Creating that Competitive Advantage

Hey all,

In today’s class we learned about the problems we face in society, especially as we consume our precious resources.  I find this topic very interesting especially when it comes to competitive advantages.

For instance, in the Department of National Defence, we have created a “greening” policy to ensure that our procurements (purchases) take into consideration “green” practices.  Click here for a link to the policy.  The interesting thing is that this policy extends from the identification of a needed material (such as a new piece of equipment or even spare part) to the disposal of that piece of equipment.  Our greening policy provides a competitive advantage as it ensures that when we make a purchase, we look at using the least amount of material, as well as environmentally friendly material which often results in cheaper contracts with industry and savings to the government.  Note: from the DND policy link you will find the policy for green procurement for all purchases at the Public Works website.

Finally, I thought that you would also be interested to see how some corporations are turning sustainable development into a competitive advantage.  The following article provides 50 examples on how businesses such as Wal-mart, GE, Star-TV, and many other have turned to greener operations, which for many has yielded greater returns.  My favorite is #14, which talks about how Coors created a process to transform 3 million barrels of waste beer into 200-proof ethanol, which is used to fuel cars in Colorado.  Now that’s something to drink to!!

Article: http://www.fastcompany.com/magazine/120/50-ways-to-green-your-business.html

Regards,

Jason Choueiri

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Posted in sustainable technologies
3 comments on “Creating that Competitive Advantage
  1. giggey says:

    JC, not sure I understand how using the “least amount of material” is a competitive advantage? Do you mean that the equip that’s purchased requires less material to make? And if so, wouldn’t it only be advantageous if that makes it cheaper?

    Sorry, but I didn’t understand how buying “environmentally friendly” material makes for cheaper contracts with industry. Does the Canadian DND know something that everybody else doesn’t?

    Looking forward to your response.

  2. penczek says:

    I just noticed the same as Giggey. To make the green thinking a competitive advantage, there must be a competitor. As far as I know Department of Defence is a monopsony?

  3. jasonchoueiri says:

    The idea of competitive advantage is in relation to other nations and countries. Competitors to the Department of National Defence (DND) are other Defence organizations (as well as other foreign government departments). For example, a competitor to DND would be the Afghan Ministry of Defense. One way we compete is by procuring equipment and services cheaper and faster to strengthen our military forces.

    Rob, to answer your question. When greening procurement, Defence looks at incorporating greening practices to, among other things,reduce materials (type and quantity) used, reduce the amount of solid waste produced and to reduce the consumption of energy and natural resources. To get a competitive advantage from a contract/cost perspective, you are correct, the material or service would need to be procured cheaper. Of course, there are other considerations. For example, if Defence purchases a set of new hydrogen-fueled vehicles versus vehicles that use traditional petroleum based fuel, the cost savings to the Forces and to Canadians is substantial given the amount of fuel used annually (less toxicity to the environment, reduced fuel consumption etc).

    W.r.t. to cheaper contracts, greener procurements can lead to contracts that are cheaper if the material procured is cheaper (i.e. recycled paper cellulose for insulating infrastructure is half the price of traditional pink insulation). The other part of my sentence was “savings to government”, which is where a large focus is…Greening throughout the material life-cycle can and should result is less expenditures during the operation of materials (fuel, consumption rates etc), as well as during the disposal of equipment (environmentally friendly material is easier to dispose of, especially if it is reusable).

    JC

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