Sustainability Issues Facing North Hook Gas - Essay Example

CONSULTANCY REPORT: NORTH HOOK GAS by Introduction North Hook Gas is a British company that was conceptualized after the government recognized the need to supply energy in the U.K. The government selected a site that was previously used as an oil refinery to set up the new energy firm. North Hook Gas is currently one of the world’s largest liquefied natural gas terminals. The main products or services that are offered by North Hook Gas include the provision of liquefied natural gas through a pipeline that traverses South Wales. Currently, the terminal produces 20 percent of the country’s energy needs. North Hook Gas is a subsidiary of Exxon Mobil (24%), Qatar Gas (67%) and Elf Petroleum (8.35%) (Nationalgrid, 2014, p. 1). The operations of North Hook Gas are faced with a number of sustainability issues. In order to address these sustainability issues, it is vital to formulate a change management approach for sustainability. This will be achieved through consultancy. The resultant report will identify all the barriers and drivers for change, and provide realistic proposals that will move the firm from a first wave firm to a third wave firm. Sustainability Issues Facing North Hook Gas North Hook Gas faces a number of sustainability issues. The sustainability issues that affect the operations of North Hook Gas can be divided into the external and internal categories. All the sustainability issues faced by North Hook Gas have a bearing on the firm’s external environment. The first external issue that affects the operations of North Hook Gas is the environment in which the firm is located. The terminal is located within the Pembrokshire National Park (BBC News, 2007, p. 1). The location of the park raises a number of environmental issues, particularly within the scope of environmental pollution. The second external sustainability issue is concerned with the risks posed by the firm. The local community is concerned that the pipeline will leak gas, which might cause safety and health issues. The third external issue that affects the firm is waste management. The firm must have a capacity to handle, remove or dispose all hazardous materials coming from the facility. Pollution is also a major sustainability issue that affects the operations of North Hook Gas. The internal operations of the firm contribute to carbon dioxide emissions. Additionally, the terminal is the largest in the world, which means that it receives a lot of sea and road traffic. This also contributes to carbon dioxide emissions (Hydrocarbon-Technology, 2014, p. 1). The internal sustainability issues faced by North Hook Gas include the lack of recycling capabilities. North Hook’s recycling capabilities have not been optimized. The firm needs to focus its recycling programs to the high potential recycling of high value components such as the copper wires used in the lighting systems. Setting Corporate Sustainability The critical events and situations faced by North Hook Gas have been caused by multiple factors. The main factor that has caused this situation is the recognition of the importance of the firm to the society, and its impact on the environment and its community. Companies such as North Hook Gas are the fundamental blocks of modern economies. Their successes are phenomenal in the transformation of earth’s resources, in this case natural gas (Masero, 2010, p. 1). North Hook Gas has a responsibility of turning earth’s resources into real wealth, which can shape the social and physical aspects of its surrounding. The powerful dynamism of North Hook Gas has the potentials to transform nature and society for the good of humanity. The main issue is the importance of transforming the current model or operations of the firm towards sustainable processes. Sustainability in this case means the state of earth, the survival of biotic communities and development of humane and just societies. It is evident that the operations and processes of North Hook Gas are not sustainable. Therefore, there is a need to significantly change or reshape North Hook Gas. During the change process, there are a number of drivers and barriers that should be expected. Drivers and Barriers to Change The main drivers of change are efficiency, compliance and strategic pro-activity. The main barriers to change are non-responsiveness and rejection. Rejection refers to the attitude that the firm and its internal processes have on the change movement (Pasmore, Woodman & Shani, 2010, p. 8). In most of the cases, the firm may have an attitude that all resources, human and natural resources, environment and infrastructure are meant for exploitation. This means that the firm should maximally exploit all resources at its disposal for the maximization of profits. In this case, employees are regarded as industrial inputs. As a result of rejection, the firm does not show commitment towards the development of human resources (Colboyd, Griffiths & Benn, 2008, p. 251). Additionally, safety and health measures are ignored. Rejection leads to the establishment of notions that the firm exists for the maximization of profits. Claims by the community are disregarded and the firm ignores its destructive impacts on the environment. Non-responsiveness is also an important barrier for the change movement. Non-responsiveness is caused by ignorance or lack of awareness of corporate ethics. This barrier is supported by business cultures that were used before the advent of business ethics. Based on this barrier, the firm concentrates on business as usual operations (Colboyd, Griffiths & Benn, 2008, p. 255). The company does not incorporate sustainable business practices or operations. The human resource strategies used by the firm are focused on the creation and maintenance of a compliant workforce (Doppelt, 2009, p. 25). This barrier ignores the concerns or issues raised by the community. In addition, environmental concerns are disregarded regardless of the environmental impact of the firm. Compliance is one of the drivers of the change movement. The firm complies because of the urgency to reduce the risks or negative impacts of failing to meet the minimum standards set for the industry. Based on compliance, the firm is focused on being a decent employer. As a result, the firm shows an interest in the safety and health of the workplace. Compliance ensures that the business avoids environmental abuse that might lead to strong community actions or litigations (Colboyd, Griffiths & Benn, 2008, p. 261). Compliance is primarily focused on legal requirements and community expectations. It seeks to ensure sustainable practices. Recent changes in compliance focus on co-regulatory practices (Andreas, 2011, p. 19). In this case, instead of the habitual command and control tendencies used by the government, businesses are collaborating with an aim of developing new approaches for voluntary compliance. Efficiency is a crucial driver that shows that a firm has increased its awareness of its community and processes. Efficiency is a reflection that the corporate world recognizes the advantages of proactively introducing sustainable practices (Salzmann, 2008, p. 39). Efficiency institutes sustainable practices in environmental and human resources policies and practices. The aim of efficiency is to reduce operational costs while increasing operational efficiency (Colboyd, Griffiths & Benn, 2008, p. 262). It leads to reduction in industrial waste. This minimizes the environmental impact of the operations carried out by a business. As a result of efficiency, the firm tends to value or invest in the improvement of its human resources. These investments are motivated by the recognition of the fact that improving human resources increases the value of the firm. Strategic pro-activity is a driver that moves the business into sustainability. This driver makes sustainability a crucial aspect of the business strategy (Reiss, 2012, p. 44). As a result of this driver, the business’s strategies are formulated with an aim of providing potential competitive advantages. Strategic pro-activity focuses on the positioning of the firm as a sustainable business leader that has advanced human resources (Colboyd, Griffiths & Benn, 2008, p. 271). Strategic pro-activity crucially builds stakeholder support through product quality and innovation. Additionally, the firm benefits from being certified as being environmental friendly. However, the commitment for sustainability is embedded in the firm’s quest to maximize its long-term corporate profitability. Realistic Proposal for Moving the Firm to a Third Wave Firm Businesses move from first to third wave businesses because they are motivated to make sustainable goals and take sustainable initiatives. Third wave businesses have sustainable strategic plans, which are based on sustainable values and missions (Stead & Stead, 2004, p. 58). As businesses work on reducing their impacts on the environment and improving their work force, they are forced to look for effective and technologically driven approaches that will facilitate these efforts. The proposal suggests the use of an enterprise content management system to monitor the progress made by the business as it shifts to a third wave firm. The enterprise content management system is a platform that enables employees to process, store, and archive and manages documents electronically. The firm’s intention is to move from a first wave business to a third wave business. In order to achieve its transformation to a third wave firm, it is vital to follow a transformational phase. These phases are the rejection, non-responsive, compliance, efficiency, proactive and sustaining organization phases. In its current first wave, the firm is characterized by ignorance and objection. In this phase, the organization is actively involved in activism against sustainability and inappropriate use of science (Fisher, 2010, p. 17). The firm risks losing its reputation and business. In order to shift the business from this state, it is essential to begin by destroying the values held by the firm. This means that the firm must destroy the culture of exploitation and opposition to environmental regulation. After destroying the unnecessary values, it is essential to limit some of the values, which are closely held by the organization (Eweje & Perry, 2011, p. 64). Destroying all the values at once may lead to a culture shock. In order to prevent a culture shock, it is essential to limit some of the values. The accomplishment of these activities will move the firm to the second wave, which is characterized by compliance, efficiency and strategic pro-activity. During this process, it is vital to engage in the conservation of the desirable values while destroying some of the limited values. Values are conserved through the integration of human resources with environmental functions, reduction of risks and introduction of routes for compliance (Zink, 2008, p. 6). After the conservation of values, the firm should engage in the creation of new desirable values. In this case, the human resources department should be established as a department that fosters efficiency and productivity. Additionally, caring for the environment or community is viewed as a sustainable strategy for reducing operational costs. A newly created value that could help with the operation of the firm is innovativeness. Additionally, the firm can introduce a value of inclusiveness. This means that the firm engages stakeholders through innovative and environmentally friendly processes and products. The accomplishment of these activities will lead to the establishment of a sustainable business (Hope & Hope, 2007, p. 116). The final process is the reinterpretation of the nature of the business and integration of self-renewing elements of the society. Handling the Change Management Process The framework for managing or handling change management is the phase model. Progress on the phase model indicates the willingness of the firm to progress towards sustainability. The phase model is dependent on change agents who have the ability to drive the firm towards sustainability (Smith & Fingar, 2007 p. 153). The change agents include people who work within the firm, and people who influence the operations of the firm from outside. Internal agents of change include the Chief Executive Officer, board members, supervisors, managers and professionals who assume the role of employees. External agents of change include bureaucrats, politicians, consultants, investors, subcontractors and suppliers, in addition to environmental activists (Erickson, 2009, p. 43). The influence of these individuals on change management differs. The firm’s executives may exert their influence through their exercise of authority. Additionally, they may exert their influence through informal networks, and by ensuring that the firm markets sustainable products. Consumers also have the potential to influence the operations of the firm. They exert their influence through activism (NATO Advanced Research Workshop On Sustainable Energy Production And Consumption And Environmental Costing, Barbir & Ulgiati, 2008, p. 94). They may decide to boycott North Hook’s products or demonstrate against the firm’s harmful environmental impact. Concerted efforts between external and internal agents of change are powerful in causing significant change within an organization. Recommendations The movement of the firm from a first wave to a third wave firm should be based on a phase model. The model will guide the firm through the first, second and third waves of the transformation (Howlett, Jain & Lee, 2010, p. 24). Additionally, it will help the firm to identify its strengths and weaknesses as it moves along the model. The firm should empower its internal and external agents of changes during its management of change. Empowering these agents of change will ensure that the firm goes through the right processes of change with minimum disruptions (Howlett, Jain & Lee, 2010, p. 39). Engagement of stakeholder is important because they will make crucial contributions that will assist during the change process. Technology based tools can help the firm achieve its transformation because they help in monitoring the process. For instance, the firm can use the enterprise content management tool, which is a system that will help in monitoring the transformation (Haggar, 2007, p. 37). The system helps in processing, storing, archiving and managing documents electronically. Conclusion North Hook Gas is one of the largest natural gas terminals in the world. The firm faces a number of sustainability issues. Most of these issues are concerned with the management of the environment and the sustainability of its operations. In order to address these issues, it is vital to shift the firm from a first wave organization to a third wave organization. The transformation of the firm will follow a phase model, which will provide guidelines for each of the phases. Appendix A Detailed Timeline of Planned Actions North Hook Gas has allocated 50 million pounds for its corporate social responsibility and sustainability initiatives. The allocation will cover the initiative over a period of ten years. The timeline for the planned course of action is provided below. Appendix B Waves of Sustainability (Colboyd, Griffiths & Benn, 2008, p. 40) Bibliography Andreas, F. (2011). A Simple Path To Sustainability: Green Business Strategies For Small And Medium-Sized Businesses. Santa Barbara, Calif, Praeger. BBC News. (2007). Objectors Shown Pipeline Burial. BBC News. Retrieved From http://news.bbc.co.uk/2/hi/uk_news/wales/south_west/6735813.stm Colboyd, D., Griffiths, A., & Benn, S. (2008). Organizational Change For Corporate Sustainability: A Guide For Leaders And Change Agents And The Future. Chicago. Psychology Press. Doppelt, B. (2009). Leading change toward sustainability a change-management guide for business, government and civil society. 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