green ocean competitive strategy

Green Ocean Competitive Strategies

Susan SheehanJune 10, 2010

“ There is no end to the amount of money to be made by doing the right thing.”

Bill Clinton, 2007

o Companies do ‘sustainability’ for competitive advantage

o Blue Ocean Strategy….Green Ocean

o 2 Green Ocean examples

today

CEOs and sustainability

◦ Improve Brand (54%)

◦ Differentiate Products (50%)

Not compliance, risk or cost

Top two reasons for sustainability strategy

AT Kearny &

Institute for Supply Chain Management

o >70% of executives said sustainability contributes to shareholder value

o >70% rank sustainability as very or extremely important to corporate reputation and brand

McKinsey & Company, 2010

Sustainability delivers value5

Competitive strategy?

>70% CEOs say sustainability should be STRATEGIC

<20% are doing it

The math looks good!

How to create uncontested market space and make the competition irrelevant…

Create uncontested market space

Make the competition irrelevant

Find ‘non-customers’

Pursue differentiation AND low cost

Set outrageous goals and set your people loose!

Red vs. Blue Oceans…

• Focus on core market

• Beat the competition

• Combat ‘commoditization’

• Keep your customers

• Choose low cost or differentiation

• Set realistic goals and micro-manage

• Death by a thousand cuts!

“…do all this, and do it right, and do it first before this decade is out.”J.F.K. 1962

Set outrageous goals

Create uncontested market space

Low cost AND differentiation

Serve non-customers

2000’s

Reinvented systems

furniture

“be a good corporate neighbor by being a good steward of the environment”

Dirk Jan De Pree (DJ)

1955

Herman Miller, Founder

2020 Commitment – crazy goals

ZERO

• Minimum LEED Silver

• 100% green energy

• landfill

• hazardous waste generation

• air emissions

• water emissions

the mirra®

outrageous goals

non-customers

In the past year….

23rd year most admired company in its industryFortune Magazine poll of industry executives and analysts

One of world’s 50 Most Innovative Companies Fast Company

One of 50 Best Manufacturing Companies Industry Week

"SAM Sector Leader" and "SAM Sector Mover”SAM Social Investing global ranking

Herman Miller a Green Ocean Winner?

Green Ocean

Red Ocean

A few crazy ideas

2nd largest office furniture company in the world; $1.92B sales

“Serve our communities as a committed corporate citizen.”

Auto Industry

Revolution

Auto Crash &

Fuel Costs

Green Ocean

oCut energy 20% in 5 years

o Empower branch managers

Chairman’s Task Force on Sustainability -2008

o World’s largest fleet of fuel efficient vehicles

o Thousands of hybrids and electric vehicles

o Fleet as 'petri dish' for fuel and engine technology

Fleet Alternatives

Sustainable Construction

LOW COST AND DIFFERENTIATION

WeCar Sharing

Non-Customers

o $1.25 per rental, matched by Enterprise Foundation

Carbon Offset Program

50 million, 5 yearTree Pledge

o $100 M fund

o Algae biofuels PHDs

o Goal – large scale supply of biofuel

Enterprise Institute for Renewable Fuels

Last 12 months

o Business Traveler Innovation Award for outstanding and original environmental efforts in the travel industry;

National Business Travel Ass./Wall Street Journal

o Readers’ Choice Award as their favourite rental car brand

Budget Travel Magazine

Green Ocean ahead?

o Irrational, right brain thinking

o unachievable goals

o non-customers

o create uncontested green ocean markets

Think Green Ocean

Susan SheehanLeapfrog Sustainability Hub

416-708-2164susansheehan@leapfroghub.com

Leapfrog Hub

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Execution

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