Free «Sustainability Issues in Design and Business Contexts» Essay
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Sustainable development in business environment helps modern companies to improve their performance and increase profitability. Marketing companies are usually described and discussed under steady-state conditions. Their structural forms and processes are determined, including such concepts as line and staff relationships, the division of responsibilities and authority, and group charts. Equally important for sustainable development is the process of organization change to meet changing markets and internal conditions. For though sustainable development comprise regular sets of behavior and specified interrelationships, achievement in marketing depends on one element -- dealing with change. “Relative cost, however, via value, is a significant driver of share change as it can represent sustainable advantages” (Brands, Innovation and Growth 2004, p. 13). Today, sustainable organizational processes and arrangements are essential to deal with sustainable products and goals. Modern companies like Nordex must not be directed to the maintenance of a placid, static, stable situation (Boone and Kurtz 2002). Rather, it should be directed to achieve "dynamic sustainability", stability through adjustments. The sustainable development process as evidenced in marketing has witnessed a change in the design of organizations, changes in personnel and job titles, and development of a sustainable and specialized staff.
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Recent years, alternative energy solutions become extremely popular in Europe and America. Nordex is a German-based company established in 1985 in Give, Germany. This company specializes in wind turbines and energy solutions developed for large target audience. The uniqueness of Nordex is that it is oriented to alternative energy resources and innovative solutions important for the global community. Using this strategy, Nordex tries to protect the community from global warming and resource depletion. This strategy meets ethical and moral rules established by the company. Since 1985 Nordex achieved competitive position on the global market. Nordex brand is one of the most popular around the globe based on unique quality and exceptional offering of sustainable products (Nordex Home Page 2009).
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Sustainability helps Nordex to become a part of environment and respond to changes and needs of business. “The sustainable environment is such a rich area for innovations with ideal combination of virgin issues” (Tomkin 2007, p. 10). Profitable changes require information, intertwined with organization structure, which in turn shape the information base. As companies grow to include wider territories and product lines, formal intelligence systems become requisite for evaluating and designing sustainable organizations. Modern organizations have to change in two ways (Bansal, 2001). They have to plan to make radical adjustments over the long run to meet frantic market changes. Second, they have to meet shorter-term changes that require less radical but continuous adaptation (Bansal, 2001).
At Nordex, sustainable development depends on marketing in three ways. First, where there is unused productive ability, marketing pressures are generated to use it, which occasions added expenditures on salesmen, advertising, distributors, and marketing research. Second, marketers develop new uses for current products. Third, markets are analyzed for sustainable opportunities. Growth is accompanied by larger organizational complexes, both internal and external, that place pressures on coordination and integration. As the growth process continues, managers see shifts to product, divisional, or functional areas to ease pressures on coordination (Boone and Kurtz 2002). Thus change and growth are not cost-free (Nordex Home Page 2009). The addition of marketing managers, such as researchers or planners, induces the division of labor, more organization levels, and greater coordination (Cannon, 1994). This requires the establishment of more formalized procedures and special staffs and departments. Both rate and kind of growth affect an organization's form and efficiency. Although sustainable growth is partially an internal process, market conditions establish external constraints and influence both the current use of resources and the direction of expansion. “The better solution is to us use IT to create collaborative laboratories (what we refer to as where we ca can bring together expertise” (Wacker 2009). From an external perspective, sustainable development may be conceived of as an organizing activity -- the organization of corporate inputs so that they are linked successfully with environments. The sustainable development of constellations of several marketing organizations results in ecosystems designed to achieve competitive advantage. Marketing organization and leadership is concerned with both sustainable development and the development of ecosystems (Nordex Home Page 2009). Different managerial arrangements and the authority-responsibility relationships are investigated. More traditional methods of organizing the spectrum of marketing activities are contrasted with more contemporary approaches. The major forces resulting in managerial changes and guidelines for evolving new organizational structures are noted (Bansal, 2001).
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Product Innovations and Sustainability
For Nordex, the focus of a sustainable product-development program is a clearly defined set of corporate objectives and an inventory of corporate resources showing both strengths and weaknesses. Coupled with an estimate of the future economic climate, this knowledge of corporate goals can provide a valuable background for a development program and assessment of possible product ideas. Research-and-development departments, marketing research, employees, salesmen, design groups, engineering groups, external consultants, customers, government research, and middlemen may spark a multitude of sustainable product ideas. These ideas must be screened carefully, and it is never easy to distinguish between profitable and unprofitable ones (Brands, 2004). Although numerous guides have been developed for screening sustainable product ideas, some poor ideas are certain to be included and good ones screened out (Nordex Home Page 2009). Product ideas are evaluated in terms of characteristics, potential contributions to profit, potential markets, cost, and a firm's capabilities. The screening process, which is directly related to an estimation of customer demand, often uses secondary sources of data. This first stage of appraisal is significant, because as the product-development program progresses, the investment in the potential sustainable product increases and the costs of drop ping it become higher. When the product idea has passed the feasibility test, the way is cleared for specification of the product and construction of a prototype. Prototypes require both a detailed description of product characteristics and the undergoing of physical tests. Tests, which must be done in a relatively short period of time, should simulate the customer-use environment (Wacker, 2008).
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Nordex recognizes that the initial introduction of a sustainable product is generally met with small sales, for consumers do not know about and accept changes readily. As product experience accumulates, the product will be altered to meet the demands of markets. Given larger volume, sustainable -product costs and prices tend to decline, thereby affecting the market. The product then is likely to become widely diffused, and both the rate of purchase and actual purchases rise rapidly. Eventually the rate of purchase declines and product sales tend to level off; market saturation is reached. Sustainable products require increasing support from marketing programs. A supporting system of communication and distribution must be established to assure the success of a product, and the level of initial promotional costs may be relatively high (Steger, et al. 2004).
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From a functional standpoint, sustainable development can be referred as the control of marketing effort in terms of regulating such activities as advertising, personal selling, credit, product development, and marketing research. From a corporate standpoint, sustainable development exists within the corporate system by bringing the marketing factors into balance with those of other functional areas, such as production and finance. From an external standpoint, control refers to a corporation's adjustment to its changing environment through factors in the marketing mix (Nordex Home Page 2009). The very need for marketing control arises from the requirements of the marketing operation to manage change effectively. The adjustment of corporate effort to meet the demands of the sustainable development, or the balancing of corporate resources with market potential, is the essence of control activity. Marketing control serves the end of redirecting and reshaping marketing effort in order to maximize a firm's impact and sustainable development. It is the area of corporate activity through which the resources and actions of a company make the most of changing marketing opportunities. It is also the means for overcoming deviations from goals, and standards, for resolving conflicts, and for achieving greater efficiency (Pruzan and Zadek. 1997).
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The very need for sustainable development arises from the requirements of the marketing operation to manage change effectively. The adjustment of corporate effort to meet the demands of the market, or the balancing of business resources with market potential, is the essence of control activity. Sustainable development serves the end of redirecting and reshaping marketing effort in order to maximize a firm's impact and profitability. It is the area of sustainable development through which the resources and actions of a company make the most of changing marketing opportunities. It is also the means for overcoming deviations from goals, and standards, for resolving intersubsystem conflicts, and for achieving greater efficiency. For instance, from knowledge of inventories of staple items with extremely predictable demands, minimum inventory levels, and reorder points, quantities can be established, and computers can control the inventory situation (Tomkin, 2007). But almost all marketing-control systems are open-loop systems that need human aid. It continuously gathers data about such aspects of marketing activity as costs, and the profitability of goods, customers, and territories. In so doing, it assesses the effectiveness of salesmen in terms of quotas, number of calls, and volume; it ascertains the competence of various types of distribution channels by volume and profit ability; and it determines the cost of different techniques of storing and handling inventories, which it evaluates against established or implied values. Based on assessment of sustainable development, some realignment of the marketing program may be made (Hollensen, 2007). Although marketing systems are open rather than closed and are not completely capable of being controlled by automatic systems, they are tending to become more so. Sustainability helps modern companies adjust to sustainable environment and respond effectively to coming changes, economic and business demands. Sustainable environments create sustainable conditions of business, so the company should be flexible enough to predicate and foreshadow these business transformations (Nordex Home Page 2009).
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In sustainable development, Nordex relies n research and development initiatives. Marketing research, patent research, styling and redesigning, and cost and profit assessments receive attention. The evaluation of production, including techniques, material selection, and inventories, must be based on a cold look at market potential, for management faces the decision of making a considerable investment (Boone and Kurtz 2002). This part of the testing program includes more than technical testing. The level of testing is directly related to the degree of newness in the product, the speed with which feedback flows from the marketplace, the capacity to correct mistakes, the amount of commitment, interaction with existing product lines, desire or need for secrecy, and the relative position of competitors. Several guidelines have been developed for determining the extent of planning and testing in a sustainable -product development program. Once the company is well satisfied that the proposed product has withstood realistic tests, the product may be put on the market. Launching the product is a costly affair that requires constant audit and control. It is necessary to support sustainable products with adequate promotion and distribution. Feedback from the market is essential so the product can be reassessed and adjusted (Fill, 1999).
In sum, at Nordex, sustainable product-development programs are the foundation of corporate planning, since business strategy is expressed in products. A company is no more successful than its product. Thus, product planning is a top management responsibility that cannot be delegated. Neither a haphazard nor a random activity, it must be planned and programmed. The example of Nordex shows that specific criteria for sustainable products must be laid down; yet the whole sustainable product-development function is one of continuous evaluation and assessment. Organization and control of the product-development function should relate to the stages of sustainable -product evolution that require interdepartmental teams operating on a coordinated basis. Ultimately, the market must be the focal point for all sustainable -product development. Sustainable products should tie in as much as possible with corporate resources and companies should plan to update their product lines on a regular basis.