Sustainability and innovation: what matters in innovation management.

The development of sustainable innovations requires a rethink, which is already reflected in the innovation strategy. The aim is to generate innovative ideas that have a positive impact on society, the economy, and the environment. Sustainable innovations aim to develop long-term strategies that bring economic success as well as social improvements and environmental protection.

What is sustainable innovation?

Sustainable innovation refers to the development and implementation of new products, processes, or services that make a positive contribution economically, ecologically, and socially. From an ecological perspective, sustainable innovation should help to reduce the consumption of resources, for example. From a social perspective, products or services should also fulfill social needs as part of sustainable innovations. These include, for example, an improved quality of life for all members of society or the promotion of equal opportunities. 

Sustainability and innovation: what innovation managers need to look out for

When developing sustainable ideas, innovation managers should take certain aspects into account. For example, this includes:

• The integration of environmentally friendly materials and processes.
• The promotion of social responsibility and the involvement of stakeholders. 
• The consideration of the entire life cycle of a product or service.

In order to drive sustainable innovation, innovation managers should realize that opportunities for sustainability can come from all areas of an organization.

Which company measures promote sustainablity? 

Sustainability is an important factor for companies that want to take their responsibility for the environment and society seriously. There are various measures that companies can take to promote sustainability; e.g. reducing energy consumption, saving water and other resources, reducing waste and emissions, and increasing employee awareness of sustainability. Social aspects can also be taken into account; e.g. through the use of fair trade products or involvement in social projects. 

For a manufacturing company, the use of environmentally friendly materials and processes is an obvious consideration. FACC is an example of this. The company in the aerospace industry sees its main growth area in climate protection and emission-free aviation. One of the first ideas was to line the interior of airplanes with biological instead of petrochemical products. The first components for retrofitting Austrian Airlines aircraft have already been used. By using sustainable materials and implementing environmentally friendly production processes, the company's ecological footprint can be reduced.¹

Making processes, supply chains, logistics, and energy requirements more sustainable

Organizations are shaping the circular economy with sustainable innovations. It is therefore not just about individual products or services, but about future economic activity and the entire value creation cycle. In addition to product and material innovations, this requires sustainable solutions for processes, supply chains, logistics, energy consumption, and much more. The aim behind this is to rethink entire business systems in the form of closed loops. As in innovation management, this can only be achieved in sustainability management through a holistic approach. To this end, sustainability and innovation teams must work closely together at a strategic and operational level. 

Social effects of innovation

Companies should also be aware of how their innovations influence society. These issues are complex and innovation managers and sustainability officers can work together to find solutions.

Two examples of sustainable innovations with a social impact: 

1. Technologies to improve healthcare in remote areas: In many regions, people do not have access to high-quality medical care, as hospitals and clinics are often far away. Innovative telemedicine solutions enable doctors and patients to communicate with each other over long distances, and medical advice and diagnoses can be provided. In addition, technologies such as 3D printing  can contribute to better care in the healthcare sector.
2. Creating jobs and driving economic development: The development of new technologies or products often creates new jobs (green jobs), whether in production, sales, or research and development. These jobs offer people the opportunity to earn a stable income and improve their living conditions. In addition, innovative companies can also help to boost the local economy and strengthen a region's infrastructure.

These examples show that innovations can not only bring economic success, but can also have a positive impact on society. By assuming social responsibility and developing innovative solutions, companies can help to solve social problems and improve the lives of many people. 

Innovation closely linked to the circular economy

It may mean a rethink for some companies if the focus is to be on developing sustainable innovations in the future. Among other things, because it means that you have to plan the entire life cycle of a product or service.

The following questions should always be discussed in a sustainable innovation project:

• What is the life cycle of our existing products or services?
  Identify resources required for the manufacture, use, maintenance, and disposal of the product or service. Consider possible effects on the environment and society (e.g. working conditions when mining rare earths).
• What options are there for using recyclable materials, conserving resources, and minimizing waste?
  It is important to always consider the entire life cycle! Perhaps the project team will also discover alternative approaches with the help of technology scouting.
• How can circular economy concepts be integrated?
  Can products be designed in such a way that they are easier to repair, can be reused, or are easier to recycle?  

For innovation teams, it means ensuring that sustainability is taken into account at every stage of the innovation process. Here are two examples of this:

• The selection of ideas can be geared around sustainability as early as during the fuzzy front end. This fills the idea funnel with ideas that fit the organization's sustainability goals. 
• In the design and prototyping phases, it is important that products have a modular structure and that components can be easily replaced. This increases the longevity of the products and reduces the need for new production.

The list goes on and on and shows that sustainable innovation management means a fundamental rethink at a strategic and operational level. 

Risk of the greenwashing of sustainable innovations, using the example of the finance sector

In the podcast series "Greenwashing in der Finanzindustrie" von ÖGUT (Österreichische Gesellschaft für Umwelt und Technik), Raphael Fink on the eco-label team of the VKI (Austrian Consumer Information Association) describes how greenwashing accusations can arise in the financial services industry.

Fink explains that accusations are often unjustified and could easily be avoided. Sustainability departments at financial companies develop innovative products and take sustainability aspects into account. However, when the product then passes from the sustainability department to the marketing department, a lot of information is lost. The handover to the marketing department is not done properly, resulting in advertising claims that no longer correspond to what the product or service does. According to Fink, this happens very frequently in companies. It shows how important it is to carefully consider the roles and processes of all those involved in innovation and product development processes so that greenwashing does not occur with sustainable innovations. 

Why sustainability makes a difference for innovative companies

Companies that develop sustainable innovations can make a big difference in today's business world. It requires a rethink in management and the involvement of all employees in the development process in order to generate and successfully implement ideas.

One approach I recommend is to exchange ideas with experts from similar areas. The different perspective gives rise to new ideas, but also sharpens the understanding of problems and solutions from other areas.

Innovation management cannot be geared towards sustainability if the corporate strategy is not equally so aligned. Sustainable innovation therefore always starts at the executive level and must be exemplified top-down. From an innovation management perspective, a holistic approach such as the House of Innovationhelps here.

Finally, it should be mentioned that sustainable innovation is just the beginning. People will be quick to point out that sustainable management is not enough: it is about regenerative management, and therefore about regenerative innovations. 

Quellen:

1) FACC, biologische Produkte im Flugzeugbau; Industrie Magazin 12/2022-01/2023