The Pros and Cons of Being Big
The food sector has faced a barrage of issues recently. Much of it is summarized in this report launched recently by Oxfam America called “Behind the Brands”. The report analyses the largest food companies (in the interests of full transparency many of them are BT customers) across a range of sustainability dimensions, including nutrition and obesity, environment, tracing and trust, poverty and international development. There is a well balanced review of the report by Marc Gunther here.
But in contrast we need to consider observations I noticed by Emma Duncan of the Times. In theUK, and I am sure there are similar patterns in other developed economies too, the cost of food for the consumer has decreased from 20% to 10% of household expenditure in the last couple of decades. And, over the last 100 years the annual death rate from gastrointestinal disorders has plunged from 100 people per 100,000 to almost nil.
Just what is going on here? At the same time as we’re seeing massive improvements in health and nutrition, effected by the processes and efficiencies that large companies have instituted, we’re witnessing increasing concern over nutritional value and overall health and criticism of the very companies that have brought these improvements to bear. I see a key dilemma that we need to take into account whatever sector we are in.
Efficiency and, therefore, efficient use of resources is well served by size and scale, but size and scale is also a challenge to sustainability. As populations of developing nations achieve acceptable standards of living and increased consumption, large scale efficient processes will be critical to delivering even basic needs within existing resources. But, as I have mentioned in previous posts, larger organisations have greater degrees of separation – greater gaps between the customer, the shareholder, the resource, the employee, and stakeholders are fickle in their priorities. While there is a lot to be learned about resource efficiency from a large organisation, there is much to be learned about true and balanced stakeholder engagement from a small family business.
Technology has a large role to play in resolving this dilemma. Information communications technology gives us the potential to build platforms that create scale without sacrificing sensitivity to differences and without sacrificing a detailed understanding.
This dilemma is also something for us sustainability practitioners to address. As our organisations grow, how do we maintain the level of stakeholder engagement that small and medium sized businesses naturally exhibit?