Sunday, January 14, 2007

On Excess, Efficiency & the Environment

It is true what Starbucks says about itself: it is not about the coffee, it is about the people. While this makes a very good business model, and it creates loyal customers and loyal employees (not to mention that Starbucks doesn't show any signs of stopping expansion), it is also a business that creates a great deal of excess and waste.

Many companies create products that people buy because they feel it is worth it to them, but the seller usually creates wasteful by-products. Starbucks is a famous example, because of the number of paper cups it hands out every day. According to NPR in 2005, over 150 billion cups are discarded every year.

The question that I have about Starbucks is why all the paper cups? It takes a lot of energy, limited resources, and money to create a paper cup. When I went to Montreal, Canada, I noticed that coffees are automatically served in glasses and mugs
first before they are served in a paper cup.

On a similar note, in regards to plastic, Ireland recently posed a tax of 15 cents per plastic bag in grocery stores. The implication behind this initiative is that people must pay a tangible cost to compensate for highly limited natural resources.

The bottom line is: Companies, governments and organizations have to change the way they do business. We see that it is possible in other countries, so why not in the US? While many companies claim that they are "socially responsible," it seems that they should not just change the way they produce their products, but they must change the model of the company.

Of course, organizational behavior theory teaches us that this is not so easy to do, because often times, the secret success of a business is embedded in the company culture that has developed. (Think Toyota and competitors' difficulty in imitating Toyota standards).

Even so, many Americans live under the illusion of being rich. We are a nation of debt but contrary to economic law, we continue to spend money. We cannot continue to think that our resources are unlimited. A serious cultural change must be made. Companies need to change their approach towards business to consider the limitations of other resources besides money.