Last week, French President Emmanuel Macron struck a rare coup double. As host of the One Planet Summit, he brought together leaders from the public and private sectors to develop climate change mitigation strategies. With the United States sidelined from climate leadership, Macron seized the opportunity to become a global leader on the issue. But, more importantly, Macron spotlighted an important and accelerating dynamic: some of the strongest environmental leadership in the world is coming from innovative businesses.
This private sector support for action on climate change is critical. It means that, while President Trump may slide backward on greenhouse gas mitigation, the impact of his decisions is limited. Today, the most powerful force for change on the planet is not American politicians but the leaders of innovative companies, from start-ups to massive corporations.
These business leaders – who range from inventors of water-purification systems, designers of shoes made from ocean plastic and power company executives investing in massive solar arrays – are legion. And they are committed to innovation on products, operations, supply chains and partnerships across their industries to solve environmental challenges and address the seemingly intractable problem of climate change. Importantly, they are not necessarily do-gooders, but leaders who can see the writing on the wall: the future success of their businesses depends on this innovation.
Yes, the market for sustainable practices and products is rapidly growing. But the opportunities that are expanding across every industry aren’t simply there for the picking. The business leaders who successfully develop solutions to challenges like climate change – while also winning by traditional business metrics – share three distinctive elements of a future first mindset:
- They embrace sustainability as an innovation opportunity.
Future first leaders embrace global challenges. Rather than denying, ignoring or surrendering to their inevitability, these leaders see issues like climate change and resource depletion as opportunities for innovation.
The vast majority of people don’t take substantial action on climate change. But why? In most cases, it isn’t because they don’t think it’s real. They realize all too well the threat climate change poses to the future of our planet – and are completely overwhelmed by it.
Not so with future first leaders. Fully aware of what a huge problem climate change is, leaders with a future first mindset are instead compelled to seek solutions. They innovate new business models and products to push the value frontier of the future.
An example: Traditional industrial manufacturing is incredibly material-intensive, but companies can’t simply stop making clothes or cars or medical equipment. But instead of just shrugging their shoulders or making some incremental changes, future first leaders innovate new processes, like 3D printing.
3D printing, also known as additive manufacturing, builds objects by adding multiple layers of a construction material to create an end use product. This doesn’t sound revolutionary, except that most manufacturing does the opposite. Traditionally, production processes make almost everything by taking a much larger piece of raw material and cutting, hammering, and molding it until the final product emerges. Much of what is left over becomes waste on the factory floor. With 3D printing, there is no cutting room floor – or the resulting waste.
Just as importantly, 3D printing doesn’t need a factory at all. The whole process takes place inside machines that range in size from an oven to a large refrigerator. Freed from centralized production hubs, manufacturing can be distributed to smaller spokes. This means that transportation and distribution networks can be shrunk massively, with huge resulting reductions in the planet-warming petroleum fuel that powers virtually every truck, train and container ship.
Getting 3D printing to the point where companies from General Electric to UPS to SAP are major investors in the technology wasn’t an obvious path. There was a longstanding industry joke that 3D printing was the technology that was always “about 10 years” from being a viable industrial production process. But a core of future first leaders saw 3D printing’s challenges as opportunities for innovation. Today 3D printing is steadily replacing traditional manufacturing by creating faster and smarter practices that can reduce water usage by up to 90% while virtually eliminating material waste.
- They get over their presentism.
Future first leaders are constantly thinking ahead of the present tense. This is harder than it sounds because most of us are wired for right now. While a present-centric mindset is helpful when we need to be immersed in an immediate task – or even chill out from our busy lives – it stops us from making good decisions about the future.
Take, for example, the huge issue of transitioning from dirty, carbon-based electricity production, like coal, oil and natural gas, to renewable sources. Until recently, at least, it was not something most leaders could think about in the present tense. The eventual transition may be inevitable, but only at some indeterminate distant point. Unless, of course, a leader can see beyond a present in which fossil fuels produce most electricity and petroleum powers the vast majority of transportation.
Some leaders in the clean energy space can imagine and actualize a future of “grid parity,” the point at which the cost of renewable energy will be equal to the cost of carbon-based energy. Grid parity is not today’s global reality, but it will be – at which point new business solutions and rapid adoption of renewables will suddenly appear inevitable to everyone. Some future first leaders are seeking to achieve grid parity by looking at better power storage solutions.
The primary roadblock to grid parity is not solar or wind technology itself, but the ability to store it so that consumers can rely on solar-produced power at night. That’s why future first leaders at Tesla Motors, Panasonic and SolarCity have been working together to develop lithium battery storage technology. Many other companies, like ABB, Primus Power and Samsung, are now following suit. Soon, the present that only a few business leaders could see once will be a massively disruptive reality.
- They develop integrative thinking.
Although many of these leaders bring an element of idealism to their work, they are too pragmatic to be rigid idealists. Instead, they use flexible, integrative thinking to create profitable and scalable solutions to the world’s biggest problems. Coined by Harvard Business School Professor Roger Martin, “integrative thinking” is the ability to bring together two seemingly contradictory ideas and to create something new. In our heavily polarized political and cultural climate, integrative thinking is a more complex, nuanced view of the world that is in short supply but high demand.
Future first leaders don’t get caught up in an either/or approach to success. They are simultaneously financially driven and motivated to innovate around long-term global problems like climate change. They don’t eschew traditional business models, because they know that businesses must be consistently profitable in order to play the game and win. But they also understand that today’s game must be played by new rules – rules that account for the reality of an increasingly overpopulated planet with finite resources.
The automotive sector provides a case in point. Ten years ago, fully electric vehicles (EV) were little more than government-funded novelties and cool-looking concept cars. They were fun to talk about, but very few people actually wanted one parked in their driveway. People who were dedicated to producing no or extremely low emissions walked, rode a bike, carpooled or took public transit. For most people, this was unrealistic.
Then certain companies across the globe fully committed to EV technology and the whole game changed. Suddenly you could integrate the lifestyle of driving a car with having a very small carbon footprint. Today, we can see the results of this integrative mindset in electric cars such as the mid-priced Tesla Model 3, Chevy Bolt and Nissan Leaf. In some countries, including the US and UK, electric vehicles are already cheaper to own and run than those powered by gas or diesel. This development was not inevitable, but the result of integrative thinking about transportation solutions.
Global challenges, such as reducing greenhouse gas emissions fast enough to actually slow down global warming, will require accelerating the development of technologies like 3D printing, renewable energy and electric cars. But it is the adoption of a future first leadership mindset, not the technology itself, that is most important. Only future first leaders will be prepared to meet the future by innovating around challenges, thinking outside the present, and integrating a new future into their business reality.
This article was the second of my new leadership column for Forbes. To read more about how business leaders can embrace and solve global challenges through innovation, follow me on Forbes, Twitter, and LinkedIn.