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Executive Summary

This is a report that examines the findings of an analysis of how Canon has implemented a change program for corporate sustainability. It establishes the sustainability problem then investigates the change process before giving some recommendations for management. The report also looks at some of the challenges management encountered and how they overcame them during this process.

Every major organization today is faced with the issue of change. Change is necessary in organizations for a variety of reasons. It could be the need to cope up with technological advancements, the need of coming up with more efficient work procedures, restructuring of the organization structure due to changing environmental factors both internal and external or just changing as part of a rebranding exercise. But while change is both inevitable and necessary, it is imperative that it should be sustainable change. Sustainable development is a term that was coined by the World Commission on Environment in the year 1987 and it was translated to mean the development should be addressing the problems of the present without compromising the future generations (Clegg &Walsh, 2004).

One of the organizations that have successfully implemented a change program for corporate sustainability is the Canon Company. Canon is a multinational Japanese company founded in the year 1937. It is a leading manufacturer in the imaging and optical products industry. The sustainable development initiatives of the company can be traced back to 1994 when the company began publishing Global Environmental reports. BY the year 1997, canon Oceania had also began publishing their reports. The year 2009 was a culmination of a long campaign by Canon and other leaders in the IT industry to get legislation introduced into Australia to make recycling of E Waste mandatory (Keifer,2005).

Sustainability Problem

In the context of research, Projects are said to be simultaneously beneficial. This is because they are directed towards solving a problem (Hult & Lennung, 1980). Global warming has been one of the greatest concerns for companies. If it is not to be put in check, then it will overly influence increase in cost of primary materials and other supplies. Furthermore, global warming will have the effect of social disruption due to extreme weather patterns and climates. This is not a good environment for business practice. The other problem identified is the customer's efficiency resource programs. While it was easy to control the company's waste and effectively manage it, the electronic waste form the customers could not easily be controlled. The tradeoff would be to increase the product life time but the demerit of this would be increased production cost which would lead to a decline in profits.

Another big challenge is the global economic downturn. The hard economic times naturally affected canon. However, it was noted that while the company was affected globally, Oceanic Canon was able to weather the storms of this hard times. This could be attributed to government stimulus packages as well as the strong economy which was a suitable environment for them to operate in. Canon did some research to establish on the need for government legislation to enhance sustainable change. As Hult and Lennung (1980) point out, there has always been a relationship between research and the application of the results. Perhaps this was what informed Canon's management to embark on an ambitious research initiative. Oceanic Canon set up the Byteback pilot program in Victoria to investigate different models of how a Product Stewardship Legislation scheme might work and to demonstrate to the government that its legislation was necessary. This was consistent with the organization culture at canon of innovation. Conceptual cultures in an organization serve help in guiding research (Hatch,1993).

The Byteback program which is still running was put up to form the basis of a national scheme to be rolled out across the country. It showed that over 50% of the waste that was collected was from recalcitrant manufacturers who were not prepared to take a responsible attitude to product stewardship without legislation. Their effort s bore fruit when the government announced that it would introduce Product Stewardship Legislation in 2011. This legislation will be capable of covering a broad range of products, and that first cab off the rank will be a national scheme for TVs and IT equipment. This was something that Canon had been fighting to see for close to eight years.

The Change Process

Initially, experts widely thought that there is a blanket procedure for change that could be a universal standard. However, as Dunphy and Stace (1993) point out, this is changing with time. Different circumstances catapult different reactions and changes within different organizations. For instance, the 2009 Sustainability Report Canon reported a 13% reduction in waste to landfill since 2007 which had been set as the benchmark year. This percentage could be small but if the Organization Development theory is anything to go by, change happens by small cumulative adjustments (Dunphy & Stace, 1988).

As organizations change, they must put environmental factors of the globe in mind (Russell & McIntosh, in press). One of the notable Changes that were put in place that could have made this possible is the appointment of a national waste provider. This was with an aim of improving the accuracy of the company's reporting. The company was also contracted to identify opportunities for improvement where Canon could reduce its waste to landfill further. Plans are also underway at the moment to implement a new data base that will capture carbon emissions and waste on a month by month basis so that we can monitor our progress against targets and implement corrective action if necessary. Canon has put in place a project management methodology that includes conducting a lessons learned session after each report. This helps them come up with lessons learnt and gives them new strategies.

Analysis of the change process

The change process of canon mainly focused on the customer base. The company endeavored to create products, services and information that assist customers with their efficiency. For instance, the Uniflow and SecurePrint software have been developed to help achieve this goal. The company also decided to focus on tailor-made solutions for the customers. This is because there are constantly changing needs as well as a very dynamic technological environment. This put a demand on the company to continually focus on long-term development of new products. Efficiency has the long term desired effect of reduced waste and reduced carbon foot prints.

The company also made a bold step with the goal of surmounting the challenges of a global economic instability by having a diverse portfolio. This would cushion The Company from the risk of lack of business in the dynamic environment. Canon is one of the two leading companies in their field. They have been tendering with the government and their experience is that tenders from government departments and large corporate clients are requiring an increasing amount of information about the environmental performance of both the products and the organisation. They are also increasing the information required about CSR initiatives. Canon found that they can always do well in this part of the tender by providing their Sustainability Report and reference to our web site. Customers understand that they take Sustainability seriously and this means that they get to be contended. While Sustainability issues may not be the decider in tenders there is an ever increasing standard that the company has had to meet to even be considered.

For some of the other Canon companies they have already taken this approach and are focused on different issues - for example in UK where the economy is not in as good shape as in Australia and the government has announced big cut backs in spending. This will have an impact on their strategy compared to that of Oceanic Canon. In the environmental area their focus has been on the coming E Waste legislation whereas in Europe the WEEE legislation has been in place for some time.

As would be expected, nothing comes without its ups and downs. It has not been smooth sailing for canon. There are some of the sustainability initiatives that didn't pick up immediately as had been planned. Last year after much research on best opportunities for abatement the company adopted a Canon Oceania target to reduce its Green House Gas Emissions by 1.5% per year until 2020. The idea was to use the target that Ross Garnaut had proposed was Australia's fair share of reduction if the world wanted to keep below 2 degrees of warming, that is, 25% reduction on 2000 levels. Because carbon emissions are not one person's responsibility but involve many different functions in the business it has taken longer than expected to get everyone to understand the target, to understand their role in achieving it, and to commit to actions that they can take in their area.

The other impediment has been competing for resources with other projects. As with all corporate initiatives you have to compete amongst a whole range of priorities for senior management time and resources. The resistance to change is often as a result of personality differences (Oreg, 2006) and this has proved to be a challenge for canon. Convincing management on the importance of sustainability indicatives over other projects has been a tall order. However the managing director has been supportive of such initiatives and there have been no significant issues that have been strongly resisted. But still, some projects are taking longer than expected. Change management is always hard because it is not easy to agree on the factors that should influence it. (SirKin, Keenan & Jackson, 2005). There is also the challenge of being able to clearly articulate the business case which sometimes takes one or two iterations.

Another challenge for Canon has been in the economic area. While there has been massive growth in the consumer electronics area there has also been significant competitive pressure and pressure on margins. The company has had to take actions like reduction on transportation costs to stay in front of the market in the consumer area and to improve their position in the office equipment market. There is also the coming product stewardship legislation which has meant that management has been very heavily involved with the industry and government in establishing an effective national scheme for collection and recycling of E Waste - taking into account the lessons learned from the home insulation scheme!

Evaluation and Recommendations

While the change process has yielded a lot of positive results, some gains are still hard to quantify as they have to do with the company's Brand and reputation. Product Stewardship activities like Byteback and Cartridges for Planet Ark fall into this category, there have also been huge savings in electricity in New Zealand and CiSRA as well as the reduction in waste to landfill which has resulted in savings at some branches in waste costs. In economic terms it is clear that company has implemented innovative marketing programs in the consumer product area to directly target the consumers while at the same time supporting the resellers.

The consumer products are sold through an indirect mode; that is their products are not sold directly by Canon but through partners such as Officewor. The goals of Oceanic Canon are based on the global goals and their performance is measured against a standard set of criteria. However there are always differences in the local market and Canon provides a great deal of freedom to Canon Oceania to pursue their own strategies according to their region. Also the focus changes with time. Their focus in Australia as described in the sustainability report has been to integrate the business and consumer marketing activities and to strengthen their position in the market by going into partnerships to provide more channels by which their products are sold.

But perhaps the biggest challenge for management as far as sustainable development is concerned is the longevity of the initiatives. The company ought to do more training to the management on the importance of sustainable development. This will make it easier for them to prioritize the initiatives of sustainable development. The other important recommendation would be the longevity of the success stories. Canon has actively been involved in sustainable development initiatives and has set the pace for other companies. This needs to be maintained. There usually is the danger of complacency after a major achievement. While

Canon is a leading manufacturer in the imaging and optical products industry. The sustainable development initiatives of the company can be traced back to 1994 when the company began publishing Global Environmental reports the year 2009 was a culmination of a long campaign by Canon and other leaders in the IT industry to get legislation introduced into Australia to make recycling of E Waste mandatory. This has been a good precedent that has been set in place and it should be emulated not only by the management involved, but by every employee of the company as well as the customers. Leadership begins when a problem is noticed. When this problem persists on, the person is inspired to help. This is leadership (Wheatley, 2008). The company should therefore impress on everyone to embrace the sustainable change initiatives and own the process.