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Sustainability
From pledge to performance: Using design thinking to achieve sustainability goals
In this second article on delivering winning sustainability strategies, the authors explore how design thinking can transform your organizationâs mission into actionable plans.
Having to wait more than 20 minutes for your morning coffee is a suboptimal start to your morning. It also implies poor service design. This was the unfortunate outcome of Starbucksâ strategic shift under CEO Laxman Narasimhan, who encouraged baristas to spend more time conversing with customers while imposing efficiency measures that made it harder for them to perform their core jobs.
Guided by a new mission, âwith every cup, with every conversation, with every community â we nurture the limitless possibilities of human connection,â Starbucks put people at the heart of its strategy. It made partner, community, and customer safety one of its top ESG priorities. Regrettably, in the following quarters, customer wait times went up and employee dissatisfaction rates soared. In early 2024, Starbucks baristas began to speak up in the global press about understaffing and work-related stress, turning employee well-being into an even greater company priority. As sales, morale, and the stock price tumbled, Narasimhan stepped down as Starbucks CEO in August 2024 after just 17 months in the job. The Starbucks story epitomizes a lack of design thinking, resulting in a failing business strategy. Paradoxically, as part of its human capital development measures, Starbucksâ global academy does offer baristas and other staff several design thinking courses on a variety of topics such as customer centricity and recovering from service failures but doesnât appear to use them when implementing major strategic change.
The challenge of delivering winning sustainability strategies
Turning ambitious sustainability programs and ESG dashboards into successfully implemented sustainability strategies is notoriously difficult. But itâs also more relevant than ever as evidence mounts that the world is substantially behind on its 1.5°C scenario from the Paris Climate Agreement. New ESG reporting standards require many resources while greenwashing means cautious companies are inclined to be conservative. Despite an overall 12% decline in greenwashing cases, leading researcher on data for business conduct RepRisk reported that the number of high-risk incidents surged by over 30% in 2023-2024. No surprise that companies are increasingly downgrading their sustainability targets â like Swedish automaker Volvo Cars, which announced in September 2024 that it would scrap its target of going all-electric by 2030, citing low customer demand and lagging government policy change as major causes for its decision.
A stakeholder-centered design thinking approach not only enhances the chances of successful implementation but also promotes a culture of continuous learning and improvement.
Applying design thinking to sustainability
Design thinking, as described by Tim Brown, an industrial designer and executive chair of nonprofit design studio IDEO.org, is a human-centered approach to innovation that draws from the designerâs toolkit to integrate the needs of people, the possibilities of technology, and the requirements for business success. A stakeholder-centered design thinking approach not only enhances the chances of successful implementation but also promotes a culture of continuous learning and improvement, leading to better outcomes and a more engaged workforce. By designing the implementation of sustainability strategies with the phases of prepare, train, and master, organizations can better guide their employees and partners through a structured and supportive journey of change.
Prepare: The prepare phase focuses on securing buy-in from employees by crafting a compelling change story that explains the reasons and benefits and which supports the sustainability journey by âtalking the walk.â Early adopters, or front-runners, are essential to testing and sharing success stories, helping build momentum. One effective way to involve front-runners is by including them in the double materiality assessment process. Since one of the most important prerequisites for change is relevance, the change story on sustainability transformation should be rooted in the companyâs most significant material issues. What better test audience than early adopters in sustainability with an in-depth knowledge of the companyâs materiality assessment to ensure a direct link with the core business risks and opportunities? That said, accurately predicting transformational change is not without its difficulties.
A case in point is Equinor, the Norwegian energy company established 50 years ago as the Norwegian State Oil Company. Its purpose is âto turn natural resources into energy for people and progress for societyâ and the company is committed to long-term value creation in support of the goals of the Paris Agreement.
In 2021, Equinor announced a bold strategy: to transition into a diversified energy company targeting net-zero emissions by 2050, encompassing both operational emissions and those from its products. This transformation journey (the âwalkâ) toward sustainability was supported by three strategic objectives:
- Reducing environmental impact in oil and gas operations
- Investing significantly in renewable energy, with a focus on creating lasting value
- Pioneering advancements in low-carbon technology and supply chains
To move quicker from pledge to performance, the company appointed Per Ivar Selvaag, a former car designer at Ford, BMW, and Peugeot, to spearhead the company’s efforts to implement design thinking. Selvaag managed to establish a framework to accelerate the companyâs transition towards net zero by setting ambitions and actions for reducing emissions, building a renewable energy portfolio, and developing low-carbon solutions.
As a player within the constantly changing energy landscape, Equinor’s ambitious strategy contained several intricacies. As with almost all transformational strategies, it required striking a delicate balance between short-term profitability and long-term sustainability, meeting the expectations of both shareholders and the broader public. One way Equinor addressed this was by reinvesting a portion of its profits from the traditional oil and gas business into cleaner energy initiatives to support the companyâs net-zero objective. In 2024, the company âwalked the talkâ by acquiring a 9.8% share in Ărsted, a Danish wind energy group for $2.5bn. Only a few days later, Equinor astonishingly announced plans to cut back on its investments in renewable energy till 2030 and downsize its renewable energy business, citing that renewables were in a down cycle.
Avoiding a perceived disconnect between stated sustainability objectives and tangible progress requires credible change stories that continuously involve employees and value chain partners in discovering viable, innovative business models and technical solutions for achieving those goals. But even with a well-executed design thinking approach, (substantial) iterations might be obligatory when faced with changing market circumstances.
âAll airport staff with an access key card were required to participate in the entire training program, from top management to cleaning staff. The CEO made it clear that everybody who wanted continued access needed to fulfill the program to have it.â
Train: In this phase, employees actively engage in learning and practicing new processes and behaviors by upskilling at scale. Whether itâs mastering new tools, adopting new processes, or collaborating with partners, the goal is to equip the workforce to realize the big changes.
In 2017, Oslo Airport doubled its size and capacity representing a massive change for all stakeholders. The goal of this expansion was to position Norway as an even more attractive international destination by offering more direct flights, fewer delays, and high customer satisfaction. To achieve this, all 22,000 employees across 1,100 subcontractors had to work together, united in serving one common customer: the passenger. As this required a formidable change story, the preparation phase at Oslo Airport focused on building understanding and reflection on what was new for each subcontractor and employee, from cleaning staff to air traffic controllers, so they could individually and collectively better prepare for the changes. At the same time, it was crucial to develop an understanding of the interfaces that existed between different processes, companies, and employees. At Oslo Airport, training was focused on three main areas to support the ambition of more direct flights, fewer delays, and high customer satisfaction.
Changes to core processes and systems: âOne Airportâ experience-based courses where employees from different companies, professions, and work processes came together to understand the main elements of the new system, core processes, and how everyone depends on each other to succeed.
Technical and operational training: simulations of new processes, game-based training in new technology and equipment, and company-specific training on more specialized tasks and procedures.
Cultural development: âItâs all about the people.â Different arenas and formats to develop behaviors and attitudes through training, building awareness of individual responsibility, and understanding how everybody plays a role in improving customer experience.
All airport staff with an access key card were required to participate in the entire training program, from top management to cleaning staff. The CEO made it clear that everybody who wanted continued access needed to fulfill the program to have it.
Master: This final phase is about realizing the benefits of change. Processes, partners, and employees need time to adapt and benefits from sustainability strategies typically take time to materialize. Continuous evaluation, celebration of wins, and ongoing improvements all contribute to ensuring long-term success. After the initial transition, it is important to reach a level where the results of the changes can be identified, measured, and realized. In this master phase, it is essential to have sufficient space for evaluation, learning, and adjustments.
At Oslo Airport, a key strategic choice in the mastering phase was the gradual implementation of the new way of working over five months. This way, not everything would be new for everyone at the same time but rather introduced step by step. This relieved the organization and allowed for learning and adjustments along the way.
So, what can go wrong?
By following the above phases of design thinking for the implementation of sustainability strategies, organizations can create a smoother, more effective change journey that keeps employees and other stakeholders on their toes. However, such a journey is not one without peril. Failure is right around the corner. From experiences of collected live cases, three common pitfalls in design thinking for sustainability can be distilled:
| Common pitfall | Description | Remedy |
| Underestimating the learning effort required | Many organizations fail to fully grasp the time, effort, and resources needed to implement sustainability strategies successfully. Jointly scoping and driving the business towards net zero in 2050 takes different skills. Supplementary upskilling will reduce unforeseen obstacles and delays and go beyond the training of a handful of sustainability ambassadors. |
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| Poorly defined problems | Sustainability solutions will likely miss the mark without a clearly articulated and validated problem statement. A lack of problem clarity will most likely result in a substandard change story and initiatives that fail to address the core issues. |
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| Lack of stakeholder involvement | Too often, key stakeholders, such as employees, customers, and partners, are insufficiently involved in the ongoing planning and execution process with a prevalence of parochialism. Studies show that change initiatives are 30% more likely to succeed when those most affected by the change are actively engaged in creating it. |
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Copyright @ 2024 by Canoe Consulting
As companies progressively move from ESG compliance reporting to the implementation of sustainability strategies, net zero, and well-being approaches, design thinking emerges as an essential tool to help create transformational change programs that work. Design thinking is unique in that it prioritizes human needs and experiences for desirability, takes a system approach for feasibility, and uses iterative processes to adjust for viability.
This is the second in a series of three articles on how to better deliver Winning Sustainability Strategies. The last article of the series will explore improving engagement from external value chain partners since performance on transformative topics is almost by definition co-dependent on other actors within the value chain.
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