How sustainability makes your business more profitable through business model change

According to a survey by MIT Sloan Management Review and the Boston Consulting Group (BCG) of over 2,600 executives and managers across a wide range of industries, business model innovation assists companies in profiting from their sustainability efforts  Tweet This!.

More specifically:

• 63 per cent of the survey’s respondents who said their companies profited from sustainability activities also said their company changed its business model on account of sustainability
• 46 per cent of survey respondents who changed their business model because of sustainability said sustainability efforts added to their companies’ profits, compared to 26 per cent of those who did not change their business model
• 50 per cent of survey respondents who changed three or four business model elements because of sustainability said their companies profited from sustainability initiatives, while only 37 per cent of those who changed only one element of their business model said so
• Survey respondents who said that, due to sustainability efforts, they changed their business model and strengthened collaboration with 6 to 10 types of stakeholders were more than twice as likely to say their companies profited from sustainability, compared to respondents who changed their business model but increased collaboration with not more than two types of stakeholders

According to the survey, in order to increase their sustainability-based profitability, companies should:

• Be prepared to change their business model
• Understand how their customers think in relation to sustainability and what they would be willing to pay for, as regards sustainable products or services
• Collaborate more extensively with customers, businesses, individuals and groups outside the company’s boundaries

References:

This article was compiled using a survey by MIT Sloan Management Review and the Boston Consulting Group (BCG). For the sake of readability, we did not use brackets or ellipses but made sure that the extra or missing words did not change the survey’s meaning. If you would like to quote these written sources from the original please revert to the link below:

http://sloanreview.mit.edu/article/the-benefits-of-sustainability-driven-innovation/