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Doing well, by doing good: The case of Interface and its journey towards sustainability
by Melhus, Peter, PhD, UNIVERSITY OF CALIFORNIA, BERKELEY, 2005, 0 pages; 3210319
 

Abstract: Organizational decision-making literature tells us that profit maximization is such a predominant factor influencing decisions within for-profit organizations that it would be difficult, even if theoretically possible, to integrate into the organization a long-term environmental sustainability ethic. In this dissertation I study Interface, Inc., a $900 million, publicly traded manufacturer of broadloom and carpet tile for commercial buildings. I present a case that demonstrates that Interface has internalized an environmental sustainability ethic and I illustrate how it was done. The means by which Interface instituted this organizational cultural change may serve as an exemplar for other organizations. My methodology was a combination of exploratory and explanatory. I interviewed key people involved in the decision-making process within Interface and supplemented this with my own observations of the decision making processes. I reviewed official company records, such as training manuals, performance review programs and compensation packages. Along with publicly available financial materials I used this information to analyze and explicate the extent to which the economic and non-economic factors identified in the academic literature explain the decisions made. I studied the scholarly-described economic and non-economic influences on Interface's decision makers. Economic influences include direct cost-benefit of projects and individualized financial incentives, such as salary and incentive pay. Non-economic influences include the mission, culture and history of the organization, clarity of goals and their internal translations, the way things 'really work,' the rigor and frequency of performance reviews, and so on. I ascertained that decision-makers were sufficiently compelled by non-economic influences to make decisions that might result in lower personal economic returns. I conclude that the combination of leadership, vision and internal incentive systems, supplemented by the development and maintenance of a corporate culture that supports the simultaneous consideration in decision-making of environmental sustainability and profitability, has enabled Interface to achieve an organization in which environmental and financial influences on decision-making are at parity. Like employees in other for-profit organizations, Interface's associates are expected to make money for the company. But they are expected to do more. They are also expected to deliver environmental returns on investment in conjunction with financial returns.

 
Advisor: Innes, Judith
School: UNIVERSITY OF CALIFORNIA, BERKELEY
Source: DAI-A 67/03, p. 1113, Sep 2006
Source Type: PhD
Subjects: Area planning & development
Publication Number: 3210319
     
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