e.

reducing plastic waste, decreasing pollution, controlling global warming

Advantages & Disadvantages of Corporations Going Green

Going green and becoming more environmentally aware and then putting that awareness into

practice, is increasingly common among both individuals and businesses. Advocates say it saves

money and helps the planet.

i. Saving Money: Green practices can save money. The EPA recommends shutting down

your computer if it will be inactive for more than a day. According to Microsoft, turning

off your machine every night, or putting it into "hibernate" mode so that the screen uses

no energy, can save $90 per computer over the course of a year.

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ii. Cost Effectiveness: The upfront cost of going green can be steep. Solar cells have

become more efficient over the last 20 years, but still take around three years to pay back

their upfront costs in the form of lower power bills, according to the Brookhaven

National Laboratory.

iii. Customer Preferences: Many companies make a virtue of their environmental

awareness, building advertising campaigns around it in the belief that customers prefer

dealing with socially responsible businesses. Ben & Jerry's ice cream is a prominent

example.

iv. Market Size: A recent article in Harvard Business Review argued that "brands that

truly appeal to the environmentalist consumer can't reach the mainstream." It cites

research showing that protecting the environment is rarely the key reason why people

choose to buy a product.

v. Tax Benefits: The 2009 federal stimulus bill contained approximately $50 billion in

funding to promote clean energy. Among the incentives are tax deductions for businesses

that can cut their building's energy consumption by 50 percent.

We’ve probably heard people talk about going green as of late. It has become quite the

fashionable phrase to throw out during newscasts, parties, and presidential campaign speeches. If

we want to appear progressive, trendy, or world-wise, we talk a lot about going green.

Companies who want to shed the typical capitalistic, earth-pillaging corporate image are jumping

on the green bandwagon.

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For the uninitiated, ‘going green’ refers to reducing or eliminating your use of non-eco-

friendly materials. That means petroleum-based products, especially plastics and harmful

chemicals, are out. Recycled or organic products are in. Fueled by rising fears of global

warming, going green represents an important shift in thinking toward being more responsible in

the way we use our resources.

Going green, however, also means that things will change. Some of the comforts we are

used to may fall by the wayside. Even at the workplace, employees will be feeling a dramatic

difference. If your company is going green, here are some of the disadvantages to look forward

to (and just remember: it’s worth it!):

1. Recycled toilet paper – One word: ouch! Recycled paper will never be as refined and soft as

regular paper. Unfortunately, this goes for toilet paper, too. Employees at green companies are in

for a rough ride when they visit the restroom.

2. Organic cafeteria – For those who like their steaks thick, juicy, and as enhanced as possible,

the company cafeteria is about to become a bit less appealing. Use of growth hormones and other

food-enhancing chemicals is becoming an endangered practice, viewed as bad for people and bad

for the environment. Start bringing your lunch or get used to tofu.

3. Rain-water cooler – The blue bottle/central gathering place may soon be replaced by a faucet

from a tank that collects rainwater. The rainwater is filtered, of course, but that familiar sterilized

taste will likely be gone. The thought of drinking rainwater may be unsettling to some, especially

if you live in an area known for air pollution. Just gulp down the bugs and the taste of exhaust

with a smile, knowing you are doing your part to save the planet.

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4. Bamboo office chairs – Most of today’s well-supported, well-cushioned office chairs are

composed of plastics and other synthetic materials. Look for companies to ditch those for more

plant-based materials. Bamboo is popular but not very friendly to backsides. You might have

grounds to get your boss to provide an on-site chiropractor.

5. Biodegradable food containers – Plastics tend to overstay their welcome in the environment,

hanging around for several millennia. To remedy this, companies are providing food containers

made from sugar cane waste in their cafeterias and break rooms. The problem: these containers

break down (within 90 days) considerably faster than their plastic counterparts. The result: don’t

be surprised if your leftovers from the company Christmas party suddenly collapse into a pile of

mush.

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Analysis

As reported by the Chinese

government they have found an

environmentally friendly way to save money

while easing congestion on city roads.

Instead of spending millions to widen roads,

the Shenzhen Huashi Future Parking

Equipment company is developing a “3D Express Coach” (also called a “three-dimensional fast

bus”) that will allow cars less than two meters high to travel underneath the upper level which

carries the passengers. The ‘Straddling Bus’ looks like a subway or light-rail train bestriding the

road. It is 4-4.5 m high with two levels: passenger’s board on the upper level while other

vehicles lower than 2 m can go through underneath.

It’s powered by electricity and solar energy and reaches 60 km/h carrying as many as

1400 passengers at a time without blocking other vehicles’ way. The cost to build a bus and a

40km track is only about 10% of building an equivalent subway. It is said that the bus can reduce

traffic jams by as much as 30%.When completed; the straddling buses will run on “relay

charges” of electricity and solar power. “The bus itself is electrical conductor,” Song Youzhou

explained during his presentation of the project. “Two rails built on top to allow the charging

post to run along with the bus, the next charging post will be on the rails before the earlier one

leaves that is why we call it relay charging. It is new invention, not available yet in other places.”

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The construction of the first 185 km of track will begin in Beijing’s Mentougou district at

the end of 2010.

Printing and Writing Grade and End Use Snapshots USA

Printing & Writing Paper Tons (000) End Use Uncoated Free-sheetTons (000)
Snapshot Snapshot
Uncoated free-sheet 13,898 Office Reprographics 4,656
Coated Paper 9,615 Commercial Printing 3,297
Uncoated Ground wood 1,832 Business Forms 1,892
Printing & Writing Total 26,935 Envelopes 1,430
Books 626
U.S. Statistics. Source: U.S. Statistics. Source: AF&PA,
AF&PA, 2000 2000

World’s Top 30 Producing and Consuming Countries, 2000

(Pulp and Paper International)

Country Metric Tons Country Metric Tons Country Metric Tons

(000) (000) (000)
USA 85,495 USA 57,002 USA 92,355
Japan 31,828 Canada 26,411 China 36,277
China 30,900 China 17,150 Japan 31,736
Canada 20,689 Finland 11,910 Germany 19,112
German 18,182 Sweden 11,517 United Kingdom12,684
y

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Finland 13,509 Japan 11,399 France 11,376

Sweden 10,786 Brazil 7,463 Italy 10,942
France 9,991 Russia 5,814 Canada 7,476
Korea 9,308 Indonesia 4,089 Korea 7,385
Italy 9,000 Chile 2,841 Spain 6,922

From the above data we can observe that the consumption of paper has been increasing since the

past years. Since the consumption is increased the production has also been increased hence,

causing more deforestation and other effects. For this we must make sure that the people are

made aware, recycle paper as far as possible and decrease the consumption by not using paper

instead using soft copy outputs as far as possible.

Paper Recovery

• Recovery of all printing-writing papers is 41.1% (office paper is recovered

at a rate of 46.9%), but only 4.8% recovered paper goes back into making new

recycled printing and writing paper. (AF&PA Paper Recovery Progress Report, May

2001)

• 12,891,000 tons of printing and writing paper (42.1%) was recovered in 2001(pre- and

postconsumer). 10.9% into new printing and writing paper 34.9% - net exports 23.4% -

tissue 20.6% - recycled paperboard 4.5% - newsprint 5.8% - all other.

Like the Copenhagen summit convention, the United States to itself told that human

beings of developed nations must be sensible towards the conservation of environment, instead

the people and the scientists of the United States are affecting the environment more in

comparison to the developing part of the world. Through which they are producing methane and

harmful green house gasses by producing various defense mechanisms leading to the depletion

of the ozone layer.

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Conclusion

To sum up, this case study was really fruitful for us since it provides us the immense knowledge

regarding the causes and consequences that leads by different harmful green house gasses.

Furthermore the different companies seem to be the most responsible for these results. The

industries and other productive organizations established in urban areas are using different kinds

of raw materials and other input resources to increase their production which are really harmful

to the nature. Thus the developed nations and their leaders must be responsible to control those

companies and their productive organization in their own arena. In the different summit

convention and seminars the world’s leaders have accepted, shout on a loud voice and agreed to

control these consequences but these things are only limited on paper but aren’t actually being

carried out in the real world. So if these things are implemented in the real world and the leaders

work not only on the voice but in the realistic situation then it could be beneficial for all living

beings and the environment.

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