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Sustainability is the use of resources to maintain a standard of living that enables society to satisfy its current needs without reducing the standard of living for successive generation. (VMS, 2010). Sustainability is important because the future is dependent on the long term strategies for the economy, society, culture and way of life. It is also important because the human population is growing at a higher rate so we need more and more resources to produce goods and services to satisfy everyone needs. This report on Sustainability will cover a summary on a Strategic Management article and its framework. It will also cover the summary of appendix 4 in the text book and compare and contract with the article that I read. The analysis will also cover how Strategic Management and Organisation Behaviour are relevant to the success of an organisation and to sustainability and also stating concepts, theory and framework. Finally, in the discussion it will cover how strategic management and organisation behavior interrelate and how sustainable strategic management and organisation behavior can help Victoria University of Wellington.
The article of Sustainability on Strategic Management, 'Why Sustainability is not the key driver of Innovation' by Ram Nidumolu, C.K. Prahalad, and M. R. Rangaswami, 2009 puts forward a framework through a five stage process of how businesses face challenge when they work towards goals of becoming more sustainable. The article reviews several companies that were convinced that the more environment friendly they became, the more cost it had for their businesses and thus eroding their competitiveness in the short term. However, in the long run, companies that make sustainability their goal will achieve competitive advantage as they are becoming environmental friendly and put sustainable practices into place. This means that businesses will have to rethink not only their business models but also their products, technologies and the processes used to deliver that product. The article proposes a five stage process for becoming sustainable:
Viewing Compliance as opportunity
Making Value Chain Sustainable
Designing Sustainable Product and Services
Developing New Business Models
Creating Next Practice Platform
The companies may face a lot of pressure in thinking about new innovation that are sustainable and the actions from these businesses will gave them competitive advantage as well as save money in the future.
(Ram Nidumolu, C. K. Prahalad & Rangaswami M. R., 2009)
The article, "Sustainability supply chains: An introduction", discusses how sustainability and supply chains are interrelated. The author discusses the framework and concepts of how operations management researchers use sustainability to consider implications, impacts and assumptions for sufficient activity (Linton, Klassen, & Jayaraman, 2007). It discusses the framework via steps such as product design, manufacturing by-products, by-products produced during product use, product life extension, product end of life and recovery processes at end-of-life (Linton, Klassen, & Jayaraman, 2007). This sequence of steps show that the focus of optimizing operation has moved from a specific facility to the entire supply chain which will help develop sustainability since the supply chain considers the product from initial processing of raw materials to delivery to the customer (Linton, Klassen, & Jayaraman, 2007). The supply chain is related to sustainability because sustainability stretches the concept of supply chain management; it looks at optimizing operations from a broader perspective by focusing on the entire production system and postproduction stewardship as opposed to just the production of a specific product. The business ethicists in and the accounting field refers to as the triple bottom line because sustainability introduces less quantifiable considerations relating to the natural environment and in some cases social issues (Linton, Klassen, & Jayaraman, 2007).
The article 'Indigenous Populations and Sustainable Development Buildings on Indigenous Approaches to Holistic, Self Determined Development' puts out a theory of how Indigenous (Maori) people suggest different types of methods than Western method to develop growth and sustain their businesses. It suggests frameworks such as social capital and culture respect to create a holistic change in a business long term plan that it includes strategic management (Loomis, 2000). This article is related to sustainability as it helps businesses to understand the holistic approach and gives them an understanding of how tribes could apply its approaches in order to help them achieve sustainable development (Loomis, 2000). The article also brings forward a concept of how indigenous culture is used to achieve sustainability as in the indigenous culture the business is passed on to future generations (Loomis, 2000).
The article in Appendix 4 discusses Sustainability in Aotearoa New Zealand, and the importance of creating changes now for the future. These changes lead to a better environment, with renewable resources which will also help to maintain the sustainable practices that have been put into place. The two main reasons that are stopping Aoteoroa New Zealand businesses from adopting sustainable practices are the added costs such as labour and the demand on management time to plan and put them into practice. (VMS 2010 p613). The article also states that Macpac, one of the outdoor equipment and clothing companies has been platformed on a "set of core values and cultures that promotes internally constant system refinement, design improvement and waste reduction" (VMS, 2010 p.604) as well as being more eco-friendly in Aotearoa New Zealand. In order to keep the clean green image of New Zealand and sustain its environment, businesses should start to focus on integrating sustainable practices in to their practices.
The three main reasons that businesses recognized to be sustainable are:
Reflections of Management values - these practices are developed to reflect the values of top management.
(VMS, 2010, p.606)
'Greenwashing' - to attempt to create a beneficial public perception of the company. 'Greenwashing' gives the impression that one supports sustainability for its own sake, but actually exploiting sustainable practices in the company as a means to rally public support and generate a better financial return for shareholders.
(VMS, 2010, p.606)
The opportunity to exploit a sustainable niche - the potential for developing business through the production of sustainable product. (VMS, 2010, p606).
The main idea of this article is the environment we are living in right now will get worse in the future so if businesses in New Zealand stop over using the resources and start becoming eco-friendly it will help the environment to become healthy and thus New Zealand's clean, green image will be kept intact.
One of the similarities I noticed in the article I read and the appendix 4 in the text book is that both has framework on improving sustainability and wanting more businesses to become eco-friendly because businesses at the moment are over using the resources and there won't be enough resources to provide the future generation.
Another similarity that the both articles talks about put different sustainable practices to make the environment and the economy sustainable and improve sustainability, and the cost of putting the sustainable practices in places is highly expensive.
The comparison between Appendix 4 and the Operation Management article "Sustainable supply chain: An Introduction" is built on the how sustainability can lead to an increase in growth by considering environmental factors. These environmental factors are highly important to achieve sustainability, help improve the natural environment and environmental growth. The triple bottom line is referred to by businesses to improve the environmental issues and the social issues for example noise pollution, congestion and carbon dioxide emission (Linton, Klassen, & Jayaraman, 2007). Furthermore, in Appendix 4 the triple bottom line is always referred to by businesses to improve the enviornmental issues and promote better public understanding of their efforts to aid the 'greening' of society (VMS, 2010, pg 605).
The comparison between the Appendix 4 and the Maori Business article 'Indigenous Populations and Sustainable Development Buildings on Indigenous Approaches to Holistic, Self Determined Development' is that appendix 4 states that the government should get involved more in the enforcement of sustainable practices by establishing to control business practices (VMS, 2010 pg. 613). The article on Maori Business also states that there needs to be a shift in the way governments and development agencies do business, from policy formation to implementation, if sustainable development is to be accomplished (Loomis, 2000 pg.902). This shows that the involvement of the government to achieve sustainability at a great level is highly important in the both articles.
The real contrast in the article I read and the appendix 4 in text book is that the appendix 4 is only related to the environment, businesses and economy of New Zealand and what New Zealand government is willing to do to make them more sustainable by places sustainable practices whereas the article 'Why Sustainability is not the key driver of Innovation' focuses various businesses around the world.
Another contrast between the Appendix and the Strategic Management is that both of them have different ways of promoting sustainable practices. Appendix 4 puts a forward a theory of 'require smart, active government working with key stakeholders across the economy and society (VMS, 2010, pg.607). The journal article focuses on a framework of innovation, leadership, talent and retains the right hand of people and has the 5 stages framework to go to through to achieve sustainability (Nidumolu, Prahalad & Rangswami,2009).
The contrast between Appendix 4 and the article "Sustainable supply chain: An Introduction" is that appendix 4 looks at how businesses are developing and implementing sustainable practices to improve public images, management values and return on investment whereas the article looks at increasing optimizing operations from a broader perspective by looking at legislation, public interest and the change in environment (Linton, Klassen, & Jayaraman, 2007).
The contrast between appendix 4 and the Maori Business article is that Appendix 4 looks at the businesses in New Zealand that are involved in sustainable practices and the safeguarding of New Zealand's unique landscape. Major wine organisations and industries such as tourism, renewable energy and viticulture apply sustainable practices daily to make the environment better for the future (VMS, 2010 pg.610-612) The article looks at how the land is important to the Maori people because it is passed down from generation to generation and thus it is respected and sacred. It also looks at using tribal values to enable general participation of members in assessing strategic scenarios and considering trade decisions (Loomis, 2000)
Relevant to the success of an organization
Strategy (SM): Strategy puts forward a theory. It is a comprehensive action plan that identifies guides resources utilisation, to achieve sustainable competitive advantage. A strategy will ensure that resources are used with consistent strategic intent. (VMS, 2010, p.239-241). It will help organizations to be successful because it gives them goals to reach and makes them an accurate organization if those goals are achieved.
Productivity (OM) - is a concept which will make a business's successful because productivity is the efficiency with which inputs are transformed into outputs. (VMS, 2010 pg. 517)
Team Work (OB) - Team work is a concept that is highly valued in an organisation if the organization wants to be successful. The advantages of team work are higher motivation, shared learning and shared workloads (Retna K, 2010).
The Lean Approach(OM) - is a framework that eliminates waste and focuses on customer by meeting the demands such as what and when customer want the product at a reasonable price and satisfying customers which will lead them to a successful business (Sheffield,2010)
Building effective teams (SM) - Building effective teams is a framework brought forward by Diane Coutu in the article "Why Teams don't Work". It highlights the five main steps on how to build an effective team to make an organization successful. The five stages are:
Teams must be real
Teams need a compelling directions
Teams need enabling structures
Teams need a supportive organization
Teams need expert coaching
Education (MB) - the article 'Indigenous Populations and Sustainable Development Buildings on Indigenous Approaches to Holistic, Self Determined Development' supports a concept of education as an important factor to success of a business. The Maori people's first priority is the iwi and whanau so educating the whole family is of benefit, "Education was seen as a key strategy" (Loomis, 2010 pg 899) so Runanga set up a wananga (a traditional learning centre) to promote education to the new generation (Loomis, 2010 pg. 899).
Effective Communication (OB) - Effective communication is a theory that is really important in a successful organisation because it allows the leaders of the organisation to maintain interpersonal relationships and gain the information that is needed to create a high performance work environment (VMS, 2010, p.439).
Pluralism (MB) - is a concept that helps business to be successful which allows for the development of a common tradition while preserving the right of each group to maintain its cultural heritage (Best ,2010).
Relevant to Sustainability
Growth strategy (SM) - Growth strategy is theory relevant to sustainability because growth is viewed as necessary for long - run survival in some industries (VMS, 2010. p.248).
Supply Chain Management (OM) - is a concept which makes business more sustainable because its goals are to achieve efficiency in all aspects of the supply chain while ensuring on-time availability of quality resources and products (VMS, 2010 pg. 520).
SWOT (SM) - SWOT is a framework which helps organisations to identify the internal analysis which includes the strengths and weakness of the business and external analysis which includes opportunities and threats of the business. SWOT will help the business to be more sustainable by improving its weaknesses and taking the opportunities they get (Daellenbach, 2010).
Triple Bottom Line (OM) - is a framework which helps businesses become more sustainable as it is based on the three areas of modern business accountability: financial, social and environment (Sheffield, 2010).
Innovation - The article, 'Why Sustainability is now the key driver of Innovation' brings forward the theory innovation and how it can be used to help businesses to become sustainable by cutting down the cost and becoming eco-friendly which will help them gain a comparative advantage (Ram Nidumolu, C. K. Prahalad & Rangaswami M. R., 2009).
Indigenous knowledge (MB) - is a concept which is important for Maori business to be more sustainable because Maori people have different values and different way to run the business. It is also important because their next generation can run the business the same ways as them (Loomis, 2000).
The article 'Roots of Sustainability' by John R. Ehrenfeld puts forwards a concept focusing on gaining sustainable competitive advantage (Ehrenfeld, 2005).
Quadruple Bottom Line (MB) - is a concept which involves using social, economic, environment and culture aspects. Many Maori businesses use culture as pride and use it to become more sustainable (Best, 2010).
Strategic Management and Organisational Behaviour can be interrelated through improving sustainability with their different concepts, frameworks and theories about putting new ideas into practices and strategies and also working towards achieving their goals. Both SM and OB help structure and maintain environment, social, and economical aspects. Strategic Management is about the process of formatting and implementing strategies (VMS, 2010 pg768). Organisational Behaviour is about the study of individuals and groups in organisations (VMS, 2010 pg764).
Strategy is SM theory which is a comprehensive action plan that identifies guides resources utilisation, to achieve sustainable competitive advantage. A strategy will ensure that resources are used with consistent strategic intent (VMS, 2010, p239-241). This interrelates to Innovation which is also a theory that's helps businesses to become sustainable by cutting down the cost and becoming eco-friendly which will help those gains a comparative advantage. If there was no strategy in an organisation, it will be hard for the businesses to make their business sustainable because there will no goals to achieve the sustainable competitive advantage without strategy.
Another interrelation between SM and OB is between Building Effective Teams (SM) and Effective Communication (OB). If there wasn't an effective communication between the members of teams it will create conflict within the groups and there will be no feedbacks and new ideas provided to create a high performance work place.
Strategic Management and Organisation Behaviour can interrelated through various concepts, theories and framework and help VUW gain competitive advantage by places sustainable practices into places. For example Team work as a theory and Effective Communication as a concept can be interrelated and can help students to work in teams and help gain them more understandability by discussing and sharing new ideas and issues with other students and lectures. This will make education at VUW more competitive because there will be more students succeeding by gaining more motivation and challenges.