Life Cycle Management as a Way to Operationalize Sustainability Within Organizations
Sarra Harbi, Manuele Margni, Yves Loerincik, and Jon Dettling
Abstract This chapter proposes a value creation framework to operationalize sustainability within organizations through an improved link between life cycle management tools and business drivers for value creation. Internal and external stakeholders' need to be first identified and accounted for, and value creation must be clearly identified in order to be acknowledged and communicated. The question “what do we want to achieve?” needs to be answered before thinking how to best achieve the identified business value. We propose to apply “reverse-engineering” to define the value creation path and identify the departments and collaborators to be involved at different level of the organization. LCM offers an essential and flexible integrated management framework of concepts, techniques and procedures to think how to best operationalize sustainable actions to achieve the identified business value. The sustainability action involves a team that should include, at least a sponsor or a pilot from the department that is expecting final value creation (Human Resources – HR for employee engagement, marketing for product positioning, etc.) and a representative from each department involved in the value creation path. Each of them will need an LCM tool adapted to their need and specific objectives. Last but not least, one needs measurable indicators on global goals that are to be monitored by the overall project sponsor, through KPI (key performance indicators) and follow-up.
Keywords Life cycle assessment • Life cycle management • Sustainability • Value creation
The role sustainability plays differs from one organization to another. This is also true across different functions within the same company. Indeed, an organization is not homogeneous, and the needs of departments such as operations, marketing, product development, sales and other stakeholders within the company are often very different. They are also very different in how they are impacted by the risks and opportunities posed by the sustainability topic. A one-fit-for-all solution to make sustainability operational within an organization is therefore not feasible, but rather the right approach needs to be tailored to the unique context, resources and constraints of the company or department in question.
Many companies have started their journey towards sustainability in response to stakeholder or customer requests, or sometimes through a strong personal commitment of key individuals. However, today's corporations are inherently profit-driven by the necessity of competition and so, to be integrated into the company and become part of the company's DNA and strategy, sustainability needs to create value for the corporation itself (Bonini and Schwartz 2014). If not connected to the business it can easily be disregarded in challenging economic conditions. In addition, today's corporations conduct their core business with great efficiency and alignment of sustainability with these core operations ensures a rapid and effective trajectory for achieving outcomes in comparison to treating sustainability work as a form of philanthropy.
Systematic integration of sustainability into strategic initiatives is key to achievement of meaningful sustainability related goals, since the long-term changes required are likely to be drastic departures from today's status quo and the path to achieving them is often as-yet unclear and quickly evolving. A strategic focus on sustainability allows appropriate actions to be taken at the right moment, as the context of the sustainability discussion plays out over the long term. Life cycle thinking is a key to achieving this strategic alignment by allowing companies to understand their position within the broad context of sustainability. Today's leaders in the sustainability space are continually finding creative ways to adapt life cycle thinking to the whole organization as well as its products and services, thus leading to a better understanding of consumer preferences, stakeholder pressure, existing regulation and future trends.
Life cycle management (LCM) is “a flexible integrated management framework of concepts, techniques and procedures incorporating environmental, economic, and social aspects of products, processes and organizations” (UNEP 2006, UNEP/ SETAC 2009) to achieve the integration of sustainable development into the company, along the whole value chain (O'Rourke 2014).