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People Planet and Profit-chapter 1
Triple bottom line in business is profit
When bottom line is negative business is failing. When it is positive that is
considered a profit.
Profit is essential to being able to continue to function as a business.
Businesses combine a mix of supplies, human effort and expertise
Operations is how businesses turn inputs into outputs
Operations are refined overtime
Operations are systemized processes that need to be paid attention to
20th century saw a boost in business growth
In 1994, British man named John Elkington coined the phrase “triple bottom
line” or TBL-as way to encourage business leasers to pay more attention to
the impact of their operations on people and the planet.
This thinking is not anti-profit, but a business philosophy that takes into
account that a business cannot continue without profit. Elkington argued
that when you are making decisions and paying attention to the impacts of
the bottom line you should also pay attention to the impact on people and
the planet.
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The goal is not to stop organizing resources and people to meet needs but to
raise the bar on how a business operates to be profitable but also beneficial
to people and the planet.
MULTIPLE-CHOICE QUESTION
What is the ideal result of adopting the “triple bottom line” perspective?
Choices
It will increase the pace of change and help companies streamline operations.
It will increase innovation, enabling companies to generate more value in more
ways.
It will decrease companies’ need to deliver on the traditional bottom line of profit.
Correct. Making decisions with an eye on their impact on people and planet as well as
profit has led many companies to come up with innovative approaches with broader
benefits.
Which of these statements BEST articulates the societal value of the triple bottom line
framework?
Choices
Strategies to increase sustainability typically increase profit.
Reducing negative impacts and increasing positive impacts on people has positive
societal value.
Destructive operations cannot go on indefinitely.
Correct. The “people” dimension of the triple bottom line is inherently tied to positive
societal value.
Eight Objectives:
• Reduce carbon emissions of energy 80 percent by 2030 and total natural
resource usage by 80 percent by 2050
• Provide secure, stable, and meaningful employment for people everywhere.
• Be self-organizing rather than regulated or morally mandated
• Honor market principles
• Be more rewarding than our present way of life
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• Restore habitats, ecosystems, and societies to their optimum
• Rely on current income
• Be fun and engaging, and strive for an aesthetic outcome
Which of these is a benefit of incorporating triple bottom line into business practices?
Choices
It can help people consider more of the implications of business decisions.
It simplifies existing processes for measuring success.
It provides a really easy way of getting a big boost in marketing.
Correct. TBL is primarily about changing the breadth of considerations brought to mind
in assessing business operations and making decisions.
Three pressure waves by John Elkington
• Wave 1 brought understanding that environmental impact have to be limited
• Wave 2-brought a wider realization that new products and technology are needed
• Wave 3-focuses on growing recognition
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Key characteristics of a corporate locust:
• The destruction of natural, human, social and economic capital
• An unsustainable “burn rate”
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• An unsustainable business model over the long run
• Periods of invisibility
• Tendency to swarm
• Incapacity to foresee negative effects
• Corporate Characteristics
Low impact
High impact
Regenerative
( increasing returns )
Butterflies
Honeybees
Degenerative
( decreasing returns )
Caterpillars
Locusts
Corporate Caterpillars:
• Generate low impacts most of the time
• Show single minded dedication
• Depend upon a “high burn rate”
• Operates on unsustainable business model
• Has potential for transformation
• Operates in sector where there is evidence that pioneering companies
are already starting to change
Corporate butterflies:
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They are comparatively small
• Sustainable business model
• Strong commitment to corporate social responsibility
• Tendency to define its position
• Wide network
• Increased involvement in symbiotic relationships
• Persistent indirect links to degenerative activities
• High visibility
Corporate honeybees:
This is a growing section for government agencies, innovators,
entrepreneurs, and inventors
• Sustainable business model
• Clear and appropriate set of ethics
• Sustainable management of natural resources
• Capacity for sustained heavy lifting
• Sociability
• Sustainable production of natural, human, social, institutional, and
culture capital
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First stage focuses on invasion
Second stage shifts to [process of internalization
Next is inclusion and integration
MULTIPLE-CHOICE QUESTION
Which corporate form is MOST difficult to identify, because the harm it brings is usually
localized? Choices
Correct. Corporate caterpillars have degenerative impacts that can bring localized harm
(though they also have a significant potential for metamorphosis).
2 MULTIPLE-CHOICE QUESTIONS
Question 1
After Ray Anderson shared with his company that they were going to work on
sustainability, what was the first step he took to learn how to change their TBL? Ch
oices
honeybee
caterpillar
locust
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He invited experienced TBL consultants to come to his company and advise his
staff.
He worked with his team to understand how their operations were impacting the
environment.
He hired a change management company to reorganize the company and bring in
new leadership.
Correct. Anderson’s first step to change the company’s TBL was to educate and engage
his staff by working with them to confront the issue.
According to Hawken, what is the best result of a company’s sustainability work?
Choices solving operational
problems innovation
reducing waste
Correct. On the path to sustainability, companies rethink everything—which can lead to
amazing innovations.
What problem led Houlahan to create B Lab?
Choices
He had difficulty finding manufacturers who support sustainability.
There were no real standards to follow for sustainability.
People didn’t believe in the importance of sustainability.
Correct. Houlahan created B Lab to provide set standards and certifications for
companies that want to invest in higher values.
Certifies B corporations are businesses that meet the highest standards of verified
social and environmental performance, public transparency, and legal accountability to
balance profit and purpose.
The B Impact assessment has a rubric that companies can use to measure their TBL
value.
B impact assessment provide a concise, high-level view of company efforts.
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Which of these TBL strategies is more likely to be employed in the manufacturing
industry (as opposed to the service industry)?
Choices improving materials-transportation processes to reduce
energy use maintaining the human connection in e-commerce
transactions
offering employee trainings to improve customer service skills
Correct. Manufacturing businesses are far more likely than businesses in the service
industry to be involved in substantial materials-transportation processes.
What movement does Elkington cite as a major cause of the recent spread of triple
bottom line thinking?
Choices
the financial community pivoting to invest primarily in companies pursuing the triple
bottom line the environmental movement responding to climate
change
B Corporations offering a way to certify a business as “for benefit”
Correct. More than 3500 companies have committed to being B Corporations,
demonstrating that it is possible to embrace these values and succeed as an
organization.
What does Elkington say it looks like when TBL thinking is working in day-to-day
operations?
Choices when people on the front lines are persuading leadership to do the right
thing when it is embedded in practice and procedure—the way things are done
when customers will no longer purchase from companies that aren’t delivering on all
three bottom lines
Correct. He mentions several large companies where practice has changed dramatically
in the past few decades and new better practices are just part of how they do things.
How does Elkington describe the impact of TBL in a company that has really taken hold
of this perspective?
Choices as key metrics that drive every decision as a measurement
of success for each department and initiative
as an integrated part of the culture
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Correct. He suggests that TBL leads people to think new thoughts about how their
decisions might impact various stakeholders until having those considerations becomes
an integrated part of the culture.
What does Elkington describe value creation as?
Choices
the real goal of TBL thinking the new
mindset guiding business strategy
the classic role of any business
Correct. He has seen a shift from defensive thinking (how can we defend) to value
creation (how can we get a slice of emerging markets).
What specific advice does Elkington offer for working in this space?
Choices
Get in touch with people who are doing the sort of things you want to do.
Leave school and start working now.
Visit Nairobi, Kenya, to see the future of business.
Correct. Elkington says it is amazing how many people are interested in talking to the
wider world, so he encourages you to reach out to them, email them, and go see them
and learn.
How does Elkington characterize “responsibility, resilience, and regeneration”?
Choices
as a realization that it is really all about the environment
as three “realms” in which TBL needs to operate
as an updated version of “people, planet, profit”
Correct. The three dimensions of people, planet, and profit need to be pursued across
three realms: Who will take responsibility? How can we make each other more resilient?
And what can we do to regenerate or repair where things are broken?
How does Elkington describe the future challenges for people working in operations?
Choices
The challenges include increasing globalization as supply chains are spread ever
further.
The challenge is to adopt an engineering mindset with precise implementation of the
roadmap provided by management.
ut
as
at
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The future challenges include the ongoing need to educate yourself about changes
in an increasingly complicated world.
Correct. Operations managers run the engine room where the most critical decisions will
be made over the next 5–7 years, requiring ongoing learning about revolutionary
technologies, shifting business environments, and an increasingly interconnected world.
