Question

In: Operations Management

How do sustainability metrics affect internal (managerial) decision making?

How do sustainability metrics affect internal (managerial) decision making?

Solutions

Expert Solution

Sustainability metrics/ indicators are:

• Material intensity

• Energy intensity

• Water consumption

• Toxic emissions

• Pollutant emissions

These metrics should operate/ benefits internal decision making to make right decisions towards a company’s sustainability maintenance or developing top or bottom lines:

• it should be simple — not requiring large amounts of time or manpower to develop, saving cost of HR department

• understandable to a variety of audiences, from people in operations to finance to strategic planning so that can well analyse the required cash flow to be generated or do cost cutting from available assets and resources

• It has to be cost-effective in terms of data collection, better be reproducible so that while incorporating the decision rules in various departments and for various perspectives to produce consistent and comparable results

• Robustness is required to indicate progress toward sustainability when improvement has quantitatively done and qualitatively justified too

• As long as protection of proprietary information is maintained — preventing the loss of all related confidential information.


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