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Indu strial S oc ial Ec ology in Danish Indu stry

Inger Bojsen D ept. of O rganization & M anagem ent, Th e A arh u s S c h ool of Bu siness Haslegaardsvej 10, D K -8210 A arh u s V, D enm ark Teleph one: +45 8948 6688, Fax: +45 8615 7629, E-M ail: inger.bojsen@ org.h h a.dk

A bstrac t

Env ironm ental m anagem ent of today is v ery m u c h based on an intra-

organisational perspec tiv e. Very good env ironm ental m anagem ent system s

h av e been developed, as EM A S and IS O 14001 in th e nam e of su stainability.

T h e qu estion is: “A re th ese intra-organisational m anagem ent system s c apable

of m ak ing c om panies su stainable?” M y answ er to th is is no. A c om pany c annot

by itself reac h a su stainable produ c tion. T h e only w ay to reac h su stainability is

th rou gh c o-operation w ith oth er c om panies. D ifferently pu t, th ere is a good rea-

son for c onsidering an inter-organisational perspec tiv e on env ironm ental m an-

agem ent. A n obv iou s exam ple is indu strial ec ology.

Indu strial ec ology is rooted in a system s perspec tiv e th at v iew s th e indu strial

system as a part of th e natu ral system instead of tw o c oexisting system s. A s

w ith natu ral sym bioses m aterials c yc les c an be establish ed in th e indu strial sys-

tem . T h e m ain preoc c u pation of indu strial ec ology as a researc h field is h ow

c om panies th rou gh partic ipation in indu strial ec o-system s bec om e c apable of

m inim ising env ironm ental im pac t by m eans of w aste m inim isation initiativ es and

at th e sam e tim e sav e m oney.

T h e ph ilosoph y of indu strial soc ial ec ology is rooted in th e c onc ept of indu strial

ec ology. Indu strial soc ial ec ology is an extension of indu strial ec ology in th at it

does not only c onsider th e m inim isation of m aterials w aste bu t it c om prises all

ph ysic al resou rc es su c h as labou r, fac ilities, m ac h ines, transport and m aterials

u sed by c om panies, too.

Partnership and Leadership: Building Alliances for a Sustainable FutureNovember 15-18, 1998 Seventh International Conference of Greening of Industry Network Rome

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A fter an extensiv e disc u ssion of th e c onc ept of indu strial ec ology and indu strial

soc ial ec ology, th e paper w ill desc ribe th e resu lts of a field stu dy abou t D anish

c om panies’ experienc es w ith env ironm ental m anagem ent and inter-

organisational c o-operation. Based on th ese resu lts follow s a disc u ssion of

w h eth er D anish indu stry is adequ ately prepared for partic ipating in inter-

organisational c o-operation in th e field of env ironm ent or if th ere are barriers

th at h inder th e dev elopm ent of indu strial ec ology in general and indu strial soc ial

ec ology in partic u lar.

Th e c onc ept of indu strial ec ology

T h e env ironm ental m anagem ent system s (EM S ’s) u sed in indu stry today is

m ainly foc u sing on th e intra-organisational level. I argu e th at in order to ac h ieve

su stainable dev elopm ent it is nec essary to extend EM S 's from th e intra-

organisational to th e inter-organisational level. T h erefore, a new approac h to

env ironm ental m anagem ent is needed. Indu strial ec ology is an env ironm ental

m anagem ent perspec tiv e based on inter-organisational c o-operation.

T h e ph ilosoph y of indu strial ec ology w as first introdu c ed in th e late 1980’s by

researc h ers argu ing for th e nec essity of inc reasing th e rec yc ling and su bstitu -

tion of m aterials. Th is m eant approac h ing th e indu strial system from an inte-

grated v iew – as an indu strial ec o-system (Frosc h & G allopou los, 1989). Th is

c onc ept of indu strial ec o-system s is based on an analogy w ith natu ral ec o-

system s th at are interac ting and interdependent system s of organism s of v ary-

ing degree of c om plexity w h ic h liv e of eac h oth er – eith er c onsu m ing eac h oth er

or eac h oth ers’ w aste. T h is m eans th at an indu strial ec osystem c an be c h arac -

terised as a system w h ere indu stry reu ses produ c ts and rec yc les w aste m ateri-

als du ring m anu fac tu ring, th ereby m axim ising th e u se of resou rc es and m inim is-

ing th e w aste.

T h e rationale of indu strial ec ology is th at indu stry sh ou ld im itate natu re by trans-

ferring th e idea of sym biotic relationsh ips to th e indu strial system in order to

ac h iev e m ore effic ient m anu fac tu ring proc esses w ith a m inim u m of w aste

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(Tibbs, 1992; Low e, 1993; S zek ely, 1996). Indu strial ec ology m eans th ink ing of

w aste not only as an ou tpu t w h ic h c an be prev ented, bu t also as som eth ing th at

c an be designed as part of th e indu strial proc ess produ c t stream (Frosc h ,

1992). Im plem entation of indu strial ec ology m eans optim ising th e total m aterials

c yc le from v irgin m aterial, th rou gh finish ed m aterial, c om ponent, produ c t, w aste

produ c t, to u ltim ate disposal. Fac tors to be optim ised inc lu de [ph ysic al] re-

sou rc es, energy, and c apital (G raedel et al., 1993; G raedel & A llenby, 1995).

G raedel et al. (1993) define indu strial ec ology as an indu strial design approac h

c apable of m aintaining a desirable c arrying c apac ity w h ile at th e sam e tim e al-

low ing for a c ontinu ed ec onom ic , c u ltu ral, and tec h nologic al ev olu tion. O r, pu t

differently, an inc rease in th rou gh pu t, i.e. ‘to do m ore w ith less’. A noth er inter-

esting featu re of indu strial ec ology is th at redu c ing w aste c an c onserv e re-

sou rc es, redu c e pollu tion, and save m oney at th e sam e tim e (D u c h in, 1992). In

oth er w ords: A w in-w in situ ation.

It m igh t be an im portant fac tor in th e attend of reac h ing a su stainable dev elop-

m ent th at indu strial ec ology is an env ironm ental m anagem ent perspec tiv e

based on inter-organisational c o-operation and th at indu strial ec ology h as an

ec onom ic as w ell as env ironm ental gain and th erefore h as great potentials for

being ac c epted by indu stry. B u t despite th e potentials th ere are still som e sh ort-

c om ings of th e c onc ept of indu strial ec ology as it look s at th e m om ent.

Indu strial ec ology in a soc ial perspec tive

T h e system ic fram ew ork of indu strial ec ology is inspired by biology, and, lik e

th e c om parable m atu re biologic al system s (A llenby & Cooper, 1994), it h as one

m ajor disadvantage – th e system ic fram ew ork tends to be inflexible. Th e u lti-

m ate env ironm ental objec tiv e for indu stry m u st be su stainability in its broadest

sense, h ow ev er is not possible in an inflexible fram ew ork , bec au se th e w orld

itself is dynam ic .

A noth er m ajor disadv antage of th e fram ew ork is th at at th is stage of its dev el-

opm ent, th e objec tiv e of indu strial ec ology seem s to be lim ited to th e m inim isa-

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tion of w aste, and only as a sec ondary objec tiv e (and prim arily as a resu lt of th e

form er) to m inim ise th e c onsu m ption of natu ral resou rc es. Bu t su stainability

c annot be ac h ieved by w aste m inim isation alone. Both resou rc es and produ c -

tion m u st be u tilised to th e fu ll (and im portant to point ou t is th at resou rc es are

not to be seen as ju st raw m aterials and w aste, bu t also h u m an c apac ity, ex-

c ess m ac h ine-, and transport c apac ity). Fu rth erm ore, today, indu strial ec ology

tends to h av e a foc u s on th e produ c t itself. Very little attention is giv en to all th e

oth er aspec ts of produ c tion and distribu tion (i.e. design, produ c tion proc esses,

transport, etc ).

In m y v iew , a broader approac h is needed to realise th e fu ll potentials of indu s-

trial ec ology. T h e foc u s on th e produ c t and w aste m inim isation only is far too

narrow for su stainability to be reac h ed. Th e c onc ept of indu strial ec ology h as

only foc u s on th e env ironm ental and ec onom ic dim ensions. A s sh ow n in th e

figu re below , to reac h su stainability it is nec essary to enlarge th e sc ope to c ov er

th e soc ial dim ension as w ell (U lh ø i, 1995; W elford, 1997).

Figu re 1: Elem ents of th e su stainable O rganisation S ou rc e: (W elford, 1997)

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In order to m inim ise th e im pac t of indu stry and c onsu m ption on natu re, it is

nec essary to extend th e fram ew ork of indu strial ec ology to inc lu de th e soc ial

dim ensions of th e c onc ept of su stainability. It is also nec essary to m ove aw ay

from th e system s perspec tiv e of indu strial ec ology to a dynam ic netw ork per-

spec tiv e. Th is perspec tiv e is labelled indu strial soc ial ec ology. Table 2 below

ou tlines th e differenc es betw een indu strial ec ology and indu strial soc ial ec ology.

Table 1: Indu strial ec ology c om pared to indu strial soc ial ec ology Industrial Ecology Industrial social ecology Perspective Systems perspective Network perspective A system of individual enti-

ties A network of integrated entities

Main focus Environment as external to the company

Environment in an integrated way

Not necessarily a learning perspective

A learning perspective

Purpose Waste minimization Resource optimization Dimension Economic Social and economic Static, inflexible Dynamic

Indu strial soc ial ec ology as a m anagem ent tool c alls for a netw ork perspec tiv e.

Im portant h ere is th at th e netw ork perspec tiv e inc lu des not only th e netw ork be-

tw een th e partic ipating c om panies in th e indu strial ec osystem bu t also netw ork s

w ith in th e single organisation and netw ork s betw een th e c om panies and th e

su rrou ndings.

A netw ork perspec tiv e offers som e interesting potentials. Instead of v iew ing

m ark ets as exc h ange of produ c ts, th ey c an be seen as netw ork s of interde-

pendent relationsh ips (H å k ansson & S neh ota, 1995). S u c h relationsh ips m ay

be long-term or sh ort-term , depending on th e ac tiv ity. T h ere is a c ontinu ity of

c h ange in bu siness relationsh ips, w h ic h im plies th at bu siness netw ork s are

c h arac terised by ongoing ev olu tion rath er th an equ ilibriu m (Hå k ansson & S ne-

h ota, 1995:269). A noth er appealing th ing abou t th e netw ork perspec tiv e is th at

it integrates soc ial relations and soc ial c ognition (Bov asso, 1996), w h ereas th e

system s perspec tiv e only takes th e ph ysic al link s into c onsideration. T h e soc ial

perspec tiv e is im portant bec au se soc ial fac tors c ontribu te to th e su c c ess and

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diffu sion of th e indu strial soc ial ec ology perspec tiv e. Fu rth erm ore, for oth er rea-

sons, m any c om panies are already part of netw ork s, w h ic h c an also be ex-

tended to em brac e th e indu strial ec ology c onc ept.

Environm ental m anagem ent and c o-operation in Danish indu stry

25 years ago an exc h ange of w aste m aterials betw een tw o c om panies in th e

D anish c ity K alu ndborg w as establish ed. T h is link w as th e beginning of w h at

bec am e k now n as th e K alu ndborg S ym biosis – an exam ple of indu strial Ec ol-

ogy. D espite th e great su c c ess w ith indu strial ec ology in K alu ndborg, th e c on-

c ept h as not attrac ted any m ajor attention am ong D anish researc h ers u ntil re-

c ently and am ong prac titioners th ere seem s to be v ery little attention to th e c on-

c ept of Indu strial ec ology.

T h is is som ew h at su rprising c onsidering th e ec onom ic as w ell as env ironm ental

potentials in th e c onc ept. Th ere are today, h ow ev er, sev eral exc h anges of

w aste produ c ts am ong c om panies, link s th at m igh t be c onsidered as being in a

pre-stage of indu strial ec ology. Th ese are basic ally c onc entrated on w aste th at

is easy to reu se or w aste c onsisting of v ery expensiv e m aterials w h ic h m ak es it

profitable to reu se. Bu t th is is only th e beginning of indu strial soc ial ec ology.

Probably m ost of th e m aterials exc h ange betw een c om panies today w ere

based on sou nd ec onom ic sense su c h as reu sing th e w aste or as a resu lt of

regu latory inc entiv es, w h ic h both c an be seen as reac tiv e approac h es. Indu s-

trial soc ial ec ology on th e oth er h and is based on proac tiv ity in th e sense of ac -

tiv ely searc h ing for new sym biotic relationsh ips.

In th e U S several indu strial ec ology projec ts h av e started du ring th e 1990’s.

T h ese projec ts are c alled Ec ologic al Indu strial Park s (EIP’s) and th e princ iple is

to establish or re-m odel indu strial areas after th e c onc ept of indu strial ec ology.

T h e ph ilosoph y is th at th e c ollec tiv e benefit is greater th an th e su m of th e indi-

v idu al benefits (Low e et al., 1997: 142). In D enm ark , h ow ev er, th ere is still a

su rprising lac k of attention on th e c onc ept of indu strial ec ology, despite th e fac t

th at one of th e m ost w ell-k now n indu strial ec ology projec t is loc ated h ere.

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T h is raises an interesting researc h qu estion:

1. W h y is Indu strial soc ial ec ology not m ore w idely diffu sed in D anish Indu stry?

To answ er th e qu estion, I m ade an em piric al pre-stu dy, interv iew ing 11 people

from six c om panies in a D anish tow n. A ll of th e 11 people interv iew ed are in-

v olv ed in env ironm ental m anagem ent on m iddle m anagem ent or m anagem ent

lev el. T h e interv iew proc ess w as planned after K v ales ‘sev en stages in inter-

v iew ing’ (K v ale, 1997) and analysed ac c ording to K v ale and Lantz (Lantz,

1993).

T h e m ain objec tion of th is pre-stu dy w as to establish basic inform ation abou t

th ese D anish c om panies w ith regard to env ironm ental m anagem ent and c o-

operation, th e tw o k ey dim ensions of indu strial soc ial ec ology.

T h e reasons w h y th e six c om panies in th e pre-stu dy are dealing w ith env iron-

m ental issu es are different for th e c om panies. For c om pany B th e m ain reason

is pressu re from regu lations and inc reasing dem ands from c u stom ers. For

c om pany A and E it is du e to c orporate dem ands. In c om pany D it is bec au se

th e m anagem ent already bac k in 1972, du ring th e first energy c risis, realised

th e need for resou rc e redu c tions (at th at tim e it w as w ater and energy). T h is

h as sinc e developed to a foc u s on env ironm ental issu es; i.e. in partic u lar re-

sou rc e sav ings, in general. Com pany F w as from th e establish m ent foc u ssing

on env ironm ental issu es du e to th e produ c tion. In c om pany C th e foc u s on env i-

ronm ental issu es is du e to th e top m anager’s perc eption of env ironm ental is-

su es. Th e differenc es in th e env ironm ental approac h es in th e six c om panies

also appear in th e differenc e in th eir env ironm ental m anagem ent as sh ow n in

table 1 below .

Table 2: Environm ental m anagem ent in th e partic ipating c om panies Company A B C D E F

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Interview 1 + 2 3 4 + 5 6 + 7 8 + 9 10 + 11 Formalised EMS ü ü ü ü ü ISO 14001 ü ü (ü) EMAS ü part of mission statement

(ü) ü ü (ü) ü

In all of th e partic ipating c om panies in th e stu dy, exc ept for one, th ere is or w ill

be a form alised env ironm ental m anagem ent system in plac e. T h ree ou t of th e

six c om panies h av e dec ided to be c ertified ac c ording to IS O 14001. T h e fac t

th at EM S ’s are form alised in a m ajority of th e partic ipating c om panies im plic ates

th at m anagem ent in general h as a relativ ely strong foc u s on th e env ironm ent:

“Earlier th ere w as a person in th e inv entory w h o w as responsible for

rem ov al of c ardboard boxes [pac k aging], now it h as bec om e som e-

th ing m anagem ent is interested in.” (1)1

T h is c an also be seen from th eir replies w h en asked abou t h ow th ey w eigh en-

v ironm ental issu es in relation to oth er issu es su c h as qu ality and pric e. A s one

of th e interv iew ed said:

“[T h e different issu es] are rank ed alongside eac h oth er in th e strategic

fou ndation of th e c om pany.” (4)

T h is m ay prov ide a v ery rosy pic tu re, bu t h ow does th e m anagem ent really c on-

sider env ironm ental issu es; w h at w as th e m ain pu rpose of im plem enting a for-

m alised EM S in th e c om panies in th e first plac e? T h e persons interv iew ed giv e

th ree m ain reasons for th is, w h ere th e m ost frequ ently m entioned reason is sav-

ing of resou rc es, or in oth er w ords, ec onom ic reasons. A noth er reason giv en by

som e of th e interv iew ed is th at a form alised EM S system atises th e proc ess. A

th ird reason m entioned is th at a form alised EM S c an h elp m anagem ent c h ang-

ing th e em ployees’ rou tines and old h abits, in oth er w ords, an instru m ent for

c h anging th e c u ltu re in th e organisation.

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“Th ere is no dou bt th at th e m ost im portant reason for w ork ing w ith

E M S is th at w e w ant to redu c e th e external w aste load… W e w ant to

u se th e EM S at an instru m ent for being able to c om ply w ith c onstantly

inc reasing/ sh arper regu lations.” (9)

T h e fac t th at th e m ost im portant reason for im plem enting a form alised EM S c an

be assigned to m oney sav ings im plic ates th at m anagem ent generally ac t ac -

c ording to a traditional neo-c lassic al profit m axim isation. T h is m eans th at m an-

agem ent w ill not volu ntarily m ak e inv estm ents in env ironm ental protec tion,

u nless th ere is a good ec onom ic inc entiv e for it.

If one look at th e attitu des tow ards env ironm ental issu es, th ere are som e inter-

esting differenc es in th e findings. A ttitu des tow ards env ironm ental issu es range

from : “It c onc erns all of u s” (5) to “it is noth ing spec ial” (1). Bu t th e basic atti-

tu des am ong all of th e persons interv iew ed are th at bu siness is basic ally abou t

produ c ing at a c om petitiv e pric e and being able to sell th e produ c ts:

“Earning m oney is… th e c ondition for being able to do anyth ing” (3)

T h is im plies som e c ontradic tion in th eir answ ers, h ow ever, as som e of th e per-

sons interv iew ed said; env ironm ental c onc ern h as as h igh priority as oth er im -

portant issu es, bu t th is seem s only to be tru e as long as th ere is an ec onom ic

inc entiv e.

To get a c loser u nderstanding on m anagem ent’s rank of env ironm ental issu es

c om pared to oth er issu es, I asked th e interv iew ees abou t th e m ain driv ing forc e

for env ironm ental initiativ es:

“If you h ad ask ed th is qu estion 7 or 8 years ago th e answ er w ou ld c er-

tainly h av e been regu lations from gov ernm ental au th orities, bu t today it

is bec au se w e see som e advantages by doing it… It is a qu estion of

m ak ing inv estm ents th at redu c es th e u se of resou rc es.” (9)

1 All the citations are translated from Danish, and they are shown in a condensed way, see (Kvale, 1997, p. 192)

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“It is th e dem ands to ou rselv es; th at w e c onstantly are one step in

front, so th at noth ing w ill c om e as a su rprise [regu lations].” (4)

“W e started already bac k in 1972, du ring th e energy c risis. A t th at tim e

w e dec ided to save w ater and energy.” (6)

T h is sh ow s th at th e m ain driv ing forc e beh ind env ironm ental inv estm ents is

u su ally related to ec onom ic c onsiderations:

“It h as c h anged from a situ ation w ith no c onc ern at all, tow ards an

aw areness, abou t a problem th at w e h ad to deal w ith , and it w as c on-

sidered as som eth ing spec ial w e w ere doing [env ironm ental initiativ es].

Now w e are in a ph ase w h ere w e look at it as good h ou seh old, w h ic h

is qu ite u ndram atic .” (1)

“… W e exam ined th e m ac h ine to c h ec k w h eth er w e c ou ld save som e

energy, w h ic h w e c ou ld bu t only w ith a retu rn on inv estm ent period be-

tw een 15 to 20 years. In su c h a c ase w e drop th e inv estm ent.” (8)

T h ese qu otes indic ate th at th ere are som e barriers to indu strial ec ology th at c an

be c alled c ognitiv e barriers. Th e present env ironm ental paradigm is based on

an anth ropoc entric v iew , w ith an ov erall foc u s on th e ec onom ic system . T h is

m eans th at env ironm ental problem s are seen and treated as ec onom ic exter-

nalities (Eh renfeld, 1995). For indu strial soc ial ec ology to be su c c essfu l, it is

nec essary to internalise env ironm ental problem s and it is nec essary to v iew

h u m an soc iety as part of th e ec ologic al system , w ith foc u s on ec ology and th e

soc ial dim ension rath er th an only ec onom ic s as sh ow n in figu re 1 above. Bu t

th is is not h ow reality is today. T h e follow ing qu ote indic ates a c lear foc u s on

th e ec onom ic dim ension of bu siness:

“Pric es c an destroy all arrangem ents, I am not bou nd to pu rc h ase from

a su pplier, if I do not w ant to pay th e pric e (s)h e c h arges. No h igh er

forc es c an forc e m e to by at th at pric e. Th is is w h y th is k ind of ar-

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rangem ents [pu rc h ase c om m itm ents] c an be destroyed at any tim e by

pric es.” (3)

If m anagers do not m ov e th e foc u s aw ay from th e ov erall foc u s on th e ec o-

nom ic dim ension and starts to c onsider th e env ironm ental and soc ial dim en-

sions, too, it is im possible for bu siness to experienc e a su stainable dev elop-

m ent.

D espite th is ev idenc e of a c learly ec onom ic foc u s in th e c om panies env iron-

m ental initiativ es h av e been tak en in all of th e six c om panies in th e pre-stu dy.

Table 3 below sh ow s a c ategorisation of th e six c om panies based on th e env i-

ronm ental beh av iou r in th e c om panies. T h e c om panies c an be separated in

th ree c ategories: A passiv e env ironm ental beh av iou r; an ac tiv e env ironm ental

beh av iou r; and a proac tiv e env ironm ental beh av iou r.

Table 3: Env ironm ental beh av iou r

Environmental Behav-iour

Reactive Active Proactive

Company B E A D F C

A noth er c ognitiv e barrier to c onsider m igh t be th at of c o-operation w ith oth er

c om panies, inc lu ding c om panies th at m igh t ev en be th e c om petitors. Fu nda-

m ental for indu strial soc ial ec ology is th at c om panies sh ou ld m ove aw ay from

pu rely w aste produ c t exc h ange to exc h ange of all k ind of exc ess c apac ity, su c h

as for exam ple m ac h ine and transport c apac ity in respec t for th e ec onom ic , en-

v ironm ental, and soc ial dim ension. None of th e c om panies inv olv ed in th e re-

searc h h as any experienc es in c ollaborativ e projec ts oth er th an a few dev elop-

m ent projec ts. A ll exc h anges of w aste m aterials are based on ordinary pu r-

c h ase arrangem ents.

Researc h h as sh ow n th at c om panies u su ally find new partners th rou gh th eir ex-

isting netw ork s (G u lati & G argiu lo, 1997). Th is im plies th at it m igh t not alw ays

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be th e m ost su itable partner a c om pany gets, and c om panies w ith no prior ex-

perienc e w ith partnersh ips m igh t h av e diffic u lties in finding partners.

“W e are c onstantly trying to find alternativ e u se, th is m eans th at w e are

alert and rec eptiv e tow ards new ideas and as tim e goes on w e get to

k now m ore and m ore c om panies w h ic h are interested in w aste.” (4)

“W e w ou ld lik e to [h av e an c o-operation in th e env ironm ental area] bu t

it h as to be w ith c om panies th at are sim ilar to u s… ” (6)

T h ese qu otes sh ow th at th ere are problem s in finding th e righ t partners for th e

c om panies. O ne of th e interv iew ees su ggests th e follow ing:

“I w ou ld lik e a c entralised D anish inform ation plac e [database], w h ere

one c ou ld inform abou t w aste produ c ts w h ic h are av ailable to oth er

c om panies. W h ere one c ou ld inform abou t needs.” (4)

T h is sh ow s anoth er barrier to th e diffu sion of indu strial soc ial ec ology, w h ic h is

related to inter-organisational c o-operation. S om e of th e persons interv iew ed

m ention th at lac k of inform ation abou t oth er c om panies and th eir needs m ak es

it diffic u lt to establish partnersh ips. For indu strial soc ial ec ology to be su c c essfu l

it is essential th at th e nec essary inform ation is av ailable. Th ere are tw o types of

inform ational barriers 1) external inform ational barriers c onc erning th e inform a-

tion flow betw een c om panies, and 2) internal inform ational barriers c onc erning

th e inform ation flow betw een em ployees in and ac ross fu nc tioning in th e c om -

pany.

T h e form al EM S system atises inform ation abou t u se of resou rc es and w aste

inside th e c om pany, and m ay th u s be a valu able tool for elim inating internal in-

form ational barriers:

“Th ere is no dou bt th at in c om panies w h ere th ere h as been no [env i-

ronm ental foc u s], it w ou ld be a good idea w ith som e sort of form alised

EM S , so th at th ey c an get th ings properly stru c tu red.” (10)

13

Bu t im plem enting an EM S m igh t not be enou gh to ensu re th e internal inform a-

tion flow . Th e stru c tu re of th e organisation itself c an be a m ajor barrier to th e

diffu sion of indu strial soc ial ec ology. If th e stru c tu re of an organisation does not

adapt to th e dem ands in th e env ironm ent, th e organisation w ill be ineffec tiv e

and ev entu ally c ease to exist (M iller & Friesen, 1984). T h erefore, to respond to

dem ands from th e env ironm ent abou t c leaner produ c tion, th ere h as to be an

adju stm ent of th e stru c tu re.

In som e of th e c om panies som e stru c tu ral c h anges h av e been im plem ented, in

th at th ey h av e establish ed an env ironm ental departm ent/fu nc tion separate from

th e produ c tion. O nly in one of th e c om panies v isited a c ross-fu nc tional adv isory

board h as been establish ed:

“Th e organisational stru c tu res h av e been c h anged in th at w e now h av e

an env ironm ental departm ent separated from th e produ c tion… I th ink

th at it h as been v ery good for a period, bu t I th ink th at it is tim e for th e

env ironm ental departm ent to be integrated in th e produ c tion again, be-

c au se it is noth ing spec ial after all.” (1)

“No [th e im plem entation of EM S ] h as not requ ired any organisational

c h anges.” (9)

T h ese qu otes sh ow th at only m inor c h anges h av e been m ade in th e respec tiv e

organisations. Th is m irrors a su perfic ial attitu de tow ards env ironm ental issu es.

Neglec ting th at a c h ange of stru c tu re is inev itable to reac h a su stainable dev el-

opm ent c reates a m ayor barrier against a su c c essfu l diffu sion of indu strial so-

c ial ec ology. O nly in one of th e partic ipating c om panies h as m anagem ent real-

ised th e need for fu rth er stru c tu ral c h anges:

“Th e position as env ironm ental m anager did not exist earlier. A nd w e

h av e ou r env ironm ental c om m ittee, w h ic h inv olv es all lev els.” (4)

14

“It is very different h ow m u c h th e EM S affec ts th e em ployees. It is not

as w ith TQ M , w h ic h h as a very big effec t on you r daily rou tines; it is not

lik e th at w ith E M S . S om e em ployees m ay ev en not feel th at w e h av e

an EM S w h ile oth ers feel it v ery m u c h on th eir body” (4)

“No m atter w h o is in th is h ou se, th ey h av e to k now w h at th eir position

is, and th ey h av e to k now w h at th e env ironm ental im pac ts of th eir fu nc -

tion are and th at th ey h av e influ enc e on it. It sh ou ld not ju st be som e-

th ing th ey k now bu t also som eth ing th ey ac t and reac t u pon. Both h eart

and brain h av e to follow it.” (5)

T h e last c om m ent is not only referring to stru c tu ral aspec ts bu t also to c u ltu ral

aspec ts of organisation. O rganisational c u ltu re c an be desc ribed as th e arti-

fac ts, v alu es and basic assu m ptions in th e organisation (S c h ein, 1985). Th e ar-

tifac ts are th e v isible patterns of beh av iou r and system s in th e organisation;

v alu es are th e indiv idu al’s interpretation of th ese patterns; and th e basic as-

su m ptions are th e indiv idu al’s ideas and assu m ptions th at h av e been bu ild on

experienc es du ring th e indiv idu al’s life. T h ese basic assu m ptions affec t th e indi-

v idu al’s beh av iou r. A c om pany’s c u ltu re reflec ts th e basic ph ilosoph y of th e

leaders, and th is ph ilosoph y is often expressed in th e c om pany’s m ission

statem ent (G ordon, 1996).

A s sh ow n in table 2 abov e, env ironm ental issu es are part of th e c om pany’s

m ission statem ent in fiv e of th e c om panies in th e stu dy. In tw o of th e c om pa-

nies, h ow ev er, th e env ironm ental issu es are not expressed in th e c om pany’s

ow n m ission statem ent bu t only in th e ov erall m ission statem ent of th e c o-

operation th ey are part of (B, E). Env ironm ental issu es h av e generally not been

on th e agenda for v ery long and only in one of th e six c om panies (F) h as th ere

been a foc u s on env ironm ental issu es sinc e th e establish m ent of th e c om pany.

In th e oth er fiv e c om panies foc u s h as c h anged ov er th e years, w h ic h im plies a

c u ltu ral c h ange in th e fiv e c om panies. C u ltu ral c h ange h appens bec au se of ei-

th er external or internal triggers. External triggers c onc erning env ironm ental is-

su es are often regu lations or dem ands from c u stom ers (Halm e, 1997), w h ic h is

also tru e for som e of th e c om panies in th e pre-stu dy:

15

“W e w ou ld not h av e been w h ere w e are today if it h ad not been for th e

regu lations.” (1)

“If you h ad ask ed th is qu estion 7 or 8 years ago th e answ er w ou ld c er-

tainly h av e been regu lations from gov ernm ental au th orities… ” (9)

Bu t th ere h as been v ery little if any pressu re from th e c u stom ers c onc erning en-

v ironm ental issu es:

“A lot of ou r c u stom ers m ark et th em selv es as env ironm entally c on-

c erned… Bu t w h en w e dec ide to m ake an arrangem ent togeth er, th ey

do not ask abou t env ironm ental issu es anym ore.” (4)

Internal triggers c an be indiv idu als in th e organisation w h o start th e c h ange.

T h is is c learly th e c ase for c om pany C, w h ere th e top-m anager started th e

c h ange proc ess:

“It is ou r top-m anager, w h o h as th e intentions… it is h is w ay to look at

th ings.” (5)

Triggers, both external and internal, produ c e ac tion from th e organisation and

th at ac tion c an be reac tiv e, ac tiv e or proac tiv e, w h ic h again produ c es c h ange.

C h anges h appen th rou gh learning. T h ere are th ree types of organisational

learning: S ingle-loop, dou ble-loop, and triple-loop learning (Van Hau en et al.,

1995). S ingle-loop learning is c h arac terised by a c h ange in th e artifac ts bu t no

c h ange in th e oth er tw o c u ltu ral lev els. D ou ble-loop learning im plies a c h ange in

artifac ts and valu es. A nd finally triple-loop learning is a c h ange in all th ree c u l-

tu ral lev els. Researc h h as sh ow n th at an adoption of su stainable strategies re-

qu ires c h anges in all th ree lev els; i.e. a th ird order c h ange (W elford, 1997).

Table 4: O rganisational learning

Action Learning Change Result Reactive Single-loop Artifacts Improvement

16

Active Double-loop + Values Innovation Proactive Triple-loop + Basic assump-

tions Evolution

Inspired by (Van Hau en et al., 1995, p. 231) In a lot of c om panies env ironm ental issu es are approac h ed in th e sam e m anner

as qu ality w ork u sing EM S ’s sim ilar to qu ality system s (i.e. BS 7750 and

IS O 14001). T h is is also th e c ase in fou r of th e c om panies (A , B, D , E) in th e

pre-stu dy. Experienc e h as sh ow n th at th e im plem entation of su c h system s

m igh t v ery w ell lead to negligenc e instead of a c ontinu ou s im prov em ent (W el-

ford, 1995, p. 81). A n approac h based on an EM S sim ilar to BS 7750 or

IS O 14001 is th erefore not su ffic ient to reac h su stainability. T h e reason for th is

is th at an EM S sim ilar to BS 7750 and IS O 14001 only c ondu c ts single-loop

learning and rarely dou ble-loop learning (Van Hau en et al., 1995). T h erefore, a

m anagerial belief th at im plem entation of an EM S is enou gh to c h ange th e c u l-

tu re tow ards an env ironm ental foc u s is a m ayor barrier for th e possibility of

reac h ing a su stainable developm ent.

T h ere seem s, h ow ever, to be an u nderstanding am ong th e interv iew ees th at

im plem entation of an EM S is not th e absolu te solu tion to approac h env iron-

m ental issu es:

“Th e EM S itself is not su itable [to ensu re th at th e c om panies c onstantly

im prov e th e env ironm ental perform anc e] th ere h as to be m anagerial

su pport to bac k it u p.” (2)

Bu t w h at th is interv iew ee and oth ers do not realise is th at a su stainable dev el-

opm ent c annot be realised w ith ou t basic c h ange in assu m ptions abou t c om pa-

nies’ roles and responsibilities in soc iety. T h ere h as to be an u nderstanding th at

c om panies h av e a broader soc ial responsibility th an ju st m ak ing m oney.

O nly one of th e interv iew ees h as realised th at c om panies h av e a soc ial respon-

sibility, w h ic h is ev ident in th e m entioning of a differenc e betw een qu ality and

env ironm ental issu es:

17

“Th e differenc e betw een env ironm ental initiativ es and qu ality of prod-

u c ts, w h ic h norm ally are c om pared, is th at th e latter is only for th e sake

of c u stom er’s, w h ile th e env ironm ent is for ev erybody. Th at is a qu ite

different th ing.” (5)

T h is interv iew ee realises th at th e soc ial dim ension is an im portant fac tor to ad-

dress in order to be able to reac h a su stainable dev elopm ent, w h ereas all th e

oth er interv iew ees equ al qu ality and env ironm ental issu es and th erefore do not

tak e th e soc ial dim ension into c onsideration w h en addressing env ironm ental

issu es. T h is c reates a barrier for th e diffu sion of indu strial soc ial ec ology and

th e possibility for reac h ing a su stainable dev elopm ent, bec au se th e soc ial di-

m ension is an essential issu e in th e su stainable organisation and c an th erefore

not be neglec ted (see figu re 1).

D isc u ssion

W h en engaging in Indu strial soc ial ec ology projec ts th e m anagem ent fac es new

w ays of doing bu siness. T h ey are h eav ily dependent of th eir partners in th e

netw ork , and dependenc e c reates u nc ertainty for th e c om pany. Th ey fac e u n-

c ertainty regarding deliv eranc e or sale of exc ess c apac ity, u nc ertainty abou t

m anaging th e inter-organisational relationsh ip and u nc ertainty bec au se of lac k

of inform ation. Th is u nc ertainty c an c reate barriers to th e developm ent and dif-

fu sion of indu strial ec ology.

T h e analysis of th e pre-stu dy sh ow s ev idenc e of c om panies th at h av e still a

long w ay before indu strial soc ial ec ology c an be reac h ed. Th ere is a c lear lac k

of ac k now ledgem ent to th e fac t th at su stainability c an only be reac h ed if th e so-

c ial dim ension is approac h ed togeth er w ith th e env ironm ental and ec onom ic

dim ensions. T h is seem s to be du e to both c ognitiv e barriers at both m anage-

m ent and em ployees as w ell as organisational barriers.

T h e analysis h as not only giv en an answ er to th e qu estion on page 7 bu t h as

also lead to oth er qu estions of interest th at needs to be fu rth er explored:

18

For indu strial soc ial ec ology to be su c c essfu lly diffu sed and adapted am ong in-

du strial c om panies it is of u tterm ost im portanc e to identify and elim inate possi-

ble c ognitiv e, inform ational and organisational barriers. Th is raises anoth er

qu estion:

2. How c an k ey barriers be identified and ov erc om e if indu strial soc ial ec ology

is to be m ore effec tiv ely diffu sed in D anish indu stry?

For m any years th ere h as been an exc h ange of w aste m aterials betw een c om -

panies. Th ese link s are based on ordinary pu rc h ase transac tions. Bu t one of th e

assu m ptions I m ak e in th is paper is th at indu strial soc ial ec ology c an not be

reac h ed if m anagem ent c ontinu es ac ting on pu re ec onom ic m otiv es and env i-

ronm ental problem s are seen as ec onom ic externalities. A t th e sam e tim e in-

du strial soc ial ec ology c annot be reac h ed w ith ou t tigh t c o-operation betw een

c om panies. Co-operation th at m igh t ev en inv olv e c om petitors. W h at im plic a-

tions th is w ill h av e for m anagem ent of organisations h as not been qu estioned

so far – an im portant issu e th at needs fu rth er researc h .

U ntil now th e env ironm ental agenda h as h ad a narrow foc u s on w aste m inim i-

sation in th e c om panies. T h e c onc ept of indu strial soc ial ec ology as introdu c ed

h ere does on th e c ontrary enc ou rage c om panies to produ c e m ore w aste m ate-

rials, if it c an be sold w ith profit to som eone. A noth er problem w ith indu strial so-

c ial ec ology is th at of ow nersh ip of w aste. If it is possible to sell w aste m aterials

to eac h oth er, m anagem ent c an easily sell th eir problem s for som eone else to

tak e c are of.

T h is raises a th ird qu estion:

3. W h at are th e im plic ations of a diffu sion of indu strial soc ial ec ology?

U ntil now attention h as only been foc u ssed on th e positiv e th ings abou t indu s-

trial soc ial ec ology, bu t th ere is a strong need for fu rth er researc h of th e im plic a-

tions of indu strial soc ial ec ology.

19

Closing rem ark s

T h ou gh it seem s lik e th ere is no prospec t of reac h ing su stainability in th e near

fu tu re, for a least fiv e of th e six c om panies th ere h as been m ayor progress over

th e past ten years. Env ironm ent is som eth ing th at is c onsidered now and m ost

of th e interv iew ees h av e th e im pression th at it is h ere to stay. Com pared to th e

ov erall perform anc e of th eir c om petitors all of th e interv iew ed persons v iew th eir

ow n c om pany as equ al to oth er D anish c om panies, bu t far ah ead c om pared to

m ost c om panies ou tside D enm ark :

“Th e fu rth er you go from D enm ark th e w orse it gets. You do not h av e

to go m u c h m ore sou th ern th an G erm any, before you see a dec rease

in th e interests for env ironm ental issu es” (10)

M anagem ent in th e six c om panies inv olv ed in th is prelim inary stu dy h as done

qu ite an effort to reac h th is lev el, bu t th ey h av e only c om e th is far bec au se of

gov ernm ental regu lations:

“W e w ou ld not h av e been w h ere w e are today if it h ad not been for th e

regu lations.” (1)

A s long as th e inv estm ents are ec onom ic ally feasible, m anagem ent seem s to

be w illing to inv est in env ironm ental protec tion. T h is m eans th at eith er govern-

m ent h as to c ontinu e m ak ing regu lations or th at a new w ay of internalising env i-

ronm ental c osts is needed.

Referenc es A llenby, B. R. & W . E. Cooper (1994). “U nderstanding Indu strial Ec ology from a Biologic al S ystem s Perspec tiv e.” Total Q u ality Env ironm ental M anagem ent 3(3): 343-354. Bovasso, G . (1996). “A Netw ork A nalysis of S oc ial Contagion Proc esses in an O rganizational Interv ention.” H u m an Relations 49(11): 1419-1435. D u c h in, F. (1992). “Indu strial Inpu t-O u tpu t A nalysis: Im plic ations for Indu strial Ec ology.” Proc eedings of th e National A c adem y of S c ienc es of th e U nited S tates of A m eric a 89(3): 851-855.

20

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