Saturday, July 31, 2021

Sustainability Case Studies 25: Sustainability and Competitive Retailing in Switzerland

Click for image credit.
This is the 25th post in this blog series, Sustainability Case Studies, that is based on the book The Palgrave Handbook of Sustainability: Case Studies and Practical Solutions edited by Robert Brinkmann (yours truly) and Sandra Garren and published by Palgrave Macmillan in 2018. Each post in the series will comment on the content of the chapter as well as some general take-aways or practical teaching or personal/organizational initiatives that could be gleaned from the chapter. Links to previous posts on the series (including the post that introduced the series) follow after the review.

Today's post is on Chapter 25, Contributing to Competitiveness in Retailing by Engaging in Sustainability:  The Case of Migros, by Thomas Rudolph, Kristina Kleinlercher, Marc Linzmajer, and Cornelia Diethelm. The chapter reviews how the Swiss retailer, Migros, found a competitive niche by broadly embracing sustainability in their products and operations. The chapter begins with a review of how business organizations often view sustainability. As the authors note, "...many Chief Executive Officers (CEOs) treat sustainability initiatives detached from business objectives." However, some companies have found ways to use sustainability in order to create a competitive edge. The rest of the chapter focuses specifically on one such company--Migros.

Migros is a complex company. Originating in the early part of the 20th century as a food retail store, it now encompasses a range of retail operations--including food. In 2015, an independent rating company, Oekom Research, ranked Migros as the most sustainable retailer in the world. They are in a competitive market, with giants like Aldi and Lidl offering tremendous deals on products throughout Europe. However, Migros decided that while those companies were going in the direction of providing cheap products, Migros would instead focus on high-quality and sustainably produced products. They developed a series of new labelled "brands" such as Migros Bio and TerraSuisse to identify products that had particular sustainable traits. They also, through a loyalty card, educated consumers about the percentage of products they purchased has sustainable traits.

The authors of this chapter note that the foundational start of Migros set them on the sustainability path. Ideas around sustainability and equity have always been part of the mindset of the company. Today, there is a distinct sustainability office and all employees are encouraged to submit ideas as to how the organization can become more sustainable. 

The chapter then goes on to highlight some distinct initiatives at the company:

  • Generation M. These are distinct promises to the next generation as to particular goals of the company.
  • From the Region for the Region. This initiative seeks to build relationships with local producers to supply the local markets.
  • Private-Label Products. Migros developed their own private label to enhance the sustainability of products they sell.
  • M-Way. This is a transportation initiative that seeks to advance electronic vehicle use.
  • Sharon. This is a car-sharing initiative that allows people to rent out their vehicle for a cost.
  • Reducing Food Waste. This is an initiative to reduce food waste within the company. 
The chapter highlights that there were four main ways that the company strengthened its sustainability management:
  • Integration of sustainability into corporate leadership
  • Strong engagement from employees
  • Guidance and monitoring by top management
  • Development of a sustainability team
As the authors highlight, Mirgos' approach is unique and that there is not one way forward to infuse sustainability within a management structure. However, managers have to be able to learn by doing and motivate customers to appreciate sustainability.

Click here for more information about the book.

Here are some class discussion questions when using this chapter for a unit on sustainable management or sustainability retailing.

1. Consumer preferences for sustainable products, such as local produce, have increased. What do you think is driving that change?

2. Describe the nature of Migros' business operations and philosophy.

3. How does Migros benchmark its green initiatives?

4. How does MIgros' management system infuse sustainability within its operations?

5. What is an example of a Generation M promise?

6. How have consumers responded to the From the Region For the Region label?

7. What strategies does Migros use to reduce food waste?

8. Do you think the Migos approach could be used by other retailers? How?

Previous Entries in This Series

No comments: