Strategic intent in the management of the green environment within SMEs

Abstract

Companies are increasingly accepting responsibility for the environment and putting in place measure that meet the green demands of customers, shareholders and politicians. Only a few however tout these environmental measures as their unique selling point and seek to gain a competitive advantage from instituting them. The small and medium-sized enterprise (SME) sector in the UK makes up the majority of businesses and accounts for more than half of turnover. However little attempt has been made to examine the degree to which SME managers make a conscious and deliberate intent to utilise environmental performance as a potential source of competitive advantage. This paper studies one sector under the SME umbrella: the screen-printing industry. It investigates the motivations that underpin the responses of screen-printers in the UK to the pressures to improve their environmental performance and finds that the managerial mindset tends to be reactive, compliance-based and operationally-focused. The paper discusses the possible explanations for this cautious approach and indicates how a more proactive stance might provide a competitive edge. The authors conducted their study through questionnaires and interviews returned from a sample of 65 screen-printing companies in the UK. While some companies identified potential gains from going beyond mere compliance measures, these tended to be couched in operational rather than strategic terms. The authors say that the findings of their study could be applied across the entire SME sector and therefore for many small businesses the environment tends to be seen primarily as a cost imposed by regulatory authorities, rather than as a value-adding activity. The authors warn that given the expectation that environmental regulation will increase, managers should establish a strategy of moving away from a focus on regulatory compliance and towards a position where enhanced environmental action becomes part of the company’s competitive profile.