Environment Management

ENVIRONMENTAL MANAGEMenT

Ecological

Innovations

in

Organizations INTRODUCTION: It is often stated that the application of information and communication technologies (ICT) to learning and training has great potential to produce significant changes in educational practice. But for this to happen, the technology first needs to be accepted and adopted. Applying innovation theory increases the chances of successful adoption. Conventional approaches to innovation, such as innovation diffusion suggest that supposedly innate characteristics of the innovation are important in determining whether or not it is adopted. Borrowing ideas from innovation translation, in actor-network theory it is people who are all important, as they may either accept an innovation in its present form, modify it to a form where it becomes acceptable, or reject it completely. Recent research has shown that an innovation translation approach is particularly useful in considering ICT innovation in small business. Beyond innovation translation, lies an ecological framework which considers the process of innovation and change in organizations. This socio-technical approach has shown the ability to identify factors at work that do not emerge from traditional approaches to innovation theory. A decision-taking process in an organization, based on an analysis of economic costs/gains

and

long-term

objectives,

often

leaves

out

an

analysis

of

expenses/effects related to environmental protection. It results from a strong pressure of competition which causes organizations to use a mechanism of transferring costs to third parties thanks to which there is an increase of an organization’s profits. On the other hand, an appropriate quality of the natural environment constitutes a generally socially acceptable objective and is not limited to selected entities. In this situation, there arises a need to force organizations into

certain behaviours. The behaviours are aimed at achieving socially acceptable objectives. In the case of environmental protection, this tendency to internalize external costs is always attained by means of instruments of ecological policy: legal, economic, psychosocial. They involve regulations of a structural character, which define rights and obligations of business entities concerning the use and protection of the environment, as well as rules which regulate financial and organizational problems, the legal importance and character of ecological policy. The aim of the regulations is to safeguard, by means of legal norms, such a system of social and economic relations which would completely eliminate harmful and undesirable changes in the environment, or which would prevent its degradation. According to the researchers, legal regulations provide a major incentive to implement ecological innovations. They force organizations, irrespective of their strategy, to comply with the binding emission standards and technological standards. Legal responsibility compels organizations to adjust their installations to legal requirements. On the other hand, the relationships holding between environmental regulations and ecological innovations are very tight. At the same time, in CentralEastern European countries, their character has not been fully recognized. Consequently, it becomes important to know if environmental regulations impact ecological innovations, including: the amount of RD spending, the range of implemented ecological innovations.

ECOLOGICAL INNOVATION AT XEROX: As the world’s largest distributor of cut-sheet paper, Xerox Corporation respects its responsibility to foster sustainable development by using paper wisely and protecting forest resources. Since its early days, Xerox has helped customers conserve paper, and more recently it has worked with partners and suppliers to promote environmentally sound practices. Following are some of the major initiatives

taken up by Xerox Corporation to imbibe environmental solutions in their core business practices: •

1964 – Xerox establishes the Media and Compatibles Technology Centre in Webster, N.Y. The research lab’s mission is to ensure that papers Xerox sells are optimized for use in Xerox products, preventing waste and product downtime.

•

1969 – Xerox introduces the 7000 duplicator, the first product that is able to make two-sided copies, a paper-conserving measure. Copying on the second side required the paper to be to be manually reinserted.

•

1973 – Xerox introduces a recycled grade of cut-sheet xerographic paper called Cyclex.

•

1988 -- Xerox announces recycled thermal fax paper with minimum wastepaper content of 50 percent, including 10 percent post-consumer waste.

•

1997 – Xerox introduces DocuShare, its first software for posting, sharing and managing collections of information across corporate intranets. DocuShare is the first of a series of software and workflow tools that help people manage, share, and store electronic documents, reducing the need for hard-copy documents.

•

1999 – Xerox introduces FlowPort, the first scan-to e-mail software. It bridges the paper and digital worlds by enabling users to capture and integrate paperbased documents into an organization’s digital workflow, where content can be electronically accessed, retrieved and distributed.

•

2000 -- Xerox notifies partners that beginning in 2003 all companies providing Xerox with paper for resale will have to meet new environmental standards to do business with Xerox. Aimed at protecting the health and integrity of forest ecosystems, conserving biological diversity and soil and water resources, safeguarding forest areas of significant ecological or cultural importance, and ensuring

sustainable

yield,

the

requirements

cover

all

aspects

of

papermaking, from forest management to production of finished goods. •

2003 – Xerox paper sourcing requirements are phased in, affecting more than 30 paper suppliers around the world. Requirements cover responsible environmental management of mills; sustainable forest management and

sourcing of wood raw materials; chemicals/materials use; packaging; and compliance with environment, health and safety regulations. Under the requirements, for example, vendors are asked to supply independent thirdparty certification that wood raw materials supplied to their mills come from sustainably-managed lands. •

2006 – Xerox announces its research laboratories have created an experimental printing technology that produces prints whose images last only a day, so that the paper can be used again and again. The technology is known as self-erasable paper and is still in a preliminary state. It blurs the line between paper documents and digital displays and could ultimately lead to a significant reduction in paper use.

•

2007 – Xerox introduces Xerox High Yield Business Paper™ – the industry’s first mechanical fibre paper optimized for digital printing. Made by grinding wood into pulp, the process uses half as many trees as the standard chemical pulping process, reduces the chemicals and water consumed, and is produced in a plant using hydroelectricity to partially power the pulping process, resulting in reduced fossil fuel use and up to 75 percent reduction in greenhouse gas emissions.

ECOLOGICAL INNOVATION AT IBM

 Waste Minimisation and Management

•

In 2008, IBM sent 79% of its non-hazardous waste to be recycled worldwide.

•

In 2008, 64% of non-hazardous waste was recycled from IBM leased and operated location in Australia, up from 57% in 2007.

•

Almost 90% of 285.57 tonnes of non-hazardous waste was diverted from landfill and primarily recycled from the National Head Quarters in Sydney.

•

In addition almost 80% of 123.67 tonnes of non-hazardous waste was diverted from landfill and reused and recycled from the national distribution warehouse in Sydney.

 Conserving raw materials and waste avoidance •

In 2008, office paper use in Australia fell by 13% or 6.1 million sheets to 41.8 million sheets, saving AU$64K in Australia. Each employee used 5.8 Reams of office paper per year, down from 7 Reams.

 Energy Efficiency and Conservation & Climate Protection

•

In 2008, Australia delivered an energy conservation saving of 4.5% against the corporate target of 3.5% of actual annual electricity and fuel used.

 saved 4,462 MWh and over AU$320K  avoided 4,400 tonnes of carbon dioxide equivalent emissions  purchased 3.9 GWh/yr of government accredited Green Power renewable

energy •

Energy

conservation

projects

included

upgrading

of

major

building

infrastructure to energy efficient chillers, cooling towers and generators, and many lighting projects were completed which improved lighting controls at many of our locations in Australia. •

As a further example in 2008 GHG emissions from Australian employees’ air travel for business reduced by 8% Y-o-Y – or over 1,500 tonnes CO2

ECOLOGICAL INNOVATION AT CIBA SPECIALITY CHEMICALS

Ciba Speciality Chemicals, a Swiss manufacturer of textile dyes is a classic example of Ecological innovation. Textile manufacturers dye cotton or rayon fabrics

by immersing the material in a bath containing dyes dissolved in water and then add salt to push the dye out of the solution and into the cloth. Ciba speciality Chemicals had introduced dyes that fix more readily to the fabric and therefore requires less salt. The new dyes help Ciba’s customers in the following way: 1. They lower the outlay for salt. This reduces their costs for salt and thereby reducing the overall cost by 2% - a significant amount in an industry with wafer thin margins. 2. It reduces the manufacturer’s costs for water treatment. Used bath water – full of salt and unfixed dye – must be treated before it is released into the rivers or streams (even in low income countries where environmental standards may be relatively lax). Thus less salt and less unfixed dye mean lower water treatment costs. 3. The new dyes higher fixation rates make quality control easier thus lowering the costs of rework. Ciba’s dyes are the result of years of development in the laboratory. They are protected against imitation by patents and by the unpatentable but complicated chemistry that goes into making them. For those reasons, Ciba can charge more for its dyes and capture some of its value it is creating for customers. Lowering a customer’s environmental costs add value to its operations just as surely as a new machine that enhances labour productivity. But there are three conditions required for success with environmental differentiation, and Ciba’s approach satisfies all the three. 1. The company has to identify customers who are willing to pay more for an environmentally friendly product 2. It has to able to communicate its product’s environmental benefits credibly 3. It should be able to protect itself from imitation for long enough to profit on its investment.

A company which fails in any of these three aspects will fall flat with its ecological innovation.

SOME OTHER INTERESTING INITIATIVES: •

LEELA HOTEL GROUP: It was honoured by the American Academy of Hospitality Sciences for environmental initiatives. At The Leela Goa, for example, Nair’s imprint can be seen in the 75 acres of lush gardens and foliage planted along the property. In all, there have been a total of 3,556,633 trees planted on the Leela Properties.

•

One of the companies has saved around $14mn/yr just by reducing the font size from 16 to 10.

•

Hybrid car that result in higher fuel efficiency.

•

Using solar energy instead of electric energy.

EFFECT OF ECO INNOVATIONS ON EMPLOYMENT: Ecological innovations have increasingly been seen as a major response to environmental problems. An important question for both economic research and public policy is whether these innovations also increase employment or not (the question of a double dividend). The question here is how factors affecting direct employment changes due to eco-innovations at the firm level. Using data from around 1600 firms in five different countries (Germany, Great Britain, Italy, Holland and Switzerland) it has been observed that firms investing in relatively important (from the firm’s perspective) labor cost saving product innovations that have not been subsidized by the state and pursuing a market driven business strategy that leads to increases of their sales in industries in which they have a market power also increase the likelihood of their achieving a positive long term direct employment effect. Firms that deviate - on average - from this ideal portrait do not have positive direct employment effects.

CONCLUSIONS:

Initiatives to bring ecological components to urban living are put forward by governments, grassroots groups and private industry. Some projects focus primarily on the application of resource-saving technology and/or related user behavior. Others emphasize the cohesion and empowerment of the community as the principal agent to proliferate and further develop concepts of sustainable living. Based on one of these perspectives, an organization (firm) will have a specific set of characteristics. These can be grouped into four categories: 1. Basic strategic orientation – The more or less coherent view of the world as it is relevant to the firm, including its relationship to the natural environment. It may not be formalized in terms of a vision or mission statement, but it is assumed to be more or less consistent at the level of a firm. 2. Definition of value – The basic strategic orientation is based on assumptions of what are valuable activities, resources, and capabilities, and a firm‟s strategy can be understood as the pursuit of such valuable items. This definition includes ecological value: what are relevant ecological issues, and what are legitimate ways of dealing with these. 3.

Capabilities – The organizational routines the firm employs to combine resources (money, people, materials, knowledge) in order to materialize the goals that are implied in its basic strategic orientation. Examples are: organization of R&D, specific ways of organizing production, routines to collaborate

with

stakeholders,

marketing

routines,

environmental

management, etc. 4. Activities related to reducing ecological impact – Based on capabilities, firms will develop activities that in the end determine their ecological impact. Examples of these are: product innovation, collaboration with consumers, recycling activities, lobbying and communication, moving production to other countries, etc.

These four categories are closely related. The definition of value can be seen as the normative complement of the basic strategic orientation. This normative framework defines the selection environment in which capabilities emerge, are

developed, or discarded. Through activities, which flow from capabilities, the strategic orientation is tested, and if successful, maintained.

From the perspective of the various studies carried out in this context it has been inferred that: •

Not surprising is the result that an eco-innovation in general, measured by its share of a firm’s total innovation expenditures (input indicator), does have a significant impact on firms’ long term employment.

•

It is surprising that organizational eco-innovations do not have any significant impact on firms’ long term employment.

•

From a theoretical (neo-classical) viewpoint is it quite surprising that pricebased competition among firms does not have a positive impact on long term employment. This suggests that imperfect competition (market power) helps firms to innovate and create jobs.

•

It is worth noticing that firms pursuing different strategies achieve different outcomes concerning employment. Firms with a clear market-driven strategy (innovation in order to secure existing markets or to increase market share) are more successful than those that are aiming at just improving their corporate image.

•

The size of innovation as measured by the share of eco-innovation expenditures as a percentage of firm’s total innovation expenditures has a positive effect on the firm’s probability to increase long term employment. In addition, as expected, product innovations seem to have a positive impact, while process innovations seem to have a negative impact on long term employment.

 The market power of the innovating firm:

The impact of competition in product markets on the long term employment of firms operating in those markets depends on the means used for competition: while innovation-based and corporate image based competition seems to have a positive effect, price competition seems to have the opposite effect.  The price elasticity of product demand:

Eco-innovation led to increase in output and sales.  Firm specific variables:

While firm size does not seem to affect long term employment due to eco-innovations, firm-specific strategies do. Eco-innovating firms that pursue a clear market driven strategy such as securing existing markets or increasing market share also increase their long term employment. On the other hand, firm strategies that consist of innovating in order to comply with environmental regulations or to improve the firm’s image do not seem to have the same systematic effect on long term employment.  Industry and country specific differences:

The long term employment effect of co innovations varies not only across firms but also across industries and countries.

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