Technology & Operations Management: Climate Change Challenge

[MUSIC PLAYING] I'm Amanda Lee. Immediately before I came to HBS, I was at a company called Generate Capital, and we financed cleantech projects. I'm David Chan. Before coming to HBS, I worked at Grow Intelligence, an agtech startup. I'm Nikhil Dewan. So I spent three years at Schlumberger as we delivered logging and drilling services to the National Oil Company of India. Technology and operations management is a required class taken by all first year MBA students at HBS. We assign them a challenge to write a blog posting of about 800 words where they're describing how a single organization that they get to choose is being affected by climate change, either through their operations, their innovation system, or their supply chain. Then we're asking them to read each other's posts and comment on them.

And so by the time they walk in the class, now that they've had the exposure to this broad array of topics, we take a deeper dive on just a few of them. When you think about the players– I mean, one of the reasons we have the TOM challenge is for you to understand what's the role of corporate leaders in thinking about climate change, and how it affects their company, their industry, their supply chain, their communities. The blogging platform was set up to rethink pedagogy within the Harvard Business School case teaching environment. My blog post is about Nestle and the work that they're doing to both mitigate and adapt to climate change, specifically around their cocoa and coffee production. When you purchase 10% of the world's coffee production and 10% of the world's cocoa production, anything you do, the industry is watching and they're likely to follow. We wrote this as a challenge, because I thought it'd be much more useful for you to see the diversity of industries, the diversity of opportunities and threats across a whole host of organizations.

I wrote my blog post on Eversource, because I worked with utilities, but also one that impacts every single HBS student here. Because that's what's really keeping their dorm rooms warm right now. And all of these are going to be affected, in some way, based on the policy environment. The decision to make the blog available to the rest of the world– we recognize that we live in a globally connected world. There is a hunger for transparency in the world. There's a hunger for knowledge in the world, and the special classroom that we create can interact back with the world as well. So I've written about Coca-Cola. I was interested to find out how the scarcity of water was impacting Coca-Cola operations. I focused on Coca-Cola's usage of water, which is generally the lifeblood of their business. There's been immense scrutiny on water management practices done by Coke, so they now proudly claim that for every drop of water we use, we give one back. They're getting this water that's usable sweet water that can be used by the community or like people, and they are wasting a lot of it in their products and process, which was a big waste.

So I think they've had like about 75% of their water does go back into the aquifers where they take it from. So how should they and how can they change their business model to not perpetuate the cycle of climate change? All of these projects really need a lot of community engagement and effort. And therefore, in some of their sites, that just isn't there. The private sector really needs to make the effort and make the change we want to see in the environment. You had written an excellent comment on this post. So Coca-Cola pledged as part of American business pledge on climate change, reduction of greenhouse gases, recycling programs, water efficiency programs, power and clean energy efficiency programs. The industry trying to save their own space or actually wanting to have a positive impact on climate change. There ends up being a lot of differing opinions, and that really allowed for, I think, a much richer dialogue and a much better learning experience, because we're actually having a debate here. This is the first time that HBS has really engaged in climate change for all 950 of our first year students, so I think it's a really exciting day.

It was amazing to hear how someone from consulting viewed a problem, and how someone from banking thought about how to finance that problem. And how someone who worked in sustainability thought about what are the long-term benefits of enacting this sort of plan. We actually ended up linking a lot of the topics together. Every part of the supply chain had a part to play in reducing impact. So I was quite blown away after the class. I think we all exited having these discussions about the next steps with some of these companies we're facing. And it helped us realize that as we go forward in our lives as leaders, we have an important part to play to kind of give a vision to how the next sustainability steps can actually be made to better the world.