With the global population growing at a rate of 200,000 people a day, according to the World Bank Institute (WBI), there is an arduous strain on the world’s resources, especially food, energy and materials. This increase in demand and resulting decrease in supply warrants a closer focus on sustainability efforts to renew the supplies being used. But as governments and businesses across the world have discovered, it’s not easy being green.
Businesses simply cannot be 100 percent focused on sustainability efforts—the bottom line is always and will always be the top concern. With the current state of the economy, it is difficult to hold environmental sustainability goals on par with financial goals. The question is: is there a way to effectively do both? Can sustainability and profitability be balanced? How effectively managers can balance these shared objectives often determines how successful organizations are in terms of profitability and long-term growth.
Forestry, One of the Oldest Commodity Markets in the World, Is an Exemplary Model
The average US citizen uses 3.5 times more wood products than in 1970, according to the Oregon Resources Institute. Forestry companies across the globe need to scramble to meet ever-increasing demand—but the key is to do it in such a way that future resources are protected.
Coillte, Ireland’s largest forestry and forest products company, prides itself on maintaining a sustainable forestry business and never cutting down more wood today than will be available tomorrow. To do this successfully, the company has embraced analytics and optimization technology, which has provided it with a stronger strategic perspective on forest resource management and the ability to make better decisions based on fact-supported analysis.
The myriad of variables and data points that Coillte must take into consideration before making a million dollar decision includes the impact of an environmental, managerial or economic change on operations; harvest and production schedules; road maintenance; growing international demand and more.
With analytics technology, Coillte has been able to run test scenarios that take into consideration these variables, interchanging factors such as alternative tree species, location and aerial fertilization to test for more optimal results.
The ability to consider, assess and strategize around an infinite number of “what-ifs” not only minimizes risk by ensuring there is always a “plan b,” but also empowers Coillte to make strategic decisions that will help sustain their forestry resources, allow them to meet demand and grow their business at the same time.