A Six-Step Approach for Small Businesses

Now that you have a few ideas about how addressing climate change can pay off for your business, let’s look at a step-by-step approach to tackling climate change. For some small businesses, this approach might result in one or more written plan documents. Other businesses might choose a more informal approach, with only certain parts put into writing. The decision is mainly up to your company’s culture and its resources. Whatever the approach, here are the steps to begin designing and implementing a climate change strategy.

Step 1

IDENTIFY CLIMATE CHANGE RISKS AND OPPORTUNITIES

Hundreds of possible risks and opportunities are associated with climate change, even for a small business. So the first step in creating a climatechange-focused sustainability plan is to narrow down the possibilities and focus on those that are most important to your situation. Sample Tasks: • Establish a team of inside stakeholders: operations people, supply managers, finance people and organizational leadership. • Have the team scan the list of risks and opportunities in the appendix to get a few preliminary ideas about which issues might apply. What are they looking for? Items on the list that are worth investigating because they’re more likely than not to be true. Try to get consensus, but don’t throw out ideas that not everyone agrees on. • Check the list you develop with some outside stakeholders if possible. Talk to some experts, nonprofits, customers, suppliers and/or industry representatives. See whether you can classify the issues into four buckets: a. not very important to our stakeholders, and not essential to our business b. important to our stakeholders, but not essential to our business c. not very important to our stakeholders, but essential to our business d. important to our stakeholders and essential to our businesses

Approximate Time to Complete: 30-60 days

Deliverable: • a written document that identifies the issues you need to address, hopefully with a sense of where to start

Step 2

SET AMBITIOUS BUT REALISTIC GOALS

Each issue that you’ve identified as important needs to have a goal (some issues may be grouped together and share a common goal). The goals you develop need to be ambitious in the sense that they will stretch your organization a little. Often, managers and others will be asked to do new things and address unfamiliar subjects. This is good! But goals also need to be achievable within real-world constraints (such as budget, other projects and customer commitments). Your business needs to remain viable. Best advice: Walk before you run. And establish a few goals that can be “quick wins.” Those get folks excited!

Sample Tasks:

Choose no more than two to four issues from Step 1 to start.

For each issue, get the team to agree on a goal that’s ambitious and achievable. Goals need to be concrete and easy to understand.

ɗ For example, a goal “to reduce total Scope 1 and 2 GHG emissions by 20 percent from a 2014 baseline” is a well-stated goal (if 20 percent is meaningful!). But a goal “to reduce our CO 2 footprint” is not sufficiently specific.

ɗ Energy goals should be stated in either reductions in kilowatt hours (kWhs) consumed or total GHG emissions output in CO 2 equivalents. ɗ Water goals should be stated in either

“overall water usage” or something specific like cubic feet. ɗ B2B goals may be less quantitative, but that does not mean they should not be specific. For example, “create and communicate a revised supplier code of conduct that contains sustainability language to all suppliers by August 2018” is a well-stated goal. ɗ Similarly, if you’re addressing green jobs, many goals will be part numbers and part narrative. ɗ Whenever possible, state a goal in terms of an outcome, not an activity. Obtain necessary sign-offs for your goals. This is where your business case comes into play: What risks and opportunities are you trying to address with your goals? What’s the likely payoff for your small business? Announce your goals. Making a public statement is ideal, but that choice is up to your leadership team. You might choose to limit your announcement to internal stakeholders only, perhaps as a first step toward a future public announcement.

Approximate Time to Complete: 30-60 days

Deliverables: • a written list of goals for each issue you identified in Step 1 (some companies find it’s easiest to do this in the Microsoft Excel spreadsheet that is later included in a plan document) • senior-level approval of goals

Step 3

CREATE STRATEGIES THAT SUPPORT YOUR GOALS

To achieve your goals, you need strategies—and the actions you’ll take to reach the goals by the time they’re due. Each goal might have its own strategy, or a group of similar goals might go together under one strategy. Most likely, though, each goal will require several different strategies. • For example, meeting a GHG emissions reduction goal probably will require strategies related to energy and fuel consumption.

Sample Tasks: • Brainstorm strategies that go with each goal. Expand the project team to include the managers who will be responsible for rolling out strategies and implementing projects, if they are not already included in your project team. If your team lacks expertise in a particular area, reach out to: ɗ subject matter experts/consultants ɗ nonprofits/environmental associations ɗ for energy issues, the U.S. Environmental

Protection Agency (EPA), the Detroit Greenhouse Gas Business Index or your local energy provider ɗ for water issues, the EPA or the Detroit

Department of Water and Sewerage As you create strategies, consider how they might get broken down into concrete tasks or projects. Ask yourself whether you have the resources to accomplish the tasks (time, money, expertise)—and then check with others. This is a good way to “reality check” your strategies before acting. ɗ Obtain necessary approval for all your strategies.

Approximate Time to Complete: 30 days

Deliverables: • a written document stating the strategies for each goal • management’s approval of strategies and required resources

Step 4

ESTABLISH METRICS THAT TRACK YOUR PROGRESS

An old business adage says that “what doesn’t get measured doesn’t get managed.” Leading sustainable businesses have found this to be true especially of sustainability and climate change challenges—an important lesson for small businesses. Some basic metrics can help you track your climate change work. You should have a mix of high-level metrics tied directly to your goals (for example, reduce carbon footprint from operations by 30 percent over 2015 by 2020) and some strategy-level metrics (for example, reduce energy consumption from lighting and HVAC by 25 percent by 2018 and 35 percent by 2020) as well. Metrics are all about data, so you must have the systems necessary to collect, manage and report your data. Sample Tasks: • Have your project team set up metrics for each goal and strategy. ɗ Metrics should be numeric whenever possible. Some B2B and green jobs metrics might be narrative. ɗ Don’t establish metrics that you can’t act on. Don’t collect data just for data’s sake. Identify the systems you have to collect, manage and report the data. And consider the issues of collecting both internal and external information. Consider data storage and security issues up front. Systems should include a “dashboard” reporting tool that allows project managers and others to see progress on a regular basis.

Approximate Time to Complete: 30-60 days

Deliverables: • list of metrics associated with each goal • data management system and a

“dashboard” to track and review metrics over time

Step 5

TAKE ACTION Somewhere between 120 and 180 days after starting, you’re ready to take your first steps in implementing your plans to address climate change. If your company has a routine way of running projects, you’ll want to follow that very closely. But allow for some flexibility, because many aspects of climate change work are new to most businesses and might not fit into established procedures. Many businesses beginning sustainability/climate change work like to roll out strategies in pilot phases. This might be a good idea if your business doesn’t have a lot of experience with this subject or deep resources.

For example, if your approach to cutting your carbon footprint includes reducing the amount of energy that lighting in your company’s facilities consumes, consider upgrading the equipment in one facility before moving on to others. But be aware that using many pilot projects will take longer to reach your goals.

Sample Tasks: • Notify department managers about planned project details. Key managers should have been involved in establishing strategies, so few surprises should come up at this point. • Using procedures that you’re comfortable with, roll out strategies and tactics. If you don’t have project-management procedures, you can use an ad hoc approach, so long as it includes: ɗ identifying project “owners” ɗ providing a clear understanding and identification of what’s included in each project ɗ demonstrating a clear understanding of expected outcomes and timeline for each project ɗ outlining required and available resources for all projects ɗ listing metrics and ways that you’ll collect and report tracking data

Approximate Time to Complete: ongoing

Deliverable: • completed/closed out project reports from project owners and managers

Step 6

IMPROVE, IMPROVE, IMPROVE

If you follow the steps outlined in this toolbox, you’re likely to succeed. Congratulations— celebrate your wins! But don’t worry if some goals were too lofty, some strategies didn’t work, some metrics tracked the wrong things or some resources weren’t there when needed. Addressing climate change risks and opportunities is a marathon and not a sprint. Just remember to review and adjust on a regular basis. Sample Tasks: • Conduct post-completion reviews of projects with project teams and other stakeholders as appropriate. • Review metrics for areas where improvement did not meet goals. Reconvene project teams to update action plans. Beef up your business case as a part of requesting additional resources.

Approximate Time to Complete: ongoing

Deliverables: • project debrief meetings and reports • Six Sigma and other process evaluation/ error control methods • resource realignments and additional resource requests

That’s our summary of the steps your business should take. It may sound like a lot of work—and it can be. But we know that the work you do will pay off for your business and for Detroit.