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Franco Lucá Supervisor: Dr DOCTORATE OF BUSINESS ADMINISTRATION Change Management Processes to Achieve Business Sustainability May 2020 Franco Lucá Supervisor: Dr. Bettina Palazzo BUSINESS SCHOOL LAUSANNE Word Count: 82,328 © Business School Lausanne All rights reserved. No part of this publication may be reproduced or utilized in any form or by any means, without the prior permissions of the publishers. 1 Original Literary work declaration Name of Candidate: Franco Lucá Registration/Reference: Title of Thesis (“this Work”): Change Management Processes to Achieve Business Sustainability Field of Study: Business Sustainability I do solemnly and sincerely declare that: 1. I am the sole author/writer of this Work; 2. This Work is original; 3. Any use of any work in which copyright exists was done by way of fair dealing and for permitted purposes and any excerpt or extract from, or reference to or reproduction of any copyright work has been disclosed expressly and sufficiently and the title of the Work and its authorship have been acknowledged in this Work; 4. I do not have any actual knowledge nor do I ought reasonably to know that the making of this Work constitutes an infringement of any copyright work; 5. I hereby assign all and every rights in the copyright to this Work to Business School Lausanne (“BSL”), who henceforth shall be owner of the copyright of this Work and that any reproduction or use in any form or by any means whatsoever is prohibited without the written consent of BSL having been first had and obtained; 6. I am fully aware that if in the course of making this Work I have infringed any copyright whether intentionally or otherwise, I may be subjected to legal action or any other action as may be determined by BSL. Candidate’s Signature Date Subscribed and solemnly declared before (Witness’s Signature) Witness’s Signature: Date Name (in capitals): Designation: 2 The Thesis Dissertation of Franco Lucá is a consolidated DBA Thesis dissertation composed of the following papers Change Management Process to Achieve Business Sustanability (A Consolidation Paper) Business Sustainability Journey in the Context of Chnage Supervisor: Dr. Bettina Palazzo A Business Case Action Research in the Cosmetics OEM/ODM Supervisor: Supervisor: Dr. Hilary Bradbury A Journey to True Sustainability in the World Cosmetics Industry Supervisor: Dr. Bettina Palazzo Sucessful Sustainability Strategy: Procter abd Gamble Case Supervisor: Dr. Bettina Palazzo The Luxury Industry in the Wind of Change to Sustainability Supervisor: Dr. Katrin Muff 3 After Defense Statement CHANGE MANAGEMENT PROCESS TO ACHIEVE BUSINESS SUSTAINABILITY Advisor: Dr. Bettina Palazzo This certifies that the Thesis of Franco Lucá is approved May 2020 Publication of the Written Dissertation is subject to: - Amendments demanded by the Thesis Committee - Final Approval of the text by the Director of BSL – Business School Lausanne Doctoral School - Final Approval of the publication channel by the Director of BSL – Business School Lausanne Doctoral School 4 Defense Thesis Committee Name of the candidate: Franco Lucá Date of the Defense: June 25th, 2019 Committee Head: Dr. David Claivaz [signature] Committee Member: Dr. Dominique Bourqui [signature] Committee Member: Dr. Bettina Palazzo [signature] 5 ABSTRACT Assuming that businesses will increasingly be the key contributors and drivers to resolving the social, economical and environmental challenges the world is facing, the Doctorate of Business Administration Program of Business School Lausanne in the field of business sustainability seeks to contribute to transforming businesses into sustainable organizations. As a manager my motivation to join the program was to learn how a business can positively contribute to a world where everybody can decently live within the limits of the resources of the planet. I wanted to personally grow to act responsibly for the world and become a responsible leader. As Prof. Herman Daly put in 1996 in “Beyond growth. The economics of sustainable development”, “sustainable development is a term that everyone likes, but nobody is sure of what it means (…) and was sufficiently vague to allow for a broad consensus”. Due managerial experience, however, I was convinced companies could not long ignore sustainability issues, leading to substantial transformation affecting organizational strategy, structure, processes and management. A business case driven doctorate is an inductive work, that involves the search for pattern from observations. It is therefore in the intrinsic nature of such a doctorate, to go stepwise, to evolve according to the findings and learnings from one case to the next one. Strongly driven by the Business Sustainability Model promoted by BSL Business School, the research focused initially on the meaning of Business Sustainability for companies, how they could integrate BST into a business context and investigate how to manage this massive transformation process in their strategies, organizations, structures and process. Through the successive emergence of patterns arising over the cases, it became more and more apparent, that business sustainability, above the organizational challenges, was strongly related to responsible leadership and individual development. This process of gradually narrowing down the doctoral research from industry to organizations to leadership and in its last phase to the smallest unities of organizations, the team and the individual, demonstrated that true business sustainability requires far more than organizational change. After five years of research in different industries, large global companies in Europe, America and Asia-Pacific, surveying, interviewing, working with hundreds of people, I came to the conclusion that there is no linearity in business sustainability from one stage to the other. Progress towards business sustainability can be achieved through organization, structure, process and actions. This is valuable. This will not transform companies, however, into true sustainable companies. Such an achievement implies to fundamentally transform the business model, consider value and strategy radically different as well as breaking the pattern of beliefs, that only the others must change. This means a fundamental culture and leadership transformation that affect every single individual. And at the very beginning every single leader. 6 General Table of Contents: 1. Change Management Process to Achieve Business Sustanability (A Consolidation Paper) ………………..8 2. Business Sustainability Journey in the Context of Chnage (App. 1)…….....………......................................48 3. A Business Case Action Research in the Cosmetics OEM/ODM Industry (App. 2)......................................85 4. A Journey to True Sustainability in the World Cosmetics Industry (App.3)…….........................................110 5. Sucessful Sustainability Strategy: Procter abd Gamble Case (App. 4)……………………..........................168 6. The Luxury Industry in the Wind of Change to Sustainability (App. 5)…….…..........................................198 7. Bibliography………………………………………………………………………………………………...221 7 Change Management Processes to Achieve Business Sustainability A Consolidation Paper Word Count: 16,657 8 Contents 1. Introduction ............................................................................................................................................ 10 1.1. Short review of a personal change .................................................................................................. 10 1.2. Theoretical context ......................................................................................................................... 12 2. Changing environment, constraint or chance? ......................................................................................... 15 2.1. Changing environment as constraint ............................................................................................... 15 2.2. Changing environment as chance .................................................................................................... 17 3. Hard factors are easiest to change, soft harder ......................................................................................... 20 3.1. The supremacy of the soft factors in theory ..................................................................................... 20 3.2. Companies are good at hard factors implementation ........................................................................ 22 3.3. Soft factors may turn out to be hard ................................................................................................ 24 4. Pillars of change in the context of business sustainability ........................................................................ 29 4.1 All people are concerned, firstly the top management...................................................................... 29 4.2 People don't resist change, they resist being changed....................................................................... 34 4.3 When everyone has to change, the leaders have to change first ........................................................ 42 5. Conclusion ............................................................................................................................................. 44 6. Bibliography………………………………………………………………………………………………….46 Table of figures Figure 1: Action Research for personal, team, community change ..................................................... 14
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