When Katsuaki Watanabe took over as President of Toyota
in zoo he made it clear that developing environmentally friendly technologies would be his top priority—even ahead of safety, quality, and cost. If this weren’t shocking enough, he also promised that his engineers would someday develop a car that could “cross the U.S. continent on one full tank of gas.” Talk about a stretch goal!
Goals for an organization can be splashy like Toyota’s or more concrete. Unilever, for example, set a fairly unsexy goal of zero liquid effluent from its 76 facilities in India. Watanabe himself set more realistic targets alongside his big 2oo-miles-per-gallon vision, including a sales goal of one million hybrid cars per year. Either way, fanciful or functional, stretch goals are a vital tool for provoking fresh thinking, promoting innovation, and building an Eco-Advantage.
As Harvard Business School’s Michael Porter has argued, having to address tough environmental issues can be the spark a company needs to go beyond its comfort zone and find ways to innovate. Stretch goals drive creativity by asking the near impossible and demanding the reexamination of assumptions. They force everyone to search for new ways to meet old needs.
We’re not talking about lofty statements like, “We seek to be an environmental leader in our industry.” Visions help set a tone and establish priorities, 
but they don’t provide concrete goals or much direction. Nor are we talking about incremental gains such as “use percent less energy next year.” We’re focusing instead on big advances that present a challenge and might seem nearly impossible. The stretch goals we’ve seen animating corporate culture give life to the mindset principle “No is not an option.”
According to the research suggestion, that the sweet spot for stretch goals comes with targets that are clear and specific, yet far-reaching. Some are technically achievable but extremely challenging, like the 3M and Nike targets of reducing emissions of volatile organic compounds by 90 percent (both companies achieved it). Other stretch goals can seem purely symbolic, but in fact also drive execution. For years, DuPont has declared, “The goal is zero” when it comes to waste. While certainly an aspiration, zero packs a punch. It is specific and easy to visualize. If something is going out a pipe or into the garbage, you know you’ve missed the target. Furniture maker Herman Miller recently outlined its goals for the year 2020, which included zero waste and a 100 percent emission-free footprint. They’ve labeled these goals “Perfect Vision.”
Stretch goals help to clarify a company’s long-term direction and empower employees down the line to step up to the challenge. In 1999, Alcan set an ambitious greenhouse-gas reduction goal of 500,000 tons by 2004. Once unleashed, the company’s engineers found 2.2 million tons to cut in only the first two years. Alcan’s Dan Gagnier told us how management had missed the boat: “Executive management, no matter how well intentioned, was lagging behind operational management, who felt it was time the company did much better on these issues.”
But here’s an irony: While operational people often know inure about what actually can be achieved, they should not be expected to set stretch goals. In the words of DuPont’s Paul Tebo, “If you set goals by letting the organization tell you how to set them, you don’t have any goals at all. . . . you just get what people know they can do.”
Some WaveRiders are setting goals that help them cut environmental impacts beyond their own operations, up and down the value chain. Alcan, which consumes tremendous energy in making aluminum, has started talking about going “Beyond Zero.” Here’s the thinking: The production of every ton of aluminum creates about twelve tons of greenhouse gases (GHGs). If the transportation market uses more aluminum, lighter vehicles will burn less fuel and emit fewer GHGs. By Alcan’s estimates, a ton of aluminum added to a car saves about twenty tons of GHGs over the life of the vehicle.
Critics would say that Alcan is just trying to get out of reducing its own emissions or, worse yet, that it’s pushing this logic to sell more aluminum. Both may be true. There can be a fine line between broad thinking and issue avoidance. But thinking about how your products fit into the full value chain is the right approach and often the best way to find opportunities your competitors may have missed, which is the definition of Eco-Advantage.
Going beyond zero can inspire everyone in the company to find new solutions and do what was once thought impossible. Over time, goals that might have been symbolic become achievable. Herman Miller now expects to reach its goals of zero landfill and 100 percent renewable energy. Our research consistently shows that tough standards often spark innovation.
We heard the same thing almost word for word everywhere: “We didn’t have a clue how we’d get there.” Diving into the unknown can be scary. But this is why seemingly impossible goals like zero, or even beyond zero, are so important for breaking out of old ways of thinking. As Dawn Rittenhouse, DuPont’s Director of Sustainable Development, told us, “We’re not looking for continuous improvement. We’re looking for strategic thinking and transformation.”