Businesses exist to solve customer’s’ problem and marketing’s job is to uncover, define, articulate and communicate those solutions to consumers. We have been doing a reasonable job so far and may be too good a job when we start focusing too much on fixing their problems only for the short term. These “fix-it” solutions, whether is for consumers or businesses rarely solve the real problems. The pharmaceutical companies want you to believe there’s medical solution to each of your problems. The business consultants want you to believe that their best practices can help you create competitive differentiations. The technology providers want you to believe that their CRM will drastically improve customer loyalty if loyalty exist at all in your category. The marketing agency wants you to think that their direct campaigns can kick-start your businesses. And politicians want you to think that they can fix all problems of this world if they are elected.
In fact many of these problems are solvable. Take energy for example, the climate problem is neither necessary nor economic, but is an artifact of not using energy in a way that saves money. Climate change can be prevented by taking markets seriously—letting all ways to save or supply energy compete fairly, at honest prices, no matter which kind they are, what technology they use, where they are, how big they are, or who owns them. Internalizing carbon and other environmental costs will be correct and helpful but not absolute essential.
Think about the clean water problem. If you think oil wars are scary, just wait for the water wars to happen. Over population and ignorance is a deadly combination… and the mechanics of fixing the problem are the same, find more oil and water and continue the same ignorant misuse of resources.
On the first glance, none of these are businesses’ problem. It is the world’s problems. Think again. Is climate change and corporate carbon footprint art of any companies’ business strategy?. Apart from talk and annual report, what must companies do to address climate change, and most important how can they profit from what they do?
No instant fixes work for one's personal life or business, extremely rare in most cases. The key difference is that those big technology solutions touted as instant solutions are orders of magnitude more expensive than the supposed instant solutions for one's personal life – and the purchase price is only the small part – there’s cost of running and opportunity costs for unnecessary distraction.
If current climate science holds true (although there is considerable questions in the estimates) global greenhouse gas emissions should ideally decrease from today’s levels by 90% as of 2050 in order to contain global warming below two degrees centigrade. To reach this ambitious goal, taking economic growth into account, the global economy’s carbon productivity would have to increase by 5% to 7% a year, compared with a historic rate of just 1%, in the days when carbon emissions were not an issue.
Economic growth must be fully decoupled from emission grow. Companies need to use “design thinking” to imagine products —say, computers, cell phones, air conditioners or cars—that are made from more carbon-efficient raw materials and consume less energy and emit lower levels of greenhouse gases in operation. According to a McKinsey research, one global manufacturer analyzes its total carbon footprint as follows: its own emissions and electricity consumption, 10%; its suppliers’ direct emissions and electricity use, 15%; and the carbon content of the raw materials used in its products, 75%.
Radical innovation is needed to decouple emissions from economic growth. In forestry and bioenergy, for example, a major new value chain seems likely to appear around the large-scale supply of biomass to power plants. Another value chain may build on cellulosic ethanol, which could significantly change the supply patterns of transportation fuels if its cost comes down as quickly as many predict. These are not quick fixes. Companies that have the visions and commitment to make the gradual transition to a global low-carbon economy will be big winners of tomorrow. By then we will all be using an eco-friendly laptop like this one.
