Sustainability risk and portfolio management—A strategic scenario method for sustainable product development

Abstract

Companies need to strategically develop their portfolio and find the balance between being proactive and passive in relation to sustainability. In this study, a strategic perspective based on backcasting from overarching socio-ecological sustainability principles was used as a lens to understand how companies might adapt their product portfolios to avoid threats and exploit opportunities on increasingly sustainabilitydriven markets. The study shows that sustainability performance, market success, and time are key areas to be considered in the product portfolio process to ensure short-term profitability and long-term competitiveness. A novel method was developed and tested in one academic group and two companies to explore how such a strategic sustainability perspective can support the product portfolio process in practice. The results indicate that the strategic layered double-flow scenario method, including different time horizons, was supportive in identifying opportunities and avoid risks in the sustainable development process at the company.

Forming Digital Sustainable Product Development Support

“…Sustainable design will be influenced by the megatrends digitalization and circular economy (Brahma, 2021). A similar conclusion is drawn in Hallstedt et al (2021), who concluded that digitalisation, sustainability, and servitisation are intertwined areas, and that circular economy in combination with digitalisation is a key to realize Product Service System solutions and to meet society's challenges and stakeholders' sustainability requirements in terms of resource savings and more efficient usage of products.…”

“…The role of designers is expected to change from design of artefacts to design of entire solutions (see e.g., Isaksson et al, 2009). This implies that designers need to consider the behaviour of products and solutions and their impact over complete life cycles (Ramani et al, 2010;Carlsson et al, 2021), developed and organized by business networks together with several suppliers and other partners with different capabilities (Hallstedt et al 2021).…”

“…strategic, tactical and operational, for a development of new and disruptive business models and innovations to happen. The suggested DSIP need to provide novel support tools for companies to e.g., assess portfolio and risk aspects from a short-term business perspective to a long-term strategic perspective (Villamil et al, 2021;Schulte & Knuts, 2022). Based on these assessments, long-term plans and new business models can be developed for disruptive sustainable innovations.…”

The climate resilience cycle: Using scenario analysis to inform climate‐resilient business strategies

“…The review reports a correlation between the maturity of foresight practices within companies and company performances; however, there is no evidence that scenario analysis results in ‘great strategies that are unique, creative, or distant from the industry status quo’ nor direct evidence that scenario analysis improves long‐term business performance (Wiebe et al, 2018). Also in the sustainability domain, scenario analysis has shown its practical relevance to inform company decisions (Villamil et al, 2021) with high relevance to assessing and managing climate‐related risks and opportunities (Hillmann et al, 2018; Linnenluecke & Griffiths, 2012). However, climate change scenario analysis by non‐financial companies is relatively recent with limited best practices (TCFD Status Reports, 2020, 2021).…”

Immunology-Based Sustainable Portfolio Management

“…A large number of different "improvements" were proposed to fulfil the portfolio designers' dreams. Authors in their literature review [2] on sustainability, indicated that a general portfolio setting followed selection criteria and the company's strategies, which are usually based on management elements, e.g., time, cost, risk, quality, etc., leaving the sustainability variables behind. The following are a couple of examples.…”