Question

Discuss the importance of integrating business models to sustainable innovations. Explain the pillars of business models that should be considered in building business models of sustainable innovations. Support your answer with two illustrative examples.

Answer 1

Ans.  

Three primary pillars of an innovative and sustainable business model are People, Environment and Profit. To understand deeper the concept of sustainable development we will have to understand the concept of sustainable innovation- sustainable innovation in business implies ability of the business to produce its goods and services in harmony with nature, provided there is zero impact on profitability.

The idea of profitability is at the core of the business as business will stop functioning of profitability is hampered. Low profitability in business will damage the entire economic ecosystem. As such Profitability is of utmost importance to ensure that businesses function in its full strength.

Across industries think-tank of different businesses have realised the importance of Sustainable innovations in businesses. It is due to this reason that corporates and government across the globe is talking about sustainable innovation.

One such innovation that we can look into is in the field of agriculture. Organic farming is one sector where we see businesses have focussed towards sustainability. This is because organic farming sector denounces the idea of using chemicals to enrich the fertility of the soil. Since chemicals destroy the natural quality of soil and make its infertile within a short span of time. In preference in Organic farming generally farmers use organic products and manures so that the soil continues to restore its vitality and richness to produce the cultivated products. As such the depleting effect of the soil is minimal and gives a greater window period of using the same piece of land for cultivation for longer period. So this sustainability of business is one such example of Business model with sustainable innovation.

Secondly we can see recently in India there was a nation-wide movement towards saving of water bodies across the country t was initiated by Isha Foundation. Due to rampant industrialization and unplanned and disorganised planning, infrastructures did come up across the country for factories, businesses and industries. However this did not yield a better result after a decade as India as nation started facing shortage of water. This is solely because many of the water bodies such as ponds and lakes got dried up. In many of these water bodies huge buildings was constructed. Since India depends solely on monsoon for its yearly water consumption and river beds, ponds and lakes were the source. Since these sources were dried up and many of them saw infrastructures built on them as such country came across sever water shortage. To counter this tragic situation rally for rivers started. One key point that was driven in this project was to ensure people plant more trees specially farmers that too a tree hat has a commercial value. This is due to the fact that no one cares about nature unless there stomach is full so unless planting trees was not made lucrative no one would have shown interest to plant trees. So movement to plat lucrative trees on the boundaries of farm land gained momentum. With this objective of preserving water on the land from getting it drained to seas and oceans was achieved. Simultaneously planting trees became lucrative and farmers were the largest beneficiaries of this movement. Existing infrastructure continues to exist but dearth of water shortage to run these factories and industries has gradually depleted. Besides as part of corporate social responsibility corporates has been taking initiative in setting up water recycling plant in their business units to meet daily requirement of water usages and simultaneously pressure on natural reservoirs of water has also reduced. So this is another fine example of sustainable innovation in business.