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3 Ways to Change an Industry

3 Ways to Change an Industry

Industries do change. And we are the ones who can change them.

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In my recent post Won’t Someone Think of the Turtles? I drew attention to the significant movement taking place in the United Kingdom around #strawssuck and the more general fight against single-use plastic. People power – the power of the consumer – you and me – is a key strategic reason for the change unfolding the way that it is in 2018. The victory hasn’t come suddenly, although many of us only really got woke to the immensity and seriousness of the issue this year.

But in addition to the power of the consumer – there is also the public and private sector.

International organisations like the United Nations, national and local governments, and BUSINESSES themselves, whether startups or corporates, obviously have a MASSIVE role to play. They can do this through legislature, policy, tariffs, and alternative operating systems and processes, respectively.

This isn’t just taking place in the UK, the USA, Canada, or Australia. This is global, and that’s good because it needs to be global. For example, as a positive sign of things to come, the UN Environment ‘Clean Seas’ campaign has seen over 50 countries sign up.

Investors are increasingly placing pressure on businesses! 25 investors, collectively worth more than USD 1 trillion in assets, recently have been busy demanding that MNCs including Nestlé, Procter and Gamble, and Unilever, reduce plastic packaging used in their business activities. Let’s never forget that the investors own the companies. A CEO (should) never forget that they are responsible to the owners of the company, their employers. So as individuals who can become shareholders, let’s never forget the power that we can wield.

But aside from investing in a business as a shareholder, how can we as everyday individuals cause new business standards to emerge? How can we help an entire industry to change?

Let’s first quickly consider how an industry homogenises in the first place.

Sometimes a business standard exists because the businesses are forced to homogenise to that particular way of doing things by external forces, for example, a government policy, ban or tariff.

Other times, a business standard exists because one business feels uncertainty, and so copies something from another (more successful) business. When that keeps on happening, new business standards emerge.

And other times, a business standard can emerge when employees, who have learnt to do things a particular way, then cross-pollinate businesses within an industry with this particular way of doing things. And again, a new business standard emerges.

This way of understanding the homogenisation of an industry is known as institutional isomorphism – coercive, mimetic, and normative, respectively. (Thanks to DiMaggio & Powell for this theory… and also, it’s good to see that my MBA is coming in handy today!). This is one of the leading theories of how an industry homogenises.

If we don’t like the current status quo – or homogeneity – of an industry – then we want to see that industry homogenise to a new business standard.

To summarise then, how does this understanding show us how an industry homogenises?

  1. External forces, e.g. governments putting in place policies, implementing bans, tariffs and other legislation

  2. Mimetic forces, e.g. businesses copying or mimicking other (more successful) businesses in times of uncertainty

  3. Internal forces, e.g. employees do things a certain way, and as those employees who do things in that way spread and move across an industry, the industry homogenises to that way of doing things

Right. So then, practically, what can we as individuals do?

  1. We can let our governments know what we want. We can vote in politicians who will legislate change to the industry. We can lobby existing governments and politicians. We can demonstrate and call out for change to our national and local public leaders.

  2. We can use our people power, aka our purchase power, our social capital and our voices. We can support businesses that choose to take their environmental impact seriously and implement processes to minimise a negative footprint on our planet. And we can call out companies that fail to change.

  3. We can bring change from the inside, as employees, and as business leaders. Never underestimate the power of a single employee in a single company or organisation. Let’s use the influence we have, and let’s grow our influence so that our impact can be more significant. And to those of us who are business educators – we can teach alternative ways of doing business so that new cohorts of professionals are trained to consider the environmental impact of business activities and can integrate #fortheplanet into business models from the outset.

As everyday individuals we actually wield a lot of power to see individual business change, new business standards emerge within an industry, and eventually, whole industries homogenise to a new normal.

What new normal do we want to see?

Whether researching our vote more carefully for the next election, celebrating and supporting businesses who are doing good things, or bringing about new practices within our workplaces that stem from our convictions – we can each do meaningful and impactful things in our everyday life.

Industries do change. And we are the ones who can change them.

 

Ref:

Photo by rawpixel on Unsplash

DiMaggio, Paul J., and Powell, Walter W. “The Iron Cage Revisited: Institutional Isomorphism and Collective Rationality in Organizational Fields.” American Sociological Review 48, no. 2 (1983): 147–160.

UN Environment. “What Are Businesses Doing to Turn off the Plastic Tap?” UN Environment - News and Stories, June 28, 2018. https://www.unenvironment.org/news-and-stories/story/what-are-businesses-doing-turn-plastic-tap.

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