At the moment, a lot of money is being directed to emissions trading, which reflects the global objective of reducing CO2 emissions. In the EU, each company is granted only a certain amount of emission allowances, the prices of which are determined by the market. Companies that produce only minor emissions are on the winning side, while heavy CO2 producers end up paying more.
Consumer behavior is also changing. The trend shows an increasing preference for energy-efficient, renewable and carbon-neutral production and business.
“There are so many drivers that it’s really starting to impact the movement of capital and fund policies, as more and more investments are being made in renewable energy production,” Laine says.
Recently, new and innovative products have entered the market and attracted consumers’ attention.
“To give an example, the traditional dairy industry has been taken by surprise as dairy-free products, such as oat milk and almond milk, have taken over the market. The investors are naturally keeping an eye on the potential as well,” Laine says.
The world is slow to change, however, and when it comes to some products and services, price is still the determining factor.
“I wouldn’t blame the consumer; the fault lies in the system. Winning companies will find a way of letting individual consumers do what’s right.” Laine continues: “The consumers’ quality of life doesn’t always need to suffer but it requires new technology and innovation. Producing something isn’t the only way to make money – you can also use the things that are already available in a smarter way.”
Environmental values cannot be pushed aside while planning new business
Industry can’t ignore environmental matters either, as it prepares for the coming decades.
“People are increasingly aware of natural resources, regardless of the goods you’re producing. The manufacturers need to come up with ways to respond. The fashion industry could start exploring the opportunities provided by the circular economy, for instance.”
In Laine’s opinion, one of the biggest challenges the industrial actors are now facing is ensuring transparency throughout the process chain, from production to media relations.
“Traceability and operational clarity are becoming increasingly important. The buyer needs to be able to base their purchase decisions on transparent information. Producing this type of research-based data can be a real game changer and competitive advantage for companies.”
Since operating environments are formed by networks of different actors, the products and services of industrial companies are always part of a larger whole.
“The growing importance of consumers means that environmental awareness is on the rise and more and more is expected of B2B companies. Products and services need to meet the demands of partners and end users alike,” says Janne Pirkola, Director of Digital Strategy and UX at Bonsky.
Environmental awareness is trending globally.
“In the United States, for example, the Fortune 500 list is being rewritten. Companies really need to stay on their toes,” Pirkola says and continues: “Having achieved a certain reputation or position in the past is no reason for complacency. Those things can be easily lost if no attention is paid to the need for change.”
What can be done right now?
How should environmental awareness and the requirements of sustainable development be taken into consideration when developing business activities?
“The most important thing is to adopt a broader perspective. Concentrating solely on the customer experience will not be enough in the future – environmental impact needs to be taken into account as well. Planet Centric Design focuses on acknowledging the environment from the viewpoint of the entire production chain. The platform economy and data utilization provide mind-blowing opportunities,” Laine explains enthusiastically.
Vincit has developed a method to help organizations achieve a planet-centric mindset.
“The five-stage process starts with a mapping of the organization’s attitude and role. It then goes on to assess the impact of the organization’s business activities, and the final stages involve producing and realizing new ideas. We think every organization should hear about this process, which is why we made the method tools available to everyone,” says Emma Ylivainio, Designer at Vincit.
Agile methods are easily adaptable to an environmentally friendly approach. Engaging various customer and target groups enables the accumulation of customer understanding and realizing what the customer truly values. Using Agile methods also allows for quick reaction times when necessary.
“Many industrial actors have optimized their production facilities according to Lean principles. The next stage would be optimizing the whole value chain. This means seeing the big picture instead of just increasing the effectiveness of the production facility. Along the same vein, organizations shouldn’t just develop new products and their properties. Instead, they should pay attention to the entire lifecycle and think about how to utilize data throughout the products’ useful life, for example. New services provide opportunities for breaking existing revenue chains and creating completely new business,” Laine summarizes.
Here's how you can get started:
- Use service design methods to find out which environmental themes your customers/stakeholders value the most.
- Select the ones that are most important in terms of your business and start planning their implementation.
- Get an overview of the situation – how can you be environmentally conscious in the big picture?
- Take advantage of continuous data collection and conduct analyses from an environmental point of view.
Vincit and Bonsky have joined forces to help industrial companies face the future with confidence and gusto. Vincit focuses on the transformation of business and digitalization and seeks to control changes through strategic choices, new business models and thought leaderships. Bonsky Digital develops digital business and architecture with Agile design methods that engage the customers.