• Andrew Munnings

Do you have a 30 year strategic plan?

30 year strategy

So here is a question for you - how far out are your strategic goals?

This year I was approached by a client looking to put together a 30 year strategy. It struck me that that was odd for 2 reasons, 1) who can predict what they want the business to look like n 30 years time, 2) why would you even try?

During the conversation though it became clear that actually now is the exact time many companies are going to need to plan a 20 or 30 year strategy.

The reason: Carbon Neutrality.

So to start with - we need to look at what is carbon neutrality, a lot of companies are talking about “Operational Neutrality” - which is to say the energy, inputs and thus output of their processes are neutral - but are not including for example the production of the plant or facilities. So as an example - if you run a delivery van - the energy needs of the van - you can get to being carbon neutral, but what about the van itself? Is that part of your plan? If you take this further - the energy you use to heat or cool a building - but what about the glass, steel and concrete? Even if you consider this existing carbon as sunk, and therefore not in scope, in 20 years time, a refresh will be in scope - so if you add on or change a building - then any new building needs to integrate with it.

If you want to be carbon neutral in 20 or 30 years time - the investment decisions you are making around capital projects now will drive that. If you buy or build a new plant today - in a building that has a 10, 15 or 20 years or longer life span - the decisions you make today will be the ones that allow or prevent the goals from being achieved. As we progress towards building more and more sustainable the harder it will get to close the final % of the gap. To get to that final % of carbon neutral it will depend for a lot of companies on the decisions made in the next 5 to 10 years, and not in 15 to 20 years time.

If you are looking to buy plant, or equipment - or even renting an office building, are you thinking about your carbon footprint or targets? So many of my corporate client see and focus on the 3 to 5 years as long term, however carbon neutrality is something that is much longer, and not something that your successor can look at in 10 years. If you are looking at becoming carbon neutral you need to look at it from now, quick wins you can make anytime, but it needs to start driving your decisions about everything - your cloud provider, yout infrastructure, you building refurbishment. Unless you are not looking at how you can reduce your carbon on every single contract you will never achieve the goals, even if you are only committing to a supplier for the next 3 to 5 years, we have all got suppliers and technology that seems to have been around from the beginning of time. Large capital projects are especially key to this, if you are replacing something like an Air or Heating system, obtaining to decorating a building, data center or hardware - it is something that we are all going to have to understand. If we are going to get to carbon neutral in 30 years, we have to make the strategic decisions now. It is not something that most of us are used to - making plans for our current role that will be having an impact many years after we have retired. Let me know if you are taking into consideration net zero on long term projects, and if not why not?

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