More and more we see the urgency to change our habits and behaviours to save our planet. Unfortunately, human beings are greedy and selfish. To create a change, we need to see how it will benefit us before benefiting others.
The way we live is unsustainable! We know that our behaviours as producers and consumers have affected the supply of natural resources, increased natural disasters, and created new diseases, among other things. We have been told to change our habits but businesses should also change the way they do business. Their priority is to make profits but it is not incompatible with the circular economy. Businesses have more to gain by becoming sustainable.
The benefits of becoming sustainable are:
· Cost Savings
· Consumer Demand
· Employee Acquisition and Retention
· Resource Limitation
· Competitive Advantage
· New Revenue Opportunities
According to a study conducted by BCG/MIT, only 25% of companies are sustainable. Those companies have changed their business model because they saw a competitive advantage in sustainability. Consumer behaviours have changed! We see an increase in awareness around environmental issues, and this increases the demand for sustainable products and services. Consumers are more informed and have access to information very easily. The pandemic has impacted the purchase behaviour of the consumers. Consumers take their time to select what and where they want to buy.
We see sectors and companies that are leaning towards a more sustainable model like the fashion industry. It is moving towards the rental business model and reused and recycled materials to manufacture garments. The supply chain plays a big role in a business, and it is important to look for ways to improve it. the ways to improve it could be to look at the packaging, the material sourcing, and the renewable energy used, for example.
For companies to take part in the circular economy, it is vital to review and change their current Business and/or Operating Model. It is important to analyse and re-evaluate the strategy and the business model. It is vital to analyse the business processes to improve and re-engineer them, to ensure alignment with Operations.
By optimizing the business processes and systems, it will be possible to reduce waste, go paperless, and create a new operating model that will be sustainable. It is not only to redesign the business but to also create a culture of sustainability and innovation.
By having a culture of innovation, employees will be able to generate new ideas to reduce waste, energy consumption. It is vital to ensure the involvement of the employees so that the strategy execution will be successful. There should a commitment towards the sustainability strategy across the board to ensure success.
In conclusion, external factors are pressuring businesses to become sustainable. Consumers, environmental activists, competition, and NGOs are playing a great part. But internal factors are also impacting their decision to change their business model. Employees’ values, the resources price, and scarcity of supply are few internal factors that have a big weight as well. By embracing change, businesses and the planet will have a win-win situation.