Palm and Eco-Risk

Green issues can be handled in two ways. One, as a risk management tool and two, as a step forward for Innovation. Andrew Winston at Eco-Advantage (who is the co-author of Green to Gold) blogs about the eco-risk for Palm.

Andrew mentions a Business 2.0 article on European Unions’ Restriction on Hazardous Substances on electronic goods. The WEEE and other directives ban “hazardous substances like lead, mercury, and cadmium from use in new electrical equipment.”

Palm, incidently, has not followed this and has to stop selling the Treo 650 in Europe. The effect of this on Palm’s share price has been considerable.

After Palm announced in late June that it would stop shipping the 650 to Europe – the only model it sells in the region – it forecasted sales for the current quarter at between $380 million to $385 million – about $20 million below what Wall Street analysts expected. That sent its shares down by 14% to $16.10. Although Palm has announced plans to start selling a new smartphone later this year that complies with the EU’s rules, its shares have continued to slide since then, closing Tuesday at $14.19.

Andrew estimates that this has wiped out $470 million from its market cap.

Andrew points out the benefits of using Green strategies both in risk management and innovation.

While it’s an understandable gut reaction that it might not be worth the expense to retool, by not managing environmental regulations and risk, companies can miss out on market access opportunities. That can mean a ripple of lost sales and value that far outweighs the initial expense. Not to mention that pursuing new technologies and materials to meet the regulations can drive new thinking, innovation, and eco-advantage.

Green Votes

Reuters examines the green trends in governments all over the world.

Just as Bill Clinton used the battle cry “It’s the economy, stupid!” to keep his 1992 presidential campaign focused, political leaders worldwide are chanting a new mantra based on growing alarm about global warming.

Mainstream parties in Germany, Britain, France, Canada, the United States and Austria believe tackling climate change is a vote winner while established Green parties in Germany and Austria are experiencing a renaissance.

“Climate change, if presented the right way, is a topic that voters are definitely opening up to,” Manfred Guellner, managing director of Germany’s Forsa polling institute, told Reuters. “We’re seeing you can score points with it

“Sustainable development and the defence of the environment is a question so fundamental that it can’t be the property of one political party, even if it’s green in colour,” the front-runner for ruling conservative UMP party told parliament.

“Showing a commitment for the environment has once again become fashionable and deemed worthy of public recognition,” said Udo Kuckartz, a University of Marburg researcher in a recent study of the public’s view for the German government.

“We haven’t seen that in a long time.”

Germany is home to the Greens party, one of the world’s most successful ecology parties which has had seven years in government. Their support has climbed from 8.1 percent in the 2005 election to around 11 percent in opinion polls.

Government intervention is important in the fight against global warming mainly because pollution is an externality and that means free markets cannot solve this issue by themselves. Green votes are the way forward.

Greening the Middle East

The Middle East is known for its oil and Dubai for its shopping. A profile of the UAE is an example of countries from the middle east.

The United Arab Emirates (UAE) economy is mainly dependent on oil and natural gas, which accounts for around 36 per cent of gross domestic product (GDP). The UAE is currently the fourth largest producer of oil in the Organization of Exporting Petroleum Countries (OPEC) with reserves estimated at 98 billion barrels (10 per cent of the world reserves).

The region is slowly changing its attitude towards the environment. Some examples:

Organic Expo in Dubai.

THE Middle East Natural & Organic Products Expo will be almost 80 per cent bigger next year as a result of bookings confirmed when the 2006 edition ended a three-day run at Dubai’s International Exhibition Centre yesterday (Tuesday, Dec 12).

The show has already grown by 100 per cent since it was first staged in 2003, with more than 300 exhibitors from 35 countries now occupying 5,000 square metres of floor space.

“The seismic shift to natural and organic foodstuffs and medications, as well as products such as textiles, cosmetics, and cleansing agents is a worldwide phenomenon that is gaining strength virtually by the day.”

Global Links managing director Nadim Al Fuqaha added: “Middle East consumers are always among the first to adopt global trends and this is very evident in the success of this year’s expo and the projected growth for next year.”

Water Awareness in Abu Dhabi

With water scarcity being an important issue across the globe, and especially in the Arab Region, this project will help bring a much needed awareness to the younger generation in the following countries: UAE, Qatar, Sultanate of Oman, Kuwait, Hashemite Kingdom of Jordan, Egypt, Palestine, Syria, Lebanon and Tunisia. Water and awareness experts from some of these countries also attended the launch.

‘The project’s aim is get Arab youth more interested and more active when it comes to water issues in their part of the world. By providing them with the right tools, training and awareness, the project will help generate a new generation of pro-active and knowledgeable youth working towards conserving the precious resource of water,’ said H.E Majid Al Mansouri, Secretary General of EAD.

Sharjah Municipality launches ‘Bee’ah’, the biggest waste recycling company in the Arab region

A waste-recycling factory will be set up in Al Saj’ah area and will depend on the latest international technology in the recycling industry under the supervision of highly experienced specialists and technicians. The company will also set up branches in all other municipalities of the Emirate of Sharjah.

Mrs Randa Kamal Chief Executive Officer of JMS Property Development stated that: “Governments and institutions are set day after day to launch environmental programmes and projects aimed at seeking solutions as required for handling the increasing environmental issues, which our contemporary world suffer from after hving gone too far in exhausting its natural resources.

As a first stage, “Bee’ah” will collect, sort out and classify waste within the following categories: aluminium materials, plastic materials, all kinds of paper, glass and ceramic, building materials, iron and organic materials. These will be sent to the recycling factory, which will be operational by late 2008 after being completed according to the latest technical specifications under the supervision of a group of manufacturing and recycling engineers and specialists.

Even though they have arrived late, the middle-east is moving fast in this area. There are many opportunities for Green companies to exploit and make a difference in this region.

Lessons of Innovation from Nintendo Wii

Innovation is critical in creating a sustainable society. The current industrial system need to look at the challenge of ‘sustainability’ as a design and innovation issue.

The Nintendo Wii, the new game console from Nintendo Japan has some interesting lessons for Green companies.

The Nintendo Wii is competing with XBox 360 and PlayStation 3. Both of these consoles have gone for faster processing, better graphics, bigger hard-disk, mulitple functions (like BluRay, DVDs etc). However, the Wii went on a different path.

One crucial aspect of Innovation is the need to be open inside the company to facilitate collaboration. The Nintendo team has taken this to the extreme, with the CEO of the company, Iwata, interviewing the main people behind the Wii in an open discussion.

First, the vision.

Listening to everyone here talk about Wii reminds me that the most important thing was clearly defining our vision. Even if it was a vision without a precedent.

That’s really true. Without a goal based on a concrete concept, I don’t think Wii would have become what it is today.

I really believe that we’ve come this far because of our vision. If you simply repeat the process of building up the hardware specs, then you just end up with higher costs and a larger console. I think a better approach is to have a clear vision, decide what you want to accomplish, and then work towards your goal.

Vision is very important in deciding upon the strategy of the company. Sometimes, the vision is found later on, but at some point in time, it is important to have a clear vision ahead.

Second, defying the trend in the Industry.

In the world of technology, there are so-called Roadmaps (overviews of proposed technologies/products) that are used by each industry…This may sound paradoxical, but if we had followed the existing Roadmaps we would have aimed to make it “faster and flashier.” But we could not help but ask ourselves, “How big an impact would that direction really have on our customers?” … the completed Wii, … has turned out to be something completely different from what was predicted in the mainstream technology Roadmaps.

Normally, when making new devices, companies compete with each other on the basis of “How much faster is the CPU, how much more memory is there, and how many more polygons can be displayed?” But Nintendo posed the question “How much can we decrease power consumption and maintain performance?”

To be honest, I even felt quite anxious about it. After all, it takes a lot of courage to divert from the Roadmaps. I was especially concerned when it was still not very clear to me what could be done with such a machine.

If automobiles can be used as a metaphor, our industry has always been trying to compete over horsepower, even though not all cars are made to compete in F1 races. Just as hybrid cars have created a new emphasis on “environmental performance,” I believe that Wii has also discovered new values.

Innovation through collaboration.

“Wii’s one-handed controller is not the great idea of a single person, but a fantastic fusion of ideas from all kinds of people.”

“I first asked a lot of employees for their opinions regarding the hardware.”

“We had to rely on the know-how of Nintendo’s handheld gaming device team.”

“A number of years ago I created somewhere between ten and twenty teams, each consisting of around three people. These teams were given free rein to couple a dedicated controller or peripheral with a GameCube title, and then see whether or not the end result was marketable. This project gave rise not only to the “Donkey Konga” Bongos and the “Dancing Stage Mario Mix” Action Pad, but to a number of ideas and designs that would find their way into the Wii Remote.”

And last, having the capability

Reducing power consumption is something that’s always been considered for handheld gaming devices, but this is the first time it has been thought of for a home console, isn’t it?

Yes, it is. So we had to rely on the know-how of Nintendo’s handheld gaming device team, and the cooperation of the chip manufacturer as well. We also tried to incorporate means of lowering power consumption into the entire system, and not just the IC. It felt like trying to achieve the impossible, but fortunately Nintendo has a history of knowing how to work in unfamiliar situations. A variety of techniques for quickly identifying and solving problems have been accumulated over the years, and I think this was an important factor in achieving our goals.

Innovation is not easy, but it starts in the mind!

Designing for India’s Consumers

Lakshman from BusinessWeek on the importance of design and the diversity of the Indian consumer.

Today, India has only about a dozen design programs, compared with 241 in China. To raise the profile of design, the government is granting the National Institute of Design a much higher status within the university system. And, even more important, the government is launching an ambitious program to promote public-private partnerships between corporations and design schools.

Any number of multinationals have stumbled trying to peddle Western goods to Indians without any changes in product or packaging. But even Indian companies have committed gaffes.

At the safe deposit vault, where villagers store family jewels and land-related documents, there was no screen to shield a couple inside from prying eyes. So a woman used one end of her sari to cover her husband while he pulled out a safe deposit box.

The vastness of India can also be baffling to companies and designers looking for a focused approach. U.S. retailer Wal-Mart (WMT) may have entered India, but setting up outlets and getting mass consumers to buy from its stores will not be that easy, says San Francisco-based emerging markets strategist Niti Bhan.

“India is not one country but a conglomeration of many countries that people have to recognize,” says Bhan.

In order to reach customers in emerging countries it is important to understand the social aspects including the cultural nuances.

What Bhan says is critical. In Australia people question me to try to understand India. However, with the mention of different languages in different states, cultures, religions, urban and rural India they get confused fast.

The best way to understand India for the western world is to think of India as the European Union. The 28 states in India are almost like 10-12 different countries in terms of language, culture, economic development etc.

GreenBlue and Green Innovation

One of the premises of this site is the entrepreneurial nature of business. Innovation plays a major role in making this come true.

Jessi Hempel from BusinessWeek explores the work of GreenBlue.

Cottrell got involved with CleanGredients, an initiative led by the GreenBlue Institute. Along with EPA representatives, academics, and other industry leaders, Cottrell tackled a challenging question: Can we build sustainability into the beginning of the design process rather than the end? Can we help our product developers to start with the right ingredients, rather than making substitutions in the final stages?

Executive Director Jason Pearson understands sustainability as an extension of the quality movement. “New metrics can feel like huge risk factors, but they are also new design opportunities,” says Pearson.

“Many of the sustainability challenges companies face are rooted in poor design—of products, services, business models, and strategy,” says Joel Makower, founder of GreenBiz.com. “GreenBlue takes a design approach to these challenges, creating tools companies can use to chart a more sustainable course.” Makower is joining the GreenBlue board in December.

The GreenBlue Institute was founded in November, 2002, to put architect William McDonough’s Cradle to Cradle principles of ecologically intelligent design into action. It was originally a project that sprang from the work of McDonough Braungart Design Chemistry, the consultancy co-founded by McDonough and German chemist Michael Braungart in 1995.

An important aspect of the problems that we are facing are due to the design of the systems in the current Industrial society. As Joel Makower notes, design is the solution to these problems.

Resources:

  • Cradle to Cradle
  • Online primer on Cradle to Cradle from GreenBlue