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Sustainability Risk Management in Product Development Companies - Motivating Change
Blekinge Institute of Technology, Faculty of Engineering, Department of Strategic Sustainable Development.
2019 (English)Licentiate thesis, comprehensive summary (Other academic)
Abstract [en]

Both the ecological and social system are systematically degrading, resulting in decreasing capacities to support human civilization. Product development and manufacturing companies play a key role in driving society’s transition towards a sustainable path. Besides moral arguments, the motivation for companies can be expressed as a matter of smart risk management, i.e. avoiding threats and exploiting opportunities. Such sustainability risks can be related to, for example, brand and reputation, legislative change, or attracting top-talented employees. But, more importantly, it is about understanding changes that are inevitable on markets to come. Based on Maxwell’s interactive qualitative research approach and following the structure of the Design Research Methodology, this thesis aims to contribute (i) to knowledge by increasing the conceptual understanding of what sustainability risks are; and (ii) to practice by researching decision-support for how sustainability risks can be managed in a product development company context. The first study reviewed existing literature and identified characteristics of sustainability risks, which make them particularly difficult to manage. A following exploratory and descriptive study investigated companies’ current risk management practices and preconditions for sustainability integration. It showed that the effects of uncertainty from the sustainability transition need to be identified, assessed, and managed in relation to how they can affect objectives anchored in both internal and external stakeholder value creation. In parallel, the Framework for Strategic Sustainable Development was applied as a lens to understand the implications of the sustainability transition for company risk management. This resulted in a new definition, stating that sustainability risks are threats and opportunities that are due to an organization’s contribution or counteraction to society’s transition towards strategic sustainable development. A questionnaire study then investigated some case companies’ challenges and preconditions to build sustainability capabilities. Finally, a workshop method is proposed that aims to support design teams in early sustainable product development. Future research will leverage on the findings to develop and test decision support for how product development companies can manage sustainability risks on different organizational levels in practice to increase competitiveness, while taking leadership in the transition towards a sustainable society.

Place, publisher, year, edition, pages
Karlskrona: Blekinge Tekniska Högskola, 2019.
Series
Blekinge Institute of Technology Licentiate Dissertation Series, ISSN 1650-2140 ; 5
Keywords [en]
corporate sustainability, product innovation process, sustainability transition, sustainable design, sustainable product development
National Category
Environmental Sciences
Identifiers
URN: urn:nbn:se:bth-17631ISBN: 978-91-7295-371-0 (print)OAI: oai:DiVA.org:bth-17631DiVA, id: diva2:1290909
Presentation
2019-03-27, J1650, Blekinge Tekniska Högskola, Valhallavägen, Karlskrona, 09:00 (English)
Opponent
Supervisors
Funder
Knowledge FoundationVinnovaKnowledge FoundationAvailable from: 2019-02-22 Created: 2019-02-21 Last updated: 2019-03-20Bibliographically approved
List of papers
1. Challenges for integrating sustainability in risk management-current state of research
Open this publication in new window or tab >>Challenges for integrating sustainability in risk management-current state of research
2017 (English)In: DS87-2 PROCEEDINGS OF THE 21ST INTERNATIONAL CONFERENCE ON ENGINEERING DESIGN (ICED 17), VOL 2: DESIGN PROCESSES, DESIGN ORGANISATION AND MANAGEMENT, The Design Society, 2017, no DS87-2, p. 327-336, article id DS87-2Conference paper, Published paper (Refereed)
Abstract [en]

Numerous examples have shown how environmental and social issues can affect companies to an existential level. In fact, today's most urgent business risks, e.g. brand value, legislative change, litigation, and supply chain disruptions, are directly linked to sustainability issues. These risks need to be systematically identified and strategically managed on both strategic company-and operational product development level in order for a company to be long-term competitive. Based on literature review and interviews at case companies, this paper investigates the current state for integrating a strategic sustainability perspective in risk management processes and related support tools. Results show that sustainability risks are not consciously identified and managed at the companies. Research is at an early stage and few frameworks and tools exist. Based on the findings, the study identifies and provides a comprehensive analysis of challenges for sustainability integration, which work as a foundation for future research. Finally, key steps to advance understanding and methods in sustainability risk management are suggested.

Place, publisher, year, edition, pages
The Design Society, 2017
Keywords
Ecodesign, Risk management, Strategic sustainable development, Sustainability, Sustainable product development
National Category
Other Engineering and Technologies not elsewhere specified
Identifiers
urn:nbn:se:bth-15308 (URN)000455237100034 ()2-s2.0-85029742256 (Scopus ID)
Conference
21st International Conference on Engineering Design, ICED, Vancouver
Available from: 2017-10-06 Created: 2017-10-06 Last updated: 2019-06-27Bibliographically approved
2. Challenges and preconditions to build capabilities for sustainable product design
Open this publication in new window or tab >>Challenges and preconditions to build capabilities for sustainable product design
2017 (English)In: DS87-1 PROCEEDINGS OF THE 21ST INTERNATIONAL CONFERENCE ON ENGINEERING DESIGN (ICED 17), VOL 1: RESOURCE SENSITIVE DESIGN, DESIGN RESEARCH APPLICATIONS AND CASE STUDIES / [ed] Maier A.M.,Skec S.,Salustri F.A.,Fadel G.,Kim H.,Kokkolaras M.,Oehmen J.,Van der Loos M., Design Society , 2017, Vol. 1, no DS87-1, p. 1-10, article id DS87-1Conference paper, Published paper (Refereed)
Abstract [en]

Sustainable product innovation has previously been found to be positively correlated to competitiveness. However, in order to build capabilities for sustainability integration one must first understand companies' current state. The overall aim is therefore to identify common preconditions and challenges for sustainability integration in product innovation. A questionnaire study, targeting employees with roles in product development, was conducted at four medium-sized to large product development and manufacturing companies in Sweden. Results show that capabilities for sustainability integration are perceived as decisive for future company success, but are not considered to be correspondingly high prioritized today. Decision making is focused on material selection and energy efficiency, so no full socio-ecological sustainability perspective is covered. Formal decision support tools are only used by half of respondents and are a main area for improvement. Identified challenges include short-term economic thinking, lack of sustainability criteria and vague management commitment. Based on these findings, seven recommendations for companies are presented and validated.

Place, publisher, year, edition, pages
Design Society, 2017
Keywords
Capability, Case study, Ecodesign, Sustainability, Sustainable product development, Decision making, Decision support systems, Energy efficiency, Innovation, Integration, Product development, Sustainable development, Decision support tools, Manufacturing companies, Questionnaire studies, Sustainability criteria, Sustainable product designs, Sustainable products, Product design
National Category
Other Environmental Engineering
Identifiers
urn:nbn:se:bth-15517 (URN)000455059100001 ()2-s2.0-85029747884 (Scopus ID)
Conference
21st International Conference on Engineering Design, ICED, Vancouver
Available from: 2017-11-24 Created: 2017-11-24 Last updated: 2019-06-27Bibliographically approved
3. Workshop Method for Early Sustainable Product Development
Open this publication in new window or tab >>Workshop Method for Early Sustainable Product Development
2018 (English)In: DS 92: Proceedings of the DESIGN 2018 15th International Design Conference, The Design Society, 2018, p. 2751-2762Conference paper, Published paper (Refereed)
Abstract [en]

It is in the early phases of product development that most of a product’s life-cycle sustainability impact is determined. This study presents a workshop method that has the purpose to support multi-disciplinary teams in sustainable product development, focusing on early phases. The workshop method aims to map the sustainability challenges and opportunities of a concept at an overarching level, utilizing backcasting from sustainability principles in three steps: create vision, assess current state, derive strategies. Testing and validation was done at two companies and with one academic group.

Place, publisher, year, edition, pages
The Design Society, 2018
Series
Design DS, ISSN 1847-9073
National Category
Environmental Sciences
Identifiers
urn:nbn:se:bth-16848 (URN)10.21278/idc.2018.0209 (DOI)978-953-7738-59-4 (ISBN)
Conference
DESIGN 2018 15th International Design Conference, Dubrovnik
Funder
Knowledge Foundation
Available from: 2018-08-12 Created: 2018-08-12 Last updated: 2019-02-21Bibliographically approved
4. Company Risk Management in Light of the Sustainability Transition
Open this publication in new window or tab >>Company Risk Management in Light of the Sustainability Transition
2018 (English)In: Sustainability, ISSN 2071-1050, E-ISSN 2071-1050, Vol. 10, article id 4137Article in journal (Refereed) Published
Abstract [en]

Many of the most important business and economic risks are directly linked to environmental and social issues. This includes both threats and opportunities, not only in relation to reputation, which is often mentioned in this context, but, even more importantly, in relation to innovation capability and legislative change on inevitably more and more sustainability-driven markets. It is, however, unclear through which mechanisms such sustainability risks currently affect companies and how they can be systematically identified and managed. Based on the Framework for Strategic Sustainable Development, this study investigates the dynamics and implications of society’s sustainability transition from a company risk management perspective. In addition, exploratory and descriptive studies were conducted at two large product innovation companies to identify current risk management practices and preconditions for sustainability integration. The results reveal that a society moving closer towards a collapse of environmental and social systems leads to increasing sustainability-related threats for unsustainable businesses and increasing opportunities for sustainable businesses. Also, risk management is found to be a promising way for maneuvering in a smart zone between being too passive and being too pro-active in relation to sustainable innovation.The study participants at the case companies were knowledgeable about risk management in general but were largely unfamiliar with risks associated with sustainability and no processes or support tools exist to work systematically with such risks. Key steps to accomplishing an integration of a strategic sustainability perspective into risk management are proposed as: (i) identifying the effects of sustainability issues on internal and external stakeholder value; (ii) actively including sustainability in objective setting and cascading objectives across the levels of the organizational hierarchy; and (iii) developing concrete support for identifying, assessing, and managing economic sustainability risks. Thereby, companies can enhance their competitiveness while providing leadership in the sustainability transition.

Keywords
risk management, sustainability, product innovation, strategic sustainable development, sustainable product development, sustainability transitions, sustainable development
National Category
Environmental Sciences
Identifiers
urn:nbn:se:bth-17246 (URN)10.3390/su10114137 (DOI)000451531700311 ()
Projects
Model Driven Development and Decision SupportSustainability Implementation Package
Funder
VINNOVA, 2018-00361Knowledge Foundation, 20120278
Note

open access

Available from: 2018-11-10 Created: 2018-11-10 Last updated: 2019-02-21Bibliographically approved

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