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Business is experiencing turbulent times. Nearly every system – health, finance, supply chains, energy – all are being disrupted. So much so, that turbulence could be our “new normal”.
I firmly believe that businesses can thrive in this new reality. CEOs just need the right playbook to help them make the right choices for their companies to prosper.
I’m most familiar with the energy systems that power and fuel our world. Talk about turbulence! Every time we read a newspaper, watch the news or catch a media feed, we hear the importance of changing our energy use to reduce the risks of climate warming.
Even financial institutions are becoming catalysts of change. Green Bonds and Sustainability Linked Loans are on offer. Companies that prove they are reducing energy waste and carbon pollution can get lower interest rates.
Historically, energy has tended to be a marginal cost centre. This has kept energy off the executive radar screen. In fact, many corporate leaders have been led to believe that energy use and energy costs cannot be controlled. This is a vital lie. Until executives see energy as a critical, controllable input, they will fail to take the appropriate actions to sustain their business and act on climate change.
Countless CEOs have delegated climate action to one department or one person. This is another mistake. The management of energy is much more than hiring someone into a sustainability role and telling them to have a go. Executive ownership of climate action is essential.
The playbook for winning in the future requires an engaged, energy literate management team. They need to know their current status. They need to know how moving the sustainability dial will advance their business with customers, stakeholders and employees.
A future focused company sees the next 5 years and beyond. It sets out a change management strategy in which energy and carbon management are integral components. The Board is onside and aligns executive performance compensation with successful execution.
Each executive manager plays a role in carrying out the strategy. Impacts will be felt across departments. Cross-departmental budgets will be affected. Here’s where having an engaged executive team pays off – in successful implementation.
Managing through turbulence requires constant monitoring to track costs and report revenue gains. Share outcomes widely amongst employees, executive and board, possibly even with customers. A winning organization is a learning organization.
If this process were easy, everyone would be doing it. I’m confident that the extra effort to take action on carbon and energy creates market leaders. Controlling energy pays dividends.
Future looking CEOs are using an energy management playbook to guide them through these turbulent times. It turns out, responding to the climate challenge offers a profitable, sustainable pathway to success.