Blekinge Institute of Technology

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Blekinge Institute of Technology

THE GREEN STRATEGY: INDUSTRY PERCEPTIONS AND

PERSPECTIVES AS A NEW MARKET-DRIVEN BUSINESS FOCUS

FOR GAINING COMPETITIVE ADVANTAGE.

Ozoeze, Joseph Ugwu-Eze

Supervisor: Jan Svanberg

Thesis for the Master’s degree in Business Administration

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Abstract

All businesses no matter how benign or smart their operations are create some level of environmental harm. These impacts can be minimized or controlled by a adopting a well articulated firm-level green strategy. The need to green should not just be to address companywide environmental challenge but also a proactive strategy to stay on the right side of the regulation and for profitability. Many factors drive a company to pursue green initiatives but whatever it is that motivate an organization, it also possible that a company can enjoy a sustained competitive advantage through greening.

This study examined the green strategies organizations can use to derive competitive advantage. A multiple case study approach based on intensive field survey was used. The field survey was carried out in 2010. A total of 268 respondents drawn from ten companies were selected for the purposes of the survey. These companies operate in different sectors of the economy: 3, from the oil/gas; 3, from the manufacturing; 2, from banking/insurance; 1, from hospitality/tourism and 1, from the telecom.

A questionnaire survey (see Appendix A) containing thirty-six (38) questions was sent out to the companies. The data gathered through the questionnaires was analyzed using the statistical functions of Microsoft Excel.

Result obtained confirmed that companies‘ activities cause environmental burden and their impacts can be responsibly controlled using firm-level green strategies. Companies can also derive other benefits from going green. Ultimately a company can achieve sustained green competitive advantage in the long run.

Our reason for being: Build the best product, do no unnecessary harm, use business to inspire and implement solutions to the environmental crisis.

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Dedication

To the Glory of God for giving me the inspiration and strength to complete this study against all odds and for His faithfulness in those challenging moments.

Next, to my priceless wife and children for their wonderful support and encouragement.

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Acknowledgements

The success of this study would not have been possible without the concerted effort of a good number of people. Top in the list are my parents, Ozo, my dad (now of blessed memory) and my mom, Uba for their unflinching supports, encouragement and prayers. Next are my wife for keeping faith and the children for their constructive nuances. I thank them more so for their constant love and motivation, and for staying on patiently.

My special gratitude goes to my thesis supervisor, Jan Svanberg for his keen interest, positive comments, guidance and thoroughness in the supervision at all stages of this research.

I wish also to express my thanks to all the course instructors whose collective and individual effort formed the foundation of this thesis. Thanks also to the MBA programme Assistants, Katrin and Eva for their just-in-time assistance. To Lebo Emori and Mudassar Asghar, I say thanks a lot for your critiques that contributed in shaping the final thesis.

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List of Figures

Figure 2.1: An illustration of the three principles for enterprise-level green decision making..17

Figure 2.2: Strategy pyramid and operations influenced by a green strategy...17

Figure 4.1: Industry perception level of environmental impact, effort to reduce the impact, pursuit of greening, consumers demand for green products and opportunities in greening………...…...38

Figure 4.2: Taking measures to reduce or minimize environmental impact...39

Figure 4.3: Significance level of market opportunities presented to your company by the green movement... ...39

Figure 4.4: Potential impacts of the green movement in companies...40

Figure 4.5: Risk Assessment of Green initiatives...41

Figure 4.6: Green technology, products and services under development...42

Figure 4.6.1: Reasons for greening products and services...42

Figure 4.6.2: Options for companies to derive green opportunities………...43

Figure 4.7: Strength of demand for green products and services by different customers...44

Figure 4.8: Future expectations of demand for green products and services...45

Figure 4.9: Factors important for green decision making...46

Figure 4.10: Likely outcomes for going green………...47

Figure 4.11: Impacts felt on various company operations as a result of going green……...49

Figure 4.12: Expected future impacts of greening on various companies‘ operations...50

Figure 4.13: Responses on whether to regulate industry and company effort to pursue environmental stewardship and profit making as a bottom-line...51

Figure 4.14: Likely company actions as a result of environmental/regulatory issues...52

Figure 4.15: Present and likely elements of business operations...53

Figure 4.16: Present and future elements of compliance/control………...55

Figure 4.17: Present and expected future green strategies………...57

Figure 4.18: Customers‘ willingness to pay premium for green, green concept in products from design stage, and rejection of greening due to cost limitations…………...58

Figure 4.19: Current and future greening efforts in R & D, engineering and manufacturing…..60

Figure 4.20: Constituencies and interest groups are the most influential in driving company‘s green initiatives………....……...61

Figure 4.21: Decision factors with regard to environmental consciousness when purchasing new equipment………...………...62

Figure 4.22: Perception of environmental harm done by industry operations...62

Figure 4.23: The importance of putting measures to reduce company‘s environmental emissions and negative impacts...63

Figure 4.24: Benefits of going green to company‘s operation and opportunities for organization in the future………...64

Figure 4.25: Factors that influences company's commitments to environmental initiatives……64

Figure 4.26: Determining the utilization level of green consumables in the organizations...65

Figure 4.27: Percentage and frequency distribution of drivers of organizational interest in green or environmental initiatives…………...66

Figure 4.28: Anticipated time (in years) for increase in the company‘s use of green products...66

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List of Figures (continued)

Figure 4.30: Assessment of company‘s current greening status………...66

Figure 4.31: The impact of top management involvement and commitment on the implementation of green strategies in the companies...66

Figure 4.32: The respondents‘ perception of how the introduction of green strategies has impacted the company in the measured aspects...68

Figure 4.33: The impact of quality and environmental management certifications on the market acceptability of company‘s product/services, its position, reputation/ public image, and competitiveness...69

Figure 4.34: Company‘s performance in green initiatives………...69

Figure 4.35: Distribution of respondents by sector………...70

Figure 4.36: Distribution of respondents by company‘s financial strength…………...70

Figure 4.37: Distribution of respondents by job category………...71

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List of Tables

Table 2.1: Summary of key best practices that support green strategy...16

Table 3.1: Distribution of population of respondents by industry...34

Table 4.1: Assessing industry perception level of environmental impact, effort to reduce the impact, pursuit of greening, consumers‘ demand for green products and opportunities in greening...36

Table 4.2: Percentage and Frequency Distribution of responses measures to reduce environmental impacts...37

Table 4.3: Significance level of market opportunities presented to companies by the green movement...38

Table 4.4: Potential impacts of green movement in companies...39

Table 4.5: Risk Assessment of Green Initiatives...39

Table 4.6: Responses to whether company is developing green technology, products and services...40

Table 4.6.1: Reasons for developing green products and services...41

Table 4.6.2: Options for companies to derive green opportunities...42

Table 4.7: Strength of demand for green products and services by various customers...42

Table 4.8: Future expectations of demand for green products and services...43

Table 4.9: Factors important for green decision making...44

Table 4.10: Likely outcomes for going green...46

Table 4.11.1: Percentage distribution of responses to impact on various operations as a result of going green...47

Table 4.11.2: Frequency distribution of responses to impact on various operations as a result of going green...47

Table 4.12.1: Percentage distribution of expected future impacts of greening on various company operations...48

Table 4.12.2: Frequency distribution of expected future impacts of greening on various company operations...49

Table 4.13: Percentage distribution of responses on whether to regulate industry and company effort to pursue environmental stewardship and profit making as a bottom-line...50

Table 4.14: Likely company actions as a result of environmental/regulatory issues...51

Table 4.15.1: Percentage distribution of responses to present and likely elements of business operations...52

Table 4.15.2: Frequency distribution of responses to present and likely elements of business operations...52

Table 4.16.1: Percentage distribution of present and future elements of compliance/control...53

Table 4.16.2: Frequency distribution of present and future elements of compliance/control...54

Table 4.17.1: Percentage distribution of present and expected future green strategies...55

Table 4.17.1: Frequency distribution of present and expected future green strategies...55

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List of Tables (continued)

Table 4.18.2: Frequency distribution of customers‘ willingness to pay premium for green, green concept in products from design stage, and rejection of

greening due to cost limitations...57 Table 4.19.1: Percentage distribution of current and future greening efforts in R & D,

engineering and manufacturing...57 Table 4.19.2: Frequency distribution of current and future greening efforts in R & D,

engineering and manufacturing...58 Table 4.20: Percentage and frequency distribution of constituencies and interest groups are

the most influential in driving your company‘s green initiatives...59 Table 4.21: Decision factors with regard to environmental consciousness when

purchasing new equipment...60 Table 4.22: Percentage and frequency distribution of perception of environmental

harm done by industry operations...60 Table 4.23: The importance of putting measures to reduce company‘s environmental

emissions and negative impacts...61 Table 4.24: Percentage and frequency distribution of benefits of going green to

company‘s operation and opportunities for organization in the future...61 Table 4.25: Factors that influences company's commitments to environmental initiatives...62 Table 4.26: Determining the utilization level of green consumables in the organizations...63 Table 4.27: Percentage and frequency distribution of drivers of organizational

Interest in green or environmental initiatives...63 Table 4.28: Anticipated time (in years) for increase in the company‘s use of green products...64 Table 4.29: Percentage and frequency distribution of company relationship with customers,

business clients, and community in terms of environmental performance...64 Table 4.30: Percentage and frequency distribution of an assessment of company‘s

current greening status...65 Table 4.31: Percentage and frequency distribution of the impact of top management

involvement and commitment on the implementation of green strategies in the companies...66 Table 4.32.1: Percentage distribution of respondents‘ perception of how the introduction of

green strategies has impacted the company in the measured aspects...67 Table 4.32.2: Frequency distribution of respondents‘ perception of how the introduction of

green strategies has impacted the company in the measured aspects...67 Table 4.33 Percentage and frequency distribution of the impact of quality and

environmental management certifications on the market acceptability of company‘s product/services, its position, reputation/public image, and

competitiveness...68 Table 4.34: Percentage and frequency distribution of company‘s performance in

green initiatives...68 Table 4.35: Percentage and frequency distribution of respondents by sector...69 Table 4.36: Percentage and frequency distribution of respondents by companies‘

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Chapter One:

Introduction

1.1 Statement of Problem and Research Focus

Growing concerns about quality, environment, safety and health have changed the ways organizations conduct their businesses. Quality-driven policies are now top management priority and boardroom agenda all because of the positive effects on the corporate image, finance, and resource optimization. A better practice will be an integration of quality, environment, safety and health elements in all corporate policies and processes to drive green business initiatives.

This work intends to contribute to the functional application of quality tools and techniques in combination with environmental, safety and health management systems necessary for superior products and service that satisfy the desired end uses and support the safety, health and environmental well being of all stakeholders in terms of green compliance.

Environmental issues have attracted increased global concern of various stakeholders; and to remain relevant and competitive in this ‗green era‘ businesses must develop strategies to tackle the challenges. In the past and even to this day quality management system has been seen and used by various firms as a tool for improving their operational efficiency and achieving competitiveness. Also environmental management has been used to a greater or less extent to achieve competitiveness but recent global environmental issues is giving impetus to current attention in this area. It is envisaged that ‗green quality‘ will drive the global economy in the near future. This work will investigate the business opportunities in terms of competitive advantage and operational efficiency that organizations can achieve by integrating green

strategies into their business processes to stand at a favourable green light. In this study this

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1.1.1 Purpose of Study

The very aim of this dissertation therefore, is to examine the use and industry perceptions of green strategy as a new market-driven business focus to achieve competitive advantage, operational effectiveness, and corporate performance of organizations. The study will draw positive conclusions on the indispensable gains of integrating green focused strategies in the overall business policies and strategies.

The purpose of this discourse is inspired by the growing concern on green initiatives necessary to control and minimize ecological hazards (e.g. climate change, flood, green house gas (GHG), pollution) resulting from human enterprise activities, economic development, globalization, infrastructural development, etc.

1.2 Research questions

1. Do global concerns of environmental stakeholders influence the need for organizations to adopt green strategies or initiatives?

2. What are the benefits of developing and adopting green strategy to an organization? 3. Does top management involvement and commitment bring about positive impact in

the implementation of green strategy?

4. How are green initiatives related to operational excellence, corporate performance (measured by employees' beliefs/perceptions of company environmental performance) and competitive advantage of organizations?

5. Do quality and environmental management certifications affect market acceptability of a product, its position, reputation/public image, and competitiveness?

1.3 Research Method

The study will use both qualitative and quantitative research methodology involving interview and case study to assess the benefits (short- and long-run) of integrating quality, safety and health of the environment in an organization‘s business policy from the green strategy standpoint. In addition to the qualitative and quantitative analyses, the study will make use of structured questions based on the concerns arising from review of various literatures. Moreover, this dissertation will use materials from both primary (field survey and observations) and secondary sources (journal articles, textbooks and working papers, etc.)

1.4 Data Analysis

Collected data would be evaluated using statistical methods such as frequency distribution tables, percentages, statistical population – sample size, and the X2_{tool (Chi-Squares) for test of the}

hypotheses. However, the choice of each analytical tool would be dependent on the suitability and reliability to address the questions raised in this study.

1.5 Relevance of Research and Limitations

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needs (not only personal but also environmental needs) at a price that represent value. It can be argued that market share/performance and competitiveness can be enhanced by operationalizing ‗green quality. It is very important that businesses should begin to align their business policy with the current global ‘green‘ thinking to abate environmental problems leading to climate change and depletion of natural resources.

It is envisaged that this ‘green‘ ideology may likely affect the business world and organizations that are ready to tap into it could be better positioned in the global market and gain competitive advantage.

The current global environmental issues centering on climate change, green house and depletion of natural of nonrenewable resources are raising fresh concerns to all stakeholders. It is very likely that the business arena will be most affected and these ‗green‘ concerns may shape the business conduct and success of contemporary firms. Therefore this discussion will give insights to policy makers, scholars, and business managers on the benefits of thinking and acting ‗green‘ in policy formulation, implementation, business practices, and technological or product innovation.

Quality in production or service provision does not really make sense in today‘s market unless there is a corresponding ‗quality stamp‘ on the product or service package. An ‗environmental (`green`) quality stamp‘ should be required of any product or service to show that it is environmentally safe and conforms to national and international regulations. Due to globalization all business, big and small, know that even products and services for local markets should as a matter of strategy meet specified customers‘ expectations, and at the same time conforming to some acceptable standards. Before the widespread use of ISO certification in response to global business pressures, most industries and organizations developed their own in-house procedures or adopted some industry-specific ways of doing things – approaches aimed at meeting the orders from customers with little or no regard to cost disadvantages resulting from poor quality and non-compliance to safety, environmental and health requirements.

The application of a generalized standards or benchmarks such as ISO suites has proven useful in the making of a good number of products and service for markets anywhere in the world. When used together with an existing system(s), the result is enhanced process methodology and superior product and service reputation. A product made in the US can now compare and compete favorably with another made in Nigeria, China or elsewhere in the world because of the requirements of quality, environmental, safety and health management packages particularly the ISO 9001:2000, ISO 14001: 2004, and OHSAS 18001.

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may have provided the unreal data. So the data for this study and their analysis are correct as an academic exercise and must be applied with caution for real world situation.

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Chapter Two:

Literature Review and Theory

2.1 Preamble

The importance of quality and compliance to environmental, safety and health standards to business processes are far-reaching and have attracted a lot of researches both in academic and non-academic circles. Research work on quality and environmental, safety and health management – in relation to ‗green‘ strategies as strategic tools to boost organizational performance, operational efficiency, reputation, and competitive advantage seem to be in its embryonic stage but rapidly gaining interest. However it is obvious that growing environmental concerns at all levels and from various stakeholders that have manifested in stringent environment regulations, government pressures, international environmental certification standards for quality and environment management ISO 9000 and ISO 14000, changing market and customer demands and the need to avoid economic waste by pollution (Porter & Van Der Linde, 1995) are strong drivers of positive environmental behaviours of firms to adapt to new regulations (Rondinelli & Vastag, 1996). However the environmental practices currently used by most organizations are not doing much to attain acceptable level of environmental quality, safety and health (greenness) that is sustainable. The global warming (greenhouse gas), climate change – a clear and present danger1, ozone layer depletion, etc. are assuming alarming dimensions that awakens businesses and organizations (including governments) to change the ways they handle environmental sensitive issues and refocus on greening strategy. If nothing is done to eradicate or minimize the green worms (pollution, wastes, etc.), the threat of global warming and climate change challenge will undermine or erode many of the gains enshrined in the Millennium Development Goals (MDGs) that world leaders pledged to achieve by 20151. This work intends to contribute to the functional application of green quality tools and techniques (environmental, safety and health management systems) necessary for superior products and service that satisfy the desired end uses and support the safety, health and environmental wellbeing of all stakeholders including our earth while ensuring profit maximization for businesses. The short- and long-term benefits to organizational growth, public image, and financial performance will be emphasized. Considering the relevance, richness and diversity of green issues it will be worthwhile to explore deeply green strategies historically and its link to business process and policy. For the purposes of this study the market-(customer-) based perspectives, the theoretical development, the determinants, management and leadership commitments and benefits of green strategy will be reviewed. Attempts have been made to identify some green options that organizations have used to improve their fortunes and launched into limelight and emerging areas that have the capacity to make them giants. Thinking, acting and building green reputation is a dominant option to stay competitive so as to continue to remain the customers‘ haven by providing products and services with desirable safety, health, quality and environmental characteristics to the customers.

Over the years many conferences at national, regional and world level have been organized to discuss issues affecting environmental health. The outcome of these conferences includes standards and guidelines aimed at effectively managing environmental quality through the

1_{Culled from the UN Secretary-General Ban Ki-moon‘s message to a special session of the UN Environment Programme (}_UNEP_{) Governing} Council / Global Ministerial Environment Forum in Bali, Indonesia.

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reduction of emissions to the environment. The United Nations Earth Summit in Rio de Janeiro in 1992 and Climate Change Conferences held in 1997 in Kyoto and in 2009 in Copenhagen attended by world leaders and other stakeholders are evidence of the importance of environmental health. The ISO 14000 is a set of guidelines for environmental management systems developed by the International Organization for Standardization (ISO). It goes without saying that the escalating ecological problems at different parts of the world are giving support to the search for a holistic environmental management system. The depletion of the ozone layer (that is responsible for climate change) and the nonrenewable resources and the greenhouse effect are serious ecological problems (Madu, 2004). For the purposes of this study, an examination of the green strategies/concepts and contributors to the field will be carried out. To achieve this objective, a good start point will be the origin of green movement, its perceptions and practice, systems that support the initiative such as TQEM, TQM, EMS, ISO 9000 and ISO 14000, etc.

2.2 Understanding Green Strategy

Green strategy has meant many things to many people and organizations. Generally green strategy is a new way to strengthen environmental commitment. A green strategy has been identified as one that complements the existing organization‘s business, operations, and asset strategies often well understood and articulated by the firm (Olson, 2008). Fundamentally a green strategy helps an organization to make important policy decisions that favourably address environmental concerns. (Olson, 2008) observed three principles that form the framework for organization‘s (firm-level) strategic green decision (see Figure 2.1).

Though green strategy development may be new it is beginning to assume remarkable attention of industry key players at all levels. As such it is not a standalone programme but one that could enhance favourable interplay with other corporate strategies. According to (Olson, 2008) it can be one key ingredient in broader corporate stewardship or social responsibility programme of an organization.

 A green strategy fosters a common culture of awareness and action

A green culture is one that may entails reinforcing desirable behaviour that people are keen to adopt and the needed change can be achieved using the right tools and orientation. Organizations with green culture create noticeable impression on the mind of visitors. Nonetheless the impact of encouraging positive environmental behaviours can be very tremendous when it embedded in an organization‘s core business strategy to support green considerations in decision making. Even when the impact seem unnoticeable the sum of the individual effort of all employees can be very significant in meeting targets.

Attitudes such as littering the environment with pieces of paper can be very disgusting to some people. Similarly wasting water by leaving a tap to run without closing or due to unattended fault can be treated as an offence in some companies. Recycling is an important green tool and can be a source of revenue for some companies.

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Best practice Illustration

Lead by example Corporate sponsorship of environmental improvement initiatives in the community, such as investment in reforestation.

Support and coordination leadership provided for volunteer work such as ‗‗beach cleanup day‘‘

Provide training Formal training that connects the science of global warming with actions that employees can take to make a difference.

Employee new hire training and refresher training that strengthens conservation behavior, such as turning off running tap, switching off lights and recycling paper.

Install appropriate tools

Place appropriate waste and recycling receptacles where they are most likely to be used.

Provide videoconferencing as an alternative to face-to-face meetings that require travel.

Measure and report performance

How many bottles were recycled from various facilities? How much paper was recycled?

How many people volunteered?

What newspaper articles have been written or local city officials have recognized the community contributions from employees?

Make it everyone’s responsibility

Senior executives establish priorities, guiding principles and governance

Managers apply guiding principles to make operational decisions aligned with the green strategy

Practitioners complete projects with a greater degree of green benefits

Create a

communication and change management plan

Communicate successes early and often, build a knowledge portal and share lessons learned

Have support available to answer questions and provide facts Anticipate organizational needs

Table 2.1: Summary of key best practices that support green strategy

Source: Eric G. Olson ‗Creating an enterprise-level ‗‗green‘‘ strategy‘, Journal of Business

Strategy Vol. 29, 2, (2008), pp. 22-30,

.

Figure 2.1: An illustration of the three principles for enterprise-level green decision making2

2_{Culled from Eric G. Olson ‗Creating an enterprise-level ‘‘green’’ strategy’,}_{Journal of Business Strategy}

VOL. 29, 2, (2008), pp. 22-30.

A Green

Strategy That That

Fosters: Facilitates: have

 Organizations should work to establish a 2.1.1 culture where green awareness and

2.1.2 proactive attitudes is part of employees

2.1.3 routine activity

2.1.4

 Employees and stakeholders should be 2.1.5 given the appropriate tools and training

2.1.6 so that living in this culture is easy, fun

2.1.7 and rewarding

A Co mm on Cu ltu re of Aware ne ss a nd Actio n

Deci sion s and Tra n sfor matio n Initiati ves tha t imp rov e the E nvir on ment

 The ability to make decisions based on the

effects they have on the environment should be integrated with other criteria already in place that facilitate decision making

 Priorities set by a green strategy should be

integrated with the business, operations, and asset strategies so that priorities are aligned and conflicting interests are easily resolved

 The business case for a green strategy

and the actions it supports should seek to identify benefits to both top-line and bottom-line costs

 New perspectives on benefits realization

need to be adopted for qualitative and quantified opportunities, and a broader perspective on the value proposition may need to be taken

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Products and Services Channels and Partners Markets and Geographies

Process and Facilities Skills and Core Competencies Reports and Data Visibility Systems and Platforms

Hardware and Equipment 2.1.8 Operating Strategy 2.1.9 Organizational Strategy 2.1.10 Information Strategy 2.1.11 Applications Strategy 2.1.12 2.1.13

 A green strategy facilitates decisions and transformation initiatives that improve the

environment.

According to (Olson, 2008) setting a clear vision and strategy ultimately enables people to make better decisions that align with the firm priorities to provide goods and services in the global marketplace. A firm-level green strategy is no different. In fact, unlike most other areas of strategy formulation in a firm, green strategy affects decisions that are made across the entire firm, including business strategy, operating strategy, organization strategy, information strategy, applications strategy, technology strategy, and supporting infrastructure. Figure 2.2 shows how the different areas of strategy formulation (the strategy pyramid), and the tactical operations areas they govern, are all influenced by a firm-level green strategy.

Figure 2.2: Strategy pyramid and operations influenced by a green strategy2

2.3 Evolution of Green Management Strategy

Management practices and theories have evolved from several thoughts beginning from the classical through the behavourial school, through total quality management (TQM), through total quality environmental management (TQEM) to green management. Contemporary management practices and theories are culmination of several thoughts spanning several periods of time and phases of economic development beginning from the period of industrial revolution in the 19th century to the present day of global rapid change and competition. Different management and organizational practices, concepts, and theories have emerged to fit the demands and challenges of the time (Stahl, 1996). These theories/practices emerge to address the circumstances of the time. The literatures on quantitative, classical, behavioural, and the management function schools are well established. These pioneering efforts gave birth to the principles for effective development and management of organizations aimed at promoting organizational performance and goal achievement. Detailed discussion on the management schools is outside the scope of this study.

To quote Wikipedia, (http://en.wikipedia.org/wiki/Category:Politics),

―Unease about adverse consequences of human actions on nature predates the modern concept of ―environmentalism". Social commentators as far apart as ancient Rome and China complained of air, water and noise pollution (Keys, 2003)3.

3_{Culled from}_{http://www.en.wikipedia.org/wiki/Category:Politics}_{. Last modified on 28 September 2010 at 11:11.} Business

Strategy

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Green ideology is closely associated with green politics that originated in Germany in the 1970s. The supporters of this ideology share many ideas with the ecology, conservation, environmental, feminist… movements.

Greens (supporters or adherents of green ideology) today reject the accusation of Luddism, countering that their policies of sustainable growth encourage 'clean' technological innovation like renewable energy and anti-pollution technology (Kassman, 1997)4. Greens have often taken the lead in raising concerns about public health issues such as obesity.

Green platforms generally favor tariffs on fossil fuels, restricting genetically modified organisms, and protections for eco-regions or communities. In keeping with their commitment to the preservation of diversity, greens are often committed to the maintenance and protection of indigenous communities, languages, and traditions.

Some claim it also includes feminism, pacifism and the animal rights movements. Some Greens support policy measures to empower women, especially mothers; to oppose war and de-escalate conflicts and stop proliferating technologies useful in conflict or likely to lead to conflict, and Great Ape personhood.

Green politics on the whole is opposed to nuclear power and the buildup of persistent organic pollutants, supporting adherence to the precautionary principle, by which technologies are rejected unless they can be proven to not cause significant harm to the health of living things or the biosphere. Green politics also encourages political action on the individual level, such as ethical consumerism, or buying things that are made according to environmentally ethical standards. Therefore, adherents to green politics (movement) advocate economic policies designed to safeguard the environment. Greens want governments to stop subsidizing companies that waste resources or pollute the natural world, subsidies that Greens refer to as "dirty subsidies".

The philosophical roots of environmentalism can be traced back to enlightenment thinkers such as Rousseau in France and, later, the author and naturalist Thoreau in America. Organized environmentalism began in late 19th Century Europe and the United States as a reaction to the Industrial Revolution with its emphasis on unbridled economic expansion‖.

The current global economy and politics seem to be tilted to green ideology considering the heightened environmental problems such as global warming and climate change. The UN has convened meetings of world leaders to proffer solution. At regional and national levels effort are ongoing to tackle the issues of environment and sustainability. The outcomes of these efforts are policies and legislations that will change the business and organizational conducts. Time will tell whether all is for better or for worse!

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2.4 Voluntary Green Initiatives

The success of implementation of environmental policies to a large extent is dependent on the enforcement of the regulation. Firms and industry associations have reduced rising compliance costs by taking up voluntary green initiatives without compromising environmental standards (Raine and Prakash, 2005; Bansal and Clelland, 2004). The resource-based view (RBV) has been recommended as a platform for studying green issues (Dowel et al., 2000; Hart, 1995). The RBV focuses on the relevance of internal resources and capabilities which determine an organization‘s competitive advantage. Similarly the institutional theory has the endorsement of researchers as the most common foundation for investigating green issues (King and Lenox, 2000; Lounsbury, 2001). Institutional theory is external force biased suggesting that organizational behaviours are influenced by external forces which are coercive, normative or mimetic in nature. In recent time, the growing pressure for better and responsive environment stewardship come from many quarters – the stakeholders, market and non-market forces, government and consumer advocates. Before now not many organizations understood the benefits that may accrue from adopting green strategies. It is no longer regulatory obligation alone that determines a firm‘s adoption of green strategies but also economic interests, social responsibility, legitimacy or image making.

Although the institutional theory is well documented, it has been faulted (Scott, 1987) for its anticipated isomorphic bearings on firms (DiMaggio and Powell, 1983). Institutional theorists refute the unfavourable claims portraying firms as mere dumps or test ground for imposing external forces (Hoffmann and Ventresca, 2002). They argue in favour of institutional pressures as drivers of enterprise- and industry-level heterogeneity in strategies and outcomes but rule out isomorphic threats. Longstanding relationship between firms and institutions can create diverse strategic opportunities for the firms (Hoffman, 1999). Green strategy has bolstering propositions built on the institutional theory to advance a green institutional theory that place coercive, mimetic and normative forces as core drivers of the response of firms to green initiatives (Jennings and Zandbergen, 1995). Institutional forces are tripartite with pressure from the professional associations as normative; government pressure (policies, regulations, treaties and protocols, etc.) as coercive; and competitive market domination and influence as mimetic. The green resource based view (RBV) posits that the rareness, inimitability, value, and non-substitutability of firm‘s green resources and capabilities confer it with competitive advantage. In support of this proposition several independent researches recommend the integration of environmental issues in strategic decision to achieve financial performance and competitive advantage (Hart, 1995; Judge and Douglas, 1998). Superior green resources and capabilities can enhance flexibility and adaptive manoeuvres over compliance that cannot be paralleled by competitors.

2.5 The Green Organization

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environmental quality. The approach is to deepen effective use of resources, waste and pollution reduction, and achieving superior product quality (with desirable characteristics in terms of consumer and environmental safety and health). It encompasses the entire business processes from production, supply chain, and waste generation, control and disposal methods. Indeed a green organization should be interested in seeking ways to make money from waste; for instance initiating waste-to-cash programme. Some example of companies that have achieved reasonable green successes include 3M Company‘s Pollution Prevention Pays (PPP), Dow Chemical‘s Waste Reduction Always Pays (WRAP) programme, and Chevron‘s Save Money and Reduce Toxics (SMART) program, Westinghouse and ACT (Achievements in Clean Technology) and Texaco with its WOW (Wipe Out Waste) program. In each case, the goals of the programmes are the same – to reduce waste and pollution while recovering lost profits (Shrivastava and Hart, 1994; Curkovic et al., 2008).

2.6 Total Quality Management (TQM)

Before the heightened demand for environmental stewardship, most businesses have used the quality management system (ISO 9000) to partly address the quality issue of the environment. But that was not enough, a dedicated and elaborate system is imperative. The ISO 14000 series for environmental management is now widely used by organizations to enhance their environmental performance. Quality does not only refer to goods and services but also include quality of time, place, equipment and tools, processes and people, the environment and safety, information and measurement (Schonberger, 1990). Greening is a systematic way to reinforce the quality, safety and health of the natural environment and its occupants by incorporating desirable characteristics in product/service design, production and supply chain, and marketing. Total Quality Management is a strategic approach to management that takes advantage of all corporate resources to continually improve performance and processes so that they may ultimately be error free. The result is a product or service that greatly exceeds customer expectations. There are several contributors to the development of TQM but the most important contribution came from Edward Deming who proposed the fourteen (14) points of TQM. He believes that while quality is everyone‘s responsibility, top management must take the lead. It is a universal rule wherever quality is desirable. Deming recognizes the importance of training and argues that one‘s best is not good enough until one knows he/she is doing and there is no substitute for knowledge. The 14 points of TQM form the foundation of TQM and guide the entire process. The 14 points rule can be adapted to environmental as well as safety management. Total Quality Management has been used by a number of firms for producing quality products or providing quality services (Evans and Lindsay, 1998). TQM is a management approach driven by participatory management and commitment to attain long-term profit and competitiveness through satisfaction of the customers (Magrab, 1997).

Integrating desirable characteristics that appeals to customers‘ needs and tastes in design and manufacturing practices will foster a win-win situation for firms and stakeholders (Besterfield et

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2.7 Total Quality Environmental Management (TQEM)

Literature on environmental management indicates that environmental quality is attracting wider and sustained attention of investors, customers, government, civil right organizations and NGOs, and host community. Previously the TQEM programme was identified as an essential tool to minimize waste generation in a cost-effective manner (Curkovic, Scroufe, & Landers, 2005). TQEM was an approach that replaced the traditional ‗end-of-pipe‘ strategies for pollution prevention (Bhat, 1998). Indeed TQEM concept is based on several theories mainly that of Deming, Juran, and Crosby combined with TQM with the goals of environmental management. It evolved from total quality and addresses all aspects of the environment (Epstein, 1996; Hanna

et al, 2000; Curkovic et al, 2000). The green movement is the next big picture that has received a

larger attention of global dimension. One can argue that green strategy is TQEM in its advanced form well-suited to address current green demands. Some scholars have defined TQEM as an economically driven, system-wide and integrated approach to minimize and eliminate waste streams associated with the design, manufacture, use and/or disposal of products and materials (Bhat, 1998; Curkovic & Landers, 2000; and Melnyk et al, 2001). In addition to several other environmental concerns such as aesthetics, green strategy has a broader perspective in that it incorporates the ideals of TQEM and goes further to deal with safety, health and security aspects of products and services including resources and processes as it affects the consumer and the natural environment. Green strategy not only recognizes pollution as waste and threat to the environment but also seeks options for optimal use of resources to create green products and services. In addition it seeks opportunity to create wealth from waste, since waste has been defined as any activity that uses resources or creates cost without generating any offsetting stream of value (Porter and Van der Linde, 1995a, 1995b). In this paper waste is classified as a negative uneconomic outcome resulting from the consumption of valuable economic inputs. Green strategy can create significant benefits including waste disposal or pollution reduction costs; environmental health and safety (EHS) issues and regulatory compliance; avoidance of environmental penalties; enhance financial returns; open up new business opportunities; engagement of workers‘ morale and participation; and protection, security and improved environmental well-being (Hanna et al., 2000). One cannot underestimate the likely boost to corporate image, competitive advantage, and community relationship that may come as dividends of greening the business processes. Just as its precursor, TQEM, going green (green management) may face acceptance problems compared to other models such as JIT, TQM, TBC (Angell and Klassen, 1999; Epstein, 1996).

2.8 Total Quality Safety Management (TQSM)

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interconnected with safety in that the former is considered an error-free work while the latter (safety) as one element of process can be thought of as producing an injury-free work or pollution-free work. Incidents leading to injury or accidental discharge of hazardous waste to the environment can cause tremendous loss and catastrophic consequences to a company (see Appendix D: examples of incidents and costs). Some research has focused on the causes of catastrophes, particularly those caused by humans (Petersen, 2003). The most fundamental human factor is obviously management—the capabilities, organization and degree of involvement in proactive safety and reliability practices.

Total Quality Safety Management concepts apply to all elements of the safety and health management system. It is modeled on the Total Quality Management (TQM) particularly on the 14 point quality rules proposed by Deming. The 14 Points of Total Quality Safety Management are as follows5_:

Point 1. Create a constant purpose to improve the product and service, with the aim to be competitive, stay in business, and provide jobs.

Deming spoke about the "problems of today and the problems of tomorrow," and that management in America today tends to focus only on today's problems when it should be placing increased, if not most emphasis on tomorrow's threats and opportunities to improve competitive position. Management should be focused constantly on improving the safety of materials, equipment, workplace environment, and work practices today so that it can remain successful tomorrow. The objective of continually working toward a safe and healthful workplace today, so that fewer injuries and illnesses occur in the future fits well with Deming's constancy of purpose. If management successfully communicates the clear, consistent message over the years that workplace safety is a core value (as stated in the mission statement), that there are "no excuses" for accidents, the company can be successful in developing a world-class safety culture. If a company considers safety only a priority that may be changed when convenient, constancy of purpose is not communicated.

Point 2. Adopt a new philosophy. We are in a new economic age. Western management must awaken to the challenge, must learn their responsibilities, and take on leadership for a change.

The emphasis here is that management must step outside itself to reflect, to take a new look at what its purpose is, long term. Safety can never be understood or properly appreciated if only the short term view is taken by management. Quick fix programmes to "impose" change will not work. Only understanding of the long term benefits will give management the vision to properly and consistently send and act on the message of workplace safety.

The old philosophy accepts as fact that a certain level of injury and illness will result from a given process, and that the associated costs should represent one of many costs of doing business.

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The new safety philosophy strives to:

• Prevent injuries and illnesses by continually analyzing and improving upstream factors such as work practices, equipment design, materials, and the workplace physical and cultural environment through education, training and recognition.

• Improve product safety for the benefit of the customer.

Point 3. Cease dependence on mass inspection to achieve quality. Eliminate the need for inspection on a mass basis by building quality into the product in the first place.

Deming was referring to the practice of inspecting every piece of product at the end of an assembly line to separate out the defects. Instead, he encouraged improving the quality of the process to decrease the defects, thus eliminating the need for mass inspection. When we apply this to safety, Deming might consider relying on the results (defects) as measuring our success solely by counting the number of accidents (also defects) that occur. No consideration is given to measuring employee and management-level safety activities.

In safety, evaluating only results statistics is like driving a car down the road and trying to stay in your lane by looking through a rear-view mirror. All you can do to react, after the fact. To only analyze accident rates, can only cause reaction to the number. Accident rates say nothing about why the accidents are happening. The old safety philosophy discussed above measures primarily injury and illness rates (defects) which represent the end results of the safety component of the process. Incident rates, accident rates, MOD rates, etc. all measure the end point, and since these measures are inherently not predictive, these statistics provide little useful information about the surface and root causes (upstream) for injuries and illnesses.

The new philosophy emphasizes measurement along the entire production process, primarily: • Measurement of management/supervisor safety activities;

• Employee safety education and training; • Individual worker behaviors; and

• Materials and equipment design prior to purchase.

Point 4. End the practice of awarding business on the basis of price tag. Instead, minimize total cost. Move toward a single supplier for any one item, on a long-term relationship of loyalty and trust.

Safe equipment, materials, chemicals may cost a little more but will save in the long-term through fewer injuries, illnesses, failures, and minimal pollution. Management should write safety specifications that meet their requirements into contracts. Even today, manufacturers of equipment and machinery sell equipment that does not meet NEC, NIOSH, ANSI, or other safety standards for product safety. Employers purchasing such equipment run increased risk of injury and illness to their employers, customers, and discharge to environment.

With respect to personal protective equipment (PPE), "cheap" is not better. Ensuring high quality personal protective equipment is smart business when we realize that it's a profit-center activity. If you spend $6,000 in various types of PPE in a given year and any one piece prevents a serious injury, your company has just paid for all the PPE for that year and probably for many years into the future. The money spent on PPE should be thought of as an investment that may result in substantial returns (reduced direct and indirect accident costs) to the company. Unfortunately, many consider only the initial cost of PPE. They don't see the big picture benefits.

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become familiar with the particular safety equipment needs of the employer. The employer who establishes a long-term close relationship with the supplier is more likely to receive the attention and higher quality equipment when requested. Developing a close, cooperative partnership between the employer and the supplier of safety equipment is extremely important for the success of both parties, and is possible by applying the single supplier principle.

Point 5. Improve constantly and forever the system of production and service, to improve quality and productivity, and thus constantly decrease costs.

A system refers to a number of processes or procedures that have been standardized. Everyone does something the same way. It's important to have an effective safety and health management system. Identify safety process or procedure might be standardized to improve your company's safety and health management system. Traditionally safety functions have been under the direction of the human resource department, which places safety and health at odds with the organization's primary goals: to produce and sell goods/services. Too often, managers in other departments feel the safety manager (alone) should contain costs, solve safety problems via training or committees, and reduce injury costs. Yet, in most cases, the safety manager must accomplish such tasks while other managers increase production goals."

Management must integrate safety as an element of quality into operations so completely that it disappears as a separate function. It must be viewed by each employee, supervisor and manager as his or her personal responsibility; one that is important in not only improving the production process and increasing profitability but in saving lives and the business from catastrophe.

Point 6. Institute training on the job.

Some companies today consider training a cost, not a benefit. An organization should invest in its workers to ensure they are properly educated and trained in supervisory, management, and leadership principles as they move up the corporate ladder. Training of new hires is also very fundamental. Currently many companies rely on the safety director or the human resources department to train safety. The new employee receives a safety overview when hired, and a safety "expert," conducts more specific training related to the employee's job exercise. The supervisor, in many instances, does not think he or she is getting paid to train safety. But, who is better suited to do the training than the person responsible for the safety and health of his or her employees? If the supervisor cannot train safety, how can he or she have the knowledge to effectively oversee safe work practices? How can the supervisor provide effective safety feedback? How can the supervisor, when needed, properly enforce safety rules?

The supervisor cannot perform any of these responsibilities unless he or she thoroughly understands safety concepts and principles, the hazards in the workplace, and is competent to train those subjects specifically related to workplace he or she controls. The human resources department or the safety director can't provide that quality of training for a couple of reasons: They don't work in the area, and they're "not the boss."

Point 7. Adopt and institute leadership. The aim of supervision should be to help people and machines do a better job. Supervision of management is in need of overhaul, as well as supervision of production workers.

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The key to adopting and instituting leadership, of course, lies at the top. Management needs to lead by example, action, and word. The leader "cares" about those he or she leads. After all, the leader's success is tied to the success of his or her workers. The "servant leadership" model fits well into the ideas expressed by Deming and others.

There is no better way to demonstrate these principles of leadership than in making sure employees use safe work procedures in a workplace that is, itself, safe from hazards. Ensuring safety is one of the most visible undertakings that management can take to show employees that they are not merely hired hands who can be replaced, but are valued human resources, an inseparable part of the family.

Point 8. Drive out fear, so that everyone may work effectively for the company.

Driving out fear is the most important requirement when implementing a Total Quality Safety Management process. Management controls the workplace. It influences the standards of behavior and performance of its employees by creating cultural norms in the workplace that dictate what are, and are not acceptable behaviours. Management may rely solely on safety rules and progressive discipline (negative reinforcement) in their attempt to control the safety behavior and performance of its employees. However, a strategy such as this, that may be successful in forcing compliance, is never successful in producing excellence in product or process. Strategies using fear and control are rarely, if ever successful. What develops from such a strategy is a controlling, compliance driven climate of mistrust and disgust; only a shell of an effective safety and health management system.

In the TQM system, managers and supervisors drive out fear through a real commitment to fact-finding to improve the system, not fault-fact-finding to punish someone. They emphasize uncovering the weaknesses in the system that have allowed unsafe work practices and hazardous conditions to exist. They educate and train everyone so that those weaknesses are strengthened, thus helping to continually improve the production process. They recognize employees for appropriate safety behaviors; compliance with safety rules, reporting injuries immediately, and reporting hazards in the workplace. Trust increases. Morale and motivation improve because employees are not afraid to report safety concerns to management. Safety is never a complaint in a TQM organization.

Point 9. Break down barriers between departments. People in research, design, sales, and production must work as a team, to foresee problems of production and in use that may be encountered with the product or service.

We should only compete with our competitors, not ourselves. Internal cooperation and external competition applies to safety as well. Cooperation among all internal functions is another key to effective safety.

Competitive safety incentive programs: Reactive safety incentive programs that challenge

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Bringing management and labor together: Cooperation at all levels of the company to identify

and correct hazards is very important. Of course, the process designed to promote this kind of cooperation is called the safety committee (or safety improvement team). A world-class safety system will take advantage of the cross-functional makeup of safety committees to bring management and employees together in a non-adversarial forum to evaluate programs and make recommendations for improvement in workplace safety.

Point 10. Eliminate slogans, exhortations, and targets for the work force asking for zero defects and new levels of productivity. Such exhortations only create adversarial relationships, as the bulk of the causes of low quality and low productivity belong to the system and thus lie beyond the power of the work force.

Zero defects may not be considered an appropriate goal. But when applied to safety, it may really make sense. It should be noted that Deming is talking about product defects here. The related safety goal might be "zero accidents." Although this goal may be unachievable, it's the only morally appropriate goal to have because we are dealing with injuries and fatalities. If we set a goal of anything less than zero accidents, what's going to happen? If we reach the goal, we pat ourselves on our collective back, sit back with our feet up on the desk, and believe we "have arrived." When this occurs, you can bet your accident rate will start rising once again. Contentment is a dangerous condition in safety. If we set zero accidents as our goal, we may never reach it, but that it keeps the safety drive continually going. We should never be content anyway. We should always be desirous achieving the target, never satisfied to make sure we continually improve the system.

If we set a goal to reduce accidents by 50%, we will design a less effective system to get us to the goal, but no farther. If we set a zero-accident goal, we will design the more effective system to reach that goal.

On another line of thought: In safety, the "happy poster syndrome" is a common occurrence. Managers think that by placing a safety poster every thirty feet on a wall, they have a successful safety awareness program. Employees, for the most part, ignore the posters, and may not believe the message that management is trying to convey. The Fix: Get rid of the posters and meaningless slogans. Replace them with action, example, and word. Each supervisor and manager becomes a walking safety slogan.

Point 11. Eliminate numerical quotas for the workforce, and eliminate management by objectives. Eliminate numerical goals for people in management. Substitute leadership.

In the safety field, many reward systems and performance appraisals are based on numerical goals and measures, such as incident rates, that are untested for random variability...this could mean receiving an undeserved bad performance rating...On the other hand, ignorance of the concept of random variability also means that work groups often get good safety ratings when they do not deserve them.

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Deming would look upon such a situation with dissatisfaction (and wonder). He would probably encourage management to do away with any numerical quotas or goals based solely on unpredictable measures such as incident frequency rates. He would stress the need to measure upstream activities such as the degree of safety education and training, number of safety meetings, individual safe work behaviors, and the safety of materials, chemicals, and equipment purchased by the company.

In emphasizing TQM principles, the company may never realize sustained zero accident rates, but the critically important ingredient in a successful process, that of continually journeying closer to that end state would be realized. Focus on the journey, not the result.

Relying solely on quotas in the "production" system results in management looking the other way, when unsafe work practices, and hazardous conditions exist. An it-is-part-of-the-job attitude by management, under pressure to produce the numbers, results in higher rates of injury and illness and equipment failure that may lead to environmental discharge. Very little thought is given to the human tragedy involved with serious injuries or fatalities. Even less thought to the indirect and 'unknown and unknowable' losses to the company. Management must understand the danger of pressure of ever-increasing quotas placed on supervisors and employees. Short cuts in work practices are inevitable, and along with them, injuries and illnesses.

Remember, managers and employees should be held accountable only for what they can control. It's difficult to control statistical results. However, as remarked earlier, they can control activities.

Point 12. Remove barriers that rob people of pride of workmanship.

According to Deming, the responsibility of supervisors must be changed from sheer numbers to quality. Remove barriers that rob people in management and in engineering of their right to pride of workmanship. Abolish the annual merit rating and adopt continual feedback processes. Deming offers some interesting ideas here, but they are crucial to success in safety as well as production.

Supervisors must ensure their workers receive equipment and materials that are as safe as possible. Employees should work at stations that have been ergonomically designed for them to decrease the possibility of strains and sprains, and repetitive motions disease which represent the greatest category of workplace injury and illness in the workforce today. Workers require and deserve the highest quality personal protective equipment to protect them from workplace hazards. The highest quality safety equipment, materials and environment all contribute to pride of workmanship.

Point 13. Institute a vigorous program of education and self-improvement for everyone.

Continual learning is an important concept. It's important that employees be educated in personal and professional skills. Safety certainly applies here as well. Return on the investment made in education is well worth the money.

Blekinge Institute of Technology