The Sustainable Supply Chain ‑ Harvard Business Review

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The Sustainable Supply Chain ‑ Harvard Business Review

The Sustainable Supply Chain
An Interview with Peter Senge by Steven Prokesch
To make progress on environmental issues, Peter Senge says, organizations must understand that they’re part of a larger system. Senge, the founder of the Society for Organizational Learning, a faculty member at MIT Sloan School of Management, and the author of The Fifth Discipline and The Necessary Revolution, spoke with HBR senior editor Steven Prokesch about the challenge of leading organizations at a time when their supply chains need to be radically transformed.
HBR: What does it take for an organization to get serious about issues like water, energy, and waste in its supply chain? Senge: It starts to get real when people believe these matters are strategic—that they will shape the future of the business. I use the word “sustainability” as little as possible because it’s so generic; it makes people’s eyes glaze over.
To confront these issues practically, you need employees who are innovative—who have the skill and the vision to redesign products, processes, and business models—and who understand the business context. Most important, they need to be able to tell a story about why this is a meaningful journey.
If they’re stuck in the mind-set (so popular in business schools, unfortunately) that a company exists to maximize return on investment capital, with an emphasis on short-term financial performance, they won’t get very far.
You’re describing a big change in perspective for most companies.
To me, it’s Leadership 101. It starts with “Who are we?” and “Why are we here?” In a great book called The Living Company, published in 1997, Arie de Geus described a study conducted by Shell in the early 1980s of companies that had survived for more than 200 years. What those organizations had in common was an…...

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