Issues in the implementation of proactive environmental strategies

Management consultants, environmental groups, and industry trade associations have all recently offered guidelines for companies to improve environmental performance.¹ The guidelines suggest ways that companies can implement strategic change to move beyond compliance with regulation, assume responsibility for the environmental impacts of their products, and gain public credibility. Much of the advice offered can be useful to managers who are responding to rapidly changing environmental pressures.

Nevertheless, implementation of some of the general guidelines could impose undue costs or introduce untoward organisational consequences for certain companies. While mentioned as an issue in the management literature, companies need more systematic advice on how best to tailor these broad guidelines for environmental strategic change to the specific needs and capabilities of their companies. In addition, as many companies are comprised of diverse business units that are sometimes linked together only through financial controls, managers must adapt environmental management programs to unique ‘substructures’ within the firm. These substructures can differ dramatically in their environmental performance and their management capabilities.

Elsewhere we have offered a framework for analysing environmental strategies and management programs.² In this paper, we identify some of the implementation issues that confront companies when they introduce environmental strategic change. We argue that environmental strategies are most effectively implemented when they are consistent with the organisational characteristics and operating context of the company involved.

We use Volvo's experience with environmental strategic change to highlight many of the difficulties that companies may encounter when altering their approach to environmental performance. The case illustrates how a company can modify its own strategy and management programs for more effective change. It is an interesting case to study because of the proactive and comprehensive nature of Volvo's environmental strategy and management programs.