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Innovation in Sustainability

Good ideas and amazing technology, by themselves, are not enough. The key component to making sustainable innovations lasting and impactful is to make them attractive to the market and profitable. To be successful, these greenovations, as we call them, have to be financially and economically feasible and scalable. Without these components, good ideas can’t get beyond being just good intentions.

Table of Content:

Innovation in Sustainability - Greenovate!

Innovation Cases in Sustainability

  • Clean & Alternative Energy

  • Recycle & Re-use

  • Efficient Use of Power

  • Sustainable Agriculture & Food Production

  • Intelligent Systems

  • Environmentally Friendly Construction

  • Greenovations in Developing Regions

  • Patience and Timing

  • Patience and Persistence

  • Creative Business Models

Insights for Making Sustainability Last

  • Do More With Less

  • Substitute Without Sacrificing Performance

  • Inform and Empower


Innovation in Sustainability - Greenovate!

We started our journey by defining “sustainable, green innovations” (or “greenovations”) because, as with “innovation,” we found the goal of making products and services “sustainable” to be a concept that is widely used, but often misunderstood. For our definition of greenovations, we combined our description of business innovation with a synthesized concept of sustainability as articulated by a number of leading global organizations: 

"Greenovations create and capture new value by meeting the needs of the present without compromising the ability of future generations to meet their needs"

Innovation Cases in Sustainability

What if we could find dozens of new ways to create alternative and clean sources of energy, thereby dramatically decreasing our use of expensive and polluting fossil fuels?

In solar power, technological strides have made solar more practical in terms of cost and flexibility of use: Energy Innovations’ Sunflower solar farms have dramatically lowered the price of solar electricity while Nanosolar and Konarka are developing new ways to create and apply solar cells. eThekwini Municipality’s (City of Durban) landfill gas-to-electricity project demonstrated that developed world solutions for clean energy can be successfully adapted to developing world situations. While many think this is a domain of high tech, there are also many low tech examples: Empower Playgrounds is converting children’s play into electricity for schools while the City of Paris and JC Decaux are collaborating to make bicycles a viable public transportation option for commuters within Paris.

What if we could recycle, re-use and efficiently dispose of substances left over from today’s manufacturing processes, turning waste into useful materials and fuels that would otherwise be dumped into the world’s ever-expanding landfills?

In the realm of recycling, Patagonia, and Terracyle have succeeded in drawing most or all of their raw materials from recycled materials and then selling them in very different markets: clothing and consumer packaging. Greenbox replaces disposable moving boxes with rentable easy-to-stack plastic boxes made with recycled materials. In Indonesia, Don Bosco has actually succeeded in “putting old wine into new bottles” by converting oil for cooking into fuel for buses. Big Belly’s automated, solar-powered urban trash compactors can improve the entire waste-disposal system in urban areas, making them more energy- and labor efficient while reducing the space that trash occupies. (And below, we’ll discuss PFNC’s transformation of shipping containers into housing.)

What if we really looked at the way we used power and found ways reduce the huge amounts of energy we lose because of inefficient systems and even simple carelessness—what if we found new ways to use less power and become more efficient?

In the domain of energy used for airplanes, Canada’s Bombardier entered into a partnership with manufacturers to find ways to reduce fuel consumption while UPS has found ways to conserve on fuel use as well as lower noise pollution by changing the way it lands its planes. While Tesla has begun to succeed in creating a market for all-electric vehicles, Bosch and Better Place have found complementary ways to maximize the energy and minimize costs associated with hybrid and electric vehicles. BAE Systems has made a real impact in extending hybrid technology to much larger vehicles, such as city buses. The One Laptop per Child initiative and the retailer Tesco, although involved in very different domains, have both made an effort to analyze supply chains and processes to reduce costs and decrease energy use everywhere possible in their respective industries.

What if we could improve processes related to agriculture and food production, making more food available, cultivation more sustainable, and processes less wasteful than ever before?

Creating and enforcing high standards of agricultural production that help to sustain the rainforest’s natural resources is the creative contribution of the Rainforest Alliance. Ikea’s Farmer Field Schools take the long view of educating cotton farmers in India and Pakistan on how to use less expensive and less toxic methods of farming, thus preserving the base of its supply chain. Netafim’s drip irrigation system makes remarkable savings of water while improving irrigation systems. US’s Dairyland Power has pioneered methods to convert waste into energy for farming while BP Energy India’s innovative business model has made it possible to distribute a sustainable cooking method throughout rural parts of India.

What if we could apply more intelligent systems to conserving energy and developing alternative sources of power, making huge savings on emissions and costs?

The possibilities of applying contemporary computer power and analytics to finding efficiencies we could never dream of before opens up many opportunities for conservation and creativity, from the scale of the individual to whole cities and countries. On the small scale level, Cisco Energywise, Oberlin College, Garmin and Progressive Insurance have found ways to provide data and feedback all the way back to individuals to inform them about how they use energy; this information is then used as a foundation for reducing energy consumption. On a much larger scale, the EU’s E-Street program and Malta’s Smart Grid project benefits from the vision of government leaders who enable and fund the wide variety of players who must collaborate cohesively to scale up green initiatives big enough to meet the huge problems posed by climate change.

What if we could create more efficient and environmentally friendly construction processes and building materials, thus attacking one of the largest emitters of harmful greenhouse gasses and physical waste?

Going from planning to construction, a variety of initiatives have already begun that could revolutionize the energy consumed and wasted through construction. LEED is a standards group whose certification process awards buildings and builders for environmentally friendly construction and finished structures. Axion has succeeded in reducing waste while simultaneously improving the performance of construction materials. Finally, the Bank of America Tower reflected a decision of B of A to set green standards for a major high-rise building in the US by using the best technology to reduce its carbon and waste footprint while simultaneously making improvements to the building’s operations.

What if we could spread these greenovations to developing regions where we can improve the wealth, health and environment for people at the bottom of the pyramid?

Many examples mentioned above (e.g., PFNC and One Laptop per Child) also fit into this category. Some other notable instances follow the lead of initiatives such as Empower Playgrounds by finding ways to improve resource distribution without having to make huge investments in new infrastructure. Grameen Danone, for example, tends to the problem of hunger in Bangladesh by constructing eco-friendly yogurt mini-factories that will be located throughout the country, thus producing jobs and providing nourishment for surrounding villages. Bloom Energy uses the same logic of decentralization in its creation of large fuel cells that can power entire households located far away from conventional electric grids. In Nigeria, Olam’s business model innovation aims at aligning the interests of private capital, public institutions, and small farmers to create a revolutionary new market system to increase the quality and quantity of the production of a key staple, rice, while also adding significant gains to the income of farmers.

Insights for Driving Sustainability Innovations

The first set of insights relates to the ways in which organizations have been most successful in creating sustainability innovations and getting them to market:

Patience and Timing

Sustainability innovations often require new-to-the-world technologies and/or significant changes in behavior from consumers. Neither of these can be easily achieved in the short-term. Companies that are focused and organized for the long march often manage to win—see Toyota’s commitment to hybrids that can achieve 100% improvements in gas efficiency versus marginal improvements in the existing combustion engine. By not pacifying the near-term needs of stakeholders, the companies in this book have avoided falling in the trap of “greenwashing” and have actually captured the inherent opportunity in achieving sustainability.

But patience is often not enough. Timing also counts, for being too early or too late to the market can mean, in the first instance, offering a product nobody is interested in or, in the second, entering an market that no longer has room for your innovation.

Passion and Persistence

To support the long march for the big win, we found that company leaders were both excited and personally motivated to build and drive the business. Whether it was to change the world and make it a better place (Oberlin College or Grameen Danone) or to make a lot of money (Konarka), the passion and persistence of these leaders were crucial in overcoming daunting challenges: from bringing new technologies to the market to changing consumer/customer behaviors to implementing different business models. It is clear that sustainable greenovations cannot be left to managers but require leaders whose passion and persistence provide the energy and stamina to overcome the range of barriers that will arise.

Creative Business Models

There is a virtuous cycle in making something that is valued by the market and doing it profitably. We find that sustainability offerings that have a clear value proposition to the consumer/customer combined with a profitable business model have greater market acceptance and higher growth rates. As an example, Zipcar’s new business model is offering drivers an alternative to owning a car or even renting a car. Offering a subscription model of car use that gives the company a base of steady cash flow, Zipcar also relieves infrequent or sporadic car users of the burden of paying for gas, insurance, and maintenance as well as the sheer cost of buying a car.

People interested in occasionally renting a car can find that Zipcars are conveniently dispersed throughout dense urban locations. Automation allows riders access to codes that unlock the cars. The company is also open to innovative partnerships with large institutions that can support a fleet of cars, such as a municipality or a university. Enabled by the insightful application of automation, Zipcar is searching out various ways to monetize its new offering. Insights for Making Sustainability Innovations Last. The second set of insights we uncovered is that almost all of the green innovations we analyzed achieve more sustainable outcomes because the companies and organizations that promoted these innovations found ways to maximize their efforts or minimize their costs in ways that consistently found success in the market. This was accomplished through using one or more of the four methods summarized below:

Do More with Less

By focusing on improving the efficiency of resource use, these offerings will extend the ability to use the finite amount of non-renewable resources. These incremental innovations are critical as they act as a bridge to technologies that can take full advantage of renewable resources that are either too new or too costly to act as substitutes for non-renewable resources in the immediate future. Furthermore, when our economies are finally able to run on renewable resources, our systems and infrastructure will sip rather than guzzle, lowering the level of investment required to introduce more greenovations in the future.
For example, as the world’s first mass-produced hybrid vehicle, the Toyota Prius achieves incredible gas mileage with a car that works with the existing transportation system. Although both Toyota and other car companies started work on alternative fuel vehicles at roughly the same time, many of the others have tried to bite off more than the market can chew: their overly-ambitious 100% electric cars needed many more billions of dollars and more development years in addition to the added requirements of creating new infrastructure and changing customer behavior. And while the other car companies have quickly rolled out hybrid options in the past few years, Toyota has already built a dominant position: the company released its third generation hybrid system this year (despite its recent recall problems which should prove to be a temporary bump rather than a permanent obstacle).

Substitute without Sacrificing Performance

These products and technologies replace scarce or finite resources with more widely available or renewable ones: organic plastic instead of petrol-based plastic or bamboo instead of wood. These innovations also include fully recyclable and upcycled products. As we mentioned earlier, Greenbox makes plastic moving boxes and other equipment from recycled materials, and, in the ultimate move towards sustainability, recycles its worn-out equipment into new boxes.

Inform and Empower

These solutions provide people with accurate, relevant information on how, when and why resources are being used. Armed with this information, users are changing their behavior in significant ways. These types of innovations are critical: while technology will drive many of the sustainability gains, these benefits can be eclipsed by simple changes in human behavior. Providing detailed information on how community resources are used by individuals enables those individuals to selfmonitor and adjust. Two projects in their early stages mentioned above — Cisco’s Energywise and Oberlin College’s Energy Use Feedback System — have demonstrated that as information on resource use is made more granular, individuals make better and smarter decisions. And both initiatives are working to lower implementation costs and increase the return on investment via lower operating costs for homes, offices and other buildings.

Find the Win-Win-Win

This final case includes sustainable green innovations that align the incentives of many to achieve sustainable outcomes. These examples usually involve at least three different groups, each with very different needs, resources and behaviors. For example, PFNC takes empty shipping containers that are too expensive to recycle or ship empty back to China and converts them into affordable, stackable homes for Mexican workers. These workers living directly across the US border were typically housed in cardboard and aluminum shantytowns. Although these basic structures, outfitted with renewable or recyclable materials, cost less than $8,000 to create, the houses remained too expensive for the workers. However, PFNC is working with the large US corporations that employ these low-income laborers to pay the upfront housing cost to PFNC and then deduct a manageable amount from each employee each month. The US firms like the idea because it creates sturdy homes and stable communities that lower the high attrition rates typical of these workers. PFNC makes enough money to continue upcycling shipping containers costs and to invest for future growth. And the Mexican workers get affordable, developed-world housing.

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