Strategy Execution

Walmart’s Sustainability Strategy - Unlocking sustainable value for the world’s largest retailer

 

Situation:

•Wal-Mart’s initial request was for an environmental footprint to help them understand their risks. We proposed looking at the environment as a chance to lead, and develop a business strategy using sustainability as a lens to reveal hidden opportunities to create value.

Our Role:

•Leadership strategy development including:

–Developed high-level footprint for direct operations, supply chain, and products using an input output based model for consumer goods

–Prepared, in partnership with Conservation International, an executive briefing on the environmental issues of the 21st century

–Developed and facilitated strategic business process planning that included key leaders and a wide range of external stakeholders and resulted in plans to ‘lead’ or ‘compete’ in 14 areas

–Designed and conducted 2-day executive choice meeting

–Helped craft bold goals and public commitments that made it clear that breakthrough solutions were required and that there was no turning back on this new direction

 

•Strategy implementation - assisted with a wide range of implementation activities including:

–Created ‘sustainable value networks’ with suppliers, NGOs, academics, and other stakeholders to implement strategies and develop new innovations

–Built processes for employee education, engagement, and alignment around sustainability objectives to help embed it into the DNA of the company

Results:

•Year 1 implementation resulted in >$500M in ROI (revenue enhancement and cost reduction).

•Met or exceeded stretch goals around in-store and truck efficiency (between 2005 & 2008, Wal-Mart increased trucking efficiency by 38%, with plans to have it doubled by 2015).

•Drove product innovation and supply chain transformations in fish, jewelry, textiles, electronics, and other categories.  (e.g. Wal-Mart is working toward making all of its appliances Energy Star-rated).

•Created a source of competitive advantage to recruit and retain key leaders.  Successfully differentiated Wal-Mart in the marketplace. 

The Sustainability Index - Moving a retail supply chain to radical transparency

Situation: 

•90% of Wal-Mart’s environmental impacts are related to the products they sell. The Sustainability Index announced by Wal-Mart is a world-changing effort that will assess products across impact areas and drive innovation.

•The system must be credible, transparent, flexible, and work for 100,000 suppliers and hundreds of thousands of products while gaining alignment from a diverse group of stakeholders including buyers, suppliers, and NGOs

Our Role:

•Working with the Sustainable Value Networks (SVNs), weexplored the issues and developed metrics that create the foundation of the Index. (SVN members include leaders from Wal-Mart, supplier companies, academia, government, and NGOs.)

•We developed a working model and roll out plan for the Index and socialized the concept within Wal-Mart leadership, a stakeholder steering committee and key suppliers, incorporating revisions along the way to create a truly collaborative approach to the Index.

•We organized and facilitated a summit of 170 stakeholders in July of 2008 to tackle key questions about design and implementation of the Index.

•We are assisting with the strategy and management of subsequent index phases including working with multi-stakeholder (and multi-retailer) groups to develop standard metrics

Results:

•A community of 170 diverse stakeholders committed to partnering in this effort.

•The first phase of the Index launched in 2009.

•Product category pilots continue to launch, further developing the product-level metrics.

Employee Engagement Program - Uncovering business value by connecting sustainability strategy with employees

Situation:

•A client wanted to develop a global employee engagement program that was connected to their overall corporate values and successful sustainability strategy. The company hired Blu Skye to assess the situation and develop the overall strategy, framework, and content.

Insight:

•The business value of an effective employee engagement program was far wider reaching than anticipated. Aside from increasing productivity and reducing retention, there was potential to reduce health care costs. In addition, this program could be adapted to engage customers in sustainability, increasing customer satisfaction, building trust and brand reputation.

Results:

•The program was rolled out globally in 2010.  An online social networking tool allowed employees collectively track and share their progress.  Performance was tracked using a management dashboard with key direct and indirect metrics. 

International Hospitality Company - Incorporating sustainability into corporate strategy

Situation:

•Our client approached Blu Skye to get help defining their corporate sustainability strategy.  They were struggling to understand the business case for sustainability, the macro/micro trends, what they were already doing throughout the company, and how to integrate sustainability across their global organization.

Our Role:

•We helped the leadership team understand how having a strategic approach to sustainability would benefit the bottom line through internal and external interviews, site visits, competitive analysis, and conducting a high-level environmental footprint

•We designed a step-by-step approach to focus company-wide efforts, starting by declaring big goals in energy, water, waste and carbon as well as focus areas around renewable energy and building and operations

•We found the opportunities that would generate the most sustainable value (value for the business and the environment).  Through identifying several opportunities that uncovered substantial cost saving and environmental benefit, we help them to leverage the best practices of company properties that had already demonstrated sustainability leadership and explore new and best practice technologies.

Results:

•Blu Skye’s work helped our client validate the economic value of an integrated data-driven approach to sustainability

•In 2008, our client committed to significant reductions in energy consumption, CO2 emissions, waste output and water consumption over the next 5 years. In addition, to these measurable targets, they committed to focusing on some high-impact areas that offer potential for long-term benefits, including sustainable buildings & operations and advancing renewable energy as a viable, cost effective source of power for their hotels globally

•In 2009, our client launched a proprietary system of measurement for sustainability performance that helps improve the guest experience and drive economic returns.  This made our client the first major hospitality company to make sustainability measurement a brand standard.