Read Peter’s first blog post introducing his new book “Business Models for Sustainability“, the first monograph on this topic.
“A brief Internet search under the term ‘sustainable business models’ yields disappointing results: The vast majority of entries are concerned with the narrow financial viability of various business models and their ability to generate returns to investors.
At the same time, there is evidentially a burgeoning interest in ranking and categorising businesses according to their sustainability performance, somewhat on the premise that a consumer ‘buys’ the business as much as he or she buys the product but also ostensibly as a guide to ethical investors. The desire to arrive at a metric appears over-riding, and betrays a simple faith in quantification that is difficult to reconcile with the complexities of organisational structure, behaviour and performance in a realm as complex as sustainability. Equally frustrating is any attempt at a ‘tick box’ approach where a selection of attributes are deemed necessary or sufficient for the accolade of a sustainable business; or conversely those approaches that reduce sustainability to a single issue – notably carbon emissions.
So, when confronted with the desire to communicate the myriad pathways through which business might potentially contribute to enhanced sustainability, and with the probable limitations of business as an organisational form for the mobilisation of social resources, I felt compelled to write a different sort of book. In this flawed effort, the underlying idea was to portray sustainability as a journey, and to identify the principles and components by which business organisational innovation might contribute to that journey – along with all the contradictions that tend to be part and parcel of life. The answers are neither simple nor are they unequivocal. The answers are neither enduring nor are they uniformly applicable. It is a horrible message for students and others who are used to being told ‘the way’; it is a message that does not convey readily in the sound-bite era of modern social networks and communications where clarity of purpose and a resolute determination to provide single solutions is more likely to be heard above the noise.
There remains an unspoken faith in generalisation that rests on the almost subconscious faith in the Newtonian ideal of science. We like to think that the more generalisable something is, the more true it is. Yet in the realm of sustainability the nature of truth is perhaps different. Sustainability as a broad socio-ecological concept suggests sensitivity to the unique characteristics of time and place, and to the particularities of the case in point; sustainability thus can be discovered and created by active participants seeking to redesign their world, in business models as in much else. Business model innovation thus is one dimension of this attempt to create a different way forward.
The wider issues remain unresolved. Perhaps business structures as a means of organising social wealth, investment, the supply of goods and services and of course employment, are not readily suitable to this journey of sustainability. Perhaps, like other social innovations, businesses as we understand them will ultimately fail and be replaced by something other. It is easy to forget how recent business organisations are, and indeed how temporary they often turn out to be.
Ultimately, as the book suggests, there are likely to be many outcomes in terms of business models for sustainability. There is no single template in that sense, and there will always be a tension between the stability implied by the term business model, and the need for dynamic structural change in the face of shifting external circumstance. The creation of more sustainable business models is thus an activity that embodies continuous challenges for the participants, and is equally challenging for those that wish to understand such organisational innovations. Sometimes my students complain, in the manner of children stuck in the back of a car, saying ‘Are we there yet?’. Little by little, I hope and believe we are getting closer – the various examples discussed in the book offer some hope in terms of inspiration for change – but no, we are not there yet. Exchanging ideas on this important subject is one way of accelerating the pace of change, which is itself an important concern given the apparent acceleration of the environmental pressures we place on planetary resources. Reaching out beyond academia is a further vital activity, such that our understandings are grounded in reality and that our ideas can perhaps inspire others with the resources to take action. There is a growing realisation of the inadequacy of eco-efficiency and technological innovation as the solutions to the resource and other burdens generated by humanity, with R&D funding organisations increasingly aware of the need to bring business model innovation into their previously narrow concerns with new technologies. Hence we can approach the future with some optimism and belief that we can make a difference for the better.”
Prof. Peter Wells, Cardiff Business School