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7 Tips for Creating a Sustainable Biz Model

Here are seven ways that businesses can start transitioning toward a sustainable business model, according to Dr. Sally Uren, deputy chief executive, Forum for the Future, in a contributed article for The Guardian.

The Forum for the Future recently held its second Business Network event, which looked at sustainable business models in practice.

Here are Uren’s seven tips for starting on the path toward sustainability.

1. Try new financing mechanisms. Uren says these could include forward purchase agreements for suppliers to allow them to experiment with new production methods, match funding arrangements with government bodies and a sustainable innovation or investment fund, which could be used to kick-start sustainable innovations.

2. Aim for profitability. She tells organizations not to view the sustainability program as a cost, but rather as an investment that will yield financial benefits to the business. As an example, Mark & Spencer’s Plan A program generated £50 million (approximately $81 million) net profit from resource efficiencies and new product developments in year three of the five-year program.

3. Integrate sustainability thinking into the business. This can include incorporating sustainability performance into cash bonus schemes and embarking on comprehensive change management programs.

4. Change the value proposition. Uren says businesses need to use the power of their brand and marketers to help consumers equate quality with things other than volume. Sustainability needs to be an attractive value proposition for everyone, she says.

5. Start shifting to a more sustainable product portfolio. This can be achieved by either removing non-sustainable products off the shelves or promoting the more sustainable choices.

6. Create a roadmap. She recommends that businesses have a clear roadmap towards sustainability in order to meet transformational goals rather than taking small steps toward sustainability.

7. Innovate. Innovation is the key to a sustainable business model from product design to service delivery, and across all levels of an organization’s operations, she says.

In the U.S. alone the sustainable business market will double over the next four years, reaching $60 billion in 2014 up from $28 billion in 2010, according to a new report from analyst firm Verdantix. The biggest spenders will be power utilities and automotive firms, followed by high-tech engineering and industrial engineering.

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3 thoughts on “7 Tips for Creating a Sustainable Biz Model

  1. Thanks for the article. I am always on the lookout for new insights on providing a strong business case for sustainability that we can relay to our small business members. Explaining how they can implement a sustainability plan in a coherent way that can demonstrate ROI and how to position themselves for long-term success is vital for our efforts.

    One question – I don’t see #3 listed in this post. What is the third tip?

    – Tim Kovach
    Product Coordinator, Energy Programs at COSE

  2. 3. Integrate sustainability thinking into the DNA of the business. From incorporating sustainability performance into cash bonus schemes to embarking on full-blown change management programmes, both approaches will bring sustainability into the heart of the business. This will shift people’s perception of sustainability from being “just another thing to do”. Fundamentally, this integration means redefining your organisation’s view of what internal success looks like. Reward and recognise your staff for making sustainability a success.

    Cut and pasted from the article mentioned at top of article.

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