Should environmental management standards be a ...

The Learning Organization Should environmental management standards be a mechanistic control system or a framework for learning? Peter Strachan,

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Should environmental standards be a mechanistic control system

The Learning Organization

Peter Strachan

Volume 4 · Number 1 · 1997 · 11–18

Introduction

Should environmental management standards be a mechanistic control system or a framework for learning?

Many business organizations are having to make innovative and yet practical responses to the complex and uncertain environmental challenges facing their firms. A number of recent research studies (Elliot et al., 1996; Scallon and Sten, 1996) have concluded that much of the business community is facing increasingly stringent legislative and regulatory measures, commercial and other stakeholder pressures to raise the environmental standards of business practices. In responding to these external pressures for change, environmental concerns have been forced onto both the strategic and operational agendas of many firms. This has led to a plethora of environmental management initiatives by the business community, with the most recent being that of the generic environmental management standard. This requires a firm to establish a comprehensive environmental management system covering the entirety of its business activities and operations (Stuart, 1995, p. 8). Today, firms can choose from three environmental management standards and they are: the British Standards Institution (BSI) environmental management system BS 7750 (BSI, 1994); the EU Eco-Management and Auditing Scheme (DoE, 1995; OJEC, 1993); and the International Organisation for Standardisation (ISO) environmental management system ISO 14001 (ISO, 1995). These management standards are receiving much support from governments throughout the world, national and international business bodies and the general business community which see them to be significant progress in businesses drive towards “sustainable development”. The World Commission on Environment and Development (1987) which brought the term “sustainable development” into popular focus and debate defines it as: “a process of change in which the exploitation of resources, the direction of investments, the orientation of technological development, and institutional change are made consistent with future as well as present needs” (p. 7). The principles of sustainable development


Peter Strachan

The author Peter Strachan is Research Assistant/Lecturer at The Robert Gordon University, The School of Public Administration and Law, Aberdeen, UK. Abstract Analyses the key aims of the recently formulated environmental management standards BS 7750, EMAS and ISO 14001, and then queries the efficacy of the management systems prescribed in their formal documentation. Isolates the various components of the standards’ management system and then considers whether or not the approach taken is appropriate for the attainment of their stipulated aims. Concludes that the environmental standards should be fundamentally revised and replaced with more participatory forms of management and organization that push a firm towards a learning organization mode.

This article draws on the following conference paper: “The formulation of environmental standards: panacea or placebo?”, presented at Eco-Management and Auditing Conference, University of Leeds, 2 and 3 July 1996.

The Learning Organization Volume 4 · Number 1 · 1997 · pp. 10–17 © MCB University Press · ISSN 0969-6474

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Should environmental standards be a mechanistic control system?


Peter Strachan

Volume 4 · Number 1 · 1997 · 10–17

enshrined in this and other reports (DoE 1990), among other things, involves the process of integrating environmental criteria into business practice. The formulation of BS 7750, EMAS and ISO 14001 are visible attempts to integrate environmental and business goals in this way. These management standards call for firms to re-examine fundamentally their primary activities and manage their operations in new and novel ways that challenge conventional thinking on business and the environment. This, the standards argue, is needed to rebuild and revitalize the strategic vision of a firm’s future, resting on agreed work norms. This new vision being one which explicitly recognizes the need for continuing growth and evolution while, at the same time, conserving natural wealth, such as clean and adequate water supplies, good arable lands and ample wildlife and forests. This article argues that the complexity of integrating environmental and business considerations will require firms to transform themselves into “learning organizations” or “companies”. Senge (1990) captures the character of the learning organization and states this is: “… an organization that is continually expanding its capacity to create its future. For such an organization, it is not enough merely to survive. ‘Survival learning’ or what is more often termed ‘adaptive learning’ is important – indeed it is necessary. But for a learning organization, ‘adaptive learning’ must be joined by ‘generative learning’, learning that enhances or capacity to be creative” (p. 16). Senge has also said that the learning organization which is functioning well has several elements in place and he describes five “competent technologies”: systems thinking, personal mastery, learning to unearth mental models, building a shared vision and teamworking. The characteristics of the learning company are also described by Pedler et al. (1991) who define it as: “an organization that facilitates the learning of all its members and continually transforms itself ”. They state that a learning company: has a climate in which individual members are encouraged to learn and to develop their full potential; extends this culture to include customers, suppliers and other significant stakeholders; makes human resource development strategy a key focus of business policy; and is in continual

organizational transformation (Hawkins, 1994, p. 75). The type of learning strategies postulated by Senge, Pedler et al. and other organizational learning theorists (Argyris and Schon, 1978; Barrett, 1995) is what the management standards believe firms must attain if they are to meet their environmental challenges. The standards fully recognize that to satisfy the growing environmental concerns of legislative and commercial stakeholder pressures, firms must re-examine the entirety of their activities and operations and manage them in new and novel ways. This, they argue, is needed to raise environmental standards in the face of such challenges. The question which this article addresses is: do the management and organizational arrangements the standards advocate offer an effective means for the raising of a firm’s environmental standards?

Method of analysis The prominent concerns of this article are to analyse the key aims of BS 7750, EMAS and ISO 14001 and then to call into question the efficacy of the management system prescribed to secure them. This paper isolates the various components of the environmental standards and considers, in the light of the learning organization literature, whether the approach taken to the design of formal management structures and organizational systems, decision-making and control procedures and the management of people are suitable for the attainment of the standards’ aims. The following discussion will demonstrate that firms which follow the standards route to environmental excellence are unlikely to realize the stipulated aims. The main conclusion of this article is that the standards need to be revised and that the stress on mechanistic solutions should be replaced with more flexible forms of management and organization that push the firm towards a learning organization mode.

The standards’ aims The broad purpose of the environmental standards is complex and multifaceted. In short, however, it can be argued that their aims are twofold. First, to ensure that a firm achieves the goals and targets it sets for itself through the establishment of a quality assurance (QA) system. Second, to augment these goals and targets and devise new ones as the 11



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Volume 4 · Number 1 · 1997 · 10–17

firm more fully understands the effects which its activities and operations have on the environment. The question that must be addressed is: do the environmental standards establish a system of management appropriate for the attainment of these aims?

The system of QA recommended is primarily concerned with controlling and monitoring the firm’s environmental impact. The key elements of the system, drawing up the register of environmental effects and regulations, senior management identifying clearlydefined targets and objectives, and monitoring and modifying the documented environmental programme in the light of progress towards these goals, are concerned with QA. However, little attention is paid to the environmental review, which is the feature of the management system charged with the responsibility of continuously raising environmental standards. From this, it can only be assumed that the model of management underpinning the QA system is also that required to raise a firm’s environmental standards. This is a significant oversight and one which is unlikely to realize the stipulated aim of continuously raising environmental standards. The rationale for this is now explained below. The QA system, when formally implemented in a firm, is likely to prompt the emergence of a role culture (Handy, 1993). This type of culture stresses the importance of formal rules and regulations, official roles and procedures, and is likely to engender in a firm an adaptive learning mindset. This type of learning is unlikely to encourage managers to challenge conventional business ethics and to alter their strategic and operational priorities. However, this is exactly what is needed to

The standards’ components In addition to having the same aims, the standards also contain many of the same core components. These are summarized in Table I. The flaws in the system of management recommended by the standards are now explored.


The critique The standards’ perspective on management incorporates a variety of management and organizational philosophies and principles. The dominant theme of this perspective, however, is a commitment to mechanistic forms of managing and organizing staff for the attainment of environmental goals. The standards are a blueprint for a centralized, hierarchical and highly formalized management system to control and monitor the firms’ stated environmental standards and programmes. This is illustrated by the approach which the environmental standards take to QA. This is summarized in Figure 1 and further outlined in their official documentation.

Table I The main components of BS 7750, EMAS and ISO 14001

Feature

Description

Initial environmental This is carried out by senior management and is intended to provide a detailed review “snapshot” of the firm’s environmental performance Environmental policy

This is drawn up by senior management to formalize the firm’s overall approach to environmental management on the basis of the environmental effects register. This should also provide a commitment to continuous environmental improvement

Environmental programme

This is created by senior management to put the firm’s environmental policy into practice. Quantifiable targets and objectives are to be set. Clearly-defined operational controls are also to be established. Once senior management has set priorities, the programme has to be implemented with a clear chain of hierarchical authority and responsibilities at every function and level of the firm

Management system The programme is set by senior management and must be formally organized and clearly documented, with fully-trained personnel responsible for it at all functions and levels Audit

An audit programme is periodically carried out by senior managers to ensure that the progress has been made in the programmes

Environmental review

The environmental policy and programmes are also to be periodically reviewed and revised accordingly by senior management 12



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Volume 4 · Number 1 · 1997 · 10–17


Figure 1 The Environmental Management Standards’ hierarchical and highly formalized approach to QA

raise a firm’s environmental standards over time. In this context Smith (1993) has said: “… the problem of environmental damage by business is a complex and multi-faceted issue which … will also necessitate a change in organizational culture …” (p. 10). Only when firms practise generative learning will they be able to manage the change strategy envisaged by Smith. This type of learning emphasizes experimentation, systematic thinking and a willingness to think outside the accepted limitations of received wisdom. It goes beyond the paradigms that created current operating and working conditions (Strachan, 1996). This is what Argyris and Schon (1978) and Argyris (1990) call “double-loop learning” and Barrett (1995) “appreciative learning”. The documentation of the standards, however, is silent on how to encourage this type of learning and the leadership and management styles, communication patterns and

human resource policies needed to support it. Again it is a failing of the standards that so little attention is paid to these issues. The learning organization literature (Argyris, 1990; Pedler et al., 1991; Schein, 1993; Senge, 1990; Watkins and Marsick, 1993), however, does suggest that a firm is more likely to practise generative learning when it has in place human resource policies which devolve authority and responsibility throughout the firm and strengthens the influence of staff over their organizational goals and objectives, methods of working and management of their immediate work environment. There is also strong evidence that when roles allow the job-holder to exercise complex cognitive and social skills, they can motivate, unshackle talent and enhance a firm’s potential to practise generative learning. Flat organizational structures and participative leadership and management styles are also thought to aid this process. Another 13




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Volume 4 · Number 1 · 1997 · 10–17

feature likely to encourage this is the use of employee involvement initiatives such as process improvement teams, quality and environment circles and other forms of teamwork. Environmental steering committees and action teams also have an important part to play. By drawing together managers and staff from different parts of the firm, such teams can help break down long established departmental and professional perspectives and improve the flow of ideas and information across the firm. The organizational and cultural arrangements outlined above are what this author believes are required to secure the complex aims articulated by the standards. The implementation of such arrangements will put managers in a better position to reassess contemporary business practices and ethics. Only when this is achieved can managers begin to change and revitalize their firm’s shared vision of the future, management strategies and methods of working. This vision being the pursuance of environmental excellence in all business activities and operations.

raising of environmental standards and to query the efficacy of the management system prescribed. It should now be clear that a successful environmental management system will probably contain features which are very different from those found in the system of management championed by these standards. The standards’ problems relate to the mechanistic model of management underpinning their deliberations and recommendations. It is unlikely that the mechanistic solutions advocated by the QA approach prescribed will result in significant progress for the firm. To secure this, firms would be better advised to transform themselves into learning organizations. The key features of the model of management underpinning the environmental standards approach to QA and the learning organization are summarized in Table II. There are many examples of firms which are attempting to raise their environmental standards and at the same time transform their organizations into learning organizations (Bennett et al., 1993; Welford, 1994). Some of these firms include, among others, the Eastman Kodak Company, Xerox, Apple Computer, the Volkswagen Audi Group, Merck and Company, the Ace Hardware Cooperation, IBM and British Telecom (BT). To secure this transformation some of the managerial and organizational arrangements

Conclusion The purpose of this article was to analyse the key aims of the standards approach to the

Table II The model of management informing the standards and the learning organization

Feature

The standards

The learning organization

The management of people Favours mainly extrinsic motivators Employees largely excluded from policy and management issues

Favours mainly intrinsic motivators Extensive use of employee involvement in schemes including teamwork

Job design principles

Fixed and narrowly defined roles, authority and responsibilities

Flexible role definitions, authority, responsibilities, contingent on changing circumstances

Structures and decision making

Hierarchical structure, centralized decision making at the top of the organization Co-ordination and control rely on highly formalized and documented rules and procedures

Flat structure, minimal administrative hierarchies, dispersed decision making contingent on expertise Co-ordination and control based more on a shared vision, values and work norms

Values, attitudes and behaviour

Tradition and precedent exercise powerful influence Rigid working practices, supports status quo or incremental change

Challenging and experimenting Adaptable, supports radical and fundamental change

Adaptive

Generative

Organizational learning

Source: Adapted from Moxen and Strachan (1995) 14



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Volume 4 · Number 1 · 1997 · 10–17

Table III Some of the managerial and organizational features of proactive environmental organizations

Managerial and organizational features Vision and mission

Description To provide the focus and energy for environmental action and learning these organizations have developed a shared vision as opposed to the all too familiar “mission statement”. In doing this they have learned to unearth and develop shared pictures of the firm’s future based on common values and norms that foster a genuine commitment to the raising of environmental standards


Strategic and operational These firms have also formulated and implemented environmental policies, planning plans and programmes in a way which consciously integrates business and environmental goals and targets. A key feature in both the formulation and implementation of these has been the use of participative styles of leadership and management, involving employee involvement schemes including teamworking Management structure, systems and decision making

These firms have also developed flat management structures based on teamworking. These firms also disperse decision making across their organization’s management structures. This is based more on expertise than formal authority. These firms have also designed systems of accounting, budgeting and reporting to assist decision making on environmental issues. To support this these firms have also recognized the use of information technology to empower and energize staff

The management of people

These firms have also recognized the importance of developing their human resources and the need for environmental training at all levels and functions of their organizations. They have also developed both formal and informal rewards and have integrated environmental considerations into performance appraisal

Internal and external communications

To exchange environmental information and promote collaboration on environmental issues across their organizations these firms have also recognized the importance of open communication networks and have developed strategies accordingly, including the use of campaigns on environmental issues. Externally, these firms also interact and exchange expertise with a wide range of organizations responsible for the formulation and implementation of environmental policy locally, nationally and internationally

management and organization that stress the merits of the learning organization. Finally, this paper ends with a call for further research into building a “sustainable learning organization” – a progressive notion which has surprisingly failed to permeate its way into the environmental and learning literature. This research may focus on, but is certainly not limited to, some of the following questions raised by this article: how do you change unsustainable business practices which have been learned over decades? Where does the motivation for environmental change and learning come from? What structural and cultural features facilitate environmental learning? What role does the human resource management function have to play in environmental learning? What managerial and

these organizations are establishing within their firms are summarized in Table III. Two short case studies outlining the approaches of IBM and BT are also presented in the Appendix. The environmental standards could learn much from the experiences of this wide range of organizations and also from the organizational learning literature discussed throughout the course of this article. The failure of the standards to learn from such case study documentation and the learning organization literature can lead this author to only one conclusion. That being, the system of management recommended by BS 7750, EMAS and ISO 14001 must be revised and the stress on mechanistic solutions should be replaced with more participatory forms of 15



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organizational barriers inhibit environmental learning and how can these be overcome?

Senge, P. (1990), The Fifth Discipline: The Art and Practice of the Learning Organization, Doubleday, New York, NY.

References

Smith, D. (1993), Business and the Environment: Implications of the New Environmentalism, PCP, London. Strachan, P. (1996), “Managing transformational change: the learning organization and teamworking”, Team Performance Management: An International Journal, Vol. 2 No. 2, pp. 32-40.

Argyris, C. (1990), Overcoming Organizational Defences, Allyn & Bacon, Heedham Heights, MA. Argyris, C. and Schon, D. (1978), Organizational Learning, Addison-Wesley, Reading, MA.

Stuart, J. (1995), “World review”, Greener Management International, January, pp. 8-30.

Barrett, F.J. (1995), “Creating appreciative learning cultures”, Organizational Dynamics, Autumn, pp. 36-49.

Watkins, K.E. and Marsick, V.J. (1993), Sculpting the Learning Organization, Jossey-Bass, San Francisco, CA.


Bennett, S.J., Freierman, R. and George, S. (1993), Corporate Realities and Environmental Truths: Strategies for Leading Your Business in the Environmental Era, John Wiley, New York, NY.

Welford, R. (1994), Cases in Environment Management and Business Strategy, Pitman, London. World Commission on Environment and Development (1987), Our Common Future, Oxford University Press, Oxford.

British Standards Institute (BSI) (1994), Specification for Environmental Management Systems BS 7750, BSI, London. Department of the Environment (DoE) (1990), This Common Inheritance: Britain’s Environmental Strategy, HMSO, London.

Appendix. Case study 1: the raising of environmental standards at IBM

Department of the Environment (DoE) (1995), EC Eco-Management and Audit Scheme: An Introductory Guide, DoE, London.

IBM is the world’s largest computer company and has been particularly proactive in environmental management. The firm’s environmental performance to date has been impressive with much having been achieved. This has been done in the context of increasingly stringent legislative and regulatory measures, a greater scientific understanding of the environment and growing social concerns regarding environmental issues including ozone depletion, the greenhouse effect, acid rain and deforestation. The commitment of IBM to the environment has existed in the firm for some time. The senior management team of IBM first established an environmental policy statement in 1971. The commitment to this and subsequent environmental policies has reinforced the firm’s determination to raise environmental standards through developing a shared vision of the firm’s future. To secure this, the firm has established, among other initiatives, a flexible and participative management structure based on teamwork. The key environmental teams include the Corporate Advisory Council, Environmental Operations Council and Environmental Affairs Co-ordinating Team. IBM also invests heavily in its human resources and as part of this strategy the firm also has provided significant commitments to environmental skills and training. To gain the co-operation of the organization further, the firm has also designed electronic communication tools to access both strategically and operationally

Elliott, D., Patton, D. and Lenagham, C. (1996), “UK business and environmental strategy: a survey and analysis of East Midland firms’ approaches to environmental audit”, Greener Management International, January, No. 13, pp. 30-48. Handy, C.B. (1993), Understanding Organizations, Penguin, London. Hawkins, P. (1994), “Organizational learning: taking stock and facing the challenge”, Management Learning, Vol. 25 No. 1, pp. 71-82. International Organisation for Standardisation (ISO) (1995), ISO/DIS Specification for Environmental Management Systems: Specification with Guidance for Use, ISO, Geneva. Moxen, J. and Strachan, P. (1995), “The formulation of standards for environmental management systems: structural and cultural issues”, Greener Management International, No. 12, October, pp. 32-48.

Official Journal of the European Communities (OJEC), Council Regulation No. 1836/93 of 29 June 1993 Allowing Voluntary Participation by Companies in the Industrial Sector in a Community Eco-management and Audit Scheme, (1993),10 July, No. 1, 168, p. 1. Pedler, M., Burgoyne, J. and Boydell, T. (1991), The Learning Company, McGraw-Hill, Maidenhead, Berks. Scallon, M. and Sten, M.J. (1996), “Environmental position for the future: a review of 36 leading companies in the Pacific northwest region of the United States of America”, Greener Management International, No. 13, January, pp. 49-65. Schein, E. (1993), “How can organizations learn faster? The challenge of the green room”, Sloan Management Review, Winter, pp. 85-92.

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important environmental information. The firm has also integrated into the organization a system of “Speak-ups” through which staff can communicate more effectively with senior management about environmental issues and problems which concern them. IBM has not only emphasized its own internal strategy but is also increasingly interested in the environmental performance of its suppliers and other key stakeholders. With a large supplier base a significant proportion of the firm’s environmental impact arises by its stakeholder activities. Accordingly, the organization has established a Supplier Environmental Task Force to promote environmental issues among these parties. IBM also communicates widely with a range of outside government, business and other bodies which are involved in the development of environmental policy locally, nationally and internationally. These bodies include the Advisory Council on Business and the Environment (ACBE), Business in the Environment (BiE), the UK Centre for Economic and Environmental Development and the International Institute for Environment and development (IIED) and various Confederation of British Industry (CBI) environmental committees and panels.

tion. To indicate this commitment and provide ownership of environmental affairs at the top of the organization BT has allocated the responsibility for environmental affairs to senior board level members. BT has also formulated a business-wide environmental management programme. The aim of this is to integrate environmental considerations into all the strategic and operational planning activities of the firm through existing total quality management (TQM) programmes. For many other firms, such as ICI, this has also proved a popular route to environmental excellence. BT has also recognized the role of teams in policy development issues and their implementation. At BT these teams include the Environmental Policy Steering Group, Environmental Issues Unit and Environmental Liaison Panel. To raise environmental awareness throughout the firm BT has also committed itself to the development of its firm’s human resources. The organization has fully-integrated environmental considerations into all of its staffing activities, including the provision of specialized training courses on environmental strategy for key environmental personnel and, for the less experienced, more general courses are provided. An internal communications strategy has also been devised aimed at increasing the environmental awareness of BT staff. This has included environmental campaigns aimed at specific environmental issues and problems. BT has also developed a comprehensive purchasing policy which is mandatory for all tenders which constitute a high environmental impact. The cornerstone of BT’s external communication is the publication of its annual Environmental Performance Report which was first published in 1992. This has been very important in promoting the firm’s commitment to the environment to key stakeholders including employees, suppliers, shareholders and investors. As with IBM, BT also interacts with key bodies involved with the formulation of environmental policy.

Case study 2: the raising of environmental standards at BT BT is the largest firm and the main supplier of telecommunications services in the UK. This firm is also recognized as taking a proactive stance with regard to environmental issues. As with IBM, BT’s environmental performance has also been impressive and much has been done in the firm’s pursuit of raising environmental standards. This has also been done in response to environmental pressures in the external business environment. BT is increasingly recognizing that environmental issues have an important part to play in the firm’s overall corporate strategy and is providing top level commitment to the raising of environmental standards throughout the organiza-

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