Enter eco-innovation, the way forward in effective innovation

Thursday, 26 February 2015 00:15 - - {{hitsCtrl.values.hits}}

For some time, one word that has done many rounds has been the term ‘innovation’. It is a concept held almost in reverence when seeking growth these days. Today economies try to align innovation policies to their development pathways. Formulating national innovation policies and setting up national innovation ecosystems are vibrant activities that policymakers engage in across countries. We in Sri Lanka are yet to see much activity and enthusiasm in this area and lack of any momentum in this area is definitely to our disadvantage. Innovation refers to creating value through doing something in a novel way. One can test perhaps one’s understanding of our nation’s innovativeness. Test yourself. How many novel economic value-adding activities can we identify in line with the stated definition that has taken place in the last few years? This self-test is important in identifying the current situation. Ideas and enabling environments To perform an activity in a novel way, initially ideas are important – in fact many ideas are important. An environment to carry out ideas is equally important. If action is stifled, ideation stops as well after a while. Institutional environments that nurture such behaviour is identified when one hears that one can spend 10% of one’s time or in some places even 20% of one’s time in any area that one likes. Enabling ‘blue sky work’ has brought in success and fame to such companies. There is a world of a difference when in an organisation you are sent from pillar to post in search of a simple answer because that is what an obscure procedure dictates to an organisation. In these organisations, circulars and procedures stay supreme and the function of a certain group of people is purely to interpret and implement. Tying a person to get 100% of his time may mean finally realising of about 10% real input. Fresh perspectives and initiatives are taboo. In economies with such organisations, productivity plummets, resource consumption escalates and economies can only suffer. Importance of eco-innovation Can innovations always be beneficial and productive? Innovations by definition can add value yet on the issue of sustainability the definition is silent. Innovations can indeed adversely affect sustainability. SUVs may be a welcome innovation from the view point of an automobile enthusiast. Yet we know the resource consumption pattern of such vehicles. When product innovation is valued, we may ignore lifecycle costs and implications. When an innovation leads to the consumption of more resources, there is definitely a negative impact on long-term sustainability. This realisation has led to the concept of eco-innovation. Eco-innovation is the development and application of a business model, shaped by a new business strategy, which incorporates sustainability throughout all business operations based on lifecycle thinking and in cooperation with partners across the value chain. Lifecycle thinking means considering in detail all phases of the product lifecycle, from extraction of raw materials through material processing, manufacturing and fabrication, distribution, use, repair and maintenance to final disposal or reuse. It is clearly seen the scope for evaluating an eco-innovation model. It is much more holistic and comprehensive. To gain recognition as an eco-innovative process, definite resource efficiency has to be proven across the value chain in a systematic way. Eco-innovation having sustainability embedded provides a win-win solution to improving economic competitiveness and sustainability at business level.

The business centric concept means that when business strategies gravitate to embrace eco-innovation, there is momentum for societies to shift into a more sustainable pathway. Quest for sustainability The quest for sustainability has driven organisations to innovate on paths to realise sustainability too. UNEP (United Nation’s Environment Program) which drives the eco-innovation program identifies five drivers for eco-innovation, namely, access new and emerging markets, increase profitability along the value chain, stay ahead of standards and regulation, attract investment and increase productivity and technical capacity. Thus, to businesses, eco-innovation is a new business strategy. As noted with drivers, businesses do want to realise profits and expansion but they would now have to achieve the same objectives now through more sustainability principled means. UNEP argues for the strength of these five drivers in prompting businesses to change strategy. Ice cream in Ceylon Today and definitely in days gone by doing things was admired and certainly resource limitations were of no concern. Classical economics never had this constraint. Consider the interesting statement of a sailor who visited Colombo in the 19th century. A crew member, Karl V. Scherzer, of the Austrian frigate Novara which circumnavigated the globe visited Colombo and he wrote his memoirs in 1864. He refers to observing the availability of ice for sale: “During our peregrinations through the streets of what they call the Fort, it was in Chatham Street, the most popular part of Colombo with the most important and most elegant shops, where we saw a confectioner offering ice for sale, a surprising sight in a city so close to the equator that displays only little luxury in other respects.” What is interesting is that this ice cream had been shipped from Boston in the United States via the Cape of Good Hope to then Ceylon. He records that the confectioner had been selling an estimated 1,000 pounds of water-ice and ice cream by weight each day. He had expressed the following: One cannot but be seized by a feeling of admiration for the enterprising Yankee people, who transport even such a liquid and perishable article as ice cream over thousands of miles and still being able to sell it at a profit. Note the admiration Karl had for the US traders over their feat. With our acceptance of such a product, we have increased trade for US as well as driven growth in that faraway land. Pity that the process aspects are not covered in his memoirs! Desiccated coconut Again, the British introduced desiccated coconut and Sri Lanka had the world’s first factory for desiccated coconut. The British opted for desiccated coconut because they did not want to spend money and effort transporting water across continents when only the coconut was needed. The birth of the desiccated process is an innovation and could count for eco-innovation too for implementing a process innovation in the value chain. The British had evaluated the value chain and interjected the step of desiccation as a way forward in building a product stripped of the unwanted components. The former – bringing ice cream across thousands of kilometres – though enterprisingly interesting is resource intensive. However, in those days with much less billions on the planet, there were less constraints on action. Today, with increasing population and the planet under increasing pressure, the means do count. An interesting observation that can be made is removal of water for preservation had been introduced in late 1860s to Sri Lanka. However, even today we appear to struggle in this area with fruits and vegetables when reducing moisture content, i.e. dehydration, is a desired action. An indication of our poor process innovation capabilities. Eco-innovation prompts A list of ideas and concepts that can be taken as eco-innovation prompts are presented in the figure. Each of these prompts can be looked into in with some detail to study the implementation feasibility. An innovative step is in order to build the concept into the fabric of the business. The European Union has placed an eco-innovation observatory in place to monitor and report on business strategy transformations. The information provided therein is excellent resource material to us as well. This suggests that today eco-innovation is the new imperative and may be stated as the necessary revolution for today’s business growth. Our businesses waking from a slumber as far as innovation is concerned now should embrace this concept of eco-innovation in moving forward. The cumulative efforts created would result in a resource efficient environment in the country and should also pave the way for green economy transition. The will to change course after Rio+20 may not have been there but eco-innovation has appeared as a logical tool in enabling the transformation. [The writer is Professor of Chemical and Process Engineering at the University of Moratuwa, Sri Lanka. With an initial BSc Chemical engineering Honours degree from Moratuwa, he proceeded to the University of Cambridge for his PhD. He is the Project Director of COSTI (Coordinating Secretariat for Science, Technology and Innovation), which is a newly established State entity with the mandate of coordinating and monitoring scientific affairs. He can be reached via email on [email protected].]