AXIS Performance Advisors

Demystifying sustainability

Multi-Stakeholder Processes

 

Copyright 2003 AXIS Performance Advisors

Breaking Down the Last Silos

The Magic of Multi-Stakeholder Processes

 

Different colored people renjith krishnanOver the last twenty years, most organizations have learned the power of teams: bring together the right people from all over the organization,give them a clear goal, and get out of their way. These teams have created innovative new products, eliminated waste in work processes, improved quality and saved money. However, most of these teams have been populated just by people inside the organization. Now, leading edge organizations are using some of these same methods and concepts to solve problems across organizations and groups.

These multi-stakeholder processes come in a variety of forms: industrygroups, architectural “eco-charrettes,” supplier conferences,and community development projects. They all share one principle: magichappens when you get everyone into a room together. Suddenly, new optionsemerge. Relationships improve. Conflicts dissipate. Win-win solutions materialize.Seemingly intractable problems go away.

This is not to say that everyone sings Kumbaya. These can be gnarly meetingsto facilitate. But if you’re looking for the next frontier for improvingorganizational performance or the quality of life in your community, thinkabout engaging people outside your own organization.

This article provides an overview of several different types of multi-stakeholderprocesses and shares tips for conducting them. In future newsletters, we’llprovide more detail and case examples on a few of these processes.

 

What is a multi-stakeholder process?

A multi-stakeholder process involves engaging people from different organizations or groups to meet a shared goal.

 

Construction/Building Eco-charrettes

If you’ve ever hired a contractor, you know how siloed the industry is.Your contractor works with a bunch of subcontractors. The person who comesout to look at the job isn’t the person who does the work. One subcontractorcauses problems for the next. The next thing you know, the window is inthe wrong place, the tile isn’t laid as you had asked, and someone backedover your prized rosebush. No one wants to try anything new because of theripple effect through the chain of subcontractors. The dirty little secretin the industry is that you are paying too much because no one wants torethink traditional building practices.

Eco-charrettes are design meetings that get everyone, or at least themajor players, into a room together to design an optimal building. The architect,engineers, contractor and customer explore options and interdependencies:If we change the glazing on the windows and improve the insulation, canwe downsize the HVAC system-and if so, does the cheaper HVAC pay for theother improvements? If we lay out the pipes in as straight a line as possible,we can downsize the pumps and motors; what impact would that have on theroom layout? If we turn the building 30 degrees, we can get the most solaraccess, reducing the need for heating; can you make the driveway and parkingarea work around that?

Many of these eco-charrettes are focused on reducing the environmentalimpact of the building. There is good reason for this. Green architect EdwardMazria came to the startling realization that buildings are responsiblefor around half of America’s energy consumption and greenhouse gas emissions(whereas cars and trucks contribute only one-sixth as much). Green buildingpractices include reducing the need for energy and natural resources, eliminatingtoxic materials that cause sick building syndrome and allergic/asthmaticreactions, treating storm water on site, and capturing rainwater for usein toilets, irrigation, or even drinking.

Many of these innovations don’t cost more than traditional constructionpractices and even when they do cost a premium, they usually pay for themselvesin reduced operating costs and improved human productivity. In a study ofover 100 green buildings in the nation by Capital E group, Lawrence BerkleyLaboratory, and participating California state agencies, they found thatgreen features pay for themselves ten times over. Their report says thatfinancial benefits of green design are between $50 and $70 per square footin a LEED building (one certified to a high level of environmental and energysaving design), over 10 times the additional cost associated with buildinggreen. The benefits include cost savings from reduced energy, water, andwaste; lower operations and maintenance costs; and enhanced occupant productivityand health. (Source: USGBC and Greenbiz.com) But you can’t get these benefitsunless all the trades, engineers and architects work together to make designdecisions. You don’t just tack on a new feature; you have to do an integrateddesign process.

 

Industry Collaborations

There are a number of situations where members of an industry need tocollaborate. For example, a number of companies in the apparel businessworked through Business for Social Responsibility to address sweatshop practicesin developing countries. The Environmental Protection Agency formed theNational Electronics Products Stewardship Initiative (NEPSI) to try to comeup with an industry solution to electronics waste ending up in landfills.(Your monitor probably has six pounds of lead in it.) And AXIS facilitateda multi-stakeholder process called the Unified Green Cleaning Alliance tocome up with standards for sustainable janitorial products.

Obviously, these industry collaborations can be tricky. In the case ofNEPSI, for example, their initial attempt struggled for a host of reasons.EPA set up the process without having a default proposal, something to drivethe companies beyond the status quo; so as long as the parties kept talking,they didn’t have to do anything. Competitive pressures got in the way aswell; some of the most progressive electronics firms resisted an industry-widesolution because they would lose their unique edge. Companies feared theprecedent this project could set, moving the responsibility for waste tomanufacturers. And last, according to some insiders, the process failedfrom not having a facilitator strong enough to manage the group.

The Unified Green Cleaning Alliance avoided many of these pitfalls witha tightly structured facilitation process. The process allowed for broadparticipation from formulators (the companies which mix up cleaning products),purchasers, users, and toxicologists. They were able over several meetingsto come up with a set of criteria they stood behind, despite their differentinterests. (Our next newsletter will describe this case study in more depth.)

 

Supplier workshops

One trend that is growing in the manufacturing sector in particular isthe use of supply chain or supplier workshops. These are meetings wherethe customer invites their first tier suppliers into a dialogue about howto improve the overall process to address quality or environmental concerns.According to a study done by Business for Social Responsibility, waste andinefficiencies across organizational boundaries can be staggering: inefficienciesacross the supply chain can waste up to 25% of a company’s operating costsand a 5% reduction in waste throughout supply chain can double a typicalcompany’s profit margin.

A supplier workshop is most effective when:

  • You represent a significant amount of business for the supplier. (If this is not true, you may need to form a coalition with other customers of the supplier to get their attention.)
  • The supplier’s product relates in some way to your goals for improvement. For example, you may be concerned about toxic chemicals in their subassemblies or their product is contributing to quality problems. Perhaps their packaging is excessive.
  • You purchase all or most of a particular product from one vendor.
  • You have a trusting, collaborative relationship with the vendor.

General Motors, for example, discovered that by requiring their supplierof ignition sets to manufacture different versions for different cars, theyinadvertently had added significant costs for themselves and their supplier.By sitting down with key suppliers, you can often reduce packaging and otherwaste while improving quality. Sometimes the solution is in changing thestructural relationship. A number of automobile manufacturers have changedtheir relationships with chemical companies, for example, by paying Dow
and DuPont to paint their cars instead of buying the paint directly. Now
both parties are encouraged to minimize the use of this hazardous product.

(If you are interested in learning more, please consider ordering the
latest booklet in our Sustainability Series: Partnering with Vendors:
Supplier Workshops for Mutual Gain.
)

 

Community Development

The ultimate multi-stakeholder process involves a host of different organizations
and the public. The projects may vary in purpose:

  • Economic revitalization
  • Urban renewal
  • Environmental mediation
  • Siting a facility (e.g., wind farm, power plant, etc.)
  • Community visioning

One interesting model is an Oregon Solutions Team. As Greg Wolf, who
runs the program through the National Policy Consensus Center explains,an Oregon Solutions Team brings together parties from business, governmentand non-profits to fulfill a need for the community. The convener is appointedby the Governor, a respected but neutral player to bring the parties together.Usually over a period of a few meetings spread out over several months,the parties create a set of commitments and agreements. Their projects havehelped site a windfarm, construct a trail across multiple landowners’ property(public and private), maximize the social benefits from a wetland restorationproject, and create a facility to provide vocational training for disabledadults.

Typical community development projects require a host of different typesof facilitated processes:

  • Community visioning
  • Focus groups
  • Neighborhood tours
  • Design charrettes
  • Workshops
  • Public meetings
  • Citizen committees
  • Development of public displays/kiosks

 

General Tips and Advice

While I’ve described several distinct types of multi-stakeholder processes- ones focused on design, an industry, suppliers or the community — thisis certainly not an exhaustive list. Despite their differences, there areseveral principles they have in common:

Chose the right convener – It matters who calls the meeting. Sometimesyour own organization is the right convener, but at times you may need towork through a non-profit or hire a respected outsider.

Hire an experienced facilitator ­ Without a gifted facilitator,your meetings will be at best inefficient; at worst they will dissolve intoconflict and dissension. Facilitators come from different backgrounds andperspectives so look for someone with the right blend of skills for yourproject.

Get the right people to the table ­ It can take some timeto verify that the right organizations are represented. Then you have tomake sure you have the right people who can speak for their organizations.You don’t want to find yourself in the negotiating game common to car salespeople: “I’ll have to go ask my manager.”

Have a burning platform ­ It’s an old adage of negotiations:if I can win by doing nothing, I’ll do nothing. You need a burning platformto bring people to the table, a reason for them to engage. This may takethe form of a straw proposal, a default decision, or a deadline (i.e., ifyou can’t come to consensus by March 1, we’ll impose a solution). But ensurethat maintaining the status quo isn’t an option.

Take time to build trust ­ In many cases, people will bringstereotypes to the meeting: business people only care about profits; ranchersdon’t care about the land; government employees are lazy; Republicans are____; Democrats are ____. You fill in the blanks. You must allow time forpeople to get to know one another, to understand one another’s needs andperspectives without being judged. Once trust begins to develop, peoplewill open up and innovative solutions will begin to emerge.

 

How do you know if you need a multi-stakeholderprocess?

Obviously, these processes take time and money. So you want to use themwhere you need them most. Answer these questions to see if you uncover anyneeds:

Is there a stakeholdergroup that concerns you? Perhaps they are already speaking out against yourorganization, or perhaps you’re being proactive and want to find out whatthey think before it shows up on the Five-O’Clock News.

Are you workingon a decision or project that will impact the community or be highly visible?Perhaps you are planning to construct a new building, expand your operations,hire ex-cons, make a new product, or move work offshore.

Do you use ordo anything the community might be concerned about-with or without cause?Think about hazardous chemicals, emissions, traffic, safety, noise, laborissues, accidents, emergency planning, etc.

Are you hamperedfrom doing the right thing by structural elements in your industry sector?Would doing the right thing put you at a competitive disadvantage? Do youwish certain relationships between organizations or sectors could be different?

Is there somethingabout your major suppliers that is inhibiting your performance? Perhapstheir costs seem high or their packaging leaves you a dumpster-full. Maybethere are quality or environmental issues you’d like to iron out.

Are you missingkey pieces of knowledge? Do you need the expertise of your suppliers, governmentalagencies or NGO’s. Do you not know what the community or other stakeholdersthink?

Are you not theright voice on this topic? Do you need the credibility of a non-profit toback up what you say? Do you need a consortium of other organizations toget others to listen? Do you need someone else to convene a group to solvea problem?

Is the problemcomplex, affecting and affected by a number of different players?

If you answered yes to any of these questions, a multi-stakeholder processmight be useful. Feel free to call us to explore how your issue might beaddressed through a multi-stakeholder process.


Two New Sustainability Seriestm booklets

How-to Booklets that Show You theWay

For information on the whole series, go to www.pacifier.com/~axis/publications.html and click on “booklets.”

 

Forming and Facilitating Sustainability Teams — Sustainabilityusually requires working with people from across the organization, or sometimeseven people outside the organization. These teams may include steering committeesto oversee the whole effort or individual task forces/project teams to investigatepromising options. In any case, it is critical to form and facilitate theseteams carefully. A room-full of people represents a sizeable investmentso you don’t want to waste time sorting out confusion or backtracking downdead ends! This booklet provides the principles and practices that willhelp your teams succeed. It includes a toolbox of our favorite facilitatortechniques.

Partnering with Vendors: Supplier Workshops for Mutual Gain — Accordingto research published by Business for Social Responsiblity, inefficienciesacross your supply chain can waste up to 25% of a company’s operating costs.So if you want to engage some of your first tier suppliers in a discussionabout how you might improve your quality, cost, and environmental performance,read this booklet to learn how to conduct these supplier workshops.

Like all books in the series, these are only $10 each plus shipping and handling. If you want to order, just email me at darcy@axisperformance.com. If you want to pay using a credit card (a little more expensive due to service charges from Acteva) go to http://www.acteva.com/go/axis.

 

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