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ECO and the CEO: Strategic retreat or strategic advance
Industrial Marketing 0 Elsevier Scientific
Management 3 (1974) 319-330 Publishing Company, Amsterdam
EC0 AND
- Printed
in The Netherlands
THE CEO: STRATEGIC
STRATEGIC
RETREAT
OR
ADVANCE
Robert Kirk Mueller
INTRODUCTION
In IMM Vol. 2, No. 3, we published an article on “Technology Assessment: New Forces Likely to Affect Industrial Marketing Strategy” which drew attention to the possible precursor effect of US legislation like the Environmental Policy Act (1969) and the Office of Technology Assessment Act (1972). Now we are very fortunate indeed to have an article from Mr Mueller which is a related essay, directed at the chief executive officer
I. EC0 AND THE CEO
Tricks of transposition aside, Ecology (ECO) and the Chief Executive Officer (CEO) are confronting each other more directly than at any other time in history. First of all, environmental management is a $10 billion “new” business with $6.6 billion for pollution control and abatement proposed in the 1973 US federal budget. More important, in man’s destruction of the environment, the chief executive is seen as a particularly guilty party,
and the board level. This second article, on the interaction between environmentalists and executives, is written after the US precursor experience has taken more tangible form. Mueller’s essay is recommended reading, not simply because America’s experience in this field predates that of Europe, but because (at the time of writing) the European Economic Community has just taken its first step towards the completion of a study to advise its Commission on whether an Office of Technology Assessment is needed.
because of his apparent unconcern and because of his past handling of his corporation’s relations with the fragile environment. At the eye of this storm is a complex set of natural phenomena, political interactions, financial problems, and ideological splits. Public demand that industry spend dollars for “profitless” purposes is a relatively new phenomenon, unless some aspects of the union movement can be considered a parallel. As of now, even a good CEO finishes last in terms of society’s perception of who is doing what constructively 319
in terms of environmental preservation. Prior to the sixties, smog in Los Angeles was a subject primarily for gag writers. In the sixties, ostensibly unrelated environmental incidents such as the New England water shortage, mercury poisoning in Japan, the Torrey Canyon and other oil spills, continued to develop the groundswell of public reaction to the environmental quality of life. This concern has spawned hundreds of legislative proposals and governmental activities in the late sixties and early seventies. Because of relative lack of preparation, many CEO’s have been unable to deal effectively with the problem which in turn has resulted in a massive credibility gap, some unwise expenditures of corporate resources, and reaction instead of action. What can and should the CEO realistically do now about this situation? A practical approach is set forth later, but first, let us look at the problem.
il. BREED
AND THE OF
Are you lately by What do think of anthropocentric ecosystem? glebe a investment these As far your operations concerned, will year’s biota better than year’s? Hopefully inquired about advantages of mesoscale, and winds before to locate new facility the East . and do you know about the benthic obliteration in New York Harbor? Can your staff distinguish between elutriation and eutrophication? Such bio-buzzwords are enveloping CEO’s these days in an unprecedented semantic smog. It is doubtful that even your vice-president for environmental control would recognize all the bio-buzzwords polluting our conversation. While many bio-buzzwords die quickly or are used for intellectual one-upmanship, there is often much value in specialized language - to use another bio-buzzword. It has served to 320
Robert K. Mueller, Vice President of Arthur D. Little, Inc., is Chairman of the Board of ADL International, Inc. and a Director of ADL, Ltd. (London). Mr. Mueller’s work at ADL involves board of director and management aspects of multinational institutions: business development, new ventures, acquisitions, corporate planning, venture capital, and diversification in various industries and financial organizations. Mr. Mueller received a B.S. degree in chemical engineering from Washington University, an M.S. degree in chemistry from the University of Michigan and completed the Advanced Management Program at Harvard University. A well-known speaker in professional circles, he is the author of five books: Effective Management Through Probability Controls; Risk, Survival, and Power; The Innovation Ethic; Board Life Realities of Being a Corporate Director, and Buzzwords, A Guide to the Language of Leadership; as well as numerous articles in scientific and business journals. In 1970, he served as Chairman of the faculty for a management of technology session at the Salzburg Seminars in American Studies, and currently is a member of that organization’s Board of Directors and Executive Committee. He is a member of the visiting Faculty of the International Institute for the Management of Technology, Milan. He is a trustee of Colby College-New Hampshire and a member of the Business Advisory Council of the University of Massachusetts School of Business Administration, and a Director of the Plastics Education Foundation.
awaken those in responsible charge to the urgent need for corporate self-control. This new eco-vocab can be heard most frequently from the lips of a new cult of ecoexperts, eco-consumerists, eco-consultants, eco-technologists, and eco-venture capitalists who are forging new social and business frontiers in all directions under the ecological banner. From the CEO’s vantage point, the new world must seem to be peopled by: econuts ecofanatics, who in emotionally action, including (sabotage for reasons); ecoracles eco-sages, who off into apparently receiving Guidance in answers to problems; ecoleptics, worry themselves fits about problems; eco-nomists, have quantitative, misty, answers the balance natural resources this planet. . . often persons who can’t change their outlook and won’t change the subject; eco-politicians weather-vanes of sensitivity to ecological matters, who ignore facts in favor of fancies and employ eco-tactics in attracting the voter; eco-crats, a new layer of staff springing up in government and in some companies where a career can be made in the paperwork and analysis-to-paralysis syndrome; ecodomos, a new position in government and corporations, as full-time job involved in environmental management. Given a high profile and a suitable title, this new career spot has an opportunity orientation.. . opportunities being problems the boss can’t solve. Eco-domos recycle this elusive subject continuously, with a worried look on their faces. With such an array of eco-expertise, it’s little wonder the CEO is uncertain about what to do first. But the confusion must not be allowed to obscure the fact that all should be concerned with the common sense principles
that underly the ecological crisis. All environmental problems aye inter-related at some point in time as part of the well-tuned total system. The planet Earth does have only a finite amount of physical resources. Herbert Hoover said it well in prohibition/pre-pollution days: “The objective in this country is to build a human society and not an economic system.” Though many eco-experts are self styled many others are authoritative sources of assistance who have indeed flagged the most serious crisis of our time. III. SOUL-SEARCHING Solving the environmental crisis is more than a current cause; it is a national objective. In 1969 President Nixon symbolically chose to sign as his first official act for the new decade the National Environmental Policy Act (NEPA), which has the lofty purpose of policy reform through government self-control. This act is directed at the people-caused ecological upset typified by our mobile American society, 19% of which relocates itself each year, and such phenomena as that in California, where about 500 acres of open land fall prey to the urban sprawl every day. NEPA opens to public view a major new source of information about the way in which the government’s activities affect the environment, and it goads the federal establishment to adapt a more sympathetic attitude toward our environment. The soul-searching caused by NEPA is indicative of what is in the wings for the private sector. In just three short years (with over 160 decisions under NEPA) the federal courts or government agencies have: initiated court action against nine Hawaiian sugar mills for causing “severe pollution;” delayed the $3 billion trans-Alaska pipeline (in 1970); programmed $185 million to correct environmental pollution control problems in 1500 federal facilities (in 1972); delayed the $400 million Tennessee321
Timbigbee Waterway (in 197 1); delayed operation of a half dozen nuclear power plants make a mockery of the NEPA, and have tied up the AEC licensing program so that is has been unable to complete a license since summer of 197 1; initiated an Air Force research and development program to improve jet aircraft combustion, which is expected to cost $35 million to convert the 60% jet engine inventory of the U.S. Air Force; forced the Department of the Interior to postpone plans to sell oil and gas leases on tracts of Gulf Coast waters; set down the “Calvert Cliffs” ruling in the Sierra Club suit against the AEC power plant, on grounds of thermal pollution of the Chesapeake Bay; forced the articulation of “environmental impact statements” on most of the 25,000 permit applications before the Corps of Engineers and the Environmental Protective Agency. The controls being imposed by government on government are being matched by controls by government on the private sector. . . this is
.
the poor salmon swimming up the Columbia River to spawn passes under the jurisdiction of twelve federal agencies! Germany’s largest detergent maker, the giant Henkel Company, has recently taken the initiative of organizing public discussions with civic groups on the topic of how to combat pollution. In Dusseldorf, for example, their “Talk with Neighbors” covered odor, water, noise, and rubbish pollution problems, with environmental experts discussing practical
solutions. The program is one of great public interest on the Continent. Since the cost of environmental pollution control must ultimately be borne by the consumer, it is obviously good business to have an intelligent public relations program, provided it is founded on a meaningful environmental management action program. Gestures contrived to ease the corporate conscience are soon exposed, but enlightened firms are turning a previously reactive style into a forthright active opportunity-oriented effort by intelligent public relations handling. One packaging company concerned about the rising problem of waste paper and plastic pollution set about to publicly rank existing packaging materials and products on their environmental desirability. Return-type, reusable, recyclable containers and bio-degradable papers ranked in the top categories. Transcending these categories, however, was unpackaged citrus fruit and a surprise winner as the ultimately desirable food package was the Chinese fortune cookie, an edible package with inedible contents. Even more recently, Dairy Research, Inc., have introduced their ultimate in disposable packages.
that the CEO must begin to anticipate and plan for the environment -just as he does in other areas of corporate business. Otherwise, the CEO will come up short with adequate reasons or excuses and thereby further widen the credibility gap. IV. SIX CORPORATE
which may serve as a model for the industrial world. It involves a common evaluation of the pollution dangers, with a goal of common EEC standards, a program of applying these standards to sources of pollution, and enforcement of regulations and standards including legal sanctions.
SELF-CONTROL Issue No. 2: Resource Requirements
ISSUES
Ecological problems are so complex that for most corporations it appears necessary to staff internally with a permanent “ecoconscience” to ensure corporate self-control. But creating a constructive strategy for corporate self-control goes beyond simply creating a new job title. It involves forging a strategic planning and control system for the corporation. What are the issues that must be considered in such a plan? Issue No. 1: Government Self-control
Control
or Corporate
The main issue is not so much how long it will take and how involved compliance measures will become under NEPA, the Environmental Quality Improvement Act of 1970, the Air Quality Act of 1967, the Clean Air Act of 1970, and many other laws past and pending. Rather, the issue is: will industry wait until public opinion forces the government to move deeper into the control process? The Environmental Protection Agency (EPA) budget for 1973 of $2.5 million was double that of 1972, but less than 20% goes into R&D effort. Surely private industry can more cheaply reduce, monitor, and account for its own spoiling of the biosphere. The economic and social challenge of the chief executive officer is to lead the way by example in his own firm and industry. For the multinational company the problem is not only a domestic one. In April 1972, for example, an EEC commission proposed a sweeping environmental protection program,
and
Recycling
Much has been said about recycling as a way to conserve resources. Time cannot be recycled yet, but money certainly can. Some of the efforts in this process are the “Earth Bonds” issued by the First Pennsylvania Bank at 5% for three months and 5.75% for two years. They also make loans at half a point below prime rate to companies engaged in fighting pollution as examples of ready resources in the US. Spot examples of recycling efforts are making news these days from recycled paper to recycled glass for roadbeds and recycled plastics as a component in structural concrete. Residents of Elgin, Illinois, collected 25,000 discarded plastic bottles, had them ground into chips, and used the resulting material to replace 30% volume of normal sand in the Fox River bridge’s concrete footing and span. The 100 feet long, 7 feet wide structural arch is now 9% lighter, with insignificant loss of strength. In another area sulfur dioxide emission control could eliminate the need to mine sulfur. * The American Petroleum Institute planned to spend $5 million in 1972 (double the previous appropriation) for research on oil spills, auto emission control, and programs for improving the quality of the environment through resource conservation and recycling. This is an encouraging sign of industry concern and action where industrial forms may not
*If emission
“scrubbers”
operate
efficiently.
Ed.
323
have the resources to solve alone some of the vexing eco-problems. But the key issues are not these spot recycling efforts. More money and manpower must be diverted to R&D in the whole environmental area by both government and private sources. One estimate made by President Nixon’s Council on Environmental Quality puts the number of professional and para-professional jobs in the five areas of environmental management (i.e., ecology, earth sciences, resources and recreation, and environmental design and protection) currently at about 656,000 practitioners. Employment needs are estimated to almost double this number to about 1.2 million jobs by 1980. If national objectives can be better balanced toward saving the world rather than destroying it, this issue of resources and recycling will be less critical. Issue No. 3: The Myth of Instant Progress
General Motors recently issued a report on Progress in Areas of Public Concern. High on GM President Cole’s list of priorities was the dispelling of the myth that the rapid increase in scientific knowledge and the generally decreasing lag in innovation time implied that improvements in auto design and performance would be forthcoming quickly in production volume. In the auto business the complex problems of safety and health, production lead time, consumer acceptance, and cost-benefit analyses determine what and when innovations can be safely and effectively added. Commercial reality is not an instant process. Typical chemical plant installations take one to one and a half years to erect, water treatment installations take a little less time, and the sequential clean-up of streams and rivers may not be accomplished for years. Instant results are not practical to achieve, but this is no escape from getting on with important changes. The demand for change and improvement is staggering. A 1966 pollution inventory 324
showed 142 7 20 48 26 3
in the U.S. there were million tons of air pollutants million junked cars million tons of waste paper billion discarded cans billion discarded bottles billion tons of rock, mining, and mill wastes 50 trillion gallons of hot water It requires time and effort to cope with this outflow of discards, waste, and pollution and get these forces under corporate self-control; while instant progress is not achievable, an instant start is imperative. Issue No. 4: Perspectives and Trade-offs The German Weltanschauung implies a philosophical conception of the world or a worldly perspective which is important when considering practical trade-offs in environmental management issues. There are, after all, natural as well as human-caused impacts on the environment. For example, flood damage of $2 billion per year across the nation, which has taken place despite flood control measures, must be kept in some perspective with manmade impacts on the ecology; and this also embraces matters of biology, zoology, and psychology. General Motors Corporation is on the poorly-understood and defensive side of the problem of tailpipe pollution, which emanates from more than 130 million mobile sources. According to GMC, if all cars, trucks, and buses were parked, we would still have 60% of our air pollution problem, as measured by weight, and about 90% of the problem as it relates to health. There is legitimate question as to whether national standards for air pollution are actually cost-effective or able to solve the problem. In under-developed, struggling, and emerging areas and nations, one hears little about pollution or environment. The Hooghly River in Calcutta is infinitely filthier than the Thames
in London; the problems of the Indians are such that they are worrying about other things. In developed nations, one must consider whether industrial development is necessarily a net asset. By the time public services such as roads, schools, and police protection are provided to meet the needs of an expanded industrial base, the tax revenues generated by the expansion may not offset added governmental costs, not to mention environmental costs. On the other hand, there may be a long-term betterment in quality-of-life from an appropriately conceived industrial project using enlightened environmental management concepts, and this is a trade-off to be considered. Issue No. 5: The Silent Epidemic
This refers to the quiet poisoning of man by cumulative elements such as lead and radioactive materials. Asbestos in the air, mercury in swordfish, pesticides, and detergents are some of the health threats caused by direct or indirect consumption of chemical or nuclear products. Not only are humans affected, but animals, plants, and natural resources suffer a tremendous toll from the polluted environment about them. Recent research showed that Zinfandel grapevines growing in a smoggy atmosphere produced 60% fewer grapes than those in an unpolluted area. In addition, the vines were stunted, and the mature grapes noticeably smaller and less sweet. President Nixon’s and Prime Minister Trudeau’s recent Great Lakes Water Treaty states that lakes have a right to “five freedoms” from toxic substances, nutrient overloading, oil, sludge, and noxious colors and odors. The issue of how much of what is safe for human, animal, and plant life will not be resolved soon, if ever; but the research and testing effort must be increased substantially by manufacturers and purveyors of all products
to slow the silent epidemic. An enlightened corporate attitude is required, and priorities need to be re-established. issue No. 6: Common Objectives of Two Worlds
In 1959 Sir Charles Snow first pointed out the two cultures: the world of science and technology and the world of humanism and aesthetics. In most forms of corporate selfcontrol, these two worlds coexist as common and multiple objectives of the institution, even though emphasis and timing may vary somewhat. Technical and economic feasibility must be coordinated with social desirability, and in a free nation these two-world values are coequal and inter-dependent. The area of nuclear energy is a prime example of scientific achievement which has intruded itself into the public realm with benefits to medicine, power production, transportation, and other significant fields; but the hazards of its use have intruded the public sector with problems of disposal and military applications. The concept of public trust (a Roman legal theory) rests on the idea that such common properties as air and rivers are held by the government for the free and unfettered use of the public. The right of the public in environmental quality is considered on a plane with the rights of private property, and the public trust doctrine recognizes the government’s duty to implement environmental quality. V. STRATEGIC ADVANCE?
RETREAT
OR STRATEGIC
Environmental concerns first expressed by conservation and aesthetic interests have often hatched ambitious programs on paper that proved unfulfillable by the individual organization, by the industry, or by the government. This net inaction (or, in some cases, overaction or over-reaction) is a result of the complexities of environmental issues, lack of understanding, 325
and the need for better overall communication. More realistic assessments are now coming about, and solutions are being intelligently negotiated between interested conservationists, public authorities, and private polluters. There is also a growing commitment to longer-term clean-up of the environment, with corporations accepting the responsibility for properly managing their environment as a condition of survival. A strategy of double retreat was recently reported in Sakashiro, Japan. There the dean of present-day swordsmiths, Miyairi Shohei, had found that his highly developed and formidable art of making fine katana was severely affected, since the water of the Chikuma River, which was used to temper the blades, had become polluted by the phenol waste from a nearby pharmaceutical plant. This phenol-containing effluent consistently caused smears and cracks in the metal. After strenuous but unsuccessful efforts to persuade the plant to control its wastes, Miyairi, who is recognized as one of Japan’s “human national treasures,” became increasingly upset and finally retreated to his bed! This strategy worked.. . the polluting factory moved its operations away from the master swordmaker, and Japan’s treasured katana is again being produced in all its perfection. Miyairi’s retreat, followed by the pharmaceutical company’s retreat, illustrates perhaps a strategy conceivable only in Japan. But some U.S. companies are withdrawing and relocating operations instead of facing the clean-up of pollution at its source, thereby deferring a realistic (from a social responsibility standpoint) confrontation of the problem. Rather than strategic retreat, it is proposed that corporations exercise some countervailing pressures in the form of strategic action toward their environmental responsibilities. Suggested steps in developing such a strategic plan of advance are: 1. Charter. The Environmental Quality Improvement Act of 1970 is explicit as to the 326
government’s charter: “The Congress declares that there is a national policy for the environment which provides for the enhancement of environmental quality.” Accordingly, most corporate charters need revision to be equally explicit as to corporate objectives with respect to the environment which in turn permit the corporation to survive. As a statement of corporate scope, an enlightened corporate charter will include protection of that environment as an explicit objective. A recent random sample of major organizations’ corporate long-range plans exposed the almost total absence of any such objectives as corporate self-control with respect to the environment. Many recent development and engineering efforts have been directed toward improving, restoring, or protecting the particular corporate environment. But, this objective is not explicitly set forth in the corporate charter. An examination of the existing corporate charter (not the statutory charter, but the internal determinative statement of the company’s purpose) appears in order to be certain that the charter recognizes the dependence of the entity on its equilibrium with the environment. This concept embraces not only bio-physical, but social equilibrium. A determinative charter is an evergreen statement which assumes that the enterprise will live indefinitely. But the ecology crisis challenges this assumption. Not only do few corporate charters recognize environmental protection as a desirable social goal, they do not acknowledge that self-control is vital if the corporation is to survive. The corporate charter should explicitly commit the company to maintain the natural chemical, physical, biological, and aesthetic integrity of the changing environment which sanctions the corporation’s existence. 2. Corporate Objectives and Goals. Most corporate objectives are stated in simplistic (often motherhood) style, and few articulate specifics about environmental objectives.
Corporate objectives must be multiple, having social, political, cultural, economic, and now environmental components. Goals are steps along a drive toward objectives which are timeless and perhaps will never be achieved in a perfect sense. In addition to the normal financial and organizational goals there should be some specific but realistic plan which can be implemented with respect to abatement of pollution or other treatment affecting the environment. The government is developing goals, including standards for polluters to observe setting priorities and allocating expenditures. Corporations should do the same. 3. Position Statement. This is the basis for determining a corporation’s long-range planning premises. It realistically assesses where the corporation stands with respect to environmental targets and constraints as distinct from other corporate objectives and goals derived from the charter. The review includes the kinds of uncertainties, opportunities, ecological constraints, resource availability, and timing. Sometimes this position assessment needs to be done or checked by an outside party in order to get proper objectivity. The NEPA now requires all government agencies to prepare environmental impact statements for every “major” action. This statement must describe the probably adverse effects and discuss possible alternate actions. Private institutions could likewise require similar declarations of intent, with the environmental consequences and alternatives as part of the decision-making process. Some major corporations already add an impact analysis to their appropriation request requirements. 4. Business Environment. This is a statement on competition, geography, raw material situation, products, customers, costs, regulatory, and price trends in the industry involved. While it is inappropriate in the ecology crisis to compare oneself to what competitors do, it is important, from a practical and public relations standpoint, not
to be perceived as an environmental laggard or inactive member of an industry. 5. Forces at Work. This would be a brief statement of exogenous forces at work on the corporation which reflect the legal, political, cultural, economic, and social environment, in addition to physical environment. This involves potential government action, some natural forces (i.e., weather trends), political trends, expected shifts in public values and sentiment, change in personal value systems, and cultural and societal changes. With myriad uncertainties, the temptation is to wait until requirements and outlook are clarified. However, for the foreseeable future it is unlikely that the environmental control picture will reach hoped-for clarity due to changes in technology, standards, and regulations. A wait-and-see policy is likely to be more costly than correction and abatement program property conceived and continuously managed. In addition, consideration needs to be given to those indigenous forces which are also at work and which are resistant to change, such as plans within the institution to “cause more pollution” by installing new facilities or by changes in process, or by entering and introducing new products or moving into new markets. It is a limited viewpoint that interprets the impact of environmental regulations primarily in terms of anti-pollution hardware for production facilities. The impact will also cut across marketing, financing, advertising, purchasing, public/shareholder/employee relations, packaging, research and development, and insurance functions. A strategic approach must involve all of these impacts. 6. Identification, evaluation and selection of alternate strategic courses. Control or abatement options may include removal, reclamation, process change, relocation, recycling or termination of operations. Each of these options must be evaluated in terms of economics, social impacts, public relations considerations, realism, probable changes in 327
technology, and anticipated government requirements. The government is not unmindful of the added cost of pollution control over present practices. Evaluation of strategic options will, of course, consider various tax relief advantages which the federal government and two thirds of the states provide. 7. Feedback. Some continuous assessment of accomplishment of “environmental goals”, perhaps leading to changes of objectives and realignment of effort to cope with changes in attitudes about environmental management will be necessary from time to time, since the subject is dynamic and changing and complex. The feedback or recycle mechanism is a crucial part of an adaptive strategic planning effort. A strategic plan of advance must provide at least the following: a. A fast, rational system to pull together the total concern and resources of the organization to implement the chosen strategy. b. A focus on corporate environmental concern in the form of an explicit, strategic plan, and step-by-step tactical program
which can be reviewed and adjusted regularly. c. Incentives (economic, social, and psychic) to overcome the conflicts of interests which limit contributions from within and without the organization. This development of a strategic plan of advance is really geared first at striving to reduce uncertainties so that business or social risks can be measured and balanced. Risks are both a matter of calculation and of courage. Secondly, it is an effort to eliminate surprise by government action, competition, or other external developments. Thirdly, the strategic plan discriminates among multiple choices for investment of resources. Within a concept of a strategic advance through long-range planning, there appear to be vast global opportunities for new industries and for preservation of existing industries. There is a need to introduce into environmental management the same innovative spirit that has always marked the management and advance of technology in US industry. But in order to do this corporate self-control must be sponsored and imulemented from the top.
EC0 ET LE CEO: RETRAITE STRATEGIQUE OU AVANCE STRATEGIQUE Nous avons publiC dans le Vol. 2, No. 3 de IMM, un article sur “L’&aluation technologique: des forces nouvelles susceptibles d’affecter la strat&e du marketing industriel” qui attira l’attention sur l’effet possible de la lbgislation amkricaine: (entre autre le Environmental Policy Act de 1969, et le Office of Technological Assessment Act de 1972). Nous sommes tr&s heureux de publier le prksent article de M. Mueller qui est destinC aux dirigeants et aux administrateurs. Cet article Porte sur l’interaction entre les experts de l’environnement et les dirigeants et fut &it 328
alors que l’exp&ience de prkcurseurs des Amkricains venait de prendre une forme plus tangible. Nous recommandons la lecture de l’etude de M. Mueller, non pas tant parce que l’exp&-ience amCricaine dans ce domaine dGpasse celle de l’Europe, mais parce que, au moment de la rkdaction de celle-ci, la Communaut& Economique Europienne venait juste de faire le premier pas vers la rialisation d’une &tude destinie Z?I fournir des recommandations sur le bien-fond6 d’un Bureau des Evaluations Technologiques.
EC0 UND CEO: STRATEGISCHER
RiiCKZUG ODER
VORSTOSS In IMM 2/3 verijffentlichten wir einen Artikel iiber die “Technologieveranlagung”, der die Aufmerksamkeit auf die mijglichen Auswirkungen der US-Gesetzgebung, wie z.B. das Umweltschutzgesetz (1969) und das Technologieveranlagungsgesetz (1972), lenkte. Nun liegt uns ein Artikel von Herrn Mueller vor, der eine Abhandlung darstellt, die an den Obervollzugsbeamten und die Behijrden gerichtet ist. Dieser zweite Artikel iiber die Interaktion zwischen Umweltschiitzern und Behiirden wurde abgefasst, nachdem die
amerikanischen Erfahrungen deutlichere Formen angenommen haben. Muellers Abhandlung wird nicht nur wegen der Ubertragungsmijglichkeit amerikanischer Erfahrungen auf Europa zur Lektiire empfohlen, sondern wegen der Tatsache, dass zum Zeitpunkt der Verijffentlichung die Europaische Wirtschaftsvereinigung gerade den ersten Schritt zur Erganzung einer Studie unternommen hat, die der Kommission Auskunft dariiber geben ~011, ob ein Amt fiir Technologieveranlagung notwendig wird.
329
L
c
the subjective side of science A Philosophical Inquiry into the Psychology of the Apollo Moon Scientists IAN I. MITROFF with a foreword
by C. West Churchman
1974. about 350 pages. US$11.5O/Dfl. 30.00.
An in-depth study of the psychology and behavior of over forty of the most eminent scientists who studied the moon rocks. I, . . . . a very impressive major contribution to the sociology of science and, indeed, it may well be reckoned as one of the most important spinoffs from the Apollo lunar program. Mitroff has analyzed the moon rock scientists to provide evidence as radical and fundamental as that provided by the moon rocks themselves.” Derek de Sol/a Price (Yale University)
Elsevier P.O. Box 211 AMSTERDAM,
1424 E
The Netherlands
52 Vanderbilt Avenue NEW YORK, N.Y. 10017.
Management 3 (1974) 319-330 Publishing Company, Amsterdam
EC0 AND
- Printed
in The Netherlands
THE CEO: STRATEGIC
STRATEGIC
RETREAT
OR
ADVANCE
Robert Kirk Mueller
INTRODUCTION
In IMM Vol. 2, No. 3, we published an article on “Technology Assessment: New Forces Likely to Affect Industrial Marketing Strategy” which drew attention to the possible precursor effect of US legislation like the Environmental Policy Act (1969) and the Office of Technology Assessment Act (1972). Now we are very fortunate indeed to have an article from Mr Mueller which is a related essay, directed at the chief executive officer
I. EC0 AND THE CEO
Tricks of transposition aside, Ecology (ECO) and the Chief Executive Officer (CEO) are confronting each other more directly than at any other time in history. First of all, environmental management is a $10 billion “new” business with $6.6 billion for pollution control and abatement proposed in the 1973 US federal budget. More important, in man’s destruction of the environment, the chief executive is seen as a particularly guilty party,
and the board level. This second article, on the interaction between environmentalists and executives, is written after the US precursor experience has taken more tangible form. Mueller’s essay is recommended reading, not simply because America’s experience in this field predates that of Europe, but because (at the time of writing) the European Economic Community has just taken its first step towards the completion of a study to advise its Commission on whether an Office of Technology Assessment is needed.
because of his apparent unconcern and because of his past handling of his corporation’s relations with the fragile environment. At the eye of this storm is a complex set of natural phenomena, political interactions, financial problems, and ideological splits. Public demand that industry spend dollars for “profitless” purposes is a relatively new phenomenon, unless some aspects of the union movement can be considered a parallel. As of now, even a good CEO finishes last in terms of society’s perception of who is doing what constructively 319
in terms of environmental preservation. Prior to the sixties, smog in Los Angeles was a subject primarily for gag writers. In the sixties, ostensibly unrelated environmental incidents such as the New England water shortage, mercury poisoning in Japan, the Torrey Canyon and other oil spills, continued to develop the groundswell of public reaction to the environmental quality of life. This concern has spawned hundreds of legislative proposals and governmental activities in the late sixties and early seventies. Because of relative lack of preparation, many CEO’s have been unable to deal effectively with the problem which in turn has resulted in a massive credibility gap, some unwise expenditures of corporate resources, and reaction instead of action. What can and should the CEO realistically do now about this situation? A practical approach is set forth later, but first, let us look at the problem.
il. BREED
AND THE OF
Are you lately by What do think of anthropocentric ecosystem? glebe a investment these As far your operations concerned, will year’s biota better than year’s? Hopefully inquired about advantages of mesoscale, and winds before to locate new facility the East . and do you know about the benthic obliteration in New York Harbor? Can your staff distinguish between elutriation and eutrophication? Such bio-buzzwords are enveloping CEO’s these days in an unprecedented semantic smog. It is doubtful that even your vice-president for environmental control would recognize all the bio-buzzwords polluting our conversation. While many bio-buzzwords die quickly or are used for intellectual one-upmanship, there is often much value in specialized language - to use another bio-buzzword. It has served to 320
Robert K. Mueller, Vice President of Arthur D. Little, Inc., is Chairman of the Board of ADL International, Inc. and a Director of ADL, Ltd. (London). Mr. Mueller’s work at ADL involves board of director and management aspects of multinational institutions: business development, new ventures, acquisitions, corporate planning, venture capital, and diversification in various industries and financial organizations. Mr. Mueller received a B.S. degree in chemical engineering from Washington University, an M.S. degree in chemistry from the University of Michigan and completed the Advanced Management Program at Harvard University. A well-known speaker in professional circles, he is the author of five books: Effective Management Through Probability Controls; Risk, Survival, and Power; The Innovation Ethic; Board Life Realities of Being a Corporate Director, and Buzzwords, A Guide to the Language of Leadership; as well as numerous articles in scientific and business journals. In 1970, he served as Chairman of the faculty for a management of technology session at the Salzburg Seminars in American Studies, and currently is a member of that organization’s Board of Directors and Executive Committee. He is a member of the visiting Faculty of the International Institute for the Management of Technology, Milan. He is a trustee of Colby College-New Hampshire and a member of the Business Advisory Council of the University of Massachusetts School of Business Administration, and a Director of the Plastics Education Foundation.
awaken those in responsible charge to the urgent need for corporate self-control. This new eco-vocab can be heard most frequently from the lips of a new cult of ecoexperts, eco-consumerists, eco-consultants, eco-technologists, and eco-venture capitalists who are forging new social and business frontiers in all directions under the ecological banner. From the CEO’s vantage point, the new world must seem to be peopled by: econuts ecofanatics, who in emotionally action, including (sabotage for reasons); ecoracles eco-sages, who off into apparently receiving Guidance in answers to problems; ecoleptics, worry themselves fits about problems; eco-nomists, have quantitative, misty, answers the balance natural resources this planet. . . often persons who can’t change their outlook and won’t change the subject; eco-politicians weather-vanes of sensitivity to ecological matters, who ignore facts in favor of fancies and employ eco-tactics in attracting the voter; eco-crats, a new layer of staff springing up in government and in some companies where a career can be made in the paperwork and analysis-to-paralysis syndrome; ecodomos, a new position in government and corporations, as full-time job involved in environmental management. Given a high profile and a suitable title, this new career spot has an opportunity orientation.. . opportunities being problems the boss can’t solve. Eco-domos recycle this elusive subject continuously, with a worried look on their faces. With such an array of eco-expertise, it’s little wonder the CEO is uncertain about what to do first. But the confusion must not be allowed to obscure the fact that all should be concerned with the common sense principles
that underly the ecological crisis. All environmental problems aye inter-related at some point in time as part of the well-tuned total system. The planet Earth does have only a finite amount of physical resources. Herbert Hoover said it well in prohibition/pre-pollution days: “The objective in this country is to build a human society and not an economic system.” Though many eco-experts are self styled many others are authoritative sources of assistance who have indeed flagged the most serious crisis of our time. III. SOUL-SEARCHING Solving the environmental crisis is more than a current cause; it is a national objective. In 1969 President Nixon symbolically chose to sign as his first official act for the new decade the National Environmental Policy Act (NEPA), which has the lofty purpose of policy reform through government self-control. This act is directed at the people-caused ecological upset typified by our mobile American society, 19% of which relocates itself each year, and such phenomena as that in California, where about 500 acres of open land fall prey to the urban sprawl every day. NEPA opens to public view a major new source of information about the way in which the government’s activities affect the environment, and it goads the federal establishment to adapt a more sympathetic attitude toward our environment. The soul-searching caused by NEPA is indicative of what is in the wings for the private sector. In just three short years (with over 160 decisions under NEPA) the federal courts or government agencies have: initiated court action against nine Hawaiian sugar mills for causing “severe pollution;” delayed the $3 billion trans-Alaska pipeline (in 1970); programmed $185 million to correct environmental pollution control problems in 1500 federal facilities (in 1972); delayed the $400 million Tennessee321
Timbigbee Waterway (in 197 1); delayed operation of a half dozen nuclear power plants make a mockery of the NEPA, and have tied up the AEC licensing program so that is has been unable to complete a license since summer of 197 1; initiated an Air Force research and development program to improve jet aircraft combustion, which is expected to cost $35 million to convert the 60% jet engine inventory of the U.S. Air Force; forced the Department of the Interior to postpone plans to sell oil and gas leases on tracts of Gulf Coast waters; set down the “Calvert Cliffs” ruling in the Sierra Club suit against the AEC power plant, on grounds of thermal pollution of the Chesapeake Bay; forced the articulation of “environmental impact statements” on most of the 25,000 permit applications before the Corps of Engineers and the Environmental Protective Agency. The controls being imposed by government on government are being matched by controls by government on the private sector. . . this is
.
the poor salmon swimming up the Columbia River to spawn passes under the jurisdiction of twelve federal agencies! Germany’s largest detergent maker, the giant Henkel Company, has recently taken the initiative of organizing public discussions with civic groups on the topic of how to combat pollution. In Dusseldorf, for example, their “Talk with Neighbors” covered odor, water, noise, and rubbish pollution problems, with environmental experts discussing practical
solutions. The program is one of great public interest on the Continent. Since the cost of environmental pollution control must ultimately be borne by the consumer, it is obviously good business to have an intelligent public relations program, provided it is founded on a meaningful environmental management action program. Gestures contrived to ease the corporate conscience are soon exposed, but enlightened firms are turning a previously reactive style into a forthright active opportunity-oriented effort by intelligent public relations handling. One packaging company concerned about the rising problem of waste paper and plastic pollution set about to publicly rank existing packaging materials and products on their environmental desirability. Return-type, reusable, recyclable containers and bio-degradable papers ranked in the top categories. Transcending these categories, however, was unpackaged citrus fruit and a surprise winner as the ultimately desirable food package was the Chinese fortune cookie, an edible package with inedible contents. Even more recently, Dairy Research, Inc., have introduced their ultimate in disposable packages.
that the CEO must begin to anticipate and plan for the environment -just as he does in other areas of corporate business. Otherwise, the CEO will come up short with adequate reasons or excuses and thereby further widen the credibility gap. IV. SIX CORPORATE
which may serve as a model for the industrial world. It involves a common evaluation of the pollution dangers, with a goal of common EEC standards, a program of applying these standards to sources of pollution, and enforcement of regulations and standards including legal sanctions.
SELF-CONTROL Issue No. 2: Resource Requirements
ISSUES
Ecological problems are so complex that for most corporations it appears necessary to staff internally with a permanent “ecoconscience” to ensure corporate self-control. But creating a constructive strategy for corporate self-control goes beyond simply creating a new job title. It involves forging a strategic planning and control system for the corporation. What are the issues that must be considered in such a plan? Issue No. 1: Government Self-control
Control
or Corporate
The main issue is not so much how long it will take and how involved compliance measures will become under NEPA, the Environmental Quality Improvement Act of 1970, the Air Quality Act of 1967, the Clean Air Act of 1970, and many other laws past and pending. Rather, the issue is: will industry wait until public opinion forces the government to move deeper into the control process? The Environmental Protection Agency (EPA) budget for 1973 of $2.5 million was double that of 1972, but less than 20% goes into R&D effort. Surely private industry can more cheaply reduce, monitor, and account for its own spoiling of the biosphere. The economic and social challenge of the chief executive officer is to lead the way by example in his own firm and industry. For the multinational company the problem is not only a domestic one. In April 1972, for example, an EEC commission proposed a sweeping environmental protection program,
and
Recycling
Much has been said about recycling as a way to conserve resources. Time cannot be recycled yet, but money certainly can. Some of the efforts in this process are the “Earth Bonds” issued by the First Pennsylvania Bank at 5% for three months and 5.75% for two years. They also make loans at half a point below prime rate to companies engaged in fighting pollution as examples of ready resources in the US. Spot examples of recycling efforts are making news these days from recycled paper to recycled glass for roadbeds and recycled plastics as a component in structural concrete. Residents of Elgin, Illinois, collected 25,000 discarded plastic bottles, had them ground into chips, and used the resulting material to replace 30% volume of normal sand in the Fox River bridge’s concrete footing and span. The 100 feet long, 7 feet wide structural arch is now 9% lighter, with insignificant loss of strength. In another area sulfur dioxide emission control could eliminate the need to mine sulfur. * The American Petroleum Institute planned to spend $5 million in 1972 (double the previous appropriation) for research on oil spills, auto emission control, and programs for improving the quality of the environment through resource conservation and recycling. This is an encouraging sign of industry concern and action where industrial forms may not
*If emission
“scrubbers”
operate
efficiently.
Ed.
323
have the resources to solve alone some of the vexing eco-problems. But the key issues are not these spot recycling efforts. More money and manpower must be diverted to R&D in the whole environmental area by both government and private sources. One estimate made by President Nixon’s Council on Environmental Quality puts the number of professional and para-professional jobs in the five areas of environmental management (i.e., ecology, earth sciences, resources and recreation, and environmental design and protection) currently at about 656,000 practitioners. Employment needs are estimated to almost double this number to about 1.2 million jobs by 1980. If national objectives can be better balanced toward saving the world rather than destroying it, this issue of resources and recycling will be less critical. Issue No. 3: The Myth of Instant Progress
General Motors recently issued a report on Progress in Areas of Public Concern. High on GM President Cole’s list of priorities was the dispelling of the myth that the rapid increase in scientific knowledge and the generally decreasing lag in innovation time implied that improvements in auto design and performance would be forthcoming quickly in production volume. In the auto business the complex problems of safety and health, production lead time, consumer acceptance, and cost-benefit analyses determine what and when innovations can be safely and effectively added. Commercial reality is not an instant process. Typical chemical plant installations take one to one and a half years to erect, water treatment installations take a little less time, and the sequential clean-up of streams and rivers may not be accomplished for years. Instant results are not practical to achieve, but this is no escape from getting on with important changes. The demand for change and improvement is staggering. A 1966 pollution inventory 324
showed 142 7 20 48 26 3
in the U.S. there were million tons of air pollutants million junked cars million tons of waste paper billion discarded cans billion discarded bottles billion tons of rock, mining, and mill wastes 50 trillion gallons of hot water It requires time and effort to cope with this outflow of discards, waste, and pollution and get these forces under corporate self-control; while instant progress is not achievable, an instant start is imperative. Issue No. 4: Perspectives and Trade-offs The German Weltanschauung implies a philosophical conception of the world or a worldly perspective which is important when considering practical trade-offs in environmental management issues. There are, after all, natural as well as human-caused impacts on the environment. For example, flood damage of $2 billion per year across the nation, which has taken place despite flood control measures, must be kept in some perspective with manmade impacts on the ecology; and this also embraces matters of biology, zoology, and psychology. General Motors Corporation is on the poorly-understood and defensive side of the problem of tailpipe pollution, which emanates from more than 130 million mobile sources. According to GMC, if all cars, trucks, and buses were parked, we would still have 60% of our air pollution problem, as measured by weight, and about 90% of the problem as it relates to health. There is legitimate question as to whether national standards for air pollution are actually cost-effective or able to solve the problem. In under-developed, struggling, and emerging areas and nations, one hears little about pollution or environment. The Hooghly River in Calcutta is infinitely filthier than the Thames
in London; the problems of the Indians are such that they are worrying about other things. In developed nations, one must consider whether industrial development is necessarily a net asset. By the time public services such as roads, schools, and police protection are provided to meet the needs of an expanded industrial base, the tax revenues generated by the expansion may not offset added governmental costs, not to mention environmental costs. On the other hand, there may be a long-term betterment in quality-of-life from an appropriately conceived industrial project using enlightened environmental management concepts, and this is a trade-off to be considered. Issue No. 5: The Silent Epidemic
This refers to the quiet poisoning of man by cumulative elements such as lead and radioactive materials. Asbestos in the air, mercury in swordfish, pesticides, and detergents are some of the health threats caused by direct or indirect consumption of chemical or nuclear products. Not only are humans affected, but animals, plants, and natural resources suffer a tremendous toll from the polluted environment about them. Recent research showed that Zinfandel grapevines growing in a smoggy atmosphere produced 60% fewer grapes than those in an unpolluted area. In addition, the vines were stunted, and the mature grapes noticeably smaller and less sweet. President Nixon’s and Prime Minister Trudeau’s recent Great Lakes Water Treaty states that lakes have a right to “five freedoms” from toxic substances, nutrient overloading, oil, sludge, and noxious colors and odors. The issue of how much of what is safe for human, animal, and plant life will not be resolved soon, if ever; but the research and testing effort must be increased substantially by manufacturers and purveyors of all products
to slow the silent epidemic. An enlightened corporate attitude is required, and priorities need to be re-established. issue No. 6: Common Objectives of Two Worlds
In 1959 Sir Charles Snow first pointed out the two cultures: the world of science and technology and the world of humanism and aesthetics. In most forms of corporate selfcontrol, these two worlds coexist as common and multiple objectives of the institution, even though emphasis and timing may vary somewhat. Technical and economic feasibility must be coordinated with social desirability, and in a free nation these two-world values are coequal and inter-dependent. The area of nuclear energy is a prime example of scientific achievement which has intruded itself into the public realm with benefits to medicine, power production, transportation, and other significant fields; but the hazards of its use have intruded the public sector with problems of disposal and military applications. The concept of public trust (a Roman legal theory) rests on the idea that such common properties as air and rivers are held by the government for the free and unfettered use of the public. The right of the public in environmental quality is considered on a plane with the rights of private property, and the public trust doctrine recognizes the government’s duty to implement environmental quality. V. STRATEGIC ADVANCE?
RETREAT
OR STRATEGIC
Environmental concerns first expressed by conservation and aesthetic interests have often hatched ambitious programs on paper that proved unfulfillable by the individual organization, by the industry, or by the government. This net inaction (or, in some cases, overaction or over-reaction) is a result of the complexities of environmental issues, lack of understanding, 325
and the need for better overall communication. More realistic assessments are now coming about, and solutions are being intelligently negotiated between interested conservationists, public authorities, and private polluters. There is also a growing commitment to longer-term clean-up of the environment, with corporations accepting the responsibility for properly managing their environment as a condition of survival. A strategy of double retreat was recently reported in Sakashiro, Japan. There the dean of present-day swordsmiths, Miyairi Shohei, had found that his highly developed and formidable art of making fine katana was severely affected, since the water of the Chikuma River, which was used to temper the blades, had become polluted by the phenol waste from a nearby pharmaceutical plant. This phenol-containing effluent consistently caused smears and cracks in the metal. After strenuous but unsuccessful efforts to persuade the plant to control its wastes, Miyairi, who is recognized as one of Japan’s “human national treasures,” became increasingly upset and finally retreated to his bed! This strategy worked.. . the polluting factory moved its operations away from the master swordmaker, and Japan’s treasured katana is again being produced in all its perfection. Miyairi’s retreat, followed by the pharmaceutical company’s retreat, illustrates perhaps a strategy conceivable only in Japan. But some U.S. companies are withdrawing and relocating operations instead of facing the clean-up of pollution at its source, thereby deferring a realistic (from a social responsibility standpoint) confrontation of the problem. Rather than strategic retreat, it is proposed that corporations exercise some countervailing pressures in the form of strategic action toward their environmental responsibilities. Suggested steps in developing such a strategic plan of advance are: 1. Charter. The Environmental Quality Improvement Act of 1970 is explicit as to the 326
government’s charter: “The Congress declares that there is a national policy for the environment which provides for the enhancement of environmental quality.” Accordingly, most corporate charters need revision to be equally explicit as to corporate objectives with respect to the environment which in turn permit the corporation to survive. As a statement of corporate scope, an enlightened corporate charter will include protection of that environment as an explicit objective. A recent random sample of major organizations’ corporate long-range plans exposed the almost total absence of any such objectives as corporate self-control with respect to the environment. Many recent development and engineering efforts have been directed toward improving, restoring, or protecting the particular corporate environment. But, this objective is not explicitly set forth in the corporate charter. An examination of the existing corporate charter (not the statutory charter, but the internal determinative statement of the company’s purpose) appears in order to be certain that the charter recognizes the dependence of the entity on its equilibrium with the environment. This concept embraces not only bio-physical, but social equilibrium. A determinative charter is an evergreen statement which assumes that the enterprise will live indefinitely. But the ecology crisis challenges this assumption. Not only do few corporate charters recognize environmental protection as a desirable social goal, they do not acknowledge that self-control is vital if the corporation is to survive. The corporate charter should explicitly commit the company to maintain the natural chemical, physical, biological, and aesthetic integrity of the changing environment which sanctions the corporation’s existence. 2. Corporate Objectives and Goals. Most corporate objectives are stated in simplistic (often motherhood) style, and few articulate specifics about environmental objectives.
Corporate objectives must be multiple, having social, political, cultural, economic, and now environmental components. Goals are steps along a drive toward objectives which are timeless and perhaps will never be achieved in a perfect sense. In addition to the normal financial and organizational goals there should be some specific but realistic plan which can be implemented with respect to abatement of pollution or other treatment affecting the environment. The government is developing goals, including standards for polluters to observe setting priorities and allocating expenditures. Corporations should do the same. 3. Position Statement. This is the basis for determining a corporation’s long-range planning premises. It realistically assesses where the corporation stands with respect to environmental targets and constraints as distinct from other corporate objectives and goals derived from the charter. The review includes the kinds of uncertainties, opportunities, ecological constraints, resource availability, and timing. Sometimes this position assessment needs to be done or checked by an outside party in order to get proper objectivity. The NEPA now requires all government agencies to prepare environmental impact statements for every “major” action. This statement must describe the probably adverse effects and discuss possible alternate actions. Private institutions could likewise require similar declarations of intent, with the environmental consequences and alternatives as part of the decision-making process. Some major corporations already add an impact analysis to their appropriation request requirements. 4. Business Environment. This is a statement on competition, geography, raw material situation, products, customers, costs, regulatory, and price trends in the industry involved. While it is inappropriate in the ecology crisis to compare oneself to what competitors do, it is important, from a practical and public relations standpoint, not
to be perceived as an environmental laggard or inactive member of an industry. 5. Forces at Work. This would be a brief statement of exogenous forces at work on the corporation which reflect the legal, political, cultural, economic, and social environment, in addition to physical environment. This involves potential government action, some natural forces (i.e., weather trends), political trends, expected shifts in public values and sentiment, change in personal value systems, and cultural and societal changes. With myriad uncertainties, the temptation is to wait until requirements and outlook are clarified. However, for the foreseeable future it is unlikely that the environmental control picture will reach hoped-for clarity due to changes in technology, standards, and regulations. A wait-and-see policy is likely to be more costly than correction and abatement program property conceived and continuously managed. In addition, consideration needs to be given to those indigenous forces which are also at work and which are resistant to change, such as plans within the institution to “cause more pollution” by installing new facilities or by changes in process, or by entering and introducing new products or moving into new markets. It is a limited viewpoint that interprets the impact of environmental regulations primarily in terms of anti-pollution hardware for production facilities. The impact will also cut across marketing, financing, advertising, purchasing, public/shareholder/employee relations, packaging, research and development, and insurance functions. A strategic approach must involve all of these impacts. 6. Identification, evaluation and selection of alternate strategic courses. Control or abatement options may include removal, reclamation, process change, relocation, recycling or termination of operations. Each of these options must be evaluated in terms of economics, social impacts, public relations considerations, realism, probable changes in 327
technology, and anticipated government requirements. The government is not unmindful of the added cost of pollution control over present practices. Evaluation of strategic options will, of course, consider various tax relief advantages which the federal government and two thirds of the states provide. 7. Feedback. Some continuous assessment of accomplishment of “environmental goals”, perhaps leading to changes of objectives and realignment of effort to cope with changes in attitudes about environmental management will be necessary from time to time, since the subject is dynamic and changing and complex. The feedback or recycle mechanism is a crucial part of an adaptive strategic planning effort. A strategic plan of advance must provide at least the following: a. A fast, rational system to pull together the total concern and resources of the organization to implement the chosen strategy. b. A focus on corporate environmental concern in the form of an explicit, strategic plan, and step-by-step tactical program
which can be reviewed and adjusted regularly. c. Incentives (economic, social, and psychic) to overcome the conflicts of interests which limit contributions from within and without the organization. This development of a strategic plan of advance is really geared first at striving to reduce uncertainties so that business or social risks can be measured and balanced. Risks are both a matter of calculation and of courage. Secondly, it is an effort to eliminate surprise by government action, competition, or other external developments. Thirdly, the strategic plan discriminates among multiple choices for investment of resources. Within a concept of a strategic advance through long-range planning, there appear to be vast global opportunities for new industries and for preservation of existing industries. There is a need to introduce into environmental management the same innovative spirit that has always marked the management and advance of technology in US industry. But in order to do this corporate self-control must be sponsored and imulemented from the top.
EC0 ET LE CEO: RETRAITE STRATEGIQUE OU AVANCE STRATEGIQUE Nous avons publiC dans le Vol. 2, No. 3 de IMM, un article sur “L’&aluation technologique: des forces nouvelles susceptibles d’affecter la strat&e du marketing industriel” qui attira l’attention sur l’effet possible de la lbgislation amkricaine: (entre autre le Environmental Policy Act de 1969, et le Office of Technological Assessment Act de 1972). Nous sommes tr&s heureux de publier le prksent article de M. Mueller qui est destinC aux dirigeants et aux administrateurs. Cet article Porte sur l’interaction entre les experts de l’environnement et les dirigeants et fut &it 328
alors que l’exp&ience de prkcurseurs des Amkricains venait de prendre une forme plus tangible. Nous recommandons la lecture de l’etude de M. Mueller, non pas tant parce que l’exp&-ience amCricaine dans ce domaine dGpasse celle de l’Europe, mais parce que, au moment de la rkdaction de celle-ci, la Communaut& Economique Europienne venait juste de faire le premier pas vers la rialisation d’une &tude destinie Z?I fournir des recommandations sur le bien-fond6 d’un Bureau des Evaluations Technologiques.
EC0 UND CEO: STRATEGISCHER
RiiCKZUG ODER
VORSTOSS In IMM 2/3 verijffentlichten wir einen Artikel iiber die “Technologieveranlagung”, der die Aufmerksamkeit auf die mijglichen Auswirkungen der US-Gesetzgebung, wie z.B. das Umweltschutzgesetz (1969) und das Technologieveranlagungsgesetz (1972), lenkte. Nun liegt uns ein Artikel von Herrn Mueller vor, der eine Abhandlung darstellt, die an den Obervollzugsbeamten und die Behijrden gerichtet ist. Dieser zweite Artikel iiber die Interaktion zwischen Umweltschiitzern und Behiirden wurde abgefasst, nachdem die
amerikanischen Erfahrungen deutlichere Formen angenommen haben. Muellers Abhandlung wird nicht nur wegen der Ubertragungsmijglichkeit amerikanischer Erfahrungen auf Europa zur Lektiire empfohlen, sondern wegen der Tatsache, dass zum Zeitpunkt der Verijffentlichung die Europaische Wirtschaftsvereinigung gerade den ersten Schritt zur Erganzung einer Studie unternommen hat, die der Kommission Auskunft dariiber geben ~011, ob ein Amt fiir Technologieveranlagung notwendig wird.
329
L
c
the subjective side of science A Philosophical Inquiry into the Psychology of the Apollo Moon Scientists IAN I. MITROFF with a foreword
by C. West Churchman
1974. about 350 pages. US$11.5O/Dfl. 30.00.
An in-depth study of the psychology and behavior of over forty of the most eminent scientists who studied the moon rocks. I, . . . . a very impressive major contribution to the sociology of science and, indeed, it may well be reckoned as one of the most important spinoffs from the Apollo lunar program. Mitroff has analyzed the moon rock scientists to provide evidence as radical and fundamental as that provided by the moon rocks themselves.” Derek de Sol/a Price (Yale University)
Elsevier P.O. Box 211 AMSTERDAM,
1424 E
The Netherlands
52 Vanderbilt Avenue NEW YORK, N.Y. 10017.