“Our business revenues are directly tied to winning competitive bids,” explains Elizabeth Barry, Chief Sustainability Officer of Marsh & McLennan Companies. “Over the last couple of years an increasing number of our customers are inserting into their bid packages questions that seek documentation of our company’s sustainability commitment.”
Barry’s comments reflect the growth of the green supply chain beyond manufacturing into professional services companies like Marsh & McLennan Companies which provides advice and solutions in risk, strategy and human capital.
The challenge confronting professional services companies is how to reduce an environmental footprint consisting of people in offices. Barry explains, “Our environmental footprint consists of our associates working in office buildings, using their computers and traveling to our clients. Our sustainability challenge is how to lower our environmental impacts to enhance our bid competitiveness without impacting the ability of our talented people to do their jobs.”
This challenge confronts every commercial business. There is an estimated 12 billion sq. ft of commercial space in the United States accounting for 9 percent of total U.S. energy consumption representing $24 billion in annual costs and 19 percent of the nation’s green house gas emissions.
Here are Marsh & McLennan Companies’ best practices for growing its bid competitiveness in response to the increasing number of bids asking sustainability performance questions:
“One of my most important contributions to Marsh & McLennan Companies is to help the company align with our customers’ metrics for measuring sustainability,” Barry explains.
“This entails two key activities. The first is to identify what the customers are measuring. The second is to develop metrics within our operation that align with the sustainability metrics of our customers.”
One outgrowth of this increased focus upon measuring an office’s environmental footprint is the growing use of sub-metering in commercial buildings that house multiple tenants. Marsh & McLennan Companies exemplifies this trend, “The majority of our commercial space is rented. We are actively engaged with the real estate companies we rent from to develop sub-metering that will allow us to measure our consumption of electricity, natural gas and water.” And more and more companies are also exploring questions tied to downsizing of their office space. “We recognize that one of the biggest contributors to our consumption of energy and water is our office square footage. At Marsh & McLennan Companies we continuously work to reduce the square footage of our offices without negatively impacting our ability to meet our customers’ performance expectations.”
“It isn’t enough to follow your customers if your business goal is to be a market leader,” Barry explains. “Market leadership requires being proactive in strategically identifying goals that will create the desired competitive advantage.”
The role of leadership does begin at the top
“At Marsh & McLennan Companies our board of directors has established a subcommittee focused upon corporate responsibility, including environmental sustainability,” Barry explains.
“I submit monthly reports on our sustainability performance to this subcommittee and meet with them twice a year. And our CEO, Brian Duperreault, attends these twice-a-year meetings. Our senior leadership’s focus upon achieving sustainability goals is a key to our company’s success in winning bids that contain sustainability criteria for selecting the winning supplier.”
“We actively seek volunteers among our associates to help the company find and implement green solutions,” Barry explains. “The great news is that we often don’t have to ask. Increasingly, more and more associates want to engage in promoting sustainable behavior.”
A Green Traveler Program is one by-product from Marsh & McLennan Companies’ associate engagement. Associates asked for help figuring out green travel options. The Green Traveler Program provides associates with greener hotel and flight vs. train options.
“Today Marsh & McLennan Companies has green volunteers in most of our 500+ worldwide locations. Many work off hours volunteering their time to make a sustainable difference.”
A major challenge for Marsh & McLennan Companies and most professional firms is the love of paper by associates. “We have a paper reduction campaign. Our goal is to move most of our paper system to digital. In the short term we have mandated the use of double-sided printing and our printers are set to default to black and white type. In terms of going paperless, our associates are engaging in the small steps that will ultimately lead to realizing the goal of being digital. What is helping in this process is the increasing positive feedback from our customers on our associates’ efforts at using paper more efficiently and for our efforts at moving to digital files.”
Focus on the story
“One of Marsh & McLennan Companies’ secret sauces for winning bids is our credible and authentic communications strategy that explains our company’s sustainability commitment, our achievements and future plans,” Barry explains.
“Our ability to tell authentic stories on our efforts in adopting sustainability best practices is a growing key factor along with our price competitiveness and quality of work for winning bids.”
The focus-on-the-story best practice of Marsh & McLennan Companies is an example of the growing awareness among market leaders that a company can grow its brand equity through aligning the brand with the sustainability expectations of their associates, customers and stakeholders. The following are best practices steps for developing a brand aligned with sustainability:
Define Credible Metrics. A credible message demands real numbers. Two steps are involved for harvesting credible data. Step one is for an organization to ask itself the right data questions that link to the metrics definitions of your customers, associates and stakeholders. Step two is to design and execute processes for proactively gathering data in a format that is useful to your associates, customers and stakeholders.
SWOT. The traditional business school Strength, Weakness, Opportunity and Threat analysis (SWOT) creates value placing sustainability metrics into a context of competitive advantages and threats. For example, SWOT analysis-derived questions are driving many CFOs to explore the link between cost competitiveness and the scale of of their companies’ emissions and waste streams. The companion question being asked by COOs and CMOs explores opportunities created by a company’s sustainability strengths. Companies with sustainability strengths are realizing unprecedented revenue growth opportunities offering green solutions to their customers seeking to greening of their operations. And for many companies the most telling SWOT questions envisions scenarios where a more sustainable competitor or product offering endangers an existing firm’s revenues and customer base.
Marketing. The marketing of sustainability requires the same communications expertise and focus as marketing other benefits of a business. Two trends are happening in this space. The first is the explosion in the number of customers and investors reading CSR publications in their evaluation of companies. The second major trend is the engagement of communications, marketing and PR human resources in the crafting of case study sustainability stories that engage customers and stakeholders. Business is still a personal process heavily dependent upon examples of trust and performance. Case studies are an effective tool in communicating less metrics-driven bid selection criteria like the vision of a company’s leadership or the integrity of company associates. As a result, marketing of case studies profiling real people making a sustainable difference are a growing path for engaging customers, associates and stakeholders at a level of human connection that numbers never achieve.
Build Brand Equity. Brand marketing and the pursuit of brand equity is now being realized by companies that are successfully aligning with the growing search among consumers for authenticity, transparency and sustainability in what they buy and who they buy from.
“For Marsh & McLennan Companies our brand equity is being further strengthened with our customers and associates beyond our core price competitiveness and quality of work as we demonstrate our sustainability values through our increasingly metric-based CSR reporting and our outreach through our stories of achieving sustainable results,” explains Barry. “It is our secret sauce for winning competitive bids with the growing number of customers seeking to green their supply chain.”
Bill Roth is the founder of Earth 2017. He is the author of The Secret Green Sauce that profiles business case studies on best practices for making money going green. He is the Green Business Coach for the U.S. Hispanic Chamber of Commerce Foundation’s Green Builds Business Program sponsored by Walmart that is coaching hundreds of small business owners on best practices for making money and a difference.