Case One:

Toyota and Product Innovation

Excerpt from World Inc.
Chapter 4: Toyota and the Search for the Superior Car

LEADING THE CHARGE ON SOCIAL RESPONSE CAPITALISM REQUIRES A NEW BRAND OF LEADER, ONE WHO RECOGNIZES THE FUTURE IN A WORLD THAT IS SWIFT AND SEVERE. A leader of the magnitude and caliber of a Lincoln, of the articulate power of a Churchill or Shakespeare, is not required. Instead, this job calls for someone who can bring passion and focus to superior products in this new, more severe, and rapidly changing world. The best way to examine what it means to build this type of leadership is to look at a company from the old economy that has already taken on this charge, like Toyota.

The automobile is the ultimate example of a twentieth-century product. Ever since Henry Ford introduced the Model T, Americans have been infatuated with the grace, force, speed, agility, and splendor of these products. More than simply providing transportation, the automobile offers freedom, mobility, convenience, power, status, and comfort. The automobile industry is the world's largest manufacturing enterprise. Each year it produces more than forty-four million cars and trucks, a figure larger than the population of most countries. While part of this is due to the delight of owning a personal vehicle, a much larger part is due to the built-in need for cars that has been systemically decreed since World War II by leaders of all nations in cooperation with the petrochemical, development, and tourism industries. In industrialized nations, the automobile plays a central role in the daily lives of the population.

Yet automobiles are also a primary contributor to environmental deterioration. Daily, they add to losses in the quality of our air and water. Consider that there are seven hundred million vehicles in operation worldwide, with 150,000 more added every day. In America alone, cars and trucks produce roughly one-third of the nation's smog, and Californians alone are estimated to lose more than 400,000 hours each workday due to traffic congestion. The problems that the overuse of cars poses — or, more specifically, the overuse of the wrong kind and size of car — go well beyond environmental deterioration and directly affect our quality of life, the time we have to both work and relax, and our health and enjoyment of life...

For an account of the roles we played in helping Toyota bring the hybrid power-train to its Prius series, its Camry quality line, its Lexus luxury line, and into the North American markets, please see our account in www.worldincbook.com.

Piasecki lead a five person AHC group team across three years as it developed this strategy, including public messaging, government affairs, and industry-sharing strategies.

Why is the Toyota case relevant outside the AUTO Industry?

We are now adapting the same multi-company path of innovation to the Canadian Oil Sands Innovation Alliance, in a fashion that now involves intellectual property agreements among the 14 largest CEOs with holding in the oil sands of Canada.

You can find another example in our Corporate Affiliates like MASACO that fuel the Environments for Living home efficiency program with GE, LP, Shaw Industries, and many others.

---

Case Two:

FMC and Establishing Growth and Sustainability Councils

The AHC worked with FMC Leadership to Create and Implement Program across Global Operations FMC’s Sustainable Growth council was created to implement a sustainability program and embed a sustainability mindset through- out global operations. This project was started in 2010 before Senior Leadership, continued in 2011 and 2012 in the appointment of two dozen key FMC leaders, and continues today at a business integration and implementation level.

Competing on Sustainability

• FMC has benefited from the successful implementation of a Sustainable Growth program. the Group by getting in front of emerging global trends, enhancing reputation, increasing productivity, reducing costs, and creating business and market growth.

Global Mega-Trends

• AHC worked with assisted FMC in identifying key current global mega-trends and the sustainability related risks and opportunities available to FMC.
• The trending needs for the future that were provided to FMC included the increasing demand for scarce natural resources, the need for increased food, feed and fiber production, alternatives to fossil fuels, competition for land , and the growing need for safety and protection for both people and the environment

Competitive Assessment

• To assess how FMC compares to actions by peers the AHC Group provided results from numerous surveys and case studies, A Competitive Review of Sustainability Goals and Metrics was also developed and presented to Senior Management and the Growth and Sustainability Council.

Primary Objectives of FMC’s Global Sustainability Program

• AHC assisted FMC in defining the primary objectives for the Sustainability Program, a Sustainability Council Charter, an Action Plan and Time-Line for the Sustainability Council.
• Three ongoing Working Groups were established to implement sustainability across “all” business functions within FMC.
• To facilitate the transformational process (shift in culture) of embedding sustainability throughout FMC, the AHC Group worked with leadership to develop a clear sustainability vision that was incorporated in their existing Vision statement.
• T, and others in the AHC Group Corporate Affiliates benchmarking workshops

 

AHC Group provided guidance to FMC on many issues, such as:

1. Justification and job description for Sustainability Director, Sustainability Analyst, and Stakeholder Engagement Manager.
2. Sustainability project criteria and capital allocation.
3. Stakeholder engagement process.
4. Supplier sustainability assessment program.
5. plus Integrating sustainability in M&A due diligence process.
6. Sustainability Goals and targets

---

Case Three:

Training Workshops

Across more than twenty years, the AHC Group has held SUMMITS for leadership exchange called the Corporate Affiliates programs and workshops. Often we organize and facilitate two main “Achieving Results Workshops” per year.

Lately, we have taken this knowledge base and applied it to special training areas, such as

Workshops on Understanding Reputation

Here we take a view that Reputation is a three legged stool, and we coach the  participants into understanding the three core elements: operational excellence, transparency of disclosures, and selective engagement.

Workshops on Emerging Corporate Issues

Here we have specialty knowledge and workshops on “Answering the Climate Change Challenge”, “Site Remediation and the Arts of Risk Reduction”, “Emerging Issues Mapping and Developing Internal Capacity”, and “Stakeholder Engagement.”

AHC GROUP ANNOUNCES NEW SERVICES IN STAKEHOLDER AWARENESS TRAINING AND INTERNAL RESPONSE TEAMS

Over the last three years, the AHC Group has developed a series of special mapping and senior management alert tools on the social networks and movements that are rapidly influencing and altering their course of action.

We have also run Stakeholder Awareness and Response workshops in San Francisco with our Corporate Affiliate Future 500 for the last three years, enrolling leaders from firms as consequential as Disney, PSEG, Exxon, Chevron, Conoco, Shell, Suncor, FMC, Freeport, and others.

Why do senior management awareness alerts in this new world of stakeholder engagement and social networks matter to corporate strategy and product positioning?

Foremost, it is because the world of 24/7 media is surrounding the corporate mansion. For example, this month (December 2013) the front page of the New York Times Business section featured a story on why students are working with 350.org to have their endowments discuss the best ways to divest from investments in oil companies, while at the same time North America is beginning to appreciate a significant Renaissance in Natural Gas and Oil domestic oil discovering. The conflicts occur daily and are growing in impact.

AHC Group’s newly refined services--involving the majority of our Senior Associates and attorneys in the Group--are designed to help senior management not only understand but also effectively respond to these new swift and severe inputs into their business destiny.

One such example resides in our alert below about the advent of AVATAR ENVIRONMENTALIST...

The Full Costs of BP's Mistakes: The Advent of AVATAR ENVIRONMENTALISTS

By Bruce Piasecki
Bruce@ahcgroup.com | www.brucepiasecki.com

Six years ago, key leaders at BP invited me to visit them at their headquarters. I keep vivid impressions of this largest employer in England.

BP executives were everywhere, from the libraries to nearly every place I dined. They had their own articulate drivers to take me around with public safety standards that went way beyond a Texas seatbelt.

What went so wrong, then, in a mere 72 months, the time it takes from birth to reach first grade? Why is CEO Haywood seeking his boat time to get back his life?

Their stated concern at the time was "Dr. Piasecki, what happens to an oil giant when it reaches over 300 billion in revenue?" BP knew at the time I had finished a draft of my book on the 600 largest corporations in the world (see www.worldincbook.com), and they earnestly wanted to test if size matters. But in retrospect, these were the wrong questions.

After the last days watching the largest environmental disaster in American history unfold, I feel the social wake of the disaster grows in consequence each week. Yet most of the focus is on the consequences to Obama and BP CEO Haywood. Sure enough the firm has lost half its market cap, but what has society gained, and what has the world lost? Is not that balance the right question?

William Blake once wrote that he could see the whole world in grain of sand.

To be more accurate, I believe the world is now seeing this disaster as a first glimpse into the future of corporate governance. Future BPs will need to calculate their corporate risks and rewards in a much more visible way, not only with close regulators and friendly governments. This is why I believe the spill will over time create a new kind of corporate oversight from citizens. This is not a matter only of directors and boards. (see a fuller explanation at Piasecki at www.changethis.com)

First, some more bad news. This single BP oil disaster will add to the worst tensions in our world right now, the growing hatreds between the East and the West, between scientists and humanists, between advocates for sustainability and the strong stage of corporate apologists. That is a real costly consequence of BP's arrogance and inability to clean up.

From this encounter between big oil, the Gulf of Mexico, our pelicans and our fisherman, I predict a new kind of global environmentalist-Avatar Environmentalists-to evolve rapidly. For the first time since the founding of most nation states, the court of public opinion on risk may outweigh the court of law. Like the 20 billion dollar reserve escrow inflicted by Obama on BP, this is unprecedented.

Of course, avatars have been part of the human imagination long before the record breaking movie made them fashionable again. They once roamed the fantasies of Indian, Norse, Irish and native American folktales.

But after BP's mishap of massive proportions, I believe there are now many new age environmentalists growing as big in their reach as Cameron's now famous AVATARS. They will work thru the night as we sleep. They will arm themselves with new weapons and new strategic friends in the media and in the developing regions of the world like India and China and Africa. EPA and the Mining and Minerals scientists will seem puny in contrast to this giants surfing this salty wave still mounting.

For over 40 years, environmentalists have fought their battles in a rather focused and professional fashion, hairsplitting over rules, focusing their attacks on known rulers. But an avatar works in reshaping our expectations and imagination, the very core of all cultures. They attack our appetites.

The new post-BP environmentalist, I predict, will stand taller than those from Earth Day and from Yale and Harvard. They will be more immediate, and less technical. They will be pumped up on the steroids of Hollywood, mass media, and twitter more than the schooling of MBAs. And they will attract massive global audiences like Lady Ga Ga attracts teens. (For more on these developments see the Piasecki interviews at www.smallbusinessadvocate.com. Also see the TV and podcast coverage at Piasecki's New York Times bestseller www.doingmorewithlessbook.com.)

This new post oil spill advocate will have a greater forum now, full of the potential of plain truths. This may prove the real cost of the oil spill.

Take, for example, the issue of what has happened to the public's imagination regarding massive development projects. Have we lost our appetite?

This BP spill is not only hurting the oil and the energy sector. This affects all business, all development. Think of the many shrimp fisherman in the gulf. Think of the hotel occupancy-based businesses, from entertainment in the Gulf to tourism around the beach, that are now being dragged down like a pelican trying to launch after being drenched in oil.

What has happened in the Gulf is a sea-change, that travels more like a tsunami than a regional storm.

Folks from the Middle East to land-locked middle America to the intelligentsia of Africa are beginning to ask: What is enough oil? How can we better clean up the consequences of off shore oil? How can we readjust our development expectations in this swift and severe world so we get to go where we want without such a black, intractable, coast-long stain?

These are being asked a good hundred years after the massive discoveries of oil at Spindle Top Texas. Yet strong questions at the right time have always altered world history.

3. AHC Group Announces New Services in Stakeholder Awareness Training and Internal Response Teams

Over the last four years, the AHC Group has developed a series of special mapping and senior management alert tools on the social networks and movements that are rapidly influencing and altering their course of action.

We have also run Stakeholder Awareness and Response workshops in San Fran with our Corporate Affiliate Future 500 for the last four years, enrolling leaders from firms as consequential as Disney, PSEG, Exxon, Chevron, Conoco, Shell, Suncor, FMC, Freeport, and others.

Why does senior management awareness alerts in this new world of stakeholder engagement and social networks matter to corporate strategy and product positioning?

Foremost, it is because the world of 24/7 media is surrounding the corporate mansion. For example, this month (December 2013) the front page of the New York Times Business section featured a story on why students are working with 360.org to have their endowments discuss the best ways to divest from investments in oil companies, while at the same time North America is beginning to appreciate a significant Renaissance in Natural Gas and Oil domestic oil discovering. The conflicts are daily and growing in impact.

Our newly refined services--involving the majority of our Senior Associates and attorneys in the Group--are designed to help senior management not only understand but also effectively respond to these new swift and severe inputs into their business destiny.