Which SOI Innovation Is Right for You?

Sustainability-Oriented Innovation is no longer a one-trick pony.

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Leading Sustainable Organizations

Corporate adoption of sustainable business practices is essential to a strong market environment and an enduring society. What does it mean to become a sustainable business and what steps must leaders take to integrate sustainability into their organization?
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This blog post is the fourth in a four-post series on Sustainability-Oriented Innovation (SOI). See the first post, “A bridge to breakthroughs” for our definition and overview. Our work builds on Accelerating the Theory and Practice of Sustainability-Oriented Innovation by Jason Jay and Marine Gerard. In this post, we look at the SOI decision-making process, the various considerations that must be taken into account, and the tools available for evaluating sustainability potential.

Taking sustainability-oriented innovation from concept to reality requires investment of people’s time, attention, and financial capital. Corporations, venture capitalists, incubators, and aspiring entrepreneurs may be presented with a variety of opportunities for SOI, but how should they choose which projects to invest in? To tackle energy storage, should they invest in a new nanomaterial-based technology or make another attempt at producing lithium-ion batteries at scale? To increase agricultural resilience in Africa, should they invest in a drought-resistant, genetically modified legume crop or a digitally controlled drip irrigation system?

SOI selection decisions depend on the players involved. At large companies, such as 3M, Merck, and Lockheed Martin, corporate development and technology officers assess how well product innovations align with their broader market or capital structure strategy before making significant outlays. Government grant makers at public agencies like the National Science Foundation and Massachusetts Clean Energy Center often use sustainability impact as a key metric in determining who is awarded grants and competition prize money. Sand Hill Road venture capitalists put greater weight on the feasibility of a venture scaling to a $1 billion valuation within five years. All these factors determine whether investments of time and money will succeed at meeting customer needs, enhancing business viability, and making positive impact on social and environmental systems.

We propose an overarching framework to simplify and streamline the complex decision-making process of SOI capital allocation. The framework can help inform decision making by determining how well a particular SOI is suited to solving a particular challenge. It can help people in both the private and public sector determine where they should allocate their human and financial resources. It can help them identify the magnitude of the gap between organizational priorities and the desired impact of their funds, and it can help them evaluate thresholds for scalability. Academic institutions that create

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Topics

Leading Sustainable Organizations

Corporate adoption of sustainable business practices is essential to a strong market environment and an enduring society. What does it mean to become a sustainable business and what steps must leaders take to integrate sustainability into their organization?
See All Articles in This Section

References

1. Jay, Jason and Gerard, Marine, Accelerating the Theory and Practice of Sustainability-Oriented Innovation (July 10, 2015). MIT Sloan Research Paper No. 5148-15.

2. Churchman, C. West (December 1967). "Wicked Problems". Management Science 14 (4). doi:10.1287/mnsc.14.4.B141.

3. Jay, Jason and Gerard, Marine, Accelerating the Theory and Practice of Sustainability-Oriented Innovation (July 10, 2015). MIT Sloan Research Paper No. 5148-15.

4. Khavul S. 2010. Microfinance: creating opportunities for the poor? Academy of Management Perspectives 24(3): 58–72.

5. Khavul S, Chavez H, Bruton GD. 2013. When institutional change outruns the change agent: the contested terrain of entrepreneurial microfinance for those in poverty. Journal of Business Venturing 28(1): 30–50.

6. http://www.theguardian.com/sustainable-business/life-cycle-assessment-sustainability

7. Lande, S. and Coy, D., "3M Approach to Implementing Life Cycle Management," SAE Technical Paper 2000-01-0594, 2000, doi:10.4271/2000-01-0594.

8. Olivetti E, Patanavanich S, Kirchain R (2013) Exploring the viability of probabilistic under-specification to streamline life cycle assessment. Environ Sci Technol 47(10):5208–5216.

9. http://www.c2ccertified.org/images/uploads/Herman_Miller_Journal_Of_Industrial_Ecology.pdf

10. https://hbr.org/2012/09/simple-rules-for-a-complex-world

11. Sherwood, D. (2002). Seeing the forest for the trees. London: Brealey.

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Comment (1)
Rgarcciz
I am in complete agreement. Particularly to the fact that an enterprise must have complete and entire transparency in order that its goals and metrics are attainable. Furthermore, the integrity and capabilities of the management team must meet and be inline with the long term goals. Otherwise, the enterprise/principals will run into roadblocks that should will hinder all inteinsic and common sense practices. If these barriers are not identified in the proper time line all ntended goals will be derailed and unobtainable.
Sustainability, goes without saying, must be an integral component of any implementable strategy, if it is to succeed.