Try, Learn, Try Again: Cracking the code for small businesses sustainability


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In 2007 a consultancy was born. A small team coalesced to tackle the pervasive problem that small businesses lag in implementing more sustainable practices. The purpose was clear and the team had a plan: build a profitable sustainability consulting firm for the smaller end of the small business sector. Three years later the business folded. We were partners in that business.

The problem wasn’t that it didn’t work. It worked well. The New York Times featured one client, Mi Rancho, that we trained and its creative manager, Joe Santana. With our help, Joe’s team generated stunning results. The company fulfilled its goal of scoring well enough on Walmart’s Sustainability Scorecard to gain them as a customer, and the practices they developed in our program saved them $450,000.

To enable our small business clients to have all the content they needed at their fingertips, we engaged eLearning professionals and built a comprehensive tool. It delivered all the information a company would need to increase its energy efficiency, cut its bills, and cut its carbon footprint. A variant of it is still used today by the Pet Sustainability Coalition, an industry specific group we founded. We hired a tenacious top-notch marketer to get this information to clients. We worked with clients from California to Iowa, across Colorado and Wyoming.

Our approach was innovative and ahead of its time. But we had set out not to create a boutique consulting group. Although a version of that would have worked well in any localized market, we had designed the consultancy to roll it out across the nation. But as configured, it was never going to scale. So we pulled the plug.

Seven years later, we haven’t forgotten why the small business sector matters. Defined by the census bureau as companies with 500 or fewer employees, The 28 million small businesses are the job creation engine of the nation, generating 64% of net new jobs. More than 99.7 percent of U.S. employer firms are small businesses. They generate half the non-farm income in the country and generate 16 times more patents per employee than large companies.

And we haven’t forgotten the problem: today, every large business around the world has a sustainability coordinator, often at the vice presidential level. Not so for small businesses. A 2016 survey by MIT’s Sloan Management Review and The Boston Consulting Group found that only 9% of companies with fewer than 1,000 employees fully embrace sustainability.

Why? Too little money and too little time. These constraints confront small business entrepreneurs the moment they try to do anything different.

Entrepreneurs seek the admiration of peers, the acceptance by their neighborhood, the respect of their employees and a better world for their families. They achieve these by hard work and grit. That grit gets things done, but grit alone won’t grow a business. And the minutia of day-to-day operations and the paucity of time and money grind away even the grit itself.

Shifting from business-as-usual to a more sustainable enterprise requires training and investment. Every small business wants a healthier world, but cash flow and making payroll at the end of the month rule the day. Professional sustainability consultants could help, but small businesses can’t afford them, so few ever seize the myriad opportunities to use fewer resources, employ regenerative practices, and make their communities more resilient.

Our success with clients proved that enormous opportunities exist to cut costs and enhance marketing while making small businesses more sustainable. But until we could figure how to take it to scale it wouldn’t serve our NGO mission.

Recently we assessed what worked and what didn’t work from those past experiences, and we believe we’ve cracked the code to activate a genuinely replicable, scalable and self-sustaining way to deliver sustainability to small businesses. What’s different this time is that we will give away our knowledge to participants. We will work with universities to activate local students to deliver the consulting in each of their communities. NCS is a non-profit. Rather than trying to monetize our knowledge directly, we will seek foundation funding to empower thousands of students to create boutique consulting firms, one in each community.

Meet “Sustainability For All” (S4All). This new model will engage small business as both participant, learner and teacher. We will train students, educators and entrepreneurs who will then embed profitable, sustainability practices within small businesses in every community. Here’s a quick overview of the approach:

    1) NCS will work with colleges and universities to offer a business practicum that will train graduate students to implement sustainable practices in businesses in each student’s community. Under this model, one or two graduate students will consult with a business over the course of a semester. NCS will train university faculty to offer these practicums. Therein lies the scalability; after fine-tuning the pilot program, we will roll it out to schools across the nation as a turn-key curriculum, and let them run with it. Each new school adopting the program will include the practicum as a regular offering every year.
    2) NCS will train faculty to train students to offer in-depth sustainability consulting to local small businesses for free. As their clients succeed, the example will encourage others to replicate the process.
    3) Upon graduation, students can champion sustainability inside a new employer’s business and set examples for their industry sector or:
    4) Graduates who desire to become entrepreneurs can set up their own consulting practices and offer these services to their communities.
    5) Case histories of success will accrue to the students’ portfolios and expertise.

 

Fig. 1

 
Participating businesses will increase profits, employee productivity, and sales growth by building tighter bonds with old customers and opening new markets. The companies will find it easier to attract fresh talent, enhance their brand personality, and gain a competitive advantage because of their sustainable commitments.

The S4All training program will incent clients to keep at it, on their own, year after year. Small business sustainability will serve as a gateway elixir increasing corporate social responsibility and the embrace of regenerative economic principles.

This approach builds on experiences from seventy of our past clients. These clients came from diverse business sectors: distributors, banks, engineering firms, healthcare businesses, light manufacturers, and food processors. From the sampling, we unraveled common threads and patterns.

Six patterns emerged from client actions and suggestions. The patterns coalesced into strategies that students who want to work in communities need to know:

    1. Enable each company to understand what sustainability can do for them;
    2. Dovetail into existing process;
    3. Deal directly with sustainability teams;
    4. Apply creative thinking to generate home-grown solutions;
    5. Keep engagements short, simple and substantive; and
    6. Become persuasive.

 

Fig. 2

 
What sustainability can do for small businesses. Each company is unique. Its founder started the business with a dream. S4All will train students to connect sustainability to a company’s heritage, values, mission, and destiny. Students will talk with management to learn what they believe about their business, then fit sustainability training into that context. Students will help the company define what sustainability means to them. For example a client whose owners were well known for their philanthropic work with the disabled saw sustainability as a natural extension of their values. Each company has a story to connect to sustainability.

In our trainings, we cited the example of a traditional 150-year-old family business from Pennsylvania who’s owners came from a background of hunters and fishers As early adopters of sustainability, the CEO’s sustainability statement featured, “striking the appropriate balance between our environmental responsibilities, financial performance, and social commitments.”

Dovetailing. Students will learn what processes a company has already established or adopted, then figure out how the company can slip sustainability into those processes. For example:

    1) Safety: sustainability has many ties to safety; e.g., maximizing daylighting cuts energy bills as it improves workers’ ability to see. A California client noted morale improvement from simply installing skylights for more daylight. One of our larger clients in the food industry folded sustainability into their award-winning safety program, meeting once a week to keep sustainability top of mind for their employees.
    2) Health and wellbeing. A senior living group in Denver included residents on their sustainability team. One client installed hands-free faucets and blow dryers (which save water and energy) in the restrooms and achieved reduced sick-day absenteeism. A single mother claimed that her child was ill less often during cold and flu season because of the company’s action. A lighting expert challenged one client, “your conference room has enough light to perform surgery.” Changing to more energy-efficient lighting improved comfort and cut costs.
    3) Continuous improvement (CI). Many companies practice CI: the identification and elimination of waste, plan-do-check-adjust, flowcharting, precise process measurements, and self-directed teams. Programs like lean manufacturing, founded on W. Edwards Deming’s principles, are core to achieving greater sustainability. Mi Rancho discovered that they were overprotecting their newly improved products for reasons that no longer existed, because “that’s the way we always did it.” The resulting simplified packaging design and handling process was projected to save $450,000 over five years.
    4) A client in the metals business that measured the number of printed pages per employee replaced all personal printers with a single LAN. Another measured all pallets and cardboard boxing in the receiving area and implemented a program to reduce or re-use. One client in the grocery store business cut bagging costs by setting measurable goals around “items per bag”. The prior year, they had measured five items per bag. Their sustainability plan of eight items would achieve a 40% reduction in bag cost. S4All will teach students the Deming principles inherently connected to sustainability. Learning this will train them to work with light manufacturers and food processors, even in companies not interested in sustainability.

Teams. Many consultants place too much attention on executives. Our successful clients had or formed sustainability teams. Such teams do a better job at implementing change. Orders from management tend to get lost in translation. In the best cases, management validates and sponsors the efforts of a sustainability team, reviewing the team’s output respectfully. Those who do the work should have a strong say in how it is done. If teams own strategies and tactics, they pump passion and higher purpose into everyone’s job. Companies with an engaged work force have 21% higher productivity and 22% higher profitability.

A metal-finishing client in Colorado expanded their green team concept by arranging cross-team collaborations with sustainability teams at neighboring manufacturers. The same company rotated some members of the team every six months to ensure that all corners of the company could participate.

S4All will train students to meet with company executives to help them form a team. If the company already has a team this will ease the introduction of the students as advisors and facilitators. This is done quickly so that the bulk of the training is with the actual team.

 
Creativity and homegrown solutions. Best practices are not always best. Examples of “best practices” are all over the internet and in sustainability books. Many consultants act as little more than tellers of these stale practices. You can bet that six months later employees have crawled back into the old way of thinking and working. S4All uses “best practices” solely as concrete examples to accelerate the learning process. If sustainability is to be anything more than the next management flavor of the month, employees must be encouraged to create their own approach to it. “Just tell us what to do” clients rarely achieve lasting results.

After our training, Mi Rancho referenced sustainability in daily and monthly plant meetings; the team posted bulletin board news and website items of competitors pursuing sustainability, an idea they came up with on their own to motivate continued improvement. Creativity, persuasion, and urgency underscored these approaches. Ownership of new ideas ensures the staying power of sustainability so that it flourishes into the future.

A client in the industrial and commercial HVAC business came up with an innovative energy-saving idea. An engineer whose office overlooked the company parking lot noted that the automatic gate opened and closed continually during the lunch hour as employees left and returned. He suggested leaving the gate (initially installed as a safeguard aimed at evening security for the fenced-in property) open during lunchtime.

A small consulting company in Iowa placed garbage cans outside, far from the door; they placed recycling bin next to the door. One of our clients used long runway carpets at building entrances to reduce the dirt brought into the building. Less dirt meant lower cleaning expense and better respiratory health. A food processing client provided on-site car washing services that used far less water than the usual car wash. A Colorado client in the cooling business set time limits on open overhead doors.

A quick way to engage employees is to offer programs that help them at home. A credit union client enabled employees to join in a discounted bulk buy of CFL and LED lights, low-flow shower heads, faucets, and home hot water heater blankets.

A Colorado client opened a contest for employees: who could make the best playground or fort for their kids at home using free pallets that the company cleaned and made available. They created employee gardens on company property and offered free thermography at employee homes. Another Colorado client let employees bring in old household electronics so the company could properly recycle the items. They purchased stainless steel water bottles for all the employees – a sustainable way to brand the company and bond with employees.

To stimulate client innovation, S4All will teach short ideation techniques: root-cause analysis and mind mapping to facilitate and summarize team meeting outputs. Both are engaging and fun to use. Students will learn the techniques in greater depth; the clients learn abbreviated versions, experiencing computer-projected mind mapping as the students will use it during meetings.

Businesses who come up with their own list of best practices have a better chance of weaving sustainability into the company cloth than those who try to impose an external list.

 
Short, simple, substantive. Students will deliver all that client businesses need to learn in five half-days over 12 weeks. Sustainability teams who want to dive deeper into content can access detailed information for any of the training session topics on the NCS website.

S4All will provide tools that are quick to learn and easy to use; e.g., the mind-mapping program is designed for sixth graders yet brilliantly facilitates team meetings. Students will learn to use audit tools that communicate in clear and simple language. They will learn to give PowerPoint presentations and receive decks that they can customize.

To manage clients, students will receive easy-to-access online content and a tickler file with talking points that prompt them to send pre-written emails. They will receive all materials and guidance needed for client contact, from introduction to final recap.

Class content for client training sessions will include agendas, action items for clients, presentation decks, exercise templates. The output from class exercises, surveys, questionnaires templates, and reference materials will be online and easy for students to use. They will even get a checklist of equipment needs, backup precautions, and AV requirements.

As part of the learning process, students will write two brief reports detailing what transpired after each training session and point of client contact. One will be a journal of impressions for the professor to view, another will be sent to the client.

Students will leave to meet a client well equipped and confident. They will be prepared for just about any contingency so that they may devote their attention to the learning process and listening to the client team.

Participating colleges and universities will not need to worry about the program staying current. Auditing tools and continually refreshed resources for regional sustainability financing opportunities will reside on the NCS website. Class content materials will undergo continuous improvement, with updated materials available to the schools, students, and clients.

 
Build persuasive messaging into the process. Students will help clients develop their own plans in a friendly format, using PowerPoint templates that cover each necessary area; e.g., marketing, employee transit, energy use, materials, water, material waste, material inputs and outputs, HVAC, and more. Students will be equipped with examples for each category and presentation tips. Clients will write their own headlines, and personalize their presentation by inserting pictures of people on the job, the team, the workplace, the local environs, company values, history, and their locale’s traditions into the plan.

Armed with their own action plan, sustainability teams can present to other employees, local schools, their bankers, vendors, customers, local community groups, and other stakeholders.
Reaching the small business community means speaking to them in their language. Most activists lose this audience because they mix a political agenda into pragmatic programs to enhance the economic viability of a community.

We will train students to deliver the business case for sustainability in ways that respect the belief systems of others. Sustainability is a strategy of national defense, an expression of the pioneer spirt and entrepreneurism that traces back to Ben Franklin. Energy independence is about freedom from foreign suppliers and even freedom from the grid. Distributed alternative energy is as much a libertarian agenda as it is a liberal one.

We will teach universities to frame sustainability in words that appeal to broad belief systems: opportunity, jobs, economic development, local economy, and global competitiveness. Students will learn how not to overwhelm audiences with data—those who resist change only become more resistant when showered with numbers. Conversations about increased prosperity, security, safety, health and wellness, however, tend to elicit broad agreement. S4All is designed to teach students to galvanize their audience, not convert or win arguments.

A client in the agriculture business generated a version of their action plan for their salespeople that described setting out on a journey, not that they were already a sustainable company. The client was aware of greenwashing from our training and did something creative about it. A utility company client in Iowa promoted their green efforts in employee recruitment and new employee orientation; sustainable business practices resonated with younger workers.

 
Taking it to scale
As the above data highlight, NCS has proven that small businesses can cut their environmental footprint dramatically and profitably. What we previously failed to do was show how this approach can scale. Doing that requires recruiting a vast army to deliver sustainability consulting in every community across the country.

“If you really want to master something, teach it.” This program will enable colleges to equip their students to become sustainability professionals in a direct and pragmatic way. Professors will teach the NCS practicum alongside an NCS instructor during the pilot phase. The curriculum is flexible so that professors can modify it to fit her/his personal style. Professors then teach students to train the small business clients. The students will train the clients not only how to implement sustainability, but also how to teach the company’s stakeholders about sustainability. Everyone becomes a learner, a teacher, and a persuader. This approach will enable students hungry for sustainability training to gain that at the same time it gives them a career.
 
Piloting “Sustainability for All”
Regis University of Denver is working with NCS to test a first run of S4All in 2019 in their graduate business school. Regis is considering integrating the practicum as part of an innovative “Regenerative Economy Certification.” After the initial pilot, we will select other colleges and universities to roll out the program. Natural Capitalism’s work in these first two years will be supported by foundation grants and appeals to personal philanthropy. Thereafter, NCS will charge universities a small fee for the curriculum.

Business clients for the pilot will be chosen from the college’s business alumni, from companies where students currently work while earning their graduate degrees, and from business service organizations like the Better Business Bureau and the Manufacturing Extension Partnership of the U.S. Commerce Department.

S4All will help the small business sector spread sustainability across the country. Enabling colleges and universities to help this sector implement greater sustainability will create ripples that emanate outward and back again in a regenerative cycle of local collaboration and engagement. Colleges will embrace and endear themselves to their local business community and their business alumni. Students will benefit from the blend of real-world experience learned from the diverse demands and joys of working with small businesses. Participating small businesses will be recognized as more significant contributors to the local economy, and their employees will be more productive and engaged in a higher purpose.

Natural Capitalism Solutions has chased the grail of a small business sustainability training for a decade. This time we think we’ve got it right. We invite your participation as we test this initiative and fine tune it over the next year. Stay tuned by dialing into our progress at www.natcapsolutions.org.