Coconuts- Eat The Meat, Use The Shell

Coconuts are a superfood when its comes to physical activity- coconut water for example, has all the essential electrolytes your body needs to keep nerves firing and muscles moving. One cup of cocunut water has more potassium than a banana, 15 times more electrolytes than most sports drinks, and also prevents cramping, promote recovery, and re-hydrates the body. Coconut shells are usually discarded, but they are now being used in exercise clothing. Recycled coconut shells are roasted, turning them into activated carbon and they are then combined with polyester fibers to enhance their performance properties. The result: a greener, softer, quick-drying apparel that provides both UV and odour protection.

Drink Your Coffee, Wear Your Coffee

A cup of coffee before my workout definitely gives me the energy boost I need- in fact a new study suggest that caffeine also kills some of the pain of athletic exertion. Now coffee has another use- the usually wasted ground coffee beans are being infused into the thread of fabrics.  The Coffee grounds are perfect for sports apparel because they control moisture, absorb odour, and are most often concentrated in sports bra’s cups.

Wearable Corn- Grill It, Wear It

Freshly picked corn-on-the-cob is often synonymous with summer- loaded with many essential nutrients including dietary fibre and vitamin C, corn is a summertime BBQ staple. Corn however, is not only great on the grill- it is now being used in exercise clothing. Using corn in fabric is not only environmentally friendly but the fibres wick away sweat and increase sun protection. Also, as your body temperature rises, the fibres let in cool air and post work-out they retain heat.

These active ingrediants are good for you and the environment too.

The supply chain for products we use is something that has undergone rigorous analysis and innovations that have resulted in improved efficiencies, but what about the “removal chain”?  Could a better understanding of what happens to products after we use them promote behavioral change and encourage people to make more sustainable decisions about what they consume and how it affects the world around them?

A team of researchers from MIT SENSEable City Lab (http://senseable.mit.edu/) recently embarked on a major project called Trash Track, which aims to get people thinking about what they throw away and how it impacts the environment. Like an urban equivalent of nuclear medicine–where a tracer is injected and followed through the human body, the project uses custom-designed electronic tags to track different types of waste on their final journeys through the disposal systems of New York and Seattle. Waste Management and Qualcomm funded the study.

The project’s objective is to reveal the disposal process of everyday objects and highlight potential inefficiencies in the recycling and sanitation systems. In mid-July, Trash Track enlisted volunteers in New York and Seattle, who allowed 3000 pieces of their trash to be electronically tagged with special wireless markers or “trash tags”. Working with Waste Management, the SENSEable City Lab team is monitoring the path of trash in real-time using the tags, which report data to a central server at MIT, where it is processed and visualized into dynamic maps showing a slice of the city’s waste stream.

Trash Track was initially inspired by the Green NYC Initiative, the goal of which is to increase the rate of waste recycling in New York to almost 100% by 2030. Currently only about 30% of the city’s waste is diverted from landfills for recycling.

This week, the preliminary results of Trash Track are being unveiled in two new exhibitions in New York and Seattle. For more information, visit http://senseable.mit.edu/trashtalk/index/php

The Social Purchasing Portal is a program whose primary goal is to create social value through the supply chain. They do this primarily through helping those with employment barriers (single mothers, at-risk youth, people with disabilities, etc.) find work with suppliers and then in exchange promoting those suppliers to socially conscious buyers. As we delved deeper into their issues it became apparent that their true problem was sustainability. While their model had proven its ability to have a profound impact on the local community, it was not able to sustain itself in absence of government funding. The issues leading to this lack of sustainability that manifested itself in the following ways:

• Revenue – As mentioned previously, the SPP relies on grants without consistent channels for revenue.
• Resources – There is currently considerable overlap in resources allocation among the local centres. The local managers are spread incredibly thin, helping with placements as well as performing business development for a plethora of vendors.
• Program Engagement – There is little opportunity for the SPP to provide value past the initial transaction. From the buyer perspective, the impact they are making through their purchases is often invisible.
• Service Value – Given the employment practices of the suppliers, buyers are often concerned about quality. In addition, there can be high switching costs to change suppliers on a personal and organizational level.
• Branding – The name Social Purchasing Portal connotes a function quite different from their organizational purpose. In addition, there is considerable variance between the branding of the local SPPs.

Basically, the crux of their problem was that they were excellent at creating partnerships that benefitted the community, but were unable to derive any revenue from the value they were creating. As Patrick observed, their situation was a little bit like setting up two of your best friends, only to see them run fall in love, get married, live happily ever after… and never talk to you again. This became the key insight to drive our solution.

The Social Purchasing Portal was essentially operating as a dating service, but without any membership fees or advertising revenue. They needed a new metaphor. Since they were facilitating transactions, the logical decision was for them to move to a market metaphor.

Revenue
The key to creating a consistent revenue stream for the Social Purchasing Portal is to become a facilitator of transactions, which is something the Internet does quite well (see PayPal, eBay, Craigslist, Amazon). Since the users of the Social Purchasing Portal have opted into the program in the hopes of making a difference, it makes sense to empower them to help rathern than force them to so instead of simply charging transaction fees, which may present a barrier for some buyers, upon registration, all buyers are given the option of donating a percentage of each purchase they make to the SPP, which can be increased or decreased on a transaction to transaction basis during the checkout process.

Additional revenue streams will occur through providing escrow services (which could help mitigate some of the perceived risks) and certifying suppliers who aren’t operating in any of the current centres as well as certifying national-level suppliers (we are recommending the addition of a national business development person to deal with national organizations).

Resources
In addition to consolidating under a singular technical platform, eliminating parallel efforts on behalf of the local development teams, the implementation of the marketplace will remove the burden on the local SPP managers of trying to learn and sell a series of individual suppliers to potential. Instead, they can focus on selling the marketplace.

Program Engagement
In order to keep buyers engaged, reward them and incent them to continue to transact through the SPP, a form of social currency based on community impact was introduced, allowing buyers to track their impact on an ongoing basis and incorporate it into their marketing messaging or CSR programs. In addition, suppliers will be able to update their profile pages and by extension their buyers with the first hand stories of the people that are being impacted by the program. In addition, the platform merchandises the various suppliers and provides a frictionless browsing and search experience.

Branding
The Social Purchasing Portal was open to us taking a stab at developing a new brand that could help unify the organization on a national level and better represent their mission. We felt the brand needed to fulfill four criteria:

• Connote the mission of creating social value
• Communicate competitive prices and quality from the suppliers
• Provide something that can act as a seal for suppliers and buyers to communicate their values and involvement.
• An easily obtainable and memorable URL

With that in mind, our recommendation was Third Win. Ideally, every transaction should be a win-win situation. However, what differentiates the SPP is that the community wins, hence the “Third Win.” Also, thirdwin.com was shockingly available.

Service Value
By incorporating user feedback and supplier ratings, buyers can better evaluate suppliers. In addition, the option of escrow can provide a greater feeling of security. Also, by participating in the program, buyers are able to use the Third Win seal to communicate their values to their customers with a variety of tiers available depending on their achievement based on the social currency.

With these strategies implemented, Third Win will not only have the opportunity to sustain itself, but also to grow and help transform the national business landscape through a mutually beneficial ecosystem.

Moving forward we see several options for future expansion for Third Win:

Broaden the certification system -Currently, suppliers are only evaluated on their hiring practices, there is a great opportunity to create a more multi-faceted ranking system to include environmental factors, community leadership and others to allow buyers to shop not just based on product, but on the impact of the suppliers.

• Consumer purchases – Currently, many of the suppliers already operate in both B2B and B2C contexts, why not invite another segment in to enrich the marketplace?
• Co-operative bulk buying – Often local and socially conscious products and services have difficulty competing due to their lack of scale. However, if the Third Win platform could be leveraged to allow for bulk buying, the competitiveness of businesses could be increased in a radical way.
• Allow buyers to request proposals – This would be a feature that could help attract buyers to the marketplace as well as increase platform engagement with both buyers and suppliers.
• Extend the certification – Given the proposed nature of the Third Win seal, certification could be extended from beyond just companies to products.

Although it might be difficult to establish a clear correlation between the implementation of social standards and profit making, corporations could aim at raising their reputation by implementing social standards, in order to possibly gain profits – or at least not to make losses- from this reputation, at a later point in time.

Let’s be clear there are 2 types of CSR-CSR as marketing tool (British Petroleum) and CSR as part of a business strategy (Patagonia). BP’s marketing campaign, which is all about looking for alternative energy sources, makes the consuming public feel good about purchasing BP products. But if BP had redeployed billions of dollars into environmental investments that yielded no profits, and its stock plummeted, one would certainly expect investor to dump their stocks. And if they don’t invest in alternative energy as they promised on the adv, they will lose credibility with the public, but does it hurt their profits? Is the credibility of an oil company important?

Let’s try to challenge the idea of corporate social responsibility, while it is absolutely reasonable to expect that corporations should be “responsible” such as by creating quality products and marketing them in an ethical manner, ensuring they are trading fairly with their third world suppliers, operating in compliance with laws and regulations and treating minority shareholders and investors fairly. But the notion that the corporation should apply its assets for social purposes, rather than for the profit of its owners, the shareholders, is irresponsible. This is where the challenge is.

B-School 101, a corporation’s goal is to maximize shareholder value return. They can use solar power for the offices or sponsor local charities. But it would be irresponsible for the management of a company, whose stock these investors purchased, to deploy corporate resources for social causes. Here is a litmus test of the market for corporate social responsibility. For example, Nike could sell a pair of sneakers for $90 and another for $120 with the extra $35 goes to promote a cause or provide micro lending etc. This is using the market to decide what’s best. (The problem should that $30 goes to Nike profit instead and $5 goes to a charity?)

If consumers wanted to pay the extra $35, voting with their wallets for a cause they believe in, they could. I don’ think this works. Consumers want to contribute, but want the freedom to decide and want to make it personalize. Otherwise it is called a tax. Consumer wants to have way to decide, socialize and sometimes exhibit their causes, individually and not through corporations. They certainly do not expect the for-profit corporations in which they invest to deploy corporate assets for social causes unless it helps with business performance.

Management’s job is to invest in projects that drive growth, profitability, innovation, and anything else that drives the shareholders’ return. The question is what if a project creates a second or third bottom-lines and as a result slightly reduces ROE? It is not easy to make these calls. I think the line between using CSR as a marketing tool and as part of a business strategy will blur, companies will slowly realize it is absolutely essential for them to practice CSR in order to win the hearts and minds of customers and employees. Making a greener product won’t do the job anymore. They need to apply the 4Ps of People, Planet, Purpose and Profit as the new mantra management.

Image Source: http://www.kenston.k12.oh.us/khs/academics/business/img/harvard-business-school.jpg;

1. It’s just good business to be sustainable Reducing consumption is good for business and good for the environment. Dell is walking the talk with reductions in waste from manufacturing process and packaging. Mattel has reduced unnecessary packaging by redesigning the boxes that toys come in – no longer do they use the little plastic twist ties. Barbie and Ken are held in place by pop out cardboard slits made in the external box.

2. Customers drive requirements
Listening to consumers and solving consumer’s problems came across as the number one priority. Consumers vote for business practice with the dollars they spend. Organizations can use this basic premise to do two things. 1/ Redesign products and services that don’t meet consumer needs from a quality, price and sustainability standpoint. 2/ Look for those needs that are unmet, unarticulated and underserved and solve for x. This is where true consumer innovation takes place.

3. The reduction of risk is a key consideration in any operation – service or manufacturing
77% of Starbucks coffee is procured from free trade sources. While they spend a more for their green coffee, the reduction of supply risk is factored into the business model. Going with a cheaper source doesn’t guarantee translation to the bottom line if there is risk that the source will be cut off. Ben & Jerry’s mission of social and economic justice is well known. They have been a model for sustainability with their cow to cup philosophy. Neither company has sacrificed quality with their practices and as premium brands, can command higher price points from consumers.

Smart companies will find ways to weave sustainability into their operations – inherently lowering cost and delivering consumers economic and experiential value.

Think about some of these statistics presented by Jez Frampton of Interbrand at the opening plenary tonight:

• 95% of consumers say they would consider buying green products
• 25% actually do buy green products
• 45% purposefully don’t

Look at that last statistic. Why would a person choose NOT to buy a product that is better for the environment? Is there intent to destroy our planet? No – I would venture that consumers have been disappointed by green products – they have either performed worse and are more expensive. That is not a sustainable strategy – especially in our bleak economic times. Firms producing products and services must understand that consumers expectations are high. Recycled tissue shouldn’t irritate my nose. Environmentally friendly detergent must clean my clothes as well. It’s just not good enough to slap a “green” label on products and services and expect it to be a differentiator on its own.

To appeal with the masses, sustainable products and services MUST offer the same standards as other products. Quality, performance and price come first – sustainable, green, environmental friendliness are added benefits and eventually, should be a given. The economics of sustainability must align with a consumer’s personal economics and value. Some examples for sustainable experiences include:

1. Cleaning products made from all natural ingredients found in the home (baking soda and vinegar)
2. Small living spaces
3. Local, in season produce
4. Car sharing and car pooling

There are so many ways consumers can choose to be sustainable AND economical. Today, I rented a car to drive down from San Francisco to Monterey. I’d reserved a compact car for cost and fuel efficiency. The person at the counter told me I could get a hybrid car that was slightly larger, more comfortable and give me better the mileage than the compact – all for $4 more. It was a no brainer – the experience value of the hybrid far outweighed that of the compact car.

Sustainability simply must be sustainable economically to gain traction. Green energy must become cheaper, better and more available than fossil fuel energy. Green manufacturing must produce a quality product that rivals non-green product. Green service must be just as good as non-green service. There will always be a segment who can afford to choose sustainability – but to gain momentum with the general populous, the design of sustainable products and service must take into consideration consumer needs and expectations to service demand in a responsible way.

How do we make the 4Ps of working in harmony? People, Planet, Purpose and Profit is rapidly becoming the new mantra of a new generation of managers, they are now challenged as never before to deal with a myriad of issues that go far beyond creating shareholder value. What good is shareholder value when we are selling our future short? What good is shareholder value when there are no jobs? Some argue that outsourcing to some lower cost countries can help a company to make money. When there are no jobs, there won’t be any pension funds to provide capital for these corporations? When we run out of natural resources there won’t be any customer or markets.

The 4Ps are the framework for a more sustainable world. Corporations are beginning to understand the importance of adopting this new “sustainability” business paradigm—one that focuses on creating a better balance between social, environmental and economic factors for short- and long-term performance. Innovation is not creating more products that no one wants or brand extensions that only the brand managers understand. Innovation needs to be about new business models; new partnerships and new social behavior.

Unfortunately, our economic system is not designed that way. How can a “sustainable” business climate ever be possible in a quick return capital driven economic system? Do we continue to reward those who design and manufacture products that only serve the purpose of making money at all costs or laughing at those who design “green” products that are no more than a quick green wash?

We need to start at the shareholders level. Here’s a story. When Jeff Bezos was addressing shareholders in Amazon’s annual shareholder meeting this week, the sustainability issue was raised. They questioned some of Amazon’s business seemed not very eco-friendly. It’s an online retail company that sell products with lots of extra packaging to prevent breakage and it relies on delivery trucks to deliver to people’s homes, but Bezos was well prepared and he was quick to highlight the company’s greener side:

First, he said, consumers will drive a 2,000-pound car to buy a 5-pound item from a brick-and-mortar store. “It’s much more efficient to use a full truck to drop off packages than when everyone does point to point delivery,” he said, noting that delivery trucks use an optimized route.

Second, Amazon’s investment in the Kindle – and it is indeed still in investment phase, he confirmed – is one that could lead to less paper printed later on.

Third, Amazon unveiled “frustration-free” packaging last fall that eliminates the need for dozens of wire ties and hard plastic encasements.

And finally, Amazon has dubbed hundreds of employees as “Earth Kaizens” who identify waste and look for more energy-efficient practices. As a result of the Kazien recommendations, Bezos said, the company eliminated light bulb in its food vending machines company-wide, saving $20,000 per year on energy costs.

Bezos was giving a lot of funny one-liners during the meeting, I’ve seen him doing that in the past. When he was talking about his company’s philosophy versus that of his competitors, he threw out “Advertising is the price you pay for having an unremarkable product or service…” That is a great one.

Sustainability is a wicked problem, with high energy and food prices, the debate about biofuels, water stress, agricultural subsidies, deforestation, and environmental degradation is proving too difficult for anyone to handle. The short-sightedness of governments and big institutions continue to push us down the wrong path.

As for businesses, we need to stop thinking more products. Let’s think better products. Better means products that are socially responsible. It starts with planning, not with marketing. Decisions such as what to make, where and when to make it and where to locate inventory are focused on profit or revenue maximization,, it needs to extend to include carbon emissions and exploring options to educate the customer to participate, even if it means doing more work. I think consumers are happy to do that provided we can put a compelling case together. This is the future of business. As least I hope it is the case.

At Idea Couture, we speak often about consumers’ needs – unarticulated and unmet. These exhibits bring to the front of consciousness these needs in a raw, ‘in your face’ way. Who wouldn’t want the elixirs and cures filled with promises? As I head to Monterey for Sustainability Brands 09, I ponder questions about the human condition and what it will take to satisfy our subconscious, ego and superego in a way that is sustainable.

To check out Flow Market go to http://theflowmarket.com.

Idea Couture’s first book, No One Works Here, suggests a number of new doors that could be opened for old ideas. One of them is Kiva, the micro-lending site that, this year, we discovered was gathering even more steam as bundles of wrapped-up joy under the Christmas tree were increasingly replaced by certificates for pigs purchased and fabric facilitated to assist farmers in Vietnam or seamstresses in Laos.

If you’ve read Dead Aid, Zambian economist Dambisa Moyo’s book on how foreign aid is essentially pimping out Africa, you’ll be familiar with the argument that we need to help people there by lending a hand in developing business opportunities and skills training. Her book makes it very clear that now, more than ever, is the time for tractors, irrigation systems and seeds – not bags of food. That necessity is part of the inspiration behind introducing an innovation intersection for Kiva. In short, the opportunity for the brand is there: take an innovative idea and extend it to meet more needs, more experiences, more social relationships and more financial connections between everyone involved. The idea?

As a portal to connect people through lending for the sake of alleviating poverty, Kiva’s micro-financing model has transformed the way many Third World entrepreneurs do business. For social investors, however, the relationship with these entrepreneurs and the products and services they offer their communities can be disconnected and distant. Presented with a very brief business biography and engaged with entrepreneurs in little more than a quick transaction, few, if any, lenders truly understand the economics of the seamstress in Tajikistan, the lumber delivery woman in Peru or the rice farmer in Laos.

Kiva Tea Gallery bridges this distance between investor and entrepreneur by extending the relationship from lending to spending. Designed to create a greater engagement between the cultivators and consumers of tea as well as a deeper appreciation for its economics and gastronomics, this brand extension connects people across borders through sharing some of the experiences that surround tea and global tea cultures. Indexing the very best of old and new world Japanese architecture, retail experiences initially located in San Francisco, New York and London offer customers a series of curated tea products, services and entrepreneurial opportunities. Through its online interface, Kiva Tea Gallery opens the gateway to new tastes, wellness therapies, social experiences, global stories and business relationships that allow lenders to understand, experience and reap the rewards of their investment.

Case Study: Kiva Textiles
With the boom in DIY and the growing craft movement, Kiva Textiles could be a great addition to a newly revitalized industry. With Kiva, you become familiar with the people who are growing and harvesting your raw materials. What if this was possible for textiles such as fabrics, wool and other fibers? Now someone who sells there wares on a site such as etsy.com or supermarkethq.com could link to information about the person who made their product possible. It could also step back one link, and become a resource for the crafters themselves. Say you were a seamstress, you could link up with specific individuals who could create fabrics and patterns just for you, making it easy to find quality, ethical raw materials. This would result in a much more transparent business model. As a consumer, you would know everything about the product you are buying, start to finish.

The relation of conceptual design and social interaction is an important issue that influences the future of industrial design management. The Social Web has made astonishing progress the last two years, while advanced manufacturing technology emerges in an endless stream. The results are an extensive amount of accessible data that can promote endless new ideas for innovation. The environmental effect and social moral concept of design, the manufacturing place and method of product, the materials, function and usages of product, as well as abandonment and recovery of product, have become the new connotative meanings of conceptual design. This goes beyond traditional product design.

From the design of product into the design of service, the design of material object into the design of virtual product and the design of service into social interactions… a completely new mode of industrial design is emerging. The whole world is moving into the era of accelerated digitalization and extended collaboration. Then, maybe we should be training a new breed of design called “Social” Design? Well, that’s sounds like “Anthropology meets Human Factors”.

There’s a NY Times article on Japanese industrial design guru Naoto Fukasawa. It is an interesting story about his design journey. He is being called a later day Charles Eames and is highly respected in his field. According to Brown, “He is able to interpret the relationship between people and objects in a way that is at some level obvious, yet nuanced and sophisticated. His approach to design isn’t intellectual, it’s human.” This is an interesting one, I find that architects can design great things while striving for an unrealistic level of perfection, yet industrial designers are looking for all the human elements or solving little problems of our lives. And, product development folks just want the coolest features they can add to it. Three very different schools and these are just my personal experience working with some of the best people in the business.

The world of industrial design is a great culture consisting of humanistic spirit, appealing aesthetics, human factors, philosophy, science, human interactions, space and technology. The industrial design culture is a product of this period, stigmatized distinctly with times. It is easy to see that the method and means of industrial design needs to evolve. I propose we stop calling it “Industrial” Design. Let’s use “Sustainable” Design and “Social” Design instead. After all, these names are way cooler.

Image Source: http://farm1.static.flickr.com/182/381627583_64915bfae0.jpg ;http://www.bdonline.co.uk/Pictures/web/u/p/p/Naoto_Fukasawa_for_web.jpg