2018-05-15 | 作者:We mean Business

Navigating Disruption Within Changing Systems

Changing to a low-carbon economy is the defining challenge for many companies over the next decade. How they reply to the disruption it brings will have ramifications much more beyond their own boardrooms.

Faced with rapid change it can be tempting to withdraw to business as usual, plot a steady course and hope for the best. However, engaging headlong in the global effort to decarbonize will provide companies with an effective compass to navigate the uncertainties ahead.

The company itself is quick to point out that demand for oil and gas will remain a key part of the energy mix for a long time to come. But in an industry where there has been a distinct lack of leadership, the company’s willingness to lay out a pathway that reflects the demands of the Paris Agreement counts as progress.

Taking decisive action is crucial for companies like Statoil if they are to maximise the business opportunities, minimise the risks such as stranded assets and effectively plan to transition workers away from polluting sectors in a just and fair way.

Treating low-carbon transition with care is understandable, but underestimating the rate of transition carries its own pitfalls. Not only are there risks to company in the form of bad investments and lost ground to competitors, but an ineffective planning can have detrimental impacts on a huge range of outside stakeholders.

Forward-looking companies are acknowledging that disruption is not limited to their own businesses; they recognise ramifications through entire value chains, communities and even countries. This can clearly be seen in the race to electrification by the world’s biggest automakers, where the accelerating transition risks unintended consequences if not managed carefully.

The rapid rate of change was recently underlined by Volvo’s plans to shift its entire fleet to hybrid or fully electric engines by 2019. This came as many of the major automakers are announcing plans to gear up their EV offerings in response to a tightening regulatory outlook in countries such as France, Norway, The UK, India and elsewhere.

This rapid electrification represents a seismic shift not only for those companies, but for a whole host of related industries including component manufacturers, commodity producers, electric utilities as well as the production workforce.

Few of these impacts may well have positive effects, such as copper miners seeing increased demand, while some might be potentially negative, like unemployment at automobile manufacturing plants due to the reduced number of components used in EVs.

The impact on oil demand from a rapid rollout of EVs is only starting to be fully understood, thanks partly to long-standing conservative forecasts from the likes of the International Energy Agency (IEA) downplaying the likelihood of exponential growth in EV stocks.

Source:We mean Business


Picture credit to:Patrick Hendry

GRI Software And Tools Partner