Introduction
Sustainability in a business can be regarded as the success of the company in both short term and the long run. In the business milieu, there are many forces that affect the operations of business and these plays an imperative role as the managers must define ways of overcoming these challenges.
Before the promotion of business sustainability and corporate social responsibility, financial responsibility was the main agenda in most companies but this has changed as the need for businesses to consider the society and the environment before making any decisions increases.
Sustainability principles encompass a raft of voluntary measures adopted by a business and which include the social and environmental concerns in the operations of business and call for stakeholder involvement (Kleef & Roome, 2007).
These factors encompass social, financial, environmental opportunities and threats that are within the business facet. When business incorporate healthy social and economic strategies, there are likely to overcome any present and future resiliency and this put the business in a strategic position which in turns increases it future growth (Lawrence & Weber, 2010).
In this paper, the statement “The only viable future for business is to become a sustainable business in a sustainable society” will be discussed. A sustainable business can be regarded as a business that:
- Uses sustainable raw materials
- Delivers services and products to consumers that are deemed to be sustainable
- Sells economic products
- Uses renewable sources of energy
- Is socially involved and assist the society around the company
All the above aspects are used to ensure that a business is sustainable. Most of the aspects highlighted enable the business to produce products that will have high utility value to consumers and which don’t harm the environment.
Sustainability also involves social participations where the company is actively involved in helping the society achieve its objective (Johnson, Scholes, Whittingham, 2011). Another key issue is the need for strategies adapted by the business, to be environmentally friendly. For sustainable business future, it is also imperative that the business produces economically and is able to satisfy both the consumers and the employees.
Strategies to Achieve Business Sustainability
As aforementioned, the modern business environment requires a business to adapt sustainable business methods for it to be effective and sustainable in the future. Various strategies can be adapted by the business so as to achieve short and long term sustainability. The main methods used to achieve business sustainability can be grouped into three major areas, these are:
- Economic strategies
- Social involvement
- Environmental protection
The social, economical and environmental actions can be defined as the triple bottom line in the models used by managers to enhance the business sustainability. Economic factors encompass strategies that increase profits, minimize on costs, promote the effective use of resources and strategies that promote the successful operations of the business.
The social factors encompass good staff treatment, the involvement of a company in social activities, reducing prices for products be sold in low income countries and regions, corporate social responsibility, working with the society on community projects among others (Kotler & Lee, 2005).
Lastly, it is imperative that a business considers the need to adapt environmental protection strategies such as use of clean energy, promoting the use of lean business process and, conducting a lifecycle analysis to ensure that the products manufactured don’t cause environmental pollution at any stage (Hitchcock & Willard, 2009).
Business Sustainability Methods and Their Importance
Corporate Social Responsibility
There are a number of way through which companies engage the people living around the community. One of the widely used strategies is Corporate Social Responsibility (CSR). CSR can be defined as achieving commercial success in methods that are ethical, abhor the peoples believes and protect the environment.
The term is synonymous to corporate citizenship, cooperate accountability and business sustainability. In the modern world, it is impractical to achieve success without factoring in sustainability. Corporate social responsibility calls for the implementation of business strategies taking into account the needs and views of the community and other stakeholders in the organization (Bendell, 2005).
The main reason for business being involved in CRS is the great influence that stakeholders of the business have on its operations. The stakeholders of a business greatly influence its performance directly and indirectly. These stakeholders include the customers, the employees, shareholders, governments, activists, competitors among others. The customers of a given business have a great impact on the operation of the business.
These customers are usually drawn from the local, national and international area where the business operates. Actions by the company affect the environment where these customers live and hence they have direct impact on them. Secondly, when companies engage in activities that are beneficial to the people living around there area, they create awareness about the company and this builds the confidence that consumers have (Berkhout, 2005).
This results to more people buying the products distributed by the company. When a company addresses the social concerns of the people, they tend to gain good relations with the customers and this brings about consumer loyalty and increases the profitability of the business.
When a business organization builds trust with the community, the customers and the employees become loyal to the business and this enables it to have a competitive edge as compared to the rival companies. By participating in social activities as well as addressing the concerns of communities, businesses are able to build and sustain a brand image for their products (Peter, 2009).
This is particularly important as globalization has brought intense competition and there is great need for a company to attract and retain its customers. For business to be successfully, managers must ensure that they build good relations between the company and individuals, groups and institutions. There is no way a business can thrive in a society that is rapidly deteriorating. This calls for the business to participate in activities that will uplift the society (Blowfield & Murray, 2011).
Secondly, the employees of a company are also important and CRS activities must address them. It is important for managers to understand that without the employees, the company cannot succeed. In this regard, business decisions must inculcate the views of the employees. As the company grows, there is need for employees to be given attractive remunerations and training. For sustainable business development, the company must use part of its profits in increasing the salaries and also educating its workforce (Geoffrey, 2008).
Thirdly, the government keeps a close surveillance on the company’s operation strategies. When business produce products that are harmful to the consumers or t below the consumer quality expectations, the reputation of that business may reduce and it can lose loyal consumers.
Governments have in the past forced different companies to recall their products and this damages the image of the company. Sustainable business strategy formulations call for business to evaluate the legal and regularly framework and ensure that they operate within this framework.
In addition to the three benefits of CSR, there are other numerous advantages that business gain due to their involvement in CRS activities. These include:
Better risk management: when managers take into account the views of stakeholders during the implementations of new strategies, the risks are easily indentified and methods of managing them are formulated. Sustainability calls for managers to consider the governance, legal, social and environmental factors during the decision making process which result to better risk management.
Improved reputations: when a company participates in CRS, it gains good reputations among the customers, shareholders, policy makers and investors. This results to an improvement of the brand value and equity of the company. This enables the company to attract investors, customers and employees.
Ability to recruit and retain employees: CSR enables a company to develop good human resource management policies. Most employees are willing to work in organizations that have friendly policies.
Improved innovations: Companies that participate in CSR are able to identify more business opportunities and adopt other innovative strategies as suggested by the stakeholders. When employees are satisfied, they are capable of developing new products and giving out new business ideas that may be beneficial to the organization. When a business takes into account the views of the stakeholders, there are likely to tap rich and innovative strategies from them (Daniel & Winston, 2009).
Development of effective supply chain The organizational supply chain is one of the areas where an organization is most vulnerable. When firms develop long term business relationship and also join with suppliers who have advocate for CSR and standard improvement, the supply chain becomes manageable and this results to improvement (Bendixen & Abratt, 2007).
Increased access to capital: in the modern world, financial institutions consider the firms involvement in CSR before approving grants and loans. Companies must prove their worth by indicating some of the CSR activities they perform as well as their ability to manufacture products that don’t harm the environment. Some financial institutions have polices addressing environmental concerns and give loans to activities that don’t harm the environment.
Favourable relations with regulators: when a company participates in CSR, they gain approvals from governments, activists and environmental agencies and this build their reputations. If a company was to perform operations that damage the environment, the regulators might ban the company or impose very heavy fines and these would destroy the company in the long run.CSR indicators play an important role in deciding whether a particularly company can be given approvals.
Economic Strategies
The second pillar for sustainability is the economic pillar. For a business to be successful, it must continually engage in activities that reduce costs, increase efficiency, improve the products value and minimise wastage. All these factors enable the company to increase their profit margin and this translates into greater sustainability in the long run. The main economic strategy that the company can use is Lean manufacturing and services.
This involves the adoption of strategies that will reduce wastes generated by the business. In lean, all the wastes are identified and strategies of minimizing these wastes are formulated. The major wastes that need to be eliminated in most businesses include; material wastes, extra personnel, less machine utilisations among others. Lean manufacturing methods entails the progressive removal of all the wastes generated by the firm and this increases the profitability of the company in the following ways
- Efficient utilisations of raw materials: using lean nearly all the raw materials are converted to the finished product.
- Efficient labour use: lean ensures that all workers are engaged in the production process.
- Efficient use of production factors: all factors of production are effectively used.
- Eliminations of wastes: lean eliminates wastes and these is beneficial to the environment.
Environmental Strategies
The third pillar of business sustainability is the consideration of the environment during the decision making process and production. The environment plays a significant indirect role and must be preserved for the current and future generations. The company must ensure that their products and services meet the health and environmental standards. This is vital because the destruction of the environment will affect the consumer base and the environment where the company operates.
The company must ensure that a number of strategies are developed to ensure that the products and services are environmentally friendly. The company must adopt eco-efficient strategies such as:
- Ensure that less energy is used during the manufacture of products
- Carry out a life cycle analysis so as to determine the impacts that product will have on the environment. This is done by considering the impacts from raw materials, finished product, its consumption and disposal (Michael & William, 2002).
- Recycling materials when possible
- Reduction in toxic materials released to the environment
- Maximising on the use of renewable resources
- Ensure that products are durable
Implementation Methods and Steps
From the above discussion, it can be seen that companies must adopt strategies that will propel their business towards sustainability. The change process must be gradual and continuous. This means that the company must continually evaluate their operations and ensure that there are improved every time (Kies, 2002). The implementations can be done through the following steps:
- Company vision, missions and objective changes: The company vision, mission, core values and objectives must address sustainability issues such as environmental protection, customer and employee satisfaction and profitability
- Improving the corporate culture: The Company must ensure that it adopts a good corporate culture that takes into account the needs of employees.
- Strategic planning: For sustainable business, a strategic plan must be designed and implemented. All aspects that propel a business towards sustainability must be incorporated in the strategic plan (Werbach, 2009). This plan should essentially details methods through which these sustainability goals will be achieved. The time for achieving these goals and the evaluation methods should also be detailed. If the strategic plan is followed, then the implementation process will be successful.
- Involving the management: the management staff must be trained on the need to incorporate CSR and other business sustainability methods in the company. Managers are the key implementers of the decisions made by the company and they must be enlightened through training. It is imperative to ensure the management commitment to the change process.
- Accountability: The business must ensure that they are accountable of all their actions. Proper management system will ensure that all the functions are well distributed and the employees and managers are accountable for their actions.
- Communications: The communication between the management and employees should be enhanced. During the decision making process, all the stakeholders must be informed. Adequate communications is very important during the change process.
References
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