In the build-up to another COP, the striking resemblance from year to year in the narrative can be disheartening. “The pressure is on. The urgency is clear. The solutions are here. The time is now”... but:
Action is not scaling up - While some businesses fight it out in a race to the bottom on pricing and purpose; there are also ambitious trailblazers launching pilot after pilot without quite getting to market.
Action is not reaching up – Coalitions are designed and set-up to make change happen and operate in collaboration. And yet, progress is slowed as we struggle to align ambition, messaging, process and production.
If we want to see mainstream transformation on the impact of business operations, there are two critical elements which must be part of the approach: pre-competitive horizontal collaboration, or ‘playing nice'; and genuine supplier engagement, or ‘getting our hands ditry'.
In this article we dive into what playing nice and getting our hands dirty means, how businesses can accelerate action, and start to demonstrate meaningful progress toward their sustainability ambitions.
Net zero requires competitors to play nice
Beating the competition is in many ways the cornerstone of modern economies. In the UK, one amusing example was two businesses fighting to the (almost) death over which Caterpillar cake would be the centrepiece of most six-year old’s birthday parties each year – that’s healthy and necessary competition.
But absolute, unmitigated competition is not going to work as we look to solve some of the bigger challenges coming down the line. By taking a collaborative pre-competitive approach (or ‘playing nice’) businesses that operate in the same markets look find ways for horizontal alliance which draws a line around where to come together for innovation, testing and scaling for greater impact and ambition where it's needed most.
Using the famous case of the Caterpillar cake battle, this would mean that before diving into standard competitive behaviour, retailers could still find a united approach on challenges such as:
- Implementing higher employment standards for cocoa farmers by creating market-wide policies, regulation and structural support
- Reducing scope three emissions, increasing biodiversity, improving nutrient density and reducing waste by building investment in and analysis of precision agriculture technology in shared and similar primary suppliers
- Transforming logistics which tackle ‘empty miles’ and reducing waste emissions by consolidating delivery and coordinating with return functions
- Reducing waste, increasing efficiency and limiting emissions by innovating with circular packaging solutions
- Nudging consumer behaviours to reduce downstream emissions and food waste
This isn't a new idea. We've already seen this type of collaboration take place. USB technology was developed through collaboration among several major technology companies, including Intel, Microsoft, IBM, and Compaq, during the mid-1990s. These companies, though competitors, recognised the need for a universal connector and communication protocol for devices like keyboards, mice and printers.
By working together to create the USB standard, these horizontal competitors ensured that their products would be compatible with a wide range of devices, providing a seamless experience for consumers. This pre-competitive collaboration led to the widespread adoption of USB technology, making it a universal interface used in almost all computers and many other electronic devices today.
Over in FMCG this method also works. In 2011, The Hershey Company formed an alliance with The Ferrero Group which was designed to create a shared warehousing, transportation and distribution model designed to improve supply efficiency, enhance competitiveness, and reduce CO2 emissions.
This year, Xynteo is excited to be in Dubai for COP28 to accelerate people and planet-positive growth.
LEAVE THE LAPTOP BEHIND AND GET YOUR HANDS DIRTY
You got great suppliers, you share some of them with others. But how well do you know them, their challenges, ambitions and aims? It’s time to get out of the office and reinforce or build from scratch the value chain relationships you need for transformative change. Getting your hands into the soil, heading into the forest, getting to the recycling plant or visiting the mine and meeting your primary producers where they are.
Every day the primary producers of all business are challenged with new and usually conflicting requests, regulations, pricing structures, incentives and reporting needs. This can come from us, as businesses, but it also comes from our competitors, local government, national government, regional government, their own suppliers and their wider downstream value chain. At the same time, the same producer is being bombarded with sales calls from suppliers claiming they have the solution – a new bit of tech, some clever way to manage data, or a new low carbon vehicle/machinery/waste management system.
Faced with a multitude of demands, often minimal resource and limited expertise, our producer has a choice to make.
- Ignore it all and hope the wind changes
- Pick a lane and hope it’s the right one
- Pull their business all directions and walk away without much profit or sleep
If we, as businesses, send demands down from the office to our producers by email with a pdf guide to walk them through it, they might be able to understand and implement the required changes; or they might not. But if we visit them walk with them through their process, then we can genuinely understand how they work. We get to the crux of not only what our obstacles to change might be, but also how we can come together on solutions which work for both parties, and everyone else in the value chain.
By meeting our suppliers, as humans, where they are coming from, we can:
- Empathise with the wider challenge at hand and better solve the obstacles we’re working on
- Help suppliers develop a better understanding of why we’re asking for what we’re asking for, and generate a far more likely positive outcome
- Share knowledge to bring about innovation and change beyond board room planning
- Find other efficiencies and solutions we’d not envisaged from our desks
- Build strong and transparent relationships which are better positioned to tackle the next stages of transition
Unilever is a great example of these principles and approach in action. Their Sustainable Sourcing Policy has been built and built again – redesigned over time to widen scope, provide funding and support change based on supplier engagement and feedback – today it forms a central role in their procurement with purpose vision.
And it works the opposite way too – by bringing suppliers together in our place of work to witness first-hand how their production plays into the wide ecosystem. Ikea does this annually with both suppliers and wider industry stakeholders in it’s One Home One Planet event which bring people together to work on breaking down barriers to solving key social and environmental challenges
BRINGING IT ALL TOGETHER
The potential for transformative impact is everywhere, and it can happen today. The important thing is that we identify the areas where collaboration and co-investment can make a real difference to creating a more environmentally sustainable and socially positive foundation for competition.
If businesses can both play nicely in collaboration and get their hands dirty all the way up the supply chain, then we have a real shot at meeting those annual COP ambitions.
Or contact us to find out how we can help your leaders and organisation create planet-positive and inclusive growth.