“Management makes a system work. It helps you do what you know how to do. Leadership builds systems or transforms old ones.”
“Nothing undermines change more than behavior by important individuals that is inconsistent with the verbal communication.”
“A guiding coalition made up only of managers—even superb managers who are wonderful people—will cause major change efforts to fail.”
John P. Kotter
Three strong-worded statements that articulate some of the requirements for successful change management. What does this have to do with reducing emissions from freight transportation and logistics, you may ask? At AllChiefs we believe these statements point to the core of successful (long-term) reduction strategies and roadmaps: effective change management.
Developing credible pathways and roadmaps towards net zero logistics involves a lot more than ‘simply’ adopting new technologies. In many ways the entire organization, not just the logistics function, will need to rethink its way of working on many dimensions. The figure below lists some examples of such changes.
Most of the time, these changes will require collaboration between staff across various business functions. It also means that managers within each function may not be able to optimize their own individual performance. The KPIs that are used to manage performance therefore also have to be changed.
John P. Kotter, Professor of Leadership at the Harvard Business School and thought leader in leadership and change, expresses the process for creating major change through eight steps. Adhering to these steps is foundational for successful long-term change and we believe that the people who drive emission reduction from logistics should pay close attention.
We would like to focus on step 2, create the guiding coalition. For many of our clients, the responsibility for logistics decarbonisation either lies with a central sustainability team or with the logistics function. Although either function can take the lead, we believe that successful decarbonisation needs a strong multi-disciplinary team of engaged leaders who can:
- Underline the sense of urgency
- Communicate the vision broadly
- Empower their staff to initiate cross-function collaboration
- Anchor the change in the culture by being visible role models
- Include reduction impact in the performance management reviews.
Within the logistics function, such a coalition may also be needed across countries to effectuate change in local transportation, often managed and procured at country level.
At a minimum, we think there should also be a dedicated person who drives the agenda for logistics decarbonisation, with strong ties to the sustainability team(s) and deep knowledge and experience in logistics. This person should have the skills to bring multiple internal stakeholders together and facilitate collaboration efforts for realizing transport efficiencies, enabling more options for multi-modality and guiding the roll-out of new technologies within the business.
Ensuring the year-on-year reduction impact that is needed to achieve science-based targets requires different actions in the near-term versus the long-term. Companies may prefer to focus on optimization and inter-modality in the near-term and new technology roll-out for the long-term as technologies mature and become more scalable. However, this does not mean that the types of near-term actions are easy or simple to realize. To ensure maximum reduction impact, strong (Boardroom) leadership is required to create necessary change that lasts.
