After seven years of working on sustainable business at REI, I am taking some time to reflect and share some of the things I learned. My time at the co-op was a wonderful personal and professional experience, a kind of perfect storm of opportunity: an engaged employee base, a motivated and inspirational leadership, a co-op business model with enthusiastic members all wrapped in a brand and industry position that leveraged $2B in sales well beyond its footprint. Sally Jewell, the former CEO, said that in these years the co-op moved from “random acts of greenness to sustainable business strategy.” The results were millions of dollars of recurring annual cost reductions and growth in sales and profitability all while reducing the absolute environmental impacts of business operations, contributing incremental value in REI communities and establishing an international reputation as a leader in responsible business.
REI didn’t do all this alone. In fact, help from industry players and other brands such as Patagonia, MEC, NIKE and Timberland (to name a few) accelerated the effort and shortened the learning curve. We also didn’t do it without mistakes — for every win there are plenty of stories of things that didn’t go as well but contributed to the learning. Which brings me to this blog series, where I plan share a few of the things I learned that might be useful to others on the journey to transform their company from a conventional-thinking organization to a sustainable business.
Part 1: Abundance
My first lesson was that no one was inspired by an "I have a nightmare" speech; people need an “I have a dream” vision. Telling people that my job at the co-op was to stop us from doing all the bad things we did was not the path to instant acceptance and widespread enthusiasm.
We know the consequences of conventional business — along with economic growth has usually come resource depletion, pollution and social issues around the globe. As the world becomes a smaller place most of us are pretty aware of at least some of the big challenges and it becomes particularly difficult when we think of ourselves as part of the problem. While we all want to be part of the solution, the conventional thinking remedy is pretty unattractive. Growth is bad, resources are scarce and compromises must be made. This either/or mentality that is central to conventional thinking preaches that we can either have prosperity or sacrifice; no wonder it’s not winning. Paraphrasing Einstein, solutions cannot come from the thinking that created the problem.
Communicating complex, unfamiliar sustainability claims on CPG packaging
Join us as Applegate and HowGood share insights into marketing lessons, consumer response and understanding, and marketplace data on the expression and communication of new categories of sustainability claims on CPG packaging - as well as tips for avoiding consumer and industry backlash and controversy - Wed, Oct. 16, at SB'24 San Diego.
Sustainable business is not the opposite of conventional thinking — it is a different way of looking at the world. Rather than scarcity, we see abundance. We see the fundamental business advantages of building dependencies on renewable resources rather than on limited, finite materials. We see the asset of human creativity and innovation rather than more mouths to feed. And we believe that businesses that create positive side effects rather than negative, unintended consequences will be more successful and will thrive in a world where conventional business will not. So my first lesson was that to be successful we need to paint a winning business vision. Success comes from talking about the upside of change rather than the downside of the status quo.
In coming posts I’ll add more things I learned at REI — stay tuned and feel free to comment or respond.
This post first appeared on Kevin Hagen's blog on April 15, 2013.
Part two
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VP, Environment, Social & Governance Strategy
Iron Mountain Inc.
Kevin Hagen is Vice President Environment, Social & Governance (ESG) Strategy at Iron Mountain (NYSE: IRM) the global leader in storage and information management services with $4B in sales operating over 1400 facilities in 56 countries.
Published May 13, 2013 4pm EDT / 1pm PDT / 9pm BST / 10pm CEST