CHAPTER 2

It is very important for companies to develop and implement

strategies in order to achieve long-term goals of the
company. By designing and implementing the strategies,
companies' activities become more focused and ensured the
companies' long-term goals can be achieved. In addition,
companies also need to assess their performance to determine
achievement of goals and progress of the company. There are
5 stages that are interrelated and integrated, which should be
done by the company in formulating and implementing
corporate strategy, as follows: the first stage is to develop a
vision for the company's strategy. At this stage the company
determine the direction and product / customer / market /
technology company focused on the future. By developing a
vision, the manager can inform stakeholders regarding the
company's long-term strategies and the steps that will be
pursued.
The second step is to set goals and measure the performance
of the company or the company's progress in achieving its
objectives. Companies need to explain clearly how the
company's performance, both financially and strategically, will
be measured and when. The third stage is to create strategies
in order to achieve goals and move to the direction of the
strategies that have been determined. Strategies prepared by
the company must be related to company’s reactions on the
external environment changes, markets and competitors
approaches the company will do in order to achieve a
sustainable competitive advantage, capability and competency
development, and unification of various strategic initiatives
within the company. The total strategy that emerged is a
collection of various strategic actions and approaches
undertaken by the company's business. The larger and more
diverse company operations; there will be more points and
strategic initiatives of managers and employees at various
levels who have a role relevant to the preparation of corporate
strategies. In general, the task of preparing the strategy is
more top down than bottom-up, where the strategies to higher
levels are a guide to develop strategies at lower levels.
The fourth stage is to implement and execute strategies that
have been selected by the company, in an efficient and
effective way. Managing the implementation of activity-
oriented strategies to operations in order to establish the
performance can support the implementation of the company's
core business. The company is considered successfully
implemented its strategy when things are going well and the
 company can achieve financial and strategic targets and show
good progress in achieving the strategic vision of the
company.
The latest phase of the strategy crafting is to create
performance evaluation and initiate corrective adjustments in
vision, long-term direction, goals, strategies, or changes in
circumstances, new ideas, and new opportunities. This phase
is the trigger point to decide whether the company will
continue or change the vision, goals, strategies, and / or
method of execution strategies.
A company's strategic vision, including goals and other strategies
has the same meaning with a strategic plan to address the competitive
industry conditions, face competitors as well as address the challenges
and issues which constitute obstacles to the success of the company. In
leading the implementation of the company’s strategy, a manager must
have some competencies, as follows: to listen and speak with members of
the organization, support member organizations as well as sort through a
variety of important information. Furthermore, they also must be active in
creating improvements in the organization in order to achieve better
results. Directing for the organization, while still remain focused on
operational excellence, is also the duty of a manager. They should be able
to provide innovative ideas for improvement and promoting best
practices. Managers should also mobilize its forces to develop
competencies and competitive capabilities, in addition to showing high
ethical standards. They need to demonstrate a firm commitment seen in
the ethics enforcement process. Finally, when the strategy execution
effort does not give good results and the organization does not progress
then the manager responsible to step forward and take corrective action.
 As more and more businesses grapple with the "environment", there
are many lessons to be drawn from the experience of companies known as
leaders in environmental management. These companies have two main
attributes, namely: integrating environmental issues into the overall
corporate strategy, and making "best practices" related to the
environment in daily business operations. In particular, these companies
set environmental goals explicitly in their performance measurements, in
addition to look for opportunities related to the environment that are
suitable with their strength and long-term business strategy, so as to
create a win-win situation for the stakeholders.
Currently, most corporate executives agree that environmental issues
are very important to their company, and that they have to manage
environmental risks and opportunities better in the future. However, there
are many companies that have failed in addressing environmental
problems. In a few decades ago, the company's failure to deal with
environmental problems is not an aberration because they had no
information about the causes and effects of environmental pollution,
including life cycle cost, and have misconceptions about the supply of raw
materials which do not seem. The companies consider that environmental
management is not important and not urgent.
Fortunately, in recent years, the recognition of the urgency and
importance of environmental issues increased rapidly. This is the result of
several factors: regulatory / legal risk, market risk, scientific awareness
and diverse and vocal stakeholders (such as regulators, community
leaders, environmental activists, the media, employees and
shareholders).
Along with the increasing of population, resources become limited
and awareness of the causes and effects of pollution is also
increasing. Multinational companies are increasingly being held
responsible, not only for the health of the environment around their offices
and factories, but also the planet. Moreover, the balance between
economic growth in industrialized countries and population growth in
developing countries is key to world security in the future, so it requires a
fundamental change in the behavior of both economic and international
relations.
Increasing awareness related to the environment has changed the
views of senior executives, who think that environmental issues are very
important and consider that environmental risks should be managed
better today. The companies also realized there must be a need to shift
their approach from the regulatory program-driven reactive to proactive
and innovative posture. These are evidents from the various efforts made
by companies in complying with the ever-changing environmental
regulations, creating market products with environmentally friendly
packaging, and anticipating business risks and opportunities associated
with the environment. Sometimes, companies also issue costs that are not
small in improving manufacturing processes, minimizing waste, implement
conservation and producing environmentally friendly products. This means
that companies will spend more money on the environment with the aim
of reducing the impact of environmental pollution and capturing
opportunities.
Environmental risk management is undertaken by the company to
effectively prevent the companies from civil liability and criminal
proceedings against the environmental destruction, caused by the early
identification of actual or potential problems before they become too
difficult and expensive to manage. In addition, given the increasingly
stringent, complex and costly various environmental regulations, firms
tend to change their operations to produce pollutan which can be
controlled.
Various surveys show that companies 'leaders' tend to do something
different related to the environment. They are more proactive, more often
driven by opportunity rather than threat. They integrate environmental
management in all aspects of their business and rely on the media to
determine the impact of their industry on the environment. Some
companies emphasize the importance of sustainable environmental
opportunities from time to time and link them with the strategy and
ongoing business operations. They have an approach that environmental
issues are critical as they may be exposed to the public, environmental
groups and the media. Company leaders are also success in balancing the
interests of stakeholders in environmental management issues, and
manage to find opportunities for the environment. Their focus on their
core business and understand the environmental issues most applicable to
them and focus on their programs in the region. At the time of
environmental opportunities focused and fit, then they will be profitable
and sustainable, and they also can overcome the major source of potential
problems. Finally, stakeholders can be satisfied.
Furthermore, high performance environmental organizations share a
common creative process of setting the vision, designing the right
organization to execute the strategy and setting into motion a process for
continuous improvement. Key questions must be answered through each
of these steps: setting the vision by identifying critical capabilities,
designing the blueprint for organizational excellence and creating the
processes for achieving continuous improvement. There are also
challenges faced by the leaders, as follows: set a vision and goal-bound
environment, business strategy and organizational structure specific, and
articulate that vision into policy statements and carefully fit with the
organization, industry and company's competitive position. Management
also must inform employees about the standards that must be accounted
for, describe the effectiveness of vision to show real achievements for
customers and stakeholders, and involve the appropriate group and
division managers to ensure that all companies understand and accept the
vision referred to
Companies that are successfully follow some "best practices"
common to effectively carry out environmental programs. They integrate
environmental issues throughout their organizations and manage their
environmental programs at higher levels in the organization. Thus,
environmental leaders are able to meet the interests of many parties at
once.
SHIFTING PARADIGM FOR SUSTAINABLE DEVELOPMENT:
IMPLICATIONS FOR MANAGEMENT THEORY AND RESEARCH

Sustainable development has been elaborated since 1990’s. Many

scholars created definition of sustainable development. However the core
idea was defined most significantly by The World Commision in
Evironment and Development (i.e., The Brundtland Commission) in 1987
as “development which meets the needs of the present without
compromising the ability of future generations to meet their own needs.
This normative abstraction has been widely accepted and endorsed by
thousands of governmental, corporate, and other organizations worldwide
(Gladwin & Krause, in press). While according to Meadows, Meadows, and
Randers in 1992 a sustainable society is one that can persist over
generations, one that is far-seeing enough not to undermine either its
physical or its social systems of support.
The components of sustainable development consists of inclusiveness
that is implies human development over time and space, connectivity that
is entails an embrace of ecological, social, and economi interdependence.
Moreover, equity that suggests intergenerational, intragenerational, and
interspecies fairness, prudence that connotes duties of care and
prevention: technologically, scientifically, and politically, and security that
demands safety from chronic threats and protection from harmful
disruption also the components of sustainable development.
These days, the approach of management theory shifts from
technocentrism and ecocentrism to sustaincentrism. A few years ago,
modern management theory is constricted by a fractured epistemology,
which separates humanity from nature and truth from morality. However,
reintegration is necessary if organizational science is to support
ecologically and socially sustainable development (sustaincentrism). Both
technocentrism and ecocentrism, by setting in motion self-defeating, fail
to promote development or to conserve nature.
According to sustaincentrism, the earth has to be properly managed
for the sake of human survival and welfare. Economic and human
activities are inextricably linked with natural system, therefore synthetic,
nonlinear, and intuitive modes of understanding from human being are
required. Moreover, since the global ecosystem also vulnerable to human
interference and limited in its regenerative and assimilative capacities,
human activities should result in no net loss of genetic, species, or
ecosystem diversity. According to sustaincentrism, population size must
be stabilized through the comprehensive participation and equity of
women in development, consumption in developed countries must be
scaled down in order to maintain the integrity of both natural and social-
life support system, and technologies should developed and employed in
appropriate and humane ways.
A prosperous economy depends on a healthy ecology, and vice versa.
A green and equitable economy is possible, in which ecological and social
externalities are internalized. Therefore, markets are required to
efficiently allocate resources, but other poliy instruments and economic
incentives are required to place preemptive constraints on the pursuit of
purely market criteria bearing upon natural resource use and satisfaction
of basic human needs. In sustaincentrism, poverty reduction depend on
the productive use of the poor’s most abundant asset – labor and provide
basic social services to poor, such as primary health care, family planning,
nutrition and primary education.
 Sustaincentrism offers a vision of development which is both people
centered and conservation based. The sustaincentric paradigm allows the
interest of today and tomorrow, of rich and poor to acquire fuller and
deeper attention. Greater balance is sougth within the 3E triad of
sustainable development : economy, ecology, and ethics.