First, using the Business Model Canvas, we took a look at the traditional business model of golf courses and events (a market of approximately €1.4 billion p.a.). Golf features in the top 10 of sports played in the world and out of that ranking, it is the one that brings us the closest to nature. But this comes at a price: some 35.000 golf courses around the globe consume large amounts of water and energy and - if not carefully managed - can do severe damage to the local biodiversity. This was confimed by the benchmark study of 5 top courses in Catalunya in 2012. The benchmark measured sustainability on 16 key topics including water, waste, energy, biodiversity, health and safety, and local community involvement.
Next, the industry stakeholders were mapped and analyzed what issues were relevant to them. Our research of the European PGA Tour supported the notion that several sustainability issues were material to golf events such as water use, community engagement and transportation. In addition, professional event sponsors such as KLM, UPS, Ricoh, BMW and Deutsche Bank appeared to be increasingly sensitive to these sustainability issues.
After establishing the materialities of the relevant stakeholders, and with the help of KPMG, it was possible to determine what made golf courses tick and compare those outcomes to what the internal eco-certification program of the golf sector was offering. Coming from within the industry, GEO (Golf Environmental Organisation) is more focused on risk management than at value creation from sustainability. Hence golf courses acquiring a GEO certification did not obtain much value despite its time-consuming process. However, since golf courses in more mature markets were clearly suffering from increasing costs and weaning customer loyalty, value would exactly be what courses were looking for. This is a big contributor to the slow roll out of the current certification scheme, even despite the impressive support from the nerve center of the game of golf: the R&A in St. Andrews.
But what to do next? The opportunity for courses was sizable enough: our research in Catalunya demonstrated sizeable opportunities for efficient water- and energy management. Based upon consumer pricing, cost savings of up to € 550.000,- per year on water use and € 350.000,- per year on energy consumption for large golf courses were feasible, next to the positive reputational effects. And meanwhile golf was booming in Asian markets such as China and South Korea. So Finch & Beak designed and developed The Sustainable Golf Project: an online low-cost benchmark which was largely based upon our Dow Jones Sustainability Index experience. With The Sustainable Golf Project Finch & Beak was able to support golf courses directly in value creation from sustainability. The three key value drivers from GLOBE-US are applicable: Eco-efficiency (saving energy, waste and water), Innovation (providing CO2 neutral golf) and Customer Intimacy (engaging local communities better).
How to take on the sustainability of a traditional company or even an entire industry? By combining GLOBE-US with the Business Model Canvas, cool, innovative value propositions can be developed that contribute to an improved triple bottom line. If you want to learn more about this case, the full story is described in "Will brown become the new green? Sustainable golf in the old and new world" (IMD-7-1579, forthcoming). Or else check out www.sustainablegolfproject.com or mail firstname.lastname@example.org for more information.