ERB PERSPECTIVE BLOG

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by Jacob Talbot

power_stripBehavioral approaches to energy efficiency have gained increasing acceptance over the past several years. Policymakers and regulators now incorporate behavioral techniques into their toolkits and private enterprises such as Opower and Tendril have achieved success in deploying for-profit behavior change programs. Thus far, these behavior change initiatives, as well as most research on behavior change strategies, have focused on influencing the behavior of people in their homes. There are legitimate reasons for this emphasis, but now with substantial experience in deploying behavioral programs in domestic settings, there is new attention toward using behavior change techniques to influence energy consumption in commercial buildings.

This new interest is well founded. Commercial buildings account for about a fifth of all energy use in the U.S. as well as a large portion of the waking hours during which people make decisions about how to use energy. Not only is the magnitude of energy use large, but also recent estimates by E Source place energy waste in U.S. businesses at a $60 billion annual cost.

In light of this opportunity for energy savings, the commercial buildings sector has long been a target of energy efficiency rebate programs, but these programs have largely ignored occupant behavior, in part because there are unique challenges to addressing behavior in commercial settings. For example, commercial buildings are far more heterogeneous than homes, so it is difficult to concretely identify which behaviors will be most impactful in a given building without seeing the equipment in situ. After all, how much do the energy loads in your local corner store resemble those of the coffee shop across the street? These differences make it challenging to scale behavioral interventions. Continue reading

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By Santiago Bunce

Tenda Atacado in São Paulo, Brazil

Tenda Atacado in São Paulo, Brazil

Welcome back to this seven-part blog series: Social Enterprise: Understanding the Base of the Pyramid. This week, in our second post, we are exploring the business case for engaging the market at the base. Specifically, we’ll take a look at a leading Brazilian food retailer and the steps they took to engage the BoP and obtain profitable results.

Companies attempting to access the BoP often encounter internal and external barriers. Two typical examples include difficulty acquiring buy-in from key decision makers and the lack of data to conduct reliable market analysis. In addition, there is some doubt that the sheer magnitude of the BoP is enough to make engaging it profitable. While the BoP is comprised of roughly 4 billion people, according to some definitions, this population has a very low income per capita and very limited spending capital or disposable income. These factors, among others, often make companies hesitant to enter low-income markets.

Despite these challenges, there is evidence to support the business case for BoP engagement strategies. In addition to its immensity, the BoP market is composed of active consumers who spend significant amounts of money. Estimated at about $5 trillion, this market is mostly dominated by spending on food, but also sees heavy spending in energy and health (data from the World Resource Institute: The Next 4 Billion). Little competition and lack of existing brand loyalty among consumers may also make acquiring new customers easier in the BoP compared to more mature markets. This suggests that the BoP market is ripe for innovative products and services that meet a need and deliver a positive impact. Continue reading

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By Kelsea Ballantyne

Professor Ravi Anupindi

Professor Ravi Anupindi / Photo credit: Kelsea Ballantyne

When I joined the U of M Presidents Committee for Labor Standards and Human Rights last year, I had no idea how much it would open my mind to the power universities have to transform global supply-chains.

Helping to organize the Symposium on Global Human Rights & Labor Standards (commemorating the 15th year of the committee), brought me even more awareness of this enormous potential as well as a sense of the huge responsibility we bore to ensure that this event would push conversations to action.  I knew the market for university branded goods was large, but I had no idea that the market for collegiate licensed merchandise was worth more than $4.5 billion last year.

Following U-M President Schlissel’s opening remarks, Michael Posner, Assistant Secretary of State for Democracy, Human Rights, and Labor, presented his argument  for the role of American Universities in a globalized world citing university endowments ($450 billion dollars), food service, construction of new buildings, etc. “Each year, American colleges and universities spend hundreds of billions of dollars on commercial contracts for goods and services.” Continue reading

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MiTienda_IDB

Photo credit:  Inter-American Development Bank

By Santiago Bunce

Welcome to the first of a 7-post blog series entitled: Base of the Pyramid – The Underlying Potentials and Pitfalls. Each week will feature a post highlighting Base of the Pyramid (BoP) business models, theories, and examples. The series will showcase models that are serving the underserved while generating social impact and profits.

To ensure we are all at the same starting point, let us offer a brief introduction regarding the BoP. Debate exists regarding who exactly comprises the BoP. There is a range of thoughts including some sources who note that the Base of the Pyramid refers to the nearly 2.5 billion individuals in the world who live in extreme poverty (under $2 a day), while others expand the BoP to simply include the low income populations within a country or region, whether they live in extreme poverty or relative poverty. What is certain is that the BoP population is not uniform as it varies across regions and countries and that those at the base are not actively engaged or integrated in the formal global economy. Continue reading

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Remarks to the Erb Class of 2017, By Andy Hoffman

erb-group-photo 2

Community Day, Class of 2017 and 2016 mid-year admits

One of the benefits of being a professor is that we forget that we are aging. Each year, we are met by a fresh crop of new students that are always the same age.  So, in effect, we are constantly surrounded by a group of people that never grow old.  But of course we are aging.  I can see things as they have evolved while you, the new students, see everything as if it were new.  I envy your perspective.

I have been reflecting on this passage of time as I enter my last year as Faculty Director of the Erb Institute.  Though my five-year term ends in September 2015, I will still stay involved with the institute and continue to work on sustainability research, education and outreach.  But the pending end of my term as Faculty Director marks a significant point in our history that I think you will benefit from knowing, especially on this occasion of  “Community Day”  as you mark the beginning of a new school year. Continue reading

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by Theresa Miranda

Photo: Courtesy of “The Rawanda Focus” (focus.rw/wp/)

How will it be possible to meet the needs of the 1.4 billion people who lack access to electricity? One of the most common arguments is that developing countries will leap-frog developed countries to implement cutting edge technology just as they did in eschewing landlines in favor of mobile phones. New technologies emerge, costs drop, and developing countries take advantage of the R&D money spent by developed countries, bypassing traditional costly centralized infrastructure solutions in favor of light-weight decentralized solutions.

I espoused that view on more than one occasion before spending twelve weeks on the ground in Rwanda, where I worked with Nuru Energy, a company that provides human- and solar-powered LED lighting and mobile phone recharging to rural villagers who lack access to electricity. It became clear that the argument ignores some fundamental differences between phones and lights including:

  • The absence of substitutes in the case of phones
  • The difference between lighting needs in developed and developing countries
  • The ability to easily connect the product with meaningful benefits

Yet, it is precisely these differences that make access to lighting a much bigger challenge than mobile phone adoption. Continue reading

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By Marianna Kerppola

As I entered the classroom, 26 girls between the ages of 10 and 18 chanted: “Welcome to More Than Me Academy. We are the girls of Power class, What is your name?” I answered “Marianna” and watched their charismatic teacher prompt the class to spell out my name phonetically as my heart melted. More Than Me (MTM) Academy is a girls school in Monrovia, Liberia founded in September 2013. MTM enrolls 125 girls from a slum called West Point, a neighborhood known to have the highest rates of child prostitution in the country. MTM works towards making sure that “education and opportunity, not exploitation and poverty, define the lives of the most vulnerable girls from the West Point Slum of Liberia.” Because of the 14 year civil war in Liberia, education has lagged for all children — but girls in particular. Most of the girls’ parents are illiterate, never having a chance to go to school while Charles Taylor pummeled the country. As a result, these families are stuck in a cycle of poverty, without the support of organizations, like MTM. Continue reading

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by Matthew Gacioch

group_3373Set high on the sixth floor of Ross Business School, on August 18th a group of fifteen Erb alumni, External Advisory Board members, and staffers collected for the Ann Arbor Alumni Roadshow. Overlooking the sun-washed city below, the gathering fell on one of those days towards the end of the season that makes you realize just how much we’ll all be missing summer soon.

The Ann Arbor Roadshow was the sixth and final gathering  in a series of alumni engagement events conducted by the Erb Institute across the country, as we work to continue developing our upcoming five-year plan. Led by Erb Managing Director Terry Nelidov and Erb Faculty Director Andy Hoffman, the discussion was stimulated by three questions: What are the current sustainability trends in business? How can management educators respond in addressing sustainability? What should be Erb’s unique contribution within management education?

The conversation began with the prompt that there must be a focus on seeing topics of sustainability as opportunities rather than problems. This distinction can make all the difference in promoting the necessary adjustment within corporate sustainability strategy from being reactive to becoming proactive, which opens the door to thriving in business. That is, after all, one of the Erb Institute’s core motivations. Continue reading

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Best-front_3338-600by Terry Nelidov and Dominique Abed, with Michelle Lin

Terry and Dom met with Laura Flanigan (Erb ‘06), Rosemary Lapka and Michelle Lin (both Erb ‘12)  on a Monday night in August at the  “Little Goat Diner” (Thanks Michelle, for the recommendation!)–a bustling Chicago landmark with a quirky but tasty menu started by Stephanie Izard, a Top Chef winner who is, incidentally, also a U-M grad.  Fortunately, Rosemary came prepared with both U-M and Erb flags (see photos below). Continue reading

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