Managing a Business in a Major Catastrophe - Term Paper Example

Business Sustainability Market characteristics are rapidly changing with the changes in social and economic factors. These effects directly influence the existence of businesses. For instance, many companies keep recycling raw materials with a view of creating a sustainable business-operating environment. Business practice looks at profit as a measure of business viability (Rainey, 2006:215). However, viability of a business depends on a number of factors that include business identity, survival, system, and brand. Balancing the above factors enables a business to create sustainable working environment. Survival of a company largely, depends on strategies that it develops. Sustainable business approach does not only address how the firm will increase its profit margin, but also addresses planet and people. The only viable future for business is to become a sustainable business in a sustainable society. The future of a business depends on sustainable approaches that it adopts. This concept is quite broad thereby necessitating critical structures that would handle the business towards achieving its goals. This paper will address the following core concepts. The first section will address economic viability of a business that focuses on modalities of creating profit. Ethical viability will focus on the business and its influence in the environment. Social viability will address manageability, system viability, and sustainability. The second section of the paper will address the concept of business sustainability. Sustainability has broad concept that include resource consumption, social mandate, political support, environmental impact, and image. Analysts contend that the definition of viability with respect to business is the ability to survive (Sarkis, et.al. 2010:104). Many entrepreneurs peg viability to profit margin. The projection within the working environment should indicate that the organization would be able to make some profit. Entrepreneur’s expectation is that their businesses will be able to pick up and justify their investment by generating profit. When the business projects its viability into the future the situation would create sustainability. Sustainability means the ability of the business to remain viable into the future. Sustainable activities of the business would not only look at economic viability, but also the environment. Economic viability A business that intends to be viable in the future has to operate within ethical and socially acceptable manner. The idea behind such operations looks at the interest of the consumer with respect to company products. Consumer behaviors influence the profit margin of a firm. It means that the business must produce products that address needs of the consumers without harm or exploitation. When a form engages in a business that depletes the resources with the environment, the survival of the business would be at stake because it would not be able to generate products in the market (Richards, 2009:175). A firm that does not demonstrate sustainable methods of operation does not respect the ethical measures within the society. For instance, business operation has to create a room for the consumers to buy similar product in the future. What would be the condition of the market condition in an event of product depletion? The outcome of the market condition would be economically dead. Thus, economic viability of the business addresses the issues of continuity. Business, which gets huge profit margin for a short term, would not be economically viable because it does not have the capacity to survive in the future. Entrepreneurs evaluate conditions of market or the environment where they intend to create their enterprises. Economic viability as a consideration would address the following factors accessibility of raw materials, costs associated with business operation, government policies, effects to the environment and future development among other factors (Richards, 2009:174). Practices, which influence the future of the organization, would dictate business strategies. Ethical Viability Concern about the effects of the business products to society influences sustainability (Carroll, & Buchholtz, 2011:448). For instance, when a company manufactures goods that have health risks to the society, the future of the society would be at stake. For instance, asbestos manufacturing company has to devise methods that would enable its products to be safe for consumptions. Workers in the company as wells as the community around the industry must have some assurance about their survival. A consumer is a crucial factor in business because they influence the existence of a business. Subjecting consumers to unethical standards would mean that the business would be heading to doom. Government would not allow blatant violation of societal rules. Shareholders are aware that unethical conduct of the firm would adversely affect the growth of the organization. This would mean that the business must observe set standards in the market when it intends to be viable in the future. Environment is very crucial for a given business because it directly influence consumer behavior. For example, the current environmental changes have influenced production. Industries emit waste into the atmosphere that interferes with climatic conditions. Stakeholders have noted that environmental changes have adverse effects to business. For instance, change of environmental conditions has influenced consumer industries, which derived their raw materials from climatically influenced activities such as agriculture. Agricultural production declined following adverse climatic conditions thereby influencing the strategies developed by firms. The challenge that such conditions pose to business sustainability is that raw materials derived from climatically controlled conditions delay productions. The conditions revealed by change in climate have necessitated operations that aim at protecting the needs of the consumers and the society (Richards, 2009:136). A change in environmental condition would instigate a change in price of a product because of the cost incurred in its production. However, the rise in cost must demonstrate concern for greater society. Enabling business environment offer services for the community as well as reward to shareholders. The stakeholders and consumers are essential parties that determine the market operation system of a business. Firms that uphold the interest for the community would devise strategies that seek to serve the society for long period. Environment viability Entrepreneurs chose environment that they feel would sustain the existence of the firm. The choice of a viable environment for the business depends the capacity of a given business environment to support operations of the business. Threats in a business environment would dictate business performance. Threats with a given business environment fall under the following groups: random, clustered, and intelligent. Leaders of a business would evaluate business threats and devise opportunities that would turn threats to be advantageous to the operation of the firm. For instance, threats associated with depletion of raw materials necessitate the firm to explore ways of recycling raw materials. Such strategic approaches of handling problems would enable the firm to remain viable in the environment. Consistence of a business operation depends on the activities that dictate the existence (Everard, 2009:163). In most cases, a business would evaluate the needs of consumers in relation to customer behavior. Demographic growth means that business must expand their production to suite the needs of the consumers. Expanding market calls for strategies that would offer constant production of services. However, resource production for business consumption would depend with the activity within the society that necessitates the production of the raw material. Sometimes a business may decide to introduce new products in the market with a view of sustaining the business. For example, low energy consuming vehicles came into the market because of the need of sustaining the production of motor vehicles that depend on the availability of fuel (Carroll, & Buchholtz, 2011:448). It means that depletion of raw material for fuel production would affect the sale of motor vehicles. The influence, which the above condition inflicts into the environment, necessitates action that aim at protecting the future of the business. Social viability Social influences determine the nature of operation that is applicable in a given environment. Some businesses operate in an environment that is exclusive from risks. It is important for layers in the market to offer services or goods are socially viable. That is, the products introduced by the firm have the ability to attract or fulfill the interest of the society without creating implications (Fernando, 2011:132). For instance, increasing prices of a product has social implication because the action would influence the value of money. The choice that a business must make has to evaluate social concerns with respect to consumer behavior. Sometimes, a business might not be able to create factors that would promote social interest. Such choices would limit the life of a business thereby influencing service delivery to the greater community. Sustainability The definition for sustainability focus on the interest of the future as well as addressing factors that the society needs today. The future generation requires resources that the current generation consumes (Veryard Projects and Antelope Project. 2005: 6). The idea behind sustainability is to create an environment that would create a balance among the following issues economic viability, social justice and ecosystem viability (Carroll & Buchholtz, 2011:450). In the above sense, sustainability would not be limited to limiting waste but also creating abundance that inspires business creativity. The move to a sustainable future would influence business to create new methods of doping business. The fear that many entrepreneurs harbor is the fear of failure. Analysts contend that economic viability of business is a function of various factors that influences future expectation of a business (Fernando, 2011:134). For example, the future of crop processing company depends on the future expectation as defined by ecological outcomes. The need to protect the future of the business would influence the leaders of the firm to create ways that would ensure that environmental factors sustain crop productions (Everard, 2009:162). Failure by the business to initiate measures, which sustain production of the crops, would directly translate into failure of the business economic viability. The profit margin that the business would be making in an environment where raw material is stable would be different from unstable environment. How to develop business sustainability Stakeholders have identified sustainable development as a driver that dictates the economy. It means that a business must develop and adopts sustainable strategy before choosing innovation. In contrast, many companies make first consideration before innovation to be economic viability. This choice limits the ability of the business in the future market. A sustainable strategy would create sustainable system of transition (Rachelbacher, et.al. 2008:103). Consideration about the immediate society and economic trends would influence the sustainable system adopted by the firm. The process of business sustainability dictates that a firm has to evaluate risks and opportunities that a firm is susceptible to meet. The economic consequence of a choice that the company would be making should not restrict the operation to of the firm to resent time, but also should have an element of the future. Profitability of an option taken by a business is very essential; however, it should not limit innovation of sustainable programs. The future strength of any business depends on the current economic strength (Institute of Chartered Accountants. 2005:13). In essence, the idea floated into the business must strengthen the business goals in relation to present activities and future activities. The entire firm should dedicate their abilities towards initiating the process of sustainable business. It is critical that staff decision form part of greater ambition of the business (Thomson, 2005:12). Ideally, research on better ways of responding to emergent issues such as economic crisis, depletion of raw materials and climate change among other issues should not act as a threat to business existence but should be part of opportunities that the business intend to exploit. For instance, the innovation that led to solar energy was a sustainable approach that companies developed to respond to threat of fossil fuel depletion. Business can transform a threat into an opportunity by devising better methods of solving the threat (Deloitte, 2009:7). The scope of business sustainability would influence the approach that the firm would take while making decision. For instance, when a firm intends to remain viable in the market for the next twenty years, it would evaluate costs it incurs in generating new products verses the costs of recycling used products. The assessment would enable the business to settle on an option that does not eliminate the business from existing but it would increase its economic viability. Stakeholders of large firms are aware that the cost of sustainability has adverse effects of the future of their business as opposed to the current conditions (Richards, 2009:145). For instance, a plant that manufactures steel products is aware that when it exhausts its raw material, it would automatically stall. It means that it has to focus of eventuality of non-existence of the raw material. The impact of the above condition would be adverse than the current economic viability of the firm. Handling the condition necessitate an approach which ensure continuity. An ecological factor such as influence to biodiversity is very crucial. For instance, managing industrial waste is very crucial because of the toxins generated from the waste. Failure by the business to eliminate the anticipated effects of the waste might deter the anticipated development that the business intends to create to the society (World Economic Forum. 2009:8). It is against natural justice to generate income at the expense of societal death. For example, exhausting sewage to a water reservoir limits the use of water by the greater community. It means that the option is not viable in the sense that it eliminates further use of the resource. Instead, an alternative approach would create water use for the current generation and further generation. The above condition that was a threat to the society would become an opportunity for the business to exploit. For instance, the above condition would necessitate formation of treatment plants. The new idea is an opportunity for the community for the business and the society because plant would be generating income while serving the needs of the society. Sustainability clusters focus on three major areas that influence the business. The first cluster is people that entail the social cultural benefits that the people would derive from a business existence. The second is the planet that entails resources and ecology. The third is prosperity or the profit that the business desires from a given strategic option. The identified clusters must correlate if the business has to have a sustainable future. It would be difficult for a business to focus on sustainable future when its present economic viability is wanting. On the other hand, ethical and environmental viability must demonstrate that the business concern is not limited to profit but also the societal wellbeing (Callan, 2002:152). In conclusion, business operation in an ever-changing environment requires an approach that addresses the challenges while enhancing business viability. Viability of a business is not a function of profit margin a business is able to command in the market but also, the ability of the business to respond to needs such as poverty, climate change, food crisis, or energy crisis among others. Sustainability of a business refers to ability of the business to respond to current societal demands without influencing the future. The cluster of sustainability includes economic viability, ethical and environmental viability. A prosperous future of the business enhances an environment that does not deplete the current opportunities. Largely, creating sustainable business entails evaluating opportunities and threat of the business and transforming the business threats into opportunities. Bibliography Callan, J. 2002. How to Keep Operating in a Crisis: Managing a Business in a Major Catastrophe. London: Gower Publishing, Ltd. Carroll, B. A. & Buchholtz, K. A. 2011. Business & Society: Ethics, Sustainability, and Stakeholder Management. New Jersey: Cengage Learning. Deloitte.2009. Sustainability in business today: A cross-industry view. Available from http://webserver3.deloitte.com.co/us_es_sustainability_exec_survey_060110.pdf [Accessed 19 April 2012] Ellis, T. 2010. The New Pioneers: Sustainable Business Success Through Social Innovation and Social Entrepreneurship. New Jersey: John Wiley & Sons Everard, M. 2009. The Business of Biodiversity. Brookhaven: WIT Press. Fernando, C. A. 2011. Business Environment. Pearson Education India: New Delhi. Institute of Chartered Accountants. 2005. East of England Business Leaders’ Forum-Proposals for Sustainable Business. Available from http://www.icaew.com/~/media/Files/Technical/Sustainability/business-leaders-forum-proposals-for-sustainable-business.ashx [Accessed on 19 April 2012] Rachelbacher, H. et.al. 2008. Minding Your Business: Profits That Restore the Planet. California: Insight Editions. Rainey, L. D. 2006. Sustainable Business Development: Inventing the Future Through Strategy, Innovation, And Leadership. Cambridge: Cambridge University Press. Richards, J. 2009. Mining, Society, and a Sustainable World. London: Springer. Sarkis, J. et.al. 2010. Facilitating Sustainable Innovation Through Collaboration: A Multi-Stakeholder Perspective. London: Springer. Thomson, A. 2005. Dimensions of Business Viability. Available from http://bestentrepreneur.murdoch.edu.au/Understanding_Dimensions_of_Business_Viability.pdf [Accessed 19 April 2012] Veryard Projects and Antelope Project. 2005. Business and organizations. Available from http://www.users.globalnet.co.uk/~rxv/orgmgt/viability.pdf [Accessed 19 April 2012] World Economic Forum. 2009. Sustainability for Tomorrow’s Consumer. Available from https://members.weforum.org/pdf/ConsumerIndustries/Sustainabilityfullreport.pdf [Accessed 19 April 2012] Read More