Using quality management as a bridge to environmental sustainability in organizations.
Increasingly, stakeholders such as regulators, customers, shareholders, board members, and employees are asking or requiring organizations to be more environmentally responsible (e.g., Hart, 1995; Porter and van der Linde, 1995; Naffziger, Ahmed, and Montagno, 2003). Reasons for these demands include regulatory requirements, environmental stewardship, enhanced public image, and the potential to expand the customer base and gain competitive advantages (e.g., Hart, 1995; Porter and van der Linde, 1995; Ahmed, Montagno, and Firenze, 1998).
The impact of environmental practices on organizational goals is still uncertain. While some researchers have found that environmental initiatives may have a negative impact on company performance (e.g., Freeman, 1994; Judge, 1994; Walley and Whitehead, 1994), other research indicates that being environmentally proactive can produce long-term gains (e.g., Hart, 1995; Porter and van der Linde, 1995; Ahmed, Montagno, and Firenze, 1998). In more current research, Clelland, Dean, and Douglas (2000) present evidence that pollution prevention and waste reduction practices enhance operational efficiencies. Likewise, even more recent studies (e.g., Ahmed, Montagno, and Naffziger, 2003; Naffziger, Ahmed, and Montagno, 2003) find positive correlations between companies' environmental efforts and operational efficiencies. Ahmed, Montagno, and Naffziger (2003) find a positive correlation between environmental effort and revenue. In their study, managers characterized the impact of environmental initiatives on profit as slightly positive.
Although, more and more managers are faced with the task of implementing environmentally sustainable practices in their organizations, there is a shortage of easily accessible and usable management tools and frameworks to help them. While environmental management systems (EMS), life cycle analysis (LCA), and ISO standards are used to implement environmentally sustainable practices, these tools tend to demand a significant amount of investment and commitment by organizations and managers. (Explanations of EMS, LCA, and ISO are beyond the scope of this paper, but earlier studies have compared and contrasted these systems. For example, interested readers can see Dreyfus et al, 2004.)
This paper illustrates how the well-known, widely used, and easily implemented principles of quality management (QM)--in particular, some of Deming's perspectives--can be a conceptual bridge to guide organizational decision-makers as they implement and manage environmentally sustainable practices. In particular, the paper expands upon the Deming Cycle (e.g., Dean and Evans, 1994) and illustrates how it can be used to implement environmentally sustainable practices. Deming's perspectives can be helpful in organizations that already use QM as well as in those that do not. In addition, as outlined in this paper, these practices are relatively accessible and can be used in organizations regardless of their progress toward sustainable practices--from those just beginning to explore their options, to those that have established sustainable practices and wish to evaluate them or incorporate additional ones. Therefore, companies can make the level of environmental investment and commitment that is consistent with their resources and goals.
The paper has five sections. The first explores the meaning and use of the term "environmental sustainability." The second illustrates some similarities between QM perspectives and those of environmental sustainability, and, thus, illustrates the suitability of QM tools for implementing environmentally sustainable practices. The third section shows how some of Deming's perspectives on quality management, in particular, the Deming Cycle, can be expanded to aid organization members in implementing and managing environmentally sustainable practices. The fourth section provides a case scenario of this process, and the last section is a conclusion.
Environmental sustainability, often called sustainable development, has been assigned different definitions by different groups. One of the most often cited definitions is that of the World Commission on Environment and Development (WCED): development that "meets the needs of the present generation without compromising the ability of future generations to meet their own needs" (p. 8). This broad definition is open to multiple interpretations, including all practices by organizations to reduce their environmental footprint (e.g., resource reduction, use of renewable resources, waste reduction, product redesign, process redesign).
In addition, sustainable development can be used to define environmental initiatives at different organizational levels. These include organization-wide systems (e.g., environmental management systems or EMS); product/process design and manufacturing practices (e.g., design or manufacture of products or processes that are more environmentally sustainable); and piecemeal practices (e.g., energy conservation, reducing manufacturing waste, recycling manufacturing waste). In this paper, the terms environmental sustainability, sustainable development, sustainable practices, and sustainability will be used interchangeably and will define organization-wide, product/process-focused, and piecemeal practices.
Environmental Sustainability and Quality Management
Quality management (QM) may be particularly well suited as a perspective to aid managers in implementing environmentally sustainable practices. QM and environmental sustainability have some common themes that have been illustrated by other management researchers (e.g., Hart, 1995; Porter and Van der Linde, 1995). These include a long-run organizational view, as well as a focus on both economic and social well-being. In addition, successful environmental sustainability and QM both acknowledge the importance of continuous improvement and participation by and empowerment of all employees. To reap the maximum benefits from both QM and environmental sustainability, managers should adopt an integrated, multifunctional, and organization-wide approach that extends along the whole value chain. (see Figure 1.)
Correspondingly, both QM and environmental sustainability have somewhat common histories (see Figure 2). Early on, QM was viewed as a new management paradigm due to the assumptions just discussed, and, as such, it was greeted with some skepticism. Many researchers and practitioners viewed QM as a radical paradigm that challenged traditional management assumptions. Likewise, sustainability is currently viewed as a newer paradigm and is being greeted with some skepticism (e.g., Porter and van der Linde, 1995). Now, however, QM is well-known and widely taught in management classes and is so woven into the fabric of organizations that some MBA students report using QM practices at work, but don't realize it until they learn the formal name in a management class. Likewise, QM had some initial problems establishing agreed upon measures and standards, which is the case for sustainability today. Now, QM has well-recognized standards including those for the Malcolm Baldrige Criteria (U.S.), the European Quality Award, and the Deming Prize (Japan).
Therefore, we might argue that sustainability is has the same growing pains as most new paradigms in that it is struggling to gain recognition and acceptance as well as establish a set of agreed upon standards and measures. In this situation, QM can provide a well-known and accepted management framework for helping mangers implement environmentally sustainable practices. Thus, the paradigm of QM can bridge between the concept of environmental sustainability and its concrete applications.
The Deming Cycle and Management of Environmental Sustainability
The Deming Cycle is a continuous improvement methodology with four stages: plan, do, study, act (Dean and Evans, 1994). Diagram 1 illustrates this iterative nature.
In the plan stage, the current situation is studied, data is gathered, and a plan is developed for action. The do stage consists of implementing the plan on a trial or limited basis. The study stage determines whether the trial plan is working and investigates any additional problems or opportunities with the trial plan. In the act stage, the final plan (as tweaked in the study stage) is implemented. Since the Deming Cycle focuses on continuous improvement, the improvements that result from the final plan inspire further improvements and a return to the plan stage--and the rest of the cycle. The Deming Cycle can be expanded to illustrate how managers can use it to implement and manage environmentally sustainable practices in organizations (see Figure 3).
Figure 3 is a flexible framework; managers can and should adapt it in a way that complements their own organizational culture and their organization's or department's progress with respect to environmentally sustainable practices. Organizations that are farther along in implementing sustainable practices would implement the stages in Figure 3 at a different pace and to a different degree than those that are just beginning to investigate sustainable practices. This contingency approach is consistent with the contingency approach to implementing QM (e.g., Dean and Evans, 1994).
The plan stage can start with an audit of current environmentally sustainable practices, including their compatibility with current and future regulation. Managers should also evaluate requests and demands for environmental sustainability by stakeholders. In addition, managers can use competitive or generic benchmarking to investigate sustainable practices used by competitors and others. Competitive benchmarking evaluates the organization's sustainable practices relative to those of competitors. Generic benchmarking evaluates the organization's sustainable practices relative to organizations that are best in their class with respect to sustainable practices, regardless of industry.
Managers can use the information from the audit and benchmarking to identify and evaluate a set of sustainable practices that must or can be implemented in the short, intermediate, and longer runs, including goals and outcomes measures. (Since the development of goals and outcomes measures varies greatly depending upon organizational audits, resources, and environments, it is beyond the scope of the paper to address this issue specifically. However, use of the framework in Figure 3 can provide the necessary catalyst for managers and others to address appropriate goals and outcomes measures.) Managers should be sure to include potential competitive outcomes of sustainable practices. For example, energy and waste reduction can reduce manufacturing cost (e.g., Porter and van der Linde, 1995), and companies can increase revenues through sale of waste products, sale of environmental expertise, etc. (Cordano, 1993).
Next, managers can develop an action plan, which would identify a trial or limited plan to implement sustainable practices, including goals and outcomes measures. This trial plan would limit implementation to one department, section, or area, and would specify environmental practices that are relatively quick and easy to implement, so that organization members could experience positive outcomes. Both the QM literature (e.g., Dean and Evans, 1994) and the environmental sustainability literature (e.g., Cordano and Frieze, 2000) stress the importance of positive experiences to advance the implementation of additional practices. While the particular practices would vary depending upon specific organizational needs determined during the audit and benchmarking, some sustainable practices that are relatively quick and easy to implement include energy and waste reduction. (Of course, if such piecemeal practices have already been implemented, managers could move on to other practices such as sustainable product/process design.) In developing and communicating an action plan, broader-based organizational participation tends to increase the probability of acceptance and success (e.g., Dean and Evans, 1994). Correspondingly, environmental education and training for employees solidifies their perception of organizational commitment with respect to sustainability. Employees who perceive strong commitment to the environment respond with their own creative suggestions to advance sustainability (Ramus and Steger, 2000).
In the do stage, the trial plan is implemented and goal achievements are celebrated. In the study stage, the trial plan and goal achievements are evaluated. Participants ask whether additional problems or opportunities from the trial plan can be addressed. For example, if the trial plan originally called for reducing manufacturing waste defined as by-products, perhaps participants can expand their focus to the use of recyclable packaging for shipping or ask suppliers to use recyclable packaging. If the trial plan was limited to one department or sub-section, perhaps it could be expanded to other subsections or departments.
In the act stage, the broader plan--a revised and expanded version of the trial plan--is implemented, and goals and outcomes are evaluated. Participants ask what further problems or opportunities can be addressed, and what has been learned that can be incorporated into the next iteration--which is a return to the plan stage.
This next iteration of the plan stage incorporates learning from the act stage. In addition, participants identify and evaluate the next set of sustainable practices to be implemented. This information can come from the original audit and benchmarking or from follow-ups to these activities. For example, sustainable practices that can be implemented in the intermediate run may be targeted. Therefore, a trial plan for environmental redesign of one product or process might be developed, including goals and outcomes measures.
Hence, the next iteration of the do stage implements the trial plan from the planning stage and celebrates the corresponding goal achievements. The next iteration of the study stage evaluates and expands the trial plan, etc. Since this framework focuses on continuous improvement, the iterations through the cycle are continuous. Hence, this framework can allow managers to steadily advance their organization's degree of environmental sustainability and to progress at a pace appropriate for them. As with QM and any type of organizational change, top management support is the key to successful environmental initiatives (e.g., Ashford, 1993).
This case scenario illustrates how a company can use several iterations of the Deming Cycle or the plan-do-study-act (PDSA) cycle to implement environmentally sustainable practices. The company is a large carpet manufacturer that is already successful in the areas of resource and waste reduction. This example shows how the PDSA cycle can help the company move to the next stage with respect to sustainable practices, which, in this case, is designing and manufacturing a more environmentally sustainable carpet. The stages are as follows:
* Plan. Through generic benchmarking, the company set the goal of producing a line of carpet that was more environmentally sustainable. Their limited trial plan consisted of R&D to design carpet backing made from recycled carpeting or recycled carpet backing. Some industry members said it couldn't be done since no one had done this previously. In addition, the company educated all employees with respect to environmental sustainability and its importance as a goal.
* Do. The managers implemented the plan and celebrated the small victories they enjoyed in R&D.
* Study. They evaluated their progress in R&D and suggested additional changes and improvements. The company was still a long way from manufacturing usable recycled carpet backing.
* Act. R&D implemented improvements and suggestions from the study stage; celebrated small victories; evaluated progress; and learned from their progress thus far. They continued to design and test recycled carpet backing.
* Return to Planning. The company incorporated learning from the act stage, for example, that they had to redesign the carpet glue since the old glue would not work with the new carpet backing. Therefore, they added the goal of developing and manufacturing a new carpet glue.
* Return to Doing. The company formulated a trial plan to develop and test some new carpet glues (in addition to the plan for recycled carpet backing), and celebrated small victories.
* End result: After many iterations of the PDSA cycle, the company was successful in designing and manufacturing a carpet with recycled backing and also a new carpet glue. In addition, they were able to make the new glue more environmentally sustainable than traditional glues, since it released many fewer vapors into the air. As an added benefit, the company discovered that the new carpet backing and glue decreased manufacturing costs and increased product quality. The recycled backing and new glue is now used in many carpet lines in addition to the original one for which it was designed. Hence, use of the PDSA cycle yielded a better result than the company had expected.
This paper provides a framework to help managers integrate and manage a major 21st century organizational challenge: environmentally sustainable practices. In so doing, it demonstrates how QM, a well-known and accepted management paradigm, can serve as a bridge between the concept of environmental sustainability and concrete applications by managers. In particular, the Deming PDSA Cycle is expanded to provide a framework for managers as they address stakeholder demands with respect to integrating and managing environmentally sustainable practices. The framework is flexible and is intended to be customized based on organizational resources and the degree of current participation in sustainable practices. As is the case for the Deming Cycle, the framework is iterative and based on continuous improvement; therefore, organizations at any stage of environmentally sustainable practices can benefit by applying it.
Development of specific effectiveness measures for sustainable practices are beyond the scope of the paper, largely because these types of measures are a function of individual organizational needs, resources, and environments. However, this framework can be a necessary catalyst for managers and other organization members as they begin to define and evaluate such measures for themselves. The case scenario showed how a company can use the PDSA cycle to implement sustainable practices, in this scenario achieving positive results that surpassed their original plans.
Future research on implementing sustainable practices in organizations should examine other frameworks and systems, including ISO, EMA, and LCA. While these frameworks and systems are beyond the scope of this paper, they are the next appropriate step for future study.
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Dr. Rusinko's research interests include technology and innovation management and, currently, competitive outcomes of environmentally sustainable practices. Her articles have appeared in numerous journals, including Project Management Journal and IEEE Transactions on Engineering Management.
Figure 1. Quality Management and Sustainability: Some Common Beliefs (e.g., Hart, '95; Porter and van der Linde '95) * Long-run focus--economic and social * Continuous improvement * Empower everyone * Integrated perspective * Multi-functional approach * Participation by whole value chain Figure 2. Quality Management and Sustainability: Common Histories? Quality Management * QM: Greeted by skepticism early on * QM: Early problems with measures and standards * QM: Now well known and practiced Sustainability * Sust.: Still some skepticism * Sust.: Measures and standards problems * Sust.: Will be well known and practiced? Figure 3. The Expanding Deming Cycle for Implementing and Managing Environmentally Sustainable Practices in Organizations The Plan Stage * Perform an audit of environmentally sustainable practices. ** What practices are being used now? ** Are practices consistent with government and industry regulation? ** What mandates exist for future regulation? ** What practices are stakeholders requesting/requiring? ** What practices are competitors and others using (industry and generic benchmarking)? * Use audit to identify and evaluate environmentally sustainable practices that can/must be implemented in the short, intermediate, and longer runs. ** Set goals and identify outcomes measures--also identify potential competitive outcomes (e.g., waste reduction can reduce manufacturing cost, etc.) * Develop action plan ** Identify a trial/limited plan--e.g., piecemeal practices that can be implemented in shorter run, and/or practices that are easier to implement (e.g., reduce manufacturing waste; reduce energy consumption, etc.), and/or practices in one department, division, etc. ** Identify goals and outcomes measures. ** Communicate plan and goals. ** Provide education and training about environmental sustainability and the action plan. ** Ensure broader-based organizational participation to increase probability of acceptance and success. The Do Stage * Implement trial plan. * Celebrate goal achievements--even small victories. The Study Stage * Evaluate trial plan and goal achievements. ** Can additional problems or opportunities be addressed? (e.g, change to recyclable packaging to further reduce waste; investigate/use renewable energy sources). * Expand trial plan to a broader plan (e.g., expand to larger portion of organization, and/or increase number of practices). ** Identify goals and outcomes measures. The Act Stage * Implement broader plan, including revisions from Study stage. ** Evaluate goal achievements and outcomes--celebrate goal achievements. ** Can further problems or opportunities be addressed? What did we learn for the next round of the cycle? Return to Plan Stage * Incorporate learning from Act stage. * Identify and evaluate next sustainable practices to be implemented. ** Target more challenging practices (e.g., environmental redesign of a product or process). Return to Study Stage * Develop a trial plan for this stage of the cycle
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|Author:||Rusinko, Cathy A.|
|Publication:||SAM Advanced Management Journal|
|Date:||Sep 22, 2005|
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