Sustainable Value Innovation

The preceeding chapters presented the four Competitive Environmental Strategies (CES) available to corporations to compete in existing industries (Part II). This chapter presents the fifth sustainability strategy, which builds on the concept of value innovation. According to the logic of Blue Ocean Strategy (BOS), by creating additional value to customers at lower costs, companies can bypass the competition in an existing industry because such value innovation can generate new markets spaces or, to use the BOS metaphor, “a blue ocean where the company can swim alone”. BOS also presents a subtle caveat: as long as value innovation is created to existing or previously neglected non-customers, environmental impacts resulting from the new offer do not restrict its deployment.1 On the other hand, as the chapters of Part I suggested, sustainability strategies entail embedding the value proposition of the company (private profits) into the broader environmental and societal context (public benefits). This means that the creation of Sustainable Value Innovation (SVI) requires companies to lower costs and increase consumer value while generating public benefits in the form of reduced environmental impacts and value for society.