In order to develop sustainable products and business models, it is essential to be aware of the various ways (positive and negative) the associated business activities impact the environment and the society, in addition to their impact on profitability. This statement may sound trivial. However, one only needs to bring to mind the various examples of products that have been designed with environmental sustainability in mind and instead achieved the opposite effect. The "being aware" may actually pose a real challenge in certain cases.
Take, for example, car sharing, a prime example of the use of ICT / IoT technologies to reduce vehicle ownership and the environmental impact of transportation. Due to these positive effects, it is obvious for anyone that car-sharing is good for the environment. Or is it? It has in fact been shown that urban car sharing adoption may result in a reduction in the use of public transportation infrastructure and an increase in car miles traveled in cities, generating the opposite of the intended environmental effect [1].
Or take Toms shoes, a company built around the buy-one-give-one (BOGO) model. For every pair of shoes sold in the developed world, Toms initially gave away a pair of shoes to someone "in need" in the developing world. Not only did giving away shoes not address a top-priority local problem, but the freely available footwear actually created a negative local impact, as it damaged local shoe markets.
It is of course easy to find such cases and - with hind sight - point out their suitability as examples for the law of unintended consequences. After all, whether a product or business model generates net positive or net negative impact may often be only found out via a complex and time consuming life cycle analysis.
But it is actually not required to accurately predict the overall environmental impact in order to design more sustainable products and business models, if the right approach to the design process is being taken.
The Sustainability Impact Canvas
The Sustainability Impact Canvas (SIC, download here) is a tool to incentives sustainable product- and business model design by helping designers to identify and optimise positive and negative effects of the respective business activities. The SIC forces designers to look at the positive as well as the negative impacts of their product or business idea, therefore generating the first input for a realistic impact assessment. It is structured along three levels, which take into account all potential impact categories at the technology level, the application level and the systems level.
Major advantages of this tool are that it balances a thorough methodology with an easy to use tool and that it can be used as an input generator for the Sustainable Business Model Canvas.
Most importantly, however, the SIC is an ideal tool to incentivise "honest accounting" by preventing designers form ignoring the potential negative effects of their products and business models, a common tendency and related to the confirmation bias.
How to use the Sustainability Impact Canvas
The SIC is best used by systematically analysing and completing the 6 main fields in the canvas, from first order effects to third order effects. The purpose of this exercise is to first identify, and then maximise and minimise the positive and negative effects, respectively.
To help you complete these six sections of the Sustianability Impact Canvas, we compiled a list of guidelines for each section, showing the benefits and the risks of optimising the respective effects and giving you a few examples of related business applications. You can also download the guidelines in form of printable cue cards here.
1- Maximise capture of waste or emissions
(technology / product level)
Main Principles
Wherever possible, use materials for your product which are considered „waste“ and are currently polluting the environment
If feasible, engage in „industrial symbiosis“ with relevant industrial partners
Explore the potential of long-term or permanent capture of greenhouse gasses in your product
Benefits for provider and consumer
Potentially lower manufacturing costs
Potential eligibility for subsidisation
Benefits for brand
Risks
Unstable future supply of resources
Immature technology
Examples
Glasses (Sea2See), Shoes (Adidas) and Fashion (Ecoalf) made from recycled ocean plastic (Sea2See)
Plastic partially made from captured greenhouse gasses (Newlight Technologies)
2 - Minimise life-cycle impact of technology
(technology / product level)
Main Principles
Design for longevity and resilience, i.e. via modularity
Design for timeless product appeal
Identify and utilise product as a service strategies
Use low eco-impact raw materials
Optimise production processes
Decarbonise distribution processes
Benefits for provider and consumer
Preempting of tightening regulations
Higher customer appeal for eco-aware customers
Energy and material savings
Lower manufacturing costs
Independence of volatile commodity prices
Risks
LCA time and cost extensive, long-term performance of materials may be unknown
Set up costs of recycling system
Increased durability as threat to future sales
Examples
Modular phone (Fairphone)
Pre-emptive replacement of lead solders ahead of law banning the use of lead solders (HP)
Electronics recycling as profit centre (Cisco)
3 - Maximise optimisation- and substitution potential
(application level)
Main Principles
Optimisation
Improve technology to optimise energy, fuel or capacity usage
Substitution :
Identify potential disruptive qualities of application
Digitalise, virtualize, dematerialise
Benefits for provider and consumer
Higher customer value
Higher market potential
Risks
Rebound effects
Difficulty to asses impact of substitution process
Examples
Reduced passenger car fuel consumption (Smart Drive)
Reduced home energy consumption (Nest)
Paperless billing, virtual meetings
Managed services (sharing economy)
4 - Minimise planned obsolescence and induction
(application level)
Main Principles
Induction
Identify and minimize previously non existent forms of resource consumption
Obsolescence
Match real software life cycles to HW life cycles
Benefits for provider and consumer
Lower energy and resource usage
Lower obsolescence induced replacement costs
Risks
Challenge to internalize external costs
Difficulty to adapt life cycles of products of different providers
Examples
Rising paper consumption due to cloud connected printers
Shorter product life cycle of STBs due to faster SW development cycles
Shorter Smartphone life cycles though rising App performance
5 - Maximise incentivisation and smart decision making
(system level)
Main Principles
Incentivisation
Use gamification elements (personification, virtual incentives and rewards, community challenges) to ‘nudge’ users towards sustainable behavior patterns
Decision making
Create improved management tools to enable user directed optimization through better decisions
Benefits for provider and consumer
Soft mentoring (‘nudging’) of user towards beneficial behavior
More efficient decision processes
Risks
Importance to not patronize users with excessively high ‘nudge’ frequency
Complexity of decision processes
Examples
Driving behaviour tips and incentives to save fuel (Smart Drive) or insurance (PHYD)
Improved policy decision making via Agent Based Models
6 - Minimise systemic risks and rebound effects
(system level)
Main Principles
Rebound effects
Take into account increasing resource consumption on aggregated scale (Jevons paradox)
Risks
Prevent over-optimized processes at expense of resilience
Take into account rising complexity of systems
Benefits for provider and consumer
Reliable products and services
Risks
Challenge to internalize costs of rebound effects
Difficulty to assess complexity of related risks
Examples
Smart Vending machine with reduced energy consumption increases aggregated vending machine spread and energy use
Over-optimised processes for vehicle management can be prone to complete breakdown
Once the Sustainability Impact Canvas has been completed, you can summarise the results of the left and right columns respectively and use them as input for the Sustainable Business Model Canvas:
You can download the Sustainability Impact Canvas here and the Sustainable Business Model Canvas here.
Resources
Regina R. Clewlow Gouri Shankar Mishra, Disruptive Transportation: The Adoption, Utilization, and Impacts of Ride-Hailing in the United States, Research Report – UCD-ITS-RR-17-07, 2017