Identifying risk and innovation through Sustainable Change
Delivery Assessments
Michael YoungBSc, MBA, IPMA Level A©, CPPD, FAIPM, FAPM,
FAIM, MACS(Snr), MCIPS, CPAdjunct Associate Professor
www.gpm.world
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Who or what is GPM?• Sustainable Project Management Professional
Development Organization • Services in over 145 Countries
• Training through partners (Corp., University, Association)• Certification of individuals (GPM-b™, GPM®, and GPM-m™)• Methodology (PRiSM)• Organizational Sustainability Assessments (PSM3™)• Centre of Excellence• Standards (P5) Walking the Talk
Our
Timeline
A few
Highlights…
2010
Just a laptop and an idea
Launchedcertification system
2013 Became a signatory to the UN Global Compact
Participated in first UN Summit on Sustainable Development
Became Signatory to UN Business for Peace
The GPM Reference Guide to Sustainability in Project Management Published
The GPM-b and GPM-m Certifications are introduced
Received IPMA Achievement Award
Received World HRD Award
Started the University Partner Program
100 Countries Represented 130 Countries Represented 145 Countries
PSM3 Assessment Model Launched
Signed MoU with IPMA and GAPPS
Signed MoU with UNOPS
Attended UN +15 Summit and General Assembly
Attended COP21 at request of UN
A whole lot more
Launched the GPM Sustainability Centre of Excellence
Signed UN Anti-Corruption Call to Action and contributed to the 10th Principal Summit
Launched Sustainable Agile Training
Launched Sustainable PRINCE2 and MoU with APMG
Published the GPM P5 Standard for Sustainability in Project Management (English, Spanish, Dutch, Mandarin)
Regional OfficesEstablished
PRiSM MethodologyEstablished
Training Programs Established
Awards Program Launched
2011 20122009 2013 2014 2015
Where GPM operates
The P5™ Standard for Sustainability in Project Management
So what’s the problem?
Source: Antonio Nieto-Rodriguez (2012): The Focused Organization, Gower, London
Impacts Across the Value Chain
Raw materials Suppliers Inbound Logistics
Company Operations Distribution Product
UseProduct
End of Life
Increasing Positive Impact
Minimizing Negative Impact
What’s at risk?
Source: http://www.mckinsey.com/insights/consumer_and_retail/getting_the_most_out_of_your_sustainability_program
Research Shows that the value from sustainability challenges is substantial
Challenge Example
Regulation/Reputation
Rising operating costs
Supply-chain disruption
• Restricted license to operate• Reputational damage based on perceived
misuse of resources
• Raw-material costs driven up by supply/demand• True cost of water or carbon reflected in prices
• Production delay or cancellation due to lack of access
• Especially significant for local resources – water, power
Potential Impact % *EBITDA
70
60
25
*Earnings, interest, taxes, depreciation, and amortization
Brand and reputation damageDamage to reputation/brand is the top risk facing organisations in 2015
AON Global Risk Management Survey
It takes 20 years to build a reputation and 5 minutes to destroy it Warren Buffett
Once reputation damage has occurred, it can take the share price at least two years to recover the lost value.
Georgia Tech study
• The industry sector is exposed to a number of unknown or unidentified social, environmental and economic risks, often in the supply chain, which can have a significant impact of brand image and reputation
The high profile supply chain failures of recent times have inflicted heavy reputational damage on some leading global brands , and investors want to insure against such a risk
ACCSR Whitepaper: First five steps to a sustainable supply chain
How would the following disclosures about a prospective investment affect your investment decisions?
12%
15%
73%
15%
12%
73%
Risk or history of poor Environmental Performance.
2014 2015
Reconsider Investment No Chance in investment Plan Rule out immediately
How would the following disclosures about a prospective investment affect your investment decisions?
12%
14%
75%
9%
15%
76%
Risk in supply chain not addressed
2014 2015
Reconsider Investment No Chance in investment Plan Rule out immediately
How would the following disclosures about a prospective investment affect your investment decisions?
22%
24%54%
19%
18%63%
Human rights risk from operations
2014 2015
Reconsider Investment No Chance in investment Plan Rule out immediately
Changing mindsets and expectationsEmployment • A recent survey of more than 3,700 students at top business schools showed
nearly half would chose a lower salary if it meant working for a company with better environmental environmental practices.
• About 20% also said they would not work for a company with bad environmental practices despite what the salary was.
Products• 87% of consumers in the United States believe that companies should value the
interests of society at least as much as strict business interests.• Millennials are twice as likely to buy from brands with good management of
environmental and social issues, and twice as likely to check product packaging for sustainability performance.
Source: Yale University, World Business Council for Sustainable Development and the Global Network for Advanced Management survey, 2015
Executives Speak Up
77%
Action on climate change is an urgent priority for my business
Climate change will create opportunities for growth and innovation for my company in the next 3 - 5 years
80%
Data based on survey of 75 CEOs of Caring for Climate participant companies; data represents proportion of respondents selecting “agree” and “strongly agree”.
62%
CEOs believe they can not quantify the value or their sustainability initiatives
CSR projects are not delivering value
• Companies are hampered by poor coordination and a lack of logic connecting their various programs
• CSR programs are often initiated and run in an uncoordinated way by a variety of internal managers
• Best-practices companies operate CSR programs that are aligned with:• the companies’ business purpose• the values of the companies’ important stakeholders, • the needs of the communities in which the companies operate
Source: https://hbr.org/2015/01/the-truth-about-csr
And the net result…• Shareholder backlash• Increased cost of capital• Lower product sales and reduced consumer demand• Reduction in share price and company valuation (listed company)• Loss of donors, sponsors and supporters (not for profit)• Damaged brand and reputation• Missed opportunities to save costs
As the CEO, do you want this to happen on your watch?
Sustainable Change Delivery
• Aims to maximize the social, economic and environmental value that the change initiative’s investment objectives or resulting asset brings.
• It also aims to minimize negative impact (economic social and environmental) from the method and technique.
RISK
Capi
tal B
enefi
ts
Bran
d
Opp
ortu
nity
Costs
Threats
Rumors /
Green washing
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Sustainable Change Delivery Assessments• Projects are vehicles for change – much easier
to implement sustainability through projects• Using the urgency or driver of organizational
change
• GPM with PSM3 raises awareness of:• what sustainability is, • what areas of sustainability are important and should be
focused on, • where they believe they are in these key areas, and• where they should invest limited time, capital and
resources• Identify key sustainability risks in the value chain
What is PSM3?
ProjectsProduct Impacts
Objectives & Efforts | Lifespan & ServicingProcess ImpactsMaturity and Efficiency
Society(People)
Environmental(Planet)
Economic(Profit)
Labor Practices & Decent Work
Society and Customers Human Rights Ethical Behavior Transport Energy Water Waste
Return on Investment Business Agility Economic
Stimulation
Employment
Labor/Management
Relations
Health and Safety
Training andEducation
OrganizationalLearning
Diversity andEqual
Opportunity
TrainedProfessionalEmigration
CommunitySupport
Job/Unemployment
Public Policy/Compliance
Customer Healthand Safety
MarketCommunicationsand Advertising
Customer Privacy
Cultural Impact
Non-Discrimination
Freedom ofAssociation
Child Labor
Forced orCompulsory
Labor
Investment and
ProcurementPractices
Bribery andCorruption
Anti-Competitive
Behavior
DigitalCommunicati
on
Traveling
Transport
Energy Used
Clean EnergyReturn
Renewable Energy
Water Quality
WaterConsumption
WaterDisplacement
RecyclingPractices
End of life disposal/
reusability
Waste Disposal
Co2 emissions
Air Quality
Noise Pollution
Good Neighbor
Benefit CostRatio
Direct FinancialBenefits
Sustainable Return on
Investment
Net PresentValue
Flexibility/Optionality
in theproject
IncreasedBusinessFlexibility
Local Economic Impact
Sustainable Profitability
/Indirect Benefits
The GPM® P5™ StandardFor Sustainable Project Management
With Portfolio inclusions
Materials and Procurement
Materials used by
weight or volume
Recycled input
Materials
Sustainable Procurement
Practices
PortfoliosBusiness Case Management
Organizational Commitment & Usage | Standards & Competence | Continuous Improvement
We assess a
gainst
Some of the Sustainability Standards we Map to
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A Different Approach to Assessments• Focus on raising awareness and education and providing a model to
understand, prioritize and strategize• Focus on assessments not audits• Systems and discipline focused (not process or standards focused)• Tailorable context specific model• Capability maturity grid
• Providing a tailorable assessment framework• Allowing for appreciative inquiry as opposed to a problem focused
approach• A unique element / question ranking system• Avoiding misusing ordinal scales
A Tailorable Context Specific Codel
• Different cultures, countries, industries and organizations have different areas of focus and priority
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Is required for sustainability
Environment(Planet)
Transport
Local Procurement
Digital Communication
Traveling
Transport
Energy
Materials
Energy Used
Emission / Co2 from Energy
Used
Clean Energy Return
Water
Water Quality
Water Consumption
Water Displacement
Waste
Recycling
Disposal
Reusability
Incorporated Energy
Waste
Category
Sub-Category
Elements or Questions
A Tailorable Context Specific Model
The analysis and reporting is tailored to each organizations goals, objectives and priorities
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Is required for sustainability Takes into account Different cultures, countries, industries as organizations have different areas of focus and priority
Outcome Analysis = Materiality
Organization
Supply Chain
Stakeholders
0 5 10 15 20 25 30
Organizational Goal - Social
012345NA
Organization
Supply Chain
Stakeholders
0 5 10 15 20 25 30
Facilitated Review Social
012345NA
Organization
Supply Chain
Stakeholders
0 10 20 30 40 50 60 70
Organizational Goal - Environmental
123456Series7
Organization
Supply Chain
Stakeholders
0 5 10 15 20 25 30 35 40 45
Facilitated Review - Environmental
123456Series7
Organization
Supply Chain
Stakeholders
0 2 4 6 8 10 12
Organizational Goal - Economic
012345NA
Organization
Supply Chain
Stakeholders
0 2 4 6 8 10 12
Facilitated Review - Economic
012345NA
30
32 410 5Undefined
Zero sustainability practices in place and is at high risk. Ignores environmental and social regulations.
ProvisionalHas Ad-hoc sustainability policies and practices in place with little consistency.
FoundationalManages liability and adheres to all labor, health & safety, and environmental regulations
EssentialMakes proactive efforts to improve profitability by becoming eco-friendly.
OptimizedAligns corporate principles and values towards a sustainable model. Seeks out opportunities to improve products and services
PrincipledBases decisions on value creation to improve society and the environment through their products and services.
Assessment Ranking is less “Subjective”A unique model for evaluation
Outcomes that provide valuePeople: Labour practices & decent work
People: Society & Customers
People: Human Rights
People: Ethical behaviour
Planet: Transport
Planet: Energy
Planet: Water
Planet: Waste
Planet: Materials & Procurement
Profit: Sustainable Return on Investment
Profit: Business Agility
Profit: Economic StimulationProfit: Business Case Management
Practice: Governance
Practice: Leadership
Practice: Portfolio Management
Practice: Asset Lifecycle Focus
Practice: Value Management
Practice: Benefits Management
Practice: Risk Management
Practice: Stakeholder Engagement
Practice: Change Management
Practice: Processes
-1
0
1
2
3
4
5
Organizational Goal
Facilitated Review
GPM Review
Outcomes for:• Your Organization (Operations and Change)• Your Supply Chain• Your Distributors, Customers and Society
Why?• GPM’s core values lie in the balance of where sustainability and project management converge
• Project management is the leading approach to implementation that delivers measurable results.
• As change agents, project managers have a unique opportunity to deliver economic and environmental results for societies.
• For too long the focus of sustainability has been solely on ‘operations’. For too long projects we have delivered have largely focused only on delivering profits without considering the environment or the impact on society.
• Sustainability without project management is nothing but a good idea that talked about but is never translated into tangible results.
• Project management without considering sustainability misses an opportunity and also shirks our ethical obligations by minimizing our impacts, which will felt the greatest by our children and their children.
• Sustainable project management is the space where we do our best work and where we believe the can make the greatest change. So when we incorporate sustainability and project management we deliver benefits to the CEO, shareholders, investors and also positively impact the environment, societies without compromising profits.
• It comes as no surprise that sustainable project management is the number one emerging trend in project management.
• “It has now been proved repeatedly across different industries and market segments, that sustainability initiatives can act as strong differentiating platforms for organizations” (Harvard Business Review)
Engagement plans Bronze Silver Gold Platinum
Discovery session Self-assessment review Assessment plan On-site 2-day PSM3 assessment High-level report on PSM outcomes
Full diagnostic report Risk assessment CSR Program evaluation Detailed Action Plan Full organisational audit to identify evidence that validates PSM3 results
Development of a GRI-Compliant reporting framework
Corporate university training program for staff
Next Steps1. Complete a self-assessment
2. Select the engagement plan
3. Lock in a date to start
EssenceGives you, the CEO, piece of mind, protects corporate value and differentiates your business from your competitors.
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Thank you!
www.greenprojectmanagement.org
http://blog.greenprojectmanagement.org/
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