Synopses & Reviews
"Capitalism at the Crossroads
is built on strong theoretical underpinnings and illustrated with many practical examples. The author offers a pioneering roadmap to responsible macroeconomics and corporate growth."
-Clayton Christensen, Professor of Business Administration, Harvard Business School and author of The Innovator's Dilemma
"I hope this book will be able to influence the thought processes of corporations and motivate them to adapt to forthcoming business realities for the sake of their own long-term existence. Besides business leaders, this is a thought-provoking book for the readers who are looking for solutions to capitalism’s problems."
-Muhammad Yunus, Founder and Managing Director, Grameen Bank, Bangladesh and 2007 Nobel Peace Prize recipient
"Capitalism at the Crossroads is a practical manifesto for business in the twenty-first century. Professor Stuart L. Hart provides a succinct framework for managers to harmonize concerns for the planet with wealth creation and unambiguously demonstrates the connection between the two. This book represents a turning point in the debate about the emerging role and responsibility of business in society."
-C.K. Prahalad, Ross School of Business, University of Michigan, co-author of Competing for the Future and author of The Fortune at the Bottom of the Pyramid
"Stuart Hart was there at the beginning. Years ago when the term ‘sustainability’ had not yet reached the business schools, Stuart Hart stood as a beacon glowing in the umbrage. It is clear commerce is the engine of change, design the first signal of human intention, and global capitalism is at the crossroads. Stuart Hart is there again; this time lighting up the intersection."
-William McDonough, University of Virginia, co-author of Cradle to Cradle
"Professor Hart is on the leading edge of making sustainability an understandable and useful framework for building business value. This book brings together much of his insights developed over the past decade. Through case studies and practical advice, he argues powerfully that unlimited opportunities for profitable business growth will flow to those companies that bring innovative technology and solutions to bear on some of the world’s most intractable social and environmental problems."
-Chad Holliday, Chairman and CEO, DuPont
"Capitalism at the Crossroads clearly reveals the essence of what sustainability means to today’s business world. Hart’s analysis that businesses must increasingly adopt a business framework based on building sustainable value speaks to the entire sustainability movement’s relevance. Sustainability is more than today’s competitive edge; it is tomorrow’s model for success."
-Don Pether, President and CEO, Dofasco Inc.
"Stuart Hart has written a book full of big insights painted with bold strokes. He may make you mad. He will certainly make you think."
-Jonathan Lash, President, The World Resources Institute
"A must-read for every CEO—and every MBA."
-John Elkington, Chairman, SustainAbility
"This book provides us with a vast array of innovative and practical ideas to accelerate the transformation to global sustainability and the role businesses and corporations will have to play therein. Stuart Hart manages to contribute in an essential way to the growing intellectual capital that addresses this topic. But, beyond that, the book will also prove to be a pioneer in the literature on corporate strategy by adding this new dimension to the current thinking."
-Jan Oosterveld, Professor, IESE Business School, Barcelona, Spain Member, Group Management Committee (Ret.), Royal Philips Electronics
"Capitalism at the Crossroads captures a disturbing and descriptive picture of the global condition. Dr. Hart constructs a compelling new corporate business model that simultaneously merges the metric of profitability along with societal value and environmental integrity. He challenges the corporate sector to take the lead and to invoke this change so that the benefits of capitalism can be shared with the entire human community worldwide."
-Mac Bridger, CEO of Tandus Group
"Stuart L. Hart makes a very important contribution to the understanding of how enterprise can help save the world’s environment. Crucial reading."
-Hernando de Soto, President of The Institute for Liberty and Democracy and author of The Mystery of Capital
"Stuart Hart’s insights into the business sense of sustainability come through compellingly in Capitalism at the Crossroads. Any businessperson interested in the long view will find resonance with his wise reasoning."
-Ray Anderson, Founder and Chairman, Interface, Inc.
"This stimulating book documents the central role that business will play in humanity’s efforts to develop a sustainable global economy. Professor Hart presents an attractive vision of opportunity for those corporations that develop the new technologies, new business models, and new mental frames that are essential to a sustainable future."
-Jeffrey Lehman, Former President of Cornell University
"The people of the world are in desperate need of new ideas if global industrial development is ever to result in something other than the rich getting richer and the poor getting poorer, with nature (and potentially all of us) suffering the collateral damage. Few have contributed more to meeting this need over the past decade than Stuart Hart by helping to illuminate the potential role for business and new thinking in business strategy in the journey ahead. Capitalism at the Crossroads challenges, provokes, and no doubt will stimulate many debates—which is exactly what is needed."
-Peter Senge, Massachusetts Institute of Technology, Chairperson of the Society for Organizational Learning, and author of The Fifth Discipline: The Art and Practice of The Learning Organization
New Foreword by Al Gore
Brand-New Second Edition, Completely Revised with:
- Up-to-the-minute trends and lessons learned
- New and updated case studies
- The latest corporate responses to climate change, energy, and terrorism
Global capitalism stands at a crossroads-facing terrorism, environmental destruction, and anti-globalization backlash. Today's global companies are at a crossroads, too-searching desperately for new sources of profitable growth. Stuart L. Hart's Capitalism at the Crossroads, Second Edition is about solving both of those problems at the same time.
It's about igniting new growth by creating sustainable products that solve urgent societal problems. It's about using new technology to deliver profitable solutions that reduce poverty and protect the environment. It's about becoming truly indigenous to all your markets, and avoiding the pitfalls of first-generation "greening" and "sustainability" strategies.
Hart has thoroughly revised this seminal book with new case studies, trends, and lessons learned-including the latest experiences of leaders like GE and Wal-Mart. You'll find new insights from the pioneering BoP Protocol initiative, in which multinationals are incubating new businesses in income-poor communities. You'll also discover creative new ways in which corporations are responding to global warming and terrorism. More than ever, this book points the way toward a capitalism that's more inclusive, more welcome, and far more successful-for both companies and communities, worldwide.
- Paths to profitable sustainability: Lessons from GE and Wal-Mart
- Shattering the "trade-off" myth
- New commercial strategies for serving the "base of the pyramid"
- What enterprises have learned about doing business in income-poor regions
- Becoming indigenous-for real, for good
- Codiscovering new opportunities, cocreating new businesses with the poor
- Learning from leaders: 20+ new and updated case studies
- Best practices from DuPont, HP, Unilever, SC Johnson, Tata, P&G, Cemex, and more
About the Author xii
Foreword: Al Gore, Former Vice President of the U.S. xxiv
Foreword: Fisk Johnson, Chairman and CEO, S.C. Johnson & Son, Inc. xxvii
Prologue: Capitalism at the Crossroads xxxi
PART ONE: MAPPING THE TERRAIN
Chapter 1: From Obligation to Opportunity 3
Chapter 2: Worlds in Collision 31
Chapter 3: The Sustainable Value Portfolio 59
PART TWO: BEYOND GREENING
Chapter 4: Creative Destruction and Sustainability 87
Chapter 5: The Great Leap Downward 111
Chapter 6: Reaching the Base of the Pyramid 139
PART THREE: BECOMING INDIGENOUS
Chapter 7: Broadening the Corporate Bandwidth 169
Chapter 8: Developing Native Capability 193
Chapter 9: Toward a Sustainable Global Enterprise 223
Capitalism is indeed at a crossroads, facing international terrorism, worldwide environmental change, and an accelerating backlash against globalization. Companies are at a crossroads, too: finding new strategies for profitable growth is now more challenging than it has ever been. Both sets of problems are intimately linked. In this book, readers will learn how to identify sustainable products and technologies that can drive new growth while also helping to solve today' s most crucial social and environmental problems. Drawing on his experience consulting with leading companies and NGOs worldwide, Hart shows how to become truly indigenous to all the markets and avoid the pitfalls of traditional ' greening' and ' sustainability' strategies. This book doesn' t just point the way to a capitalism that is more inclusive and more welcome: it offers specific techniques that can be used to recharge innovation, growth, and profitability in enterprise.
In this reference, readers will learn how to identify sustainable products and technologies that can drive new growth while also helping to solve todays most crucial social and environmental problems.
The multiple economic crises of the past two years demonstrate more clearly than ever that the age of "mercenary" capitalism is over: we must finally embark on a new age of sustainable, stakeholder-based capitalism. While enlightened executives and policymakers understand the critical need for change, few have tangible plans for making it happen. Stuart L. Hart, one of the world's leading experts on sustainable capitalism, presents clear roadmaps and strategies for identifying sustainable products and technologies that can drive new growth while also helping to solve today's key social and environmental problems. This edition contains
- Thoroughly updated case studies and examples
- Extensive coverage of incubating clean, green technologies at the "base of the pyramid" and "trickling them up" to the top
- A new Preface demonstrating how recent economic crises stem from unsustainable policies and strategies and what can be done about it
- New analyses of oil price spikes and the sub-prime crisis through the lens of sustainable capitalism
- Updates on breakthrough "bottom of the pyramid" initiatives in the U.S. and beyond
Drawing on his experience consulting with leading companies and NGOs worldwide, Hart shows how to overcome the pitfalls of traditional 'greening' and 'sustainability' strategies, and recharge innovation, growth, and profitability in your enterprise.
“The central message of Stuart Hart’s book is that global business needs to be caring and be committed to preserving the globe’s ecological integrity. The ongoing economic slowdown brought about by rampant capitalism, the lessons from which this new edition of the book factors in, has only served to emphasize the urgency for business to adopt the radical transformation of strategy that Stuart has been advocating.”
–RATAN TATA, Chairman, Tata Group
“A few books change the way you think. Very few change the way you act. Stuart Hart’s writings have served as a practical guide, a system of road signs that put new order into the complex business of becoming sustainable. We’re learning that we can advance in a meaningful, exciting, and beneficial way. We fully expect that his ideas are guideposts that will mark Dow Corning’s road to sustainability leadership.”
–STEPHANIE BURNS, Ph.D., Chairman, CEO, and President, Dow Corning Corporation
“Capitalism at the Crossroads rightly points to capitalism as the most powerful and creative force we have for solving global problems. It is a welcome antidote to widespread ignorance about capitalism as a force for good.”
–JOHN MACKEY, CEO, Whole Foods Market, and coauthor, Be the Solution
“I hope this book will be able to influence the thought processes of corporations and motivate them to adapt to forthcoming business realities for the sake of their own long-term existence. Besides business leaders, this is a thought-provoking book for the readers who are looking for solutions to capitalism’s problems.”
–MUHAMMAD YUNUS, Founder and Managing Director, Grameen Bank, Bangladesh, and 2006 Nobel Peace Prize recipient
“…a pioneering roadmap to responsible corporate growth.”
–CLAYTON CHRISTENSEN, Professor, Harvard Business School, and New York Times best-selling author, The Innovator’s Dilemma
Reinventing Capitalism and Companies for a Radically New World
Today’s era of economic crisis has sent a powerful message: The age of “mercenary” capitalism is ending. We must finally embark on a new age of sustainable, stakeholder-based capitalism. While enlightened executives and policymakers understand the critical need for change, few have tangible plans for making it happen. In Capitalism at the Crossroads, Stuart L. Hart presents new strategies for identifying sustainable products, technologies, and business models that will drive urgently needed growth and help solve social and environmental problems at the same time.
Drawing on his experience consulting with top companies and NGOs worldwide, Hart shows how to craft your optimal sustainability strategy and overcome the limitations of traditional “greening” approaches. In this edition, he presents new and updated case studies from the United States and around the world, demonstrating what’s working and what isn’t. He also guides business leaders in building an organizational “infrastructure for sustainability”--one that can survive budgeting and boardrooms, recharging innovation and growth throughout your enterprise.
Mapping the terrain: where we stand and where to go from here
The new business case for pursuing sustainable capitalism
Implementing sustainability strategies that go far beyond environmental sensitivity
Becoming indigenous: how to build a truly sustainable global enterprise
How to fully embed your enterprise in the local context--and why you should
Robust organizational blueprints for sustaining sustainability
Making long-term sustainability work in a short-term world
About the Author
<>STUART L. HART
is one of the world's top authorities on the implications of sustainable development and environmentalism for business strategy. He is currently the S.C. Johnson Chair of Sustainable Global Enterprise and Professor of Management at Cornell's Johnson Graduate School of Management. He also serves as senior research fellow at both the Davidson Institute (University of Michigan) and Tilburg University in the Netherlands.
Previously, he taught strategic management and founded both the Center for Sustainable Enterprise (CSE) at the University of North Carolina's Kenan-Flagler Business School, and the Corporate Environmental Management Program (CEMP) at the University of Michigan. His consulting clients range from DuPont and Hewlett-Packard to Procter & Gamble and Shell.
Hart wrote the seminal article "Beyond Greening: Strategies for a Sustainable World," which won the McKinsey Award for Best Article in Harvard Business Review in 1997, and helped launch the movement for corporate sustainability. With C.K. Prahalad, he also wrote the pathbreaking 2002 article "The Fortune at the Bottom of the Pyramid," which first articulated how business could profitably serve the needs of the four billion poor in the developing world.
Table of Contents
About the Author . . . xi
Acknowledgments . . . xii
Preface: Al Gore, Former Vice President of the United States . . . xxiii
Foreword: Fisk Johnson, Chairman and CEO, S. C. Johnson & Son, Inc. . . . xxvi
PART ONE: MAPPING THE TERRAIN 1
Prologue: Reinventing Capitalism for the Post-Crisis World . . . 3
The Great Disruption . . . 4
The Best of Times, The Worst of Times . . . 5
Environmental Meltdown? . . . 8
The Demise of Development . . . 10
Implications for Corporations . . . 13
The Fork in the Road . . . 15
Chapter 1: From Obligation to Opportunity . . . 19
The Great Trade-Off Illusion . . . 21
The Greening Revolution . . . 23
Shattering the Trade-Off Myth. . . . 25
Breaking Free of Command-and-Control . . . 26
Beyond Greening . . . 30
Raging Against the Machine . . . 33
Smart Mobs Versus Smart Globalization . . . 35
Becoming Indigenous . . . 38
The Road Ahead . . . 41
Overview of the Book . . . 43
Chapter 2: Worlds in Collision . . . 51
The Three Economies . . . 53
Collision Course . . . 60
New Lenses on the Global Market . . . 62
Developed Markets: Reducing Corporate Footprint . . . 65
Emerging Markets: Avoiding the Collision . . . 68
Traditional Markets: Serving Real Needs . . . 72
The Value Proposition . . . 76
Chapter 3: The Sustainable Value Portfolio . . . 79
Sustainability Buzzwords . . . 80
Elements of Shareholder Value . . . 81
The Buzzword Sort . . . 84
Connecting the Dots: The Sustainable Value Portfolio . . . 87
Charting the Sustainable Value Portfolio . . . 97
The Road to Sustainability . . . 99
Pursuing the White Space. . . . 104
PART TWO: BEYOND GREENING 109
Chapter 4: Clean Technology and Creative Destruction . . . 111
Continuous Improvement Versus Creative Destruction . . . 112
From Textile Dyes to Biomaterials . . . 118
Using Carbon Dioxide to Change the World . . . 120
Developing an Ecomagination . . . 122
Whole-Systems Thinking . . . 124
Reinventing the Wheels . . . 128
Technologies of Liberation . . . 131
Eating Your Own Lunch . . . 133
Chapter 5: Innovation from the Bottom-Up . . . 137
On the Horns of a Dilemma . . . 138
Birth of BoP. . . 139
The Tip of the Iceberg . . . 141
Creative Creation . . . 146
Driving Innovation from the Base of the Pyramid . . . 149
Connecting the World. . . 151
Food, Health, and Hope? . . . 155
Power to the People . . . 158
The Great Convergence . . . 162
A New Development Paradigm . . . 165
Taking the Great Leap . . . 167
Chapter 6: Raising the Base of the Pyramid . . . 171
BoP Pioneers . . . 172
It’s the Business Model, Stupid . . . 173
Assessing Sustainability Impact . . . 189
Village Phones: The Triple Bottom Line . . . 192
The MNC Advantage . . . 196
A Common Cause . . . 197
PART THREE: BECOMING INDIGENOUS 201
Chapter 7: Broadening the Corporate Bandwidth . . . 203
Learning from Ladakh . . . 204
The Post-Development Challenge . . . 207
Radical Transactiveness. . . 211
Fanning Out: Extending the Scope of the Firm . . . 213
Fanning In: Integrating Diverse and Disconfirming Information . . . 217
Expanding Our Concept of the Global Economy . . . 222
From Alien to Native . . . 224
Chapter 8: Developing Native Capability . . . 227
Next Generation Strategies and Skills . . . 229
Engage First, Design Second . . . 230
Coinvent Custom Solutions . . . 234
Fail Small, Learn Big . . . 237
Fly Under the Radar . . . 239
Work with Nontraditional Partners . . . 242
Build Social, Not Legal, Contracts . . . 244
Moving Beyond the Multinational Model . . . 248
Chapter 9: Re-Embedding Innovation Strategy . . . 253
Comparing Apples and Oranges . . . 254
Toward a Base of the Pyramid Protocol . . . 257
Learning by Doing . . . 262
Taking the Initiative on Water . . . 267
The Three Big Challenges . . . 273
Leading the Next Great Transformation . . . 276
Chapter 10: Building the Sustainable Global Enterprise . . . 281
Making It Happen in the Real World . . . 283
Aligning the Organization . . . 293
Building the Cathedral . . . 300
Postscript . . . 302
Epilogue: Looking Forward . . . 307
Draining the Swamp . . . 308
The Next Tsunami . . . 310
Who Will Be the Twenty-First Century Watchdog? . . . 312
Index . . . 315