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Business Sustainability

In: Business and Management

Submitted By akpatel23
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Business Sustainability: a business doing what is does while taking in the needs of it’s stakeholders.
Stakeholder: anyone who has an interest and can be influenced by your company
Primary Stakeholders: employees, customers, owners.

Sustaining the availability and quality of resources into the future
--Sustaining itself: manage in an efficient way; long term time horizon
--always need human and natural capital

Pillars of Sustainability:
--Four Pillars
-Cultural
-Environmental Responsibility
-Social Equity
-Economic Health

People, Planet, Profits but also Culture
-Culture: traditions, way of living, values
-5th dimension: Governance: how are decisions being made within a system.

Economics (basic review)
--Microeconomics (individual decision making)
--Macroeconomics (aggregate decisions made by all; impact on broader economy. Functioning of the entire economy

Economic Systems:
-Traditional: localized region
-Planned: socialism, communism
-Market: capitalism
-Mixed: capital/communist-individual decision making w/some control by the government.

Macroeconomics and Sustainability
==Gross Domestic Output: the monetary value of all the finished goods and services produced within a country’s borders in a specific time period, typically one year
--GDP doesn’t measure: distribution equity, pollution, social factors, production efficiency

Alternatives:
--to try and capture elements the GDP doesn’t
--Genuine Progress Indicator
--GPI: adds to GDP
--Social indicators, economic indicators, environmental indicators
--subjective values (criticism re: GPI).
Human Development Index
--accounts for quality of life, cost of education, Life expectancy,
Challenges in Modern Market Economies
--buy whatever we want
--compare $ for price/value
--competition
--motivation to take risks/find a need

Disadvantages:
--too much choice, too much information
--less true innovation
--perfect competition rarely exists

Fundamental concepts in economics: supply/demand

Level of income in relation to the price of the good;
What is the likely demand: is it elastic? Think about Rejuvenate.

Fixed costs vs marginal cost; marginal revenue (cost to produce ea. Add’tl unit)
Amount of goods produced: intersection of MC and MR

Externalities: any cost (pos/neg); business or individual generates that is felt by the society as a whole. Doesn’t impact the business.

Input resources needed:

Service: Medication/Intravenous fluids demand/price, availability, material safety.
--Consent, Liability, Malpractice insurance, Staff training/qualifications,
--Staff, Materials, Medication

Market:
--ongoing wedding market
--need overconsumption
--partners/suppliers
--marketing/communications
--robust wedding budgets --cultural environment that celebrates marriage.

Outputs:

Waste generated:
Service: medication waste (sharps, unused medications, supplies)
--Car pollution, carbon footprint

Environmental impact: medication waste goes to a landfill;
Social impact: ethical debate regarding medical necessity and potential harm, supporting alcohol abuse.

Consumption:

Company’s economic goals

Product conception and design

Raw Material

Manufacturing

Distribution

Consumption

Landfill/incinerator

Waste discharged into the environment from material extraction and processing, packaging, transportation, etc.

Sustainable Operations Lecture:

-Define operations management for manufacturing and service enterprises
-Examine techniques for increasing operational efficiencies
-Review strategies for greening the supply chain

We will use the Black Fly Case as an example.
What happens after your consumers use your services
Value added: the value created by an organization through it processes.
Gross Income = Sales-Cost of Goods Sold

How do operations differ for manufacturing and service enterprise
--more intangible with manufacturing vs tangible service products
--Easier to measure quality and efficiency w/service enterprise
--Manufacturing output is standardized; Service enterprise is not necessarily standardized.
--Manufacturing you can “store” your output; Service enterprise is not “stored”; can’t hold onto it for a later time; devalues.
--Service enterprise-employee interaction with customers; Manufacturing has less customer interaction.
--Timing: transportation of goods; manufacturing before; service-is at the time.

Competitive Strategy
-Differentiator: offering a product higher quality and cost vs competitor
-Cost leadership: not much difference; competing on price.

Core competencies: focus on activities that add value
“Make” is the activities that we do; “Buy” is the products that we need to buy in order to “make”

Different Organization Systems (manufacturing oriented)
-Fixed position: bring all materials to one place; transformation happens (construction projects: bring concrete, rock, steel and all operations happen at the single site)
-Process: activities have to happen in a sequence (Batch processing). ie: physical plant

Lean Thinking: applies to service and manufacturing organizations.
--What is the value
--Quality, Price, Demand

What is “waste”
--Inefficiency
--Anything that does not add value is waste
- 7 kinds of waste
---transportation waste
---Waiting around waste
---Overproduction waste
---Defect waste
---Inventory waste
---Motion waste
---Over-processing

5 principles to Lean
--Identify customers and specify value
-Identify and map the stream (what stages are value added/which stages produce waste)
-Create Flow by eliminating waste
-Respond to customer pull
-pursue perfection: continuously improving

Value Stream for Black Fly: not enough information…...

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