The Next Next Common Sense
For example, automotive manufacturers face complexity not just in the technical transition to electric vehicles, but in managing manufactur- ing facilities vulnerable to extreme weather, securing raw materials from regions experiencing climate instability, meeting diverse regulatory re- quirements across markets, and anticipating changing consumer mobility patterns in climate-impacted urban areas. The most sophisticated organizations have developed scenario-based approaches that integrate climate science projections with business im- pacts. For each major region, they map potential physical risks (extreme weather, resource scarcity, infrastructure damage) and transition risks (regulatory changes, market shifts, technology disruption). “What makes this especially challenging,” Roberto continues, “is that we can’t treat climate as a separate issue from other strategic consider- ations. It interacts with everything—technological development, geopo- litical tensions, social expectations, financial markets.” This interconnectedness creates both challenges and opportunities. Companies that initially approached climate change as a compliance and risk management issue are now recognizing it as a fundamental driver of innovation and business model evolution. “The most interesting developments are happening at the intersec- tions,” notes Fatima, head of innovation at the same company. “When we combine climate adaptation with AI capabilities and IoT infrastructure, we’re creating entirely new value propositions.” AA pp pp rl yoiancgh tthoeCFl ii mv e -a St et eCpoCmophleerxeint yc e The five-step approach for creating coherence introduced in Chapter 13 provides a powerful framework for addressing climate complexity: Step 1: Establish shared context : Organizations develop robust pro- cesses for creating shared understanding of climate realities. Consumer goods company Unilever conducts “climate context workshops” where
403
Made with FlippingBook. PDF to flipbook with ease