Winning sustainability efforts depend on the four P’s

07/10/2009 11:10:42 AM
Jeff Dlott

Discussion around sustainability within the agrifood sector is shifting from the rhetorical question of “what is the definition of sustainability?” to the nuts-and-bolts of “how” to make sustainability relevant to day-to-day business operations. 

The fact that market leaders in all segments of the agrifood supply chain are deeply engaged in sustainability initiatives is a clear sign that the sector has crossed the tipping point from sustainability as a curiousity to an increasingly accepted business strategy.  

Jeff Dlott
SureHarvest

Leading commodity and fresh produce trade associations and their members have invested in a number of national efforts, including Keystone’s Field-to-Market initiative with a primary focus on commodity crops, and the Stewardship Index for Specialty Crops.

These two initiatives are important for focusing on outcome measurements. 

Here is where we get to the four “P’s” of Sustainability: Principles, Practices, Process and Performance.

For over a decade, sustainability has been defined as the three “E’s” — economics, environment and equity; or the three “P’s” — people, profit and planet. 

However, these “P’s” and “E’s” don’t offer much insight into how to get from principles to actual performance. Once a company decides they believe in (or can live with) the principles … then what? 

Starting from the supply chain first mile of agricultural production, the reality of a crop season is uncompromising. There is little time to debate nuances when planting time comes. Operations are largely driven by time, weather and the application of resources within the science and art of farming.

In the manufacturing and service sectors, there has long been the saying that “if you can’t measure it, you can’t manage it.” This means that one first needs yardsticks (or metrics) to measure progress and then the ability to deploy practices, grouped into business processes, to manage effectively. 

Here is where the concepts of “best practices” and “business process improvement” were born, and today they drive management strategies in many business sectors.

I wish I could claim some leading edge innovation for combining the four “P’s” of Principles, Practices, Processes and Performance to business management. The fact is that the Fortune 100 and 500 companies have been doing it for a long, long time. 

For the right price, any company can retain one of the top software and management consulting companies to build best practices systems and business process maps to align strategy with metrics by which to manage for performance outcomes. 

Of course, it is no small feat to get the four P’s “right” in terms of customers, society, and global economic trends as is evidenced by the banking, real estate, automotive and other sector meltdowns. 

But by explicitly including a balance among people, profits and the planet, sustainability can be the lighthouse that guides companies through the rocks of single focus principles. 

Our food system is in transition. Food safety, traceability and sustainability are all top of mind for consumers, lawmakers, regulators, and the media. 

The opportunity to agree on sustainability principles for land, air, water, people, plants and animals, along with the metrics to measure on-the-ground performance, is at hand. 

The Stewardship Index for Specialty Crops is a diverse group of more than 200 specialty crop supply chain businesses, researchers, nongovernmental organizations and commodity groups working together to develop a science-based approach to performance metrics.

Because the Stewardship Index focuses solely on getting the metrics right, growers and companies will be free to innovate to find their own best Practices and Processes to achieve the highest level of Performance guided by the Principles.

The coming sustainability marketplace offers great potential. For individual growers and food companies, performance measurement offers the potential for better management of resources, leading to potential cost savings through efficiencies.

For agricultural producers, who have been producing not just commodities, but social and environmental “goods” as stewards of the land, water and wildlife, performance measurement offers the potential for these noneconomic contributions to finally be quantified, and then, valued.

Does that mean a higher price for raw commodities? There is that potential. It is likely that because of the strong consumer consideration of social and environmental factors in food purchasing decisions, buyers will seek out growers for whom sustainability is proven. 

As supply chains begin to align themselves around sustainability metrics and individual businesses see the benefits, both internally and in collaboration with their trading partners, the closer we will be to achieving true value chains — an honorable vision for our agrifood system.

By Jeff Dlott is president and chief executive officer of SureHarvest, Soquel, Calif. He can be reached at jdlott@sureharvest.com.



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