Winning in the Green Frenzy

Don’t let your competitors control what “sustainable” means in your industry.

by

Gregory Unruh

and

Richard Ettenson

by

Gregory Unruh

and

Richard Ettenson

From the Magazine (November 2010)

Summary.

Reprint: R1011J

In virtually every industry, the focus of green competition is shifting from a race to launch eco-friendly products to a battle over what constitutes a “green” product in the first place. The definition can vary from one sector or product to the next, but whatever your business, if you’re not engaged in the debate and in shaping the rules, you risk being assessed against standards you can’t meet.

Once you understand what degree of standardization exists in your industry and what your company’s internal capabilities are, you can choose from among four strategies: adopt existing standards; co-opt them by negotiating beneficial modifications with a standard-setting body; define standards where none exist; or break away from the current standards by challenging and supplanting them.

In the building sector, for example, LEED certification is considered definitive, so architects, construction companies, and office furnishings suppliers naturally choose to adopt LEED standards. But the coffee industry has more than a dozen competing standards, so Starbucks decided to create its own—the C.A.F.E. Practices.

The Idea in Brief

Green competition is shifting from a race to launch ecofriendly products to a battle over what actually constitutes a green product. Unless you’re engaged in the debate and in shaping the rules, you risk being assessed against sustainability standards you can’t meet.

Successful companies leverage opportunities to become an influential or dominant force in the green-standards battle. That requires understanding the standards that exist in your industry and also your own green capabilities.

Once you have that understanding, you can determine which of four strategies is best for your company: (1) adopt the existing standards; (2) co-opt and modify them to suit your capabilities and processes; (3) define standards for your industry; or (4) break away from existing ones and craft your own.

Right now somebody, somewhere, is defining what sustainability means for your industry, business, and products. Almost everywhere you look—textiles, communications, agriculture, autos, high tech—green competition is shifting from a race to launch ecofriendly products to a battle over what constitutes a green product in the first place. The definition can vary from one industry, business, or product class to the next. But whatever your business, if you’re not engaged in the debate and in shaping the rules, you risk being assessed against sustainability standards you can’t meet. Worse, you may be left behind by a shrewd competitor that has strategically positioned itself as a certified paragon of the new green ideal.

A version of this article appeared in the November 2010 issue of Harvard Business Review.

GU

Gregory Unruh is the Arison Professor at George Mason University. He is coauthor, with Á Cabrera, of the upcoming book, Being Global: How to Think, Act, and Lead in a Transformed World.
RE

Richard Ettenson is Professor and Keickhefer Fellow in Global Marketing and Brand Strategy, The Thunderbird School of Global Management, Arizona State University.

Winning in the Green Frenzy

The Idea in Brief

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