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Business Functions/Activities

Businesses deliver products and services through the co-ordination of various activities. The main activities are innovation, business development, procurement/ sourcing, marketing and sales, and production/operations. Figure 11.1 shows business functions and their contribution to sustainability in a company. Every activity of the organization has an influence on its sustainability performance. Therefore, integration of sustainability in business requires understanding of various business functions that deliver specific business activities in a company, and proper metrics should be developed to support decision-making.

The main activities of innovation are developing new products with novel, additional or improved functionality, improving existing products (e.g. by implementation of alternative process/manufacturing routes), and developing new processes to recycle waste. Business development is mainly involved in finding new applications or opportunities in different markets through collaboration with existing or prospective customers or by means of strategic alliances with other companies. It also defines the final product and positioning strategy and finds opportunities for the

Fig. 11.1 Value chain of a company with business functions and relation to sustainability (Manda 2014) (Adapted from Porter (1985), Epstein and Roy (2001) and Porter and Kramer (2006))

development of new business models. In some companies business development is part of innovation.

Procurement/sourcing is involved in finding the right suppliers who can provide quality inputs at the right time. It also negotiates pricing and keeps track of the production timeline. Sourcing also conducts supplier environmental and social audits and deals with supplier certifications. Sourcing is responsible for avoiding any risks arising from supplier practices, including compliance with local laws and child labor. It can go further by not only looking at sustainability performance of suppliers but also at the influence of purchased items in the final product life cycle of customers. This would help close the information cycle between suppliers and final customers and may bring collaborative opportunities for future sustainable business development.

Marketing and sales is responsible for communicating the product attributes and differentiating their products against those of their competitors. It conducts market research to find opportunities for market growth and expansion to new markets. For Business to Consumers (B2C) companies, it also handles communication with consumers. Marketing conducts research to acquire the consumer intelligence related to how customers/consumers make trade-offs between price, environmental performance and other quality parameters.

To improve sustainability performance of processes and products, all these business functions need concrete guidance and insights on the product's impacts throughout its life cycle. This calls for sound tools to support business functions in decision-making.

 
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