CSR in practice

CSR Training Workshop for Industries

Corporate Social Responsibility Training Workshop for Industries

– Long term performance improvement through CSR integration –

As part of the European Commission supported SME business development project on
Empowering Asian Business Intermediaries through Knowledge-based Networking
Focused on Sustainability Management (EMPASIA)

Müller, Opierzynski
CSR Training for Industries, 2009

Learning objectives of the CSR training

1. Understand how organizations strategically manage CSR
2. Reveal how organizations can strategically create their competitive advantage through CSR
not only with consumers and investors, but with current and future employees
3. Getting started with open source ICT tools for business management support
4. Starting an ongoing learning process among the participants

Corporate Social Responsibility (CSR) – background and business context

Systematic integration of CSR – process model and tools

Getting started with CSR – Interactive Group Work

Introduction of Redmine – Interactive Group Work „using redmine for project implementation“



Background, definitions and drivers


Sustainable development

Basis for current sustainability discussion:
1987 Report of the United Nations World Commission on Environment and Development “Our
Common Future” a.k.a. “Brundtland Report”

“Humanity has the ability to make development sustainable - to ensure that it meets the needs
of the present without compromising the ability of future generations to meet their needs.”

1992 Rio Declaration on Environment and Development, and the subsequent establishment of
the “AGENDA 21”

What exactly does “Sustainability” mean and what does it entail for businesses?

Source: http://www.worldinbalance.net/pdf/1987-brundtland.pdf


Historical background of Sustainability – from forestry to mainstream

• Hans Carl von Carlowitz (1645-1714)
– Mining Administrator for the Kingdom of Saxony
– Silver mining was backbone of economy
– Timber valuable but scarce resource for mining

• Drafting of one of the first forestry treatise
– 1713 Sylvicultura Oeconomica

• Two-fold strategy to secure timber supply
– Demand-side – promotion of wood saving innovations
– Supply-side – promotion of sustainable forestry

• Timber should only be taken in relation to the forest’s ability to regenerate
– Promotion of long-term viability vs. short-term profit www.zeit.de/1999/48/Der_Erfinder_der_Nachhaltigkeit
http://en.wikipedia.org/wiki/Hans_Carl_von_Carlowitz


Current views and definitions

managing resources and its impact in an
Sustainability
environmentally friendly, socially responsible and
Management
economically wise way
(‘Triple Bottom Line’ concept – maximization of
economic, environmental and social performance)

Approach to give a frame for businesses to express their commitment to society.
voluntarily integration of social and environmental issues into all business activities
Corporate
beyond regulations (corporate nomenklatura for Sustainability Management)
Social
• Internally (from health and safety to responsible use of resources and adaptation to change
Responsibility (innovation)
•Externally – from social handling of community, stakeholder relations to human rights and global
environmental protection
European framework, Green Paper on corporate social responsibility


Reasons for Sustainability Management – Why?

Sustainability strategy "safeguard" - reducing and managing risks

Sustainability-induced problems and challenges
e.g. climate change, poverty etc. are tackled by the political system, markets or the public
Risks could affect the financial, managerial or reputation of corporations
Goal - securing the existing markets and the position in the markets

Sustainability strategy "credibility" - enhancing credibility and reputation

Credibility and reputation is a valuable non-tangible asset (also for situation of crisis)
Prevention of conflicts with authorities and stakeholders
Attraction of suitable employees and satisfaction of customers
Defensive focus (communication with stakeholders) e.g. MNCs or industries like chemicals,
pharmaceuticals, military, oil, automotive
Offensive focus (sustainable products and services), e.g. food, textile, finance
Good corporate citizenship is a sound investment


Systematic integration of CSR issues into business operation – Why?

Sustainability strategy "efficiency" - enhancing productivity and efficiency
Enhancing eco or socio efficiency of business processes
Cost reduction through resource efficiency
Productivity improvements through work conditions and job satisfaction

Sustainability strategy "innovation" - differentiating in the market
Creation of sustainable products and services with unique selling point
Increase of sales and margins through environmentally and socially friendly product innovations
Advantages through Sustainability in production, consumption or disposal phase
needs to be strongly communicated
e.g. organic food, textiles – healthy; car sharing - easy, green energy – less risky, fair trade
Sustainability strategy "transformation" – developing markets and society
Transformation / creation of new markets transforming human needs and consumption pattern
Requires institutional changes within human needs, politics or institutional framework
Proactive lobbying participation in political committees, standard creation etc


Social Responsibility – working draft 4.1 ISO 26.000

Responsibility of an organization for the impacts of its decisions and activities (products,
services and processes ) on society and the environment, through transparent and ethical
behavior that:

Takes into account the expectations of stakeholders
Is in compliance with applicable law and consistent with international norms of behavior
Contributes to sustainable development, health and the welfare of society
Is integrated throughout the organization and practiced in its relationships

http://iso26000.jsa.or.jp/_files/doc/2008/iso26000_wd4.1.pdf



Guideline Social
Responsibility –
working draft 4.1
ISO 26.000


Reasons and impacts of CSR

Address the link between the stakeholders’ interests and the responsibilities of the organization
Determine how best to increase the beneficial impacts of the organization’s activities and how
to decrease any adverse impacts
Fulfill legal obligations (e.g. to shareholders or to employees) and address conflicting interests
(between the organization and the stakeholder or between various stakeholders)
Reconcile conflicts of interests
Improve decision making through better understanding of impact and consequences of actions
Contribute to continuous learning by the organization
Provide the organization with the benefits associated with obtaining diverse perspectives
Help an organization review its performance so it can improve it
Increase transparency and the credibility of its communications
Provide a basis for cooperative activity such as partnerships

Guideline Social Responsibility – working draft 4.1 ISO 26.000


Examples of standards which contribute to CSR

Management standards Reporting standards
– Environmental Management - GRI - www.globalreporting.org
• ISO 14000 Family
• EMAS (European Union) Social standards
– ISO 26000 forthcoming 2009
– Quality Management – AA1000 (AccountAbility)
• ISO 9000 Family – Fair Trade Labeling Organization
• EFQM model for Business Excellence – BSCI (Business Social Compliance Initiative)
(European Foundation for Quality Management)

Industry standards
Workplace standards
– Textile
– SA8000 (Social Accountability International)
• ÖkoTex Standard 100Plus
– ILO-OSH-2001 (International Labor Organization)
• Purewear
– OHSAS 18001 (various worldwide Standardization Bodies)
• European Eco-Label


BSCI Code of Conduct / แนวทางปฏิบัต ิข อง BSCI

Aims to attain compliance of MNC and their suppliers with social and environmental standards
In accordance with international conventions and laws (ILO Conventions, UN Universal Declaration of
Human Rights, UN Conventions on children's rights and the elimination of all forms of discrimination
against women, UN Global Compact, OECD Guidelines for Multinational Enterprises)

1. Legal compliance 1. การปฏิบตตามกฏหมาย
ัิ
2. Freedom of association 2. เสรีภาพในการรวมตัวและสิทธิในการตอรองรวมกัน
3. Prohibition of discrimination 3. หามมีการเลือกปฏิบัตในทุกรูปแบบ
ิ
4. Compensation 4. การจายคาจางตอบแทน
5. Working hours 5. ชัวโมงการทํางาน
่
6. Workplace health and safety 6. สุขภาพและความปลอดภัยในทีทํางาน
่
7. Prohibition of child labour 7. การหามการใชแรงงานเด็ก
8. Prohibition of forced labour 8. การหามบังคับใชแรงงานและลงโทษ
9. Environment and safety issues 9. ประเด็นดานสิงแวดลอมและความปลอดภัย
่
10. Management systems 10. บริษทผูจดการระบบการผลิต
ั ั
www.bsci-eu.com/



CSR surveys on practice, drivers on benefits

Stiftung Warentest, Case Work March 09 (19 organisations)
EU project EMIT CSR, Malaysia 07 (ca. 50 organisations)
KPMG's International Survey of CSR Reporting 05 (ca. 1.600 organisations)
McKinsey, CSR value study 09 (ca. 80 organisations, 150 investment professionals


Consumer group CSR evaluation schema by ‘Stiftung Warentest’

societal and scientific opinion-forming processes of responsible corporate behavior
national/internat. conventions, standards and guidelines for responsible corporate behavior
criteria used within the framework of consumer-oriented company surveys
criteria used for socially responsible investment
criteria used in environmental, social and sustainability reporting by companies

Social Issues / Employees The Environment
1. Guiding principles and corporate policy 1. Guiding principles and corporate policy
2. Management and measures 2. Management
3. Implementation 3. Measures and implementation
4. Reporting 4. Reporting
Social Issues / Production and Supplier Consumers and Society
1. Guiding principles and corporate policy 1. Willingness to provide information
2. Management and measures 2. Community involvement
3. Implementation
www.test.de
4. Reporting http://en.wikipedia.org/wiki/Stiftung_Warentest


‘Stiftung Warentest’ – Case Work March 09

Organisations by sector (Th, 19) Organisations by employees

Manufactur- Autom otive Health and
ing social work less than 50 51 - 250 251 - 500
Education other 501 - 1000 more than 1000

Own CSR Cross-functional No organisational
Department Collaboration CSR structure


Attitude and commitment on social issues

Commitment is explicetely expressed

Avoid active or passive corruption and bribery in business

Com plying with international m inim um social standards (e.g. Code of Conduct)

Com pliance with the OHS standards throughout the com pany is explicitly expressed

Prom otion of the integration of foreign em ployees / m inorities / different religions

Prom otion of equal opportunities for wom en and m en is explicitly expressed

Prom otion of training and further education is explicitly expressed

Prom otion of health and safety at work is explicitly expressed

Internal statem ents on corporate responsibility are accessible

Public statem ents concerning responsibilities towards its em ployees

Detailed guidelines or principles on responsible treatm ent of the em ployees

0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50%

com prehensively largely partially inadequately


Social Issues / Employees – measuring results of implementation

Measuring employee satisfaction

Details of em ployee absenteeism are system atically recorded and analysed

Measures for im provem ents are introduced on the basis of these results

Em ployees are inform ed of the results by publication

Em ployee satisfaction is m easured regularly

Em ployee satisfaction is m easured for all em ployees

0% 5% 10% 15% 20% 25% 30% 35% 40%

com prehensively largely partially inadequately

Number and development of accidents at work in the company

Greater share or the number of workplace accidents has decreased

Average share or no change

Number of workplace accidents has decreased

Lower share

0% 10% 20% 30% 40% 50%


Supply chain management - social issues
Supply chain management - social issues

There is a com plaints office for em ployees at the production site
Ensuring com pliance of sub-contractors with m inim um social standards

Preference is given to certified / audited sub-contractors (e.g. SA8000, BSCI)
The com pany offers free advice and training for em ployees at his production sites

The com pany offers free advice and training for buyers and sub-contractors
Non-com pliance results in the im plem entation of certain m easures and sanctions if applicable
Com pliance with social standards is regularly surveyed
Com plying with m inim um social standards is a pre-requisite for every signed delivery contract
0% 5% 10% 15% 20% 25% 30% 35% 40%

com prehensively largely partially

Reporting on such topics
No reporting on such topics
0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50%


Environmental performance

Status of environmental protection

Motivation system to im prove environm ental perform ance in production and acquisition
Em ployees are actively involved in environm ental protection throughout the com pany

Environm ental indicators are defined in order to m onitor achievem ent of targets
Measurable environm ental targets have been approved

Responsibility for environm ental protection concerns is integrated in product developm ent

Responsibility for production process related environm ental protection is allocated
A specific organisational unit is responsible for environm ental protection within the com pany

Responsibility for environm ental protection is allocated within the m anagem ent

0% 10% 20% 30% 40% 50% 60%



Monitoring / publishing of company data on material and energy consumption

Environmental performance measurement

Other data: transportation kilometres, noise, production accidents, complaints from the neighbourhood

Waste: total quantity, composition, hazardous waste

Water emissions: waste water quantity and pollution (especially COD, heavy metals)

Air emissions: climate relevant pollutants (CO2), nitrogen oxides, sulphur dioxide, airborne dust

Water: use in production / manufacture (industrial water), drinking water consumption

Energy: consumption data according to energy source, share of regenerative energy

Materials: consumption of raw and process materials (absolute quantities)

0% 5% 10% 15% 20% 25% 30% 35% 40%

Data is collected from several Data is collected from some Data is collected from a few Data of material and energy
areas and published areas and published areas and published consumption is not collected
and published


Complaint management system to increase customer satisfaction

Customer complaints

All custom er com plaints are docum ented and system atically evaluated

Open custom er inform ation on com plaints

Em ployees are given regular training in dealing with custom er com plaints

Fulfillm ent of defined standards is regularly m onitored and m easured

Defined targets for dealing with com plaints and actively com m unicates them to em ployees

W ritten declaration of service and quality standards for custom er com plaints

W ritten declaration of responsibility within the organisation for com plaint m anagem ent

0% 5% 10% 15% 20% 25% 30%



Consumers and society - community involvement

Community support

Participation in Local Agenda processes

Prom otion of projects, which im prove OHS of the em ployees of sub-contractors or suppliers

Sponsoring or support of training/educational establishm ents for the em ployees of sub-contractors

Regular tim e off for em ployees for charity work

Sponsoring of cultural events and am ateur sports

Annual donations in the form of m oney, m aterial goods or services for environm ental, social aim s

0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50%
com prehensively largely partially inapplicable


Why is your company interested in applying CSR?

Company - CSR Driver

Community pressure

Attraction of new investors or customers

Competitive pressure

Philanthropy

Information demand by stakeholders

Differentiation opportunities

Legal- or regulatory obligations

Environmental concerns relating to products or service

Social concerns relating to products or service

Improving Business Performance

0% 10% 20% 30% 40% 50% 60% 70% 80%

EU project EMIT CSR, Malaysia, 2007 - 2008


Market forces that could drive the need for organizations to address CSR

1. Economic considerations
2. Ethical considerations
3. Innovation and learning
4. Employee motivation
5. Risk management or risk reduction
6. Access to capital or increased shareholder value
7. Reputation or brand
8. Market position or share
9. Strengthened supplier relationships
10. Cost savings

KPMG's International Survey of CSR Reporting (2005). This report surveyed more than 1,600 companies worldwide and
documented the top ten motivators driving corporations to engage in CSR for competitive reasons.


Valuing corporate social responsibility


Consequences for action

1. Potential for shareholder value from environmental, social, and governance programs
needs to be better understood.
2. Stakeholders needs and demands are the base for meaningful changes.
3. Applying systematic performance evaluation (data gathering, evaluation and corrective
action) can drive systematic improvement
4. The integrating of effects and impacts of environmental, social, and governance
programs with the rest of the company’s finances / performance assessment is crucial.
5. The role of employees in the value adding process can be enhanced through CSR.
6. Opportunities of environmental, social, and governance programs to create new revenue
streams is not sufficiently recognized. Holistic integration of CSR issues in business
planning and reporting is the base to tap these opportunities.
7. Communication and corporate culture are keys to CSR.



CSR – making profit with a clear conscience!

Involves every aspect of an organization, like
Governance
Environmental sustainability
Risk management
Workplace issues
Cultural norms
Local laws and customs
….


Further reading

Green Paper on Promoting a European framework for Corporate Social Responsibility,
European Commission, 2001
ISO 26.000 ‘Guidance on Social Responsibility, ISO/TMB/WG SR N 137, 2008.03.11
Mapping instruments for corporate social responsibility, European Commission, Directorate-
General for Employment and Social Affairs, 2003
Valuing corporate social responsibility, McKinsey Global Survey Results, Value and effects of
CSR, survey among CFOs, investment professionals and CSR professionals, 2009

Corporate sustainability: What is it and where does it come from?, Mel Wilson, Ivey Business Journal
Online, 2003
Sustainability Management in Business Enterprises, Concepts and Instruments for Sustainable
Organisation Development, Schaltegger, Herzig, Kleiber, Müller, published by The Federal Ministry for
the Environment, Nature conservation and Nuclear Safety (BMU), Division for Environment and
Economy, Eco-Audit


Further reading, information and networking – www.sustain-asia.org



Systematic integration of CSR into business operation



Performance
Reporting
Controlling

Assessment

Continuous Improvement



Strategy
Development

Internally directed analysis of own
company (e.g. SWOT)
Formulation of the company’s core
company’
Externally directed analysis of reason to be.
- Industry
- Markets Definition of corporate values Formulation of mid- and long-term
mid- long-
- Environment
plan of action to
Definition of corporate culture - fulfill the company’s mission,
company’
- while taking account the company’s
company’
capabilities (internal analysis) and it’s
it’
competitive environment (external
analysis)



Implementation
Planning

Using the Balanced Scorecard Financial perspective
approach to break down Which financial objectives
business strategies (Kaplan & have to be fulfilled to
Norton) implement the strategy

Customer perspective Internal process p.
How the company Vision How do internal processes
wants to be seen & have to change to
by the customer Strategy implement the strategy

People & knowledge p.
What employees and the
organisation have to learn
implement the strategy


Company Medium-Term Strategy
Increase the company’s profits by international expansion and differentiation
through sustainability

Financial Perspective Move products up
market to increase
profit margin for own
branded products.

Customer Perspective Provide
Be recognized (own-branded)
as sustainable products tailored to
company customers’ needs and
tastes

Internal Process Perspective Develop and
Green Increase Increase
introduce right
production business flexibility of
products to the
process transparency production
right markets

People and Knowledge Perspective
Ensure production staff Improve
Move to
Foster a can perform tasks business
knowledge based
company culture environmentally communication
value creation
of sustainability responsibly



Financial Perspective

Goal Key issues Target Activity
Increase profit • Profit margin • +50 percent Align company processes to
margin for own- • Production costs • -10 percent sustainability principles to
branded products • Selling price • +60 percent differentiate products and
• Overhead costs • -5 percent create added value for
customers


Customer Perspective
Goal KPIs Target Activity
Goal Key issues Target Activity
Increase profit • Profit margin • +50 percent Align company processes to
Be recognized as • Positive media • 6 reports in Use PR instruments to
a sustainable reports local, 3 in communicate company’s
branded products • Selling price • +60 percent differentiate products and
company international commitment to sustainability.
• Overhead costs • -5 percent create added value for
media Develop co-branding/co-selling
customers
• Consumer survey • +35 percent strategy with sustainable
score • +25 percent products.
• Marketing budget

Provide products • Customer • +50 percent Engage customers to survey
tailored to satisfaction needs and identify trends, focus
customers’ needs • Loyalty ratio (re- • 50 percent also on buying habits.
buy rate)


Goal KPIs Target
Process Target
Perspective Activity
Goal KPIs Activity
Increase profit
Goal • Profit margin issues
Key • +50 percent
Target Align company processes to
Activity
a sustainable
Green production reports
• Recycled materials +6040 3 in
local, percent
• percent communicate company’s
Analyze production process
branded products • Selling price • differentiate products and
company
processes as input international commitment to sustainability.and
• Overhead costs • -5 percent create addedholisticfor
from a value perspective
• Hazardous media
• Decrease or customers co-branding/co-selling
Develop potential to green the
identify
• Consumer survey
materials • +35 percent to 10 strategy with sustainable
substitute production process, e.g.
score • +25 percent
percent products. substitution, reduction
through
• Marketing budget
• Energy • Use 40 percent and avoidance .
consumption from RES
Provide products
Flexibility of • Customer
• Lead-time • +50 percent
• -10 percent Engage customers to survey
Improve order planning through
tailored to
production satisfaction
• Set-up time • -15 percent needs and identify trends, focus
effective customers involvement
customers’ needs • Loyalty ratio (re-
processes • Time to customer • 50 -20 percent
• percent also on buying habits.
(design)
buy rate) Training of staff,
Optimization of internal and
external logistic, optimize
supplier management


Goal KPIs Target
Process Target
Perspective Activity
Goal KPIs Activity
Increase profit
Goal • Profit marginPeople and Knowledge Align company processes to
KPIs Target Perspective Activity
• +50 percent
Green production reports Key issues local, 3 in Target communicate company’s
a sustainableGoal • Recycled materials • 40 percent
branded products • Selling price • +60 percent
Activity
Analyze production process
differentiate products and
company
processes
Improve international / month from a holistic perspective and
as Training of staff -5 percent
• input • 6 hours commitment production related
Provide to sustainability.
• Overhead costs • create added value for
knowledge based • Hazardous media courses / year identify potential to green the
• Decrease or customers co-branding/co-selling
•2 Develop
training, set up of knowledge
value creation • Consumer survey
materials • +35 •percent to 10 strategy with sustainable Value
substitute
30% increases production process, e.g.
management system,
score • +25 percentimpact products. substitution, reduction
percent
of CIP through products through new
added
• Marketing costs
• Energy budget
• R&D • Use 40 percent toand avoidance .
• 25 % increase designs
consumption from RES
production cost
Provide products
Flexibility of • Customer
• Lead-time • +50 percent
• -10 percent Engage customers to survey
Improve order planning through to
Culture of • Employee • 85 percent Anonymous employee survey
tailored to
production satisfaction
• Set-up time • -15 percent needs and identify trends, focus
effective customers involvement
sustainability satisfaction
customers’ needs • Loyalty ratio (re- also on buying habits. set up of
identify problems,
processes • Time to customer • 50 -20 percent
• Improvement by • percent
• 15 suggestions (design)
incentive schema, CIP
buy rate) Training of staff,
employees per quarter networking events,
• Recruitment of • +20 percent Optimization of internal and
communication platform,
Univ. Gradates applications external logistic, optimize
improving working atmosphere
supplier management


Development of a CSR Performance Assessment Systems

Assessment Plan Goal system for the company
Activity specification
Stakeholder engagement

Assessment Procedure Defined procedure (reporting cycles, assessment meetings)
Responsibilities / competences
Standard key performance indicators
Change management plan for improvements
Communication plan
Review procedure

Assessment Reports Types Monitoring, benchmarking, audit / internal/external
Content KPIs, benchmarks, goal achievement, improvement monitoring
Structure Specific definition, graphics, results
Reporting Publication, frequency, work flow


Performance assessment / closed-loop controls

Company
Top Management
Information flow

Area 1 Area 2 Area n
Production Area

Department 1 Department 2 Department n Material Flow
Department

Closed Loop Closed Loop Closed Loop


Procedures, Responsibility and Competences

Ways of decisions Ways of communication

CEO

Director

Manager

Master

Forman

Employee
A B
levels

เกรงใจ graengdjai ?? Interfaces


Challenges for CSR activity implementation & performance controlling

Established management structures and processes
Hierarchical power, prestige, career related interests of employees etc.
employees
Assumptions, thoughts and beliefs of employees regarding goals and activities
Insecurity and rejection caused by transparency and quantitative controlling
quantitative
etc.
Strong commitment from top management
Creation of awareness and open mind-set of employees (internal acceptance)
mind-
Proactive approach to tackle potential mental reservations of employees
employees
Establishing a discourse-oriented infrastructure (e.g. internal discussion on activities
discourse-
before implementation)
Involvement of various functions and departments
Consideration of micro-political issues (influence and hierarchical power)
micro-
Integration into general management (avoid separation of management systems!)
management
Regular revision according to performance and changes in corporate strategy
corporate
…


Further reading / listening

Leveraging the Balanced Scorecard for Social Responsibility and Reporting, Michael E Nagel,
Balanced Scorecard Collaborative, Inc., 2005, webcast (Why the Balanced Scorecard is a powerful
tool for managing and communicating corporate social responsibility)

Sustainability management with the Balanced Scorecard, Thomas Bieker, Institute for Economy
and the Environment at the University of St. Gallen (IWOe-HSG)



ICT and business management


Ensuring business performance and competition levels

From resource and labor intensive to more knowledge based production pattern through
adaptation of advanced business management practices

World Bank ranking Thailand – overall business efficiency index versus knowledge economy index 34 – 56
(business performance versus base for economic success)
Total Factor Productivity (TFP) is regarded as technical productivity
Statistical method to determine economic development drivers
Technology growth and efficiency main sub-sections of TFP
Knowledge economy index reflects ability to employ technological progress for economic prosperity
World Bank survey of over 20.000 businesses in low- and middle-income countries
Result: companies using ICT were found to have 60% higher profits and 15% higher re-
investment rates, the value added per employee was about 3.400 US$ higher (average base of
value added per employee / a: 7.000 US$).
The Global Competitiveness Index rankings, 2007–2008 comparisons, World
Economic Forum
The Role of ICT in Doing Business, Information and Communications for
Development, 2006, World Bank, www.worldbank.org/ic4d


Adaptation of advanced business management – key areas and approaches

Strategic business management – CSR
CSR – holistic and strategic management approach to lead towards environmental-friendly and
socially advanced businesses, Integration of environmental and social factors meaningful into
business practices
Operational business management – Resource Management
process management approaches to enable effective planning and efficient use of environmental
related resources (Process Monitoring & Controlling and Enterprise Resource Planning)
Performance evaluation – Environmental Cost Accounting and Investment Appraisal
activity based, physical and monetary accounting for impact and opportunity quantification
enables fundamental decision support through quantification of environmentally related costs
and investment opportunities (e.g. technology evaluation)
Communication and business culture which contribute to organisational learning
Cross-functional methods, e.g. Continuous Improvement Processes, Knowledge Management,
Stakeholder Relationships Management


General requirements for the adaptation of advanced business management

Enhancing creativity and know-how of employees
Enhancing organizational learning
Systematic comprehensive and targeted communication
Creating transparency and managerial awareness of business processes
Both, transparency and awareness depend on the ability of companies
(particularly SMEs) to collect, process, and analyze respective data

Hence, modern business management depends on availability and efficiency of
corresponding systems for data processing system (so-called advanced ICT)


Reasons for insufficient level of ICT adoption
Poor service of support infrastructures While basic infrastructures and ICT equipment are accessible in Thailand, service
result in limited business access and and support infrastructures are underdeveloped.
low application levels
Most advanced ICT products are ICT firms used to target large enterprises (budget, HR to run state-of-the-art ICT).
designed for larger firms, not SMEs These products are often too expensive and too complex for SME users.

Limited ICT literacy of SME owners Many SME owners are unfamiliar with operating a computer, skeptical of the
hinders their ability to choose concrete benefits for the core business, and share the stereotype that advanced
ICT is only for larger companies.
Limited ICT literacy of employees in Even if SME owners have a strategic understanding of why they should adopt
SMEs hinders ICT adoption ICT, their staff is often poorly trained. Training costs both time and money –
resources that SMEs usually lack.
Adopting ICT is not a technical ICT is a difficult task for companies of all sizes, whether they are in developed or
challenge developing countries. The main challenge is, it must go along with organizational
and structural changes in companies.
Lack of financing options limits SME IT budgets are usually small or nonexistent. In addition, adopting ICT is not a one-
ability to purchase ICT time cost because there are ongoing costs of maintaining and upgrading
hardware and software, and human capacity building.


ICT for business management
Sustainable business success needs adequate controlling and supporting systems. A large
number of Thai companies are not prepared for the future! ? (IT&C FORCE 04)

IT systems used to support controlling and management tasks and real benefit (or benefit from future use)

Business assessment based on indicator
Process monitoring with indicator
Internal communication
Internal documentation
In-house gap analysis
Representation and analysis of material flows
Simulation of processes
Preparation of material and energy balances
External documentation/communication
Recycling or waste exchange
Definition of environmentally
oriented objectives
80% 60% 40% 20% 0% 0% 20% 40% 60% 80% 100%

in use not in use very great and great


Selected advanced ICT for business management
Examples for SM approach Function Link
advanced ICT
Open Bravo, SoFi Resource Management, Indicator based process monitoring from http://forge.openbravo.com,
CSR, Environmental manufacturing process to supply chains www.pe-international.com/sofi
Cost Accounting and Enterprise Resource Planning

Redmine Environmental Workflow management for continuous www.redmine.org/
Management, CSR improvement processes

Umberto Resource Management, Material and energy flow analysis, www.umberto.de/en
Environmental process simulation
Investment Appraisal
Drupal, Stakeholder Internal / external communication, http://acquia.com/products-
SugarCRM Relationship stakeholder involvement (CRM) services/acquia-drupal ,
Management www.sugarcrm.com
E-Front, Elgg Knowledge web 2.0 e-learning and knowledge www.efrontlearning.net
Management, e- management for businesses, Internal / http://community.elgg.org
Learning for business external communication


Resource flow analysis

www.modiconsult.com


Open Source Software

Computer software for which the source code are provided under a variety of software license
License examples: Apache License, GNU General Public License, GNU Lesser General Public License,
MIT License
GNU General Public License most popular (about 2/3 of projects listed on SourceForge.net)
Permits users to use, change, and improve the software under specified conditions
Permits to redistribute it in modified or unmodified forms under specified conditions
Often developed in public or collaborative manner
web-based source code repositories offer centralized location for developers to control and
manage open source software development projects
e.g. SourceForge, world largest development site, more than 230,000 projects with over 2 million
registered users, 34 million unique visitors each month
Linux, MySQL, Firefox, WordPress, xt:commerce, Elgg, OpenOffice, Redmine …
http://en.wikipedia.org/wiki/Open_Source_Definition
http://sourceforge.net/
http://opensource.yeebase.com/top100


Redmine - www.redmine.org

Flexible project management web application to manage, document and track work
Written in Ruby on Rails framework
Open source and released under the terms of the GNU GPL v2
Multiple data base support Issue management system
Refers to the discipline and process of managing business tasks
Workflow, communication support and controlling
Typical application: complaint, suggestion and project management
Main features:
Multiple projects support, flexible role based access control
Flexible issue tracking system, news, documents & files management
Feeds & email notifications, per project wiki and forums
Time tracking, custom fields for issues, time-entries, projects and users
Multilanguage support, Multiple databases support (MySQL, PostgreSQL or SQLite)


Redmine – example for issue workflow

Typical issue workflow [issue submitted] -> [open] -> [assigned] -> [solved] -> [in evaluation] ->
[closed]
Often tasks and work are completed in loops [assigned]
Example for electronic workflow with regard to roles:
1. issue submitted by a customer, salesperson, employee
2. issue is relocated to the responsible employee’s inbox
3. employee evaluates the issue and fulfills the task
4. In case task can not be completed issues is assigned to the next appropriate employee
(workflow) until task is completed
5. When task is completed result will be evaluated and closed
6. Originator will be notified
Workflow, inputs and outputs fully documented in the system



Indicator Management Process Management



Project proposition: Transition of SMEs and supply chain networks
towards sustainable production processes through an active uptake of ICT solutions for
sustainability management – ICT4SM

Objectives

1. To develop a portfolio of efficient ICT-based sustainability management tools
and solutions tailored to the local conditions in Southeast Asia and needs of local
SMEs across various industrial sectors
2. To stimulate and facilitate an uptake of ICT-based sustainability management
methods and tools in significant number of regional SMEs and to improve their
competitiveness and local environment situation
3. To establish a service infrastructure for fostering sustainability management culture
and capacity
4. To encourage uptake of sustainability management tools and practices on
national/regional level through active dissemination and promotion activities


Example for combining tools and services for on demand application


Further reading

Small and Medium Enterprises and ICT, Vadim Kotelnikov (Foreword by Kim Hak-Su), UNDP-
APDIP, APCICT, 2007
The e-primer looks at how the knowledge-based economy has impacted small and medium
enterprises (SMEs); explores why so few SMEs have adopted why SMEs should adopt ICT;
provides policy recommendations for promoting SME adoption of ICT.

The Role of ICT in Doing Business, Information and Communications for Development, 2006,
World Bank, (IC4D is a regular publication of the World Bank on the critical role of ICT in economic
development. www.worldbank.org/ic4d
Towards a Knowledge Economy in Thailand, Office of the National Economic and Social
Development Board, World Bank, 2008 (Fundamental reasons for Thai SMEs to switch to more
sustainable and innovation-based development patterns)
How businesses are using Web 2.0, McKinsey Global Survey
IT’s unmet potential, McKinsey Global Survey Results, 2008


CSR in practice

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