Sustainable innovation

From CEOpedia | Management online

Sustainable innovation is defined as development of a new product or process that take fewer environmental resources, promote the health and are financially possible for producers and consumers. From organizational point of view, sustainable innovation is an ability to create organizations capable of innovating time and again at the pace they can sustain (Hargadon 2015, p. 11). Sustainable innovation integrates environmentalism's protection of natural systems with the notion of business innovation driven by various factors.

Elements of sustainability

The science of sustainability and its effects shifted consumer behaviors and preferences recent years. Understanding and awareness of climate change, agriculture, nutrition, water use, ability to track greenhouse gas emission, air quality, energy efficiency and more contributed to creating sustainable culture in business. In parallel with developments on measuring natural environments impacts, new technologies evolved. Big companies have included in their operations renewable sources like solar panels, wind energy. The Internet created many opportunities for example radical transparency of companies. Local, state governments and the developed world are currently enacting bold programs to promote solar financing, low-carbon fuels and renewable energy sources.

Sustainable innovation strategies

In organisations, innovation emerges in a context of increasingly network-like and organizational changes. There is a tendency for generating innovations for effective implementation of new products or processes and adding value and beliefs so as they will be beneficial to the company and its shareholders. Previously, innovation strategies focused on gaining profits for the firms.

To create sustainable responsibility in the company, some strategies can be implemented:

  1. Putting sustainability in the company's strategies and DNA
  2. Linking sustainability and innovation
  3. Developing inspiring sustainable policies
  4. Hiring external sustainability consultants
  5. Training employees in sustainable innovation concepts
  6. Creating sustainable culture and work space for the company
  7. Value sustainable vision, reputation and brand equity

Challenges to sustainable innovation

According to Hargadon (2015) we can set following challenges:

  • Declining resources - dramatic expansion on production and consumption.
  • Brownfield vs. Greenfield markets - difficulties in modernization existing factories comparing to new ones with simple structure.
  • Faster, better, cheaper - struggle to bring new products and services to the market, because of politicians and incumbents.
  • Risk and uncertainty - new undertaking innovation is risky for the nature. We can distinguish several uncertainties:
    • Market uncertainty
    • Business uncertainty
    • Environmental uncertainty
    • Technology uncertainty
    • Policy uncertainty
  • The Breakthrough Bias - discussion about misconceptions where innovations came from and how firms identify and invest in them.

Examples of Sustainable innovation

  • Green technology: Green technology, also known as environmental technology, is the use of innovative technology that is designed to reduce the environmental impact caused by human activity. Examples of green technology include renewable energy sources like solar, wind and geothermal power, as well as energy efficient technologies like LED lighting, smart grids and energy monitoring systems.
  • Sustainable transportation: Sustainable transportation is a broad term that encompasses a range of transportation technologies and practices that reduce the environmental impact of transportation. Examples of sustainable transportation include electric vehicles, public transit, carpooling, ride sharing, and telecommuting.
  • Sustainable packaging: Sustainable packaging is packaging material that is designed with the environment in mind. Examples of sustainable packaging include recycled materials, biodegradable materials, and packaging made from renewable sources.
  • Sustainable agriculture: Sustainable agriculture is a type of farming that is designed to reduce the environmental impact of farming. Examples of sustainable agriculture include crop rotation, integrated pest management, and agroforestry.
  • Renewable energy: Renewable energy is energy that is generated from renewable sources, such as the sun, wind, or water. Examples of renewable energy include solar, wind, geothermal, and hydroelectric power.

Limitations of Sustainable innovation

The limitations of sustainable innovation include:

  • The cost associated with sustainable innovation. The development of sustainable products and processes often require significant financial resources or investments in new technologies and materials, which may not be available to all businesses or consumers.
  • The lack of knowledge and understanding of sustainable practices and processes. Even if the resources are available, many businesses lack the knowledge and understanding of sustainable principles and how to incorporate them into their products and services.
  • The lack of incentive. Many businesses may not have the incentive to pursue sustainable innovation due to the lack of an immediate return on their investment.
  • The lack of collaboration. Sustainable innovation requires collaboration between businesses, governments, and other stakeholders in order to be successful.
  • The lack of regulations. Many governments lack regulations that encourage businesses to pursue sustainable innovation, making it difficult for businesses to do so.

Other approaches related to Sustainable innovation

Sustainable innovation involves several other approaches related to the development of new products or processes that promote environmental protection, health, and financial sustainability for producers and consumers. These include:

  • Design Thinking: Design thinking is a creative approach to problem solving that uses data, technology, and human-centered design to create solutions to complex challenges. It encourages teams to break down barriers and find innovative ways to address the needs of society.
  • Circular Economy: The circular economy is an alternative economic system that seeks to reduce waste and increase efficiency by designing products and services that are used for as long as possible, with as much value as possible being extracted from them. It encourages reuse and recycling, and encourages companies to rethink production and consumption.
  • Social Innovation: Social innovation is the process of creating ideas, products, and services that address social and environmental issues, while also creating economic value. It enables businesses to develop innovative solutions to problems that have been traditionally too complex or too costly to tackle.
  • Open Innovation: Open innovation is a process in which companies use external sources of knowledge and ideas to drive new product development and innovation. It encourages collaboration and encourages companies to look beyond their own R&D departments for new solutions.

In summary, sustainable innovation involves a range of approaches, from design thinking to open innovation, which seek to reduce environmental impacts and promote financial and social sustainability. These approaches are used to develop creative solutions to complex challenges, while also creating economic value.


Sustainable innovation — recommended articles
Innovation and change — Green innovation — Social innovation — Dimensions of sustainability — Innovative systems — Innovation process — Alternative technology — Innovation — Total Innovation Management

References

Author: Nina

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