Strategic Management in a Sustainable Society
This article focuses on the concept of strategic management in a sustainable society as applicable to United States-based business organizations (companies). Strategic management refers to a company's detailed plan to capture and maintain competitive advantage in the marketplace. A sustainable society is one that meets current environmental, economic, and community needs without compromising those needs in the future. In order to contribute to a sustainable society, a company's strategic management plan will incorporate decisions and actions that positively address the three main facets of a sustainable society: environmental issues, economic issues, and community issues.
Keywords Business Ethics; Corporate Social Responsibility; Eco-Efficiency; Social Footprint; Socially-Responsible Investing; Stakeholder; Strategic Management; Sustainable Society
Management: Strategic Management in a Sustainable Society
Strategic management involves devising a complete roadmap for capturing and maintaining competitive advantage by determining the broader concepts of mission, goals, and long and short-term objectives; and by defining and managing the more specific details of analysis, decision-making, actions, roles, responsibilities, and timelines needed to do so.
A sustainable society is one that meets current environmental, economic, and community needs without compromising those needs in the future. There are three main categories of issues that affect a "sustainable society":
- Environmental issues
- Economic issues
- Community issues
Today, companies are expected to practice good business ethics by fostering a sustainable society.
Merely avoiding a negative impact on society is not enough. Through television and Internet, the American public is presented with the details of corporate breeches and scandals as they unfold; natural disasters, such as Hurricane Katrina; and worldwide poverty and homelessness. Geographically, these issues affect society on a local, national, and global level. Companies are obliged to practice Corporate Social Responsibility, that is, to contribute to society now and in the future by maximizing the positive aspects of its decisions and actions and by minimizing any negative impact.
Therefore, the prudent approach is for companies to incorporate sustainable society issues into their management strategies now.
Three Facets of a Sustainable Society
There are three main facets that are central to a sustainable society: environmental issues, economic issues, and community issues. In many instances, issues may overlap into more than one category.
Environmental Issues in a Sustainable Society
Environmental issues may be caused by nature or humans.
Environmental issues include the following:
- Changes in the climate, such as global warming
- Natural disasters, such as hurricanes
- The alteration of terrain or bodies of water due to natural disasters or development
- Deterioration of air quality, both outside (such as fumes from motor vehicles and airplanes) and inside (such as toxins released from paint and varnish)
- The release of hazardous materials from activities such as oil spills and the dumping of hazardous waste
- The depletion or deterioration of natural resources, such as farmland, water, trees, and minerals
- The displacement of wildlife or depletion of their food sources
A company can influence those environmental issues caused by nature through its response and management of the after-effects. For example, a company's financial or emergency response to a hurricane illustrates a company's contribution to an environmental issue in a sustainable society. This is also a good example of an environmental issue that crosses over into a "community issue."
Economic Issues in a Sustainable Society
Economic issues in a sustainable society are a bit broader and include the following:
- The efficient production of necessary goods and services, including the streamlining of the supply chain process
- The use of responsible labor, environmental, and investment practices in the production of the goods and services
Community Issues in a Sustainable Society
Community issues affect the general well-being of people — their right to good health, safety, shelter, education — and the preservation and development of institutions that promote these rights.
Community institutions in a sustainable society include the following:
- Hospitals, clinics, access to medical supplies
- Food banks, agricultural and food production facilities
- Protective services, such as fire and police, and legal and social service organizations
- Affordable housing
- Educational facilities
- Religious institutions
What then, are the implications for a company? How can a company incorporate the environmental, economic, and community issues that are central to a sustainable society into its strategic management roadmap? A company that intends to incorporate sustainable society strategies into its strategic management needs to formally write them into its planning. To be truly effective, all stakeholders — from top management to employees — need to be committed to the planning and execution of actions and decisions that contribute to a sustainable society.
Options for Incorporating Sustainable Society Issues into Strategic Management
There are two options for incorporating sustainable society issues into strategic management policies: active options and passive options; a company may incorporate either option or both options, depending upon the particular issue.
1) Active option: Engaging in practices that will result in a positive impact on a sustainable society.
2) Passive option: Avoiding practices that will result in a negative impact on a sustainable society.
Here are examples of active and passive practices that companies might employ to meet environmental, economic, and community issues.
Environmental Issues in a Sustainable Society: Active Practices
Create a formal, written environmental management plan that details goals, actions, responsibilities, and timelines.
Use renewable resources, such as bamboo and treated pine timber whenever possible.
Plant trees on company property and in the community.
Reduce the number of motor vehicles and airplanes to lower emissions and noise pollution.
Use recycled and biodegradable materials in product development.
Operate facilities during non-peak utility and travel hours.
Design products that are recyclable or biodegradable.
Use alternative fuel vehicles whenever possible.
Develop alternative energies, fuels, and products.
Offer financial incentives to employees who travel to work by bicycle, public transportation, and hybrid or electric motor vehicles.
Offer employees the opportunity to work from home part of the time.
Purchase products from companies that employ sustainable packaging.
Environmental Issues in a Sustainable Society: Passive Practices
Limit building and development that will alter the course of nature, such as rerouting rivers, encroaching upon wetlands, or displacing wildlife habitats.
Economic Issues in a Sustainable Society: Active Practices
Streamline costs and processes in order to offer goods and services at a fair price.
Increase the value of products and services while reducing the impact on the environment.
Pay employees fair wages.
Promote and enforce equal opportunity for employees.
Engage in socially-responsible investing. This is an investment strategy that has also been gaining ground with...
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