Case spotlight: Navigating Tensions and Trade-offs in Coop’s Sustainability Solution Portfolio

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This case was featured in the March 2024 issue of Connect.

Who – the protagonist

Philipp Wyss, CEO of Switzerland’s Coop.

What?

The Switzerland Coop Group is an international retail and wholesale cooperative, which is not profit-oriented; yet, in effect, the company is managed and run just like a profit-oriented outfit.

By 2022, the Coop Group employed nearly 95,000 people and had two main areas of business: retail, with total sales of CHF 19.9 billion, and wholesale/production, with total sales of CHF 15.7 billion. The retail division operated exclusively in Switzerland, while the wholesale/production business was active in several countries.

Within Switzerland, the Coop Group operated over 2,000 stores, from small corner shops to megastore supermarkets, non-food specialist stores for home improvement, pharmacies, restaurants, and more.

Based on data from 2020, Coop led the Swiss food retail sector with a market share of 35.1%.

trolley coop

Why?

With sustainability challenges growing due to record high temperatures globally, the pressure was on to respond, with consumers expecting firms to act.

For Coop, worsening global and local sustainability challenges were more than a background threat; they endangered the company’s competitive advantage. Coop’s commitment to sustainability had turned it into a global sustainability leader in the food retail sector, attracting sustainability-conscious consumers to its stores.

But with Swiss food retail rivals beginning to leverage sustainability actions to differentiate themselves, Philipp asked Coop’s board to provide him with options for expanding the company’s portfolio of sustainability actions.

When?

It was in 2022 when Coop was assessing its sustainability offering.

Where?

The Swiss food retail sector consisted of Coop and Migros, each capturing roughly a third of the market, with discounters Denner, Lidl and Aldi accounting for around 15%.

Between 2019 and 2022, Swiss consumers’ spending on organic products grew more rapidly than non-organic products at 19% versus 7%, underlining the importance the nation’s people place on sustainability.

Key quote

“Is there more we can do on some of these topics? Are there areas where we could be more sustainable and innovative in the food retail sector?”
Philipp Wyss, CEO of Switzerland's Coop.

What next?

With Coop needing to do more to fill gaps in its current approach to sustainability, Philipp’s sustainability team identified five key challenges that required mid and long-term action proposals: reducing scope 1 GHG (greenhouse gas) emissions in logistics, addressing scope 3 GHG emissions in the value chain, avoiding food waste, enhancing biodiversity, and improving human rights.

A new portfolio of sustainability actions needed to be defined for the challenges.

AUTHOR PERSPECTIVE 

On the reasons for writing the case…

The authors said: “For several years, our approach to teaching corporate sustainability relied on traditional Harvard-style case studies, but we grew dissatisfied with the narrow focus on singular challenges.

“Recognising that sustainability encompasses a multitude of interconnected issues, we embarked on a journey to educate students on the complexity of addressing multiple problems simultaneously. Unlike other fields where technological solutions might be readily available, sustainability demands a nuanced understanding of diverse and intricate challenges. Firms must grapple with highly complex problems simultaneously rather than in isolation. We realised that we needed a comprehensive 360° case study, evaluating the sustainability of a company from various perspectives and outlining multifaceted solution pathways where managers must make trade-offs and reach compromises.

“We collaborated with a supermarket chain in Switzerland, Coop, a strategic choice given the familiarity of supermarkets in the daily lives of many students in our classes. This partnership proved invaluable in illustrating the real-world intricacies of sustainable business practices.”

On the case writing challenges…

The authors continued: “One of the major challenges in writing the case was to somehow capture and handle the diversity in class across many different dimensions: a diversity of challenges, a diversity of solutions, and a diversity of students in our courses with different experiences and expertise.

“Our approach to managing this diversity in the classroom was two-fold. First, we simplified the structure and format of the case documentation and reduced the complexity and diversity inherent across the different challenges. This allowed us to find a common way to allow students to assess the impact and viability of proposals without overwhelming them with metrics and details.

“Second, when we run the case in class, we actively seek to manage heterogeneous groups by deliberately placing students with different academic, cultural, and study programme backgrounds together, encouraging them to leverage the differences in worldview, life experience etc., during their discussions.

“Although diversity posed a challenge, it ultimately made our case more interesting and valuable, drawing the attention of researchers and industry experts from different fields. Students especially discovered that their unique strengths, effective collaboration and listening to peers, emerged as essential success factors in developing and evaluating solutions to sustainability challenges.”

On teaching the case…

They added: “Our case has become a versatile educational tool, reaching diverse audiences across various countries and presented in different formats. We have used it within shorter three-hour sessions, immersive one-day workshops, and comprehensive semester-long courses. The case works really well in executive courses, but also in master's level courses and even with high-school students.

“The case is broadly applicable and very effective in engaging learners across diverse educational levels and settings. This versatility allowed us to convey sustainable business principles to a broad spectrum of individuals and allowed us to nurture a nuanced understanding of complex challenges and solutions in the realm of corporate sustainability.”

stacked coop

On how students react to the case…

They explained: “What sets our case apart is its relatable setting - the familiar aisles of a supermarket where everyone can envision buying fruits, vegetables, and everyday essentials. Here, many people are already aware of sustainability challenges but lack easy solutions to them. Amidst these commonplace scenarios, negotiations unfold in unique ways. Executive students find it easy to adopt a broad corporate strategic perspective during discussions. Students with backgrounds in engineering or natural sciences gravitate towards scrutinising and evaluating the details of individual solutions. The case's impact extends even to high school students, offering them insights into the challenging reality of implementing solutions within resource-constrained corporate environments.

“This diverse engagement highlights the case's ability to bridge the gap between theoretical understanding and practical application across various levels of expertise and experience.”

On case writing tips…

The authors commented: “What helped us immensely when developing and writing the Coop case was that we started with a setting that genuinely fascinated us and added substantial value not only to our classes but also to our research projects.

“Our top tips for writing a good case? Invest ample time in crafting the case, with a particular emphasis on testing it across diverse audiences. Seek feedback not only from students and colleagues within your university but also from industry professionals to ensure real-world relevance. Opt for a case that resonates with a broad spectrum of students, making it easily relatable.

“Additionally, don't overly concern yourself with direct cooperation from the case company; even with large corporations, there is often abundant publicly available material. Maintaining independence from the case company can provide a valuable perspective.

“And don’t forget to continue collecting and implementing feedback from the students.”

Final word…

The authors concluded: “The case adopts a novel format known as a 360° case study, inspired by Sarah Kaplan's book The 360° Corporation: From Stakeholder Trade-Offs to Transformation.

“This innovative structure proves really valuable for facilitating role-playing scenarios centered around the inherent tensions and trade-offs within sustainability. Acting as board members, students engage in collective negotiations to address diverse sustainability challenges. Through this immersive experience, they train crucial soft skills such as negotiation and leadership, essential for effective sustainability communication and advocacy.

“We believe that the 360° case study format uniquely enables students to delve into a wide spectrum of issues, consider a longer time horizon, and grapple with the complexities inherent in sustainability-driven change.”

THE CASE 

The case

Who – the protagonist

Philipp Wyss, CEO of Switzerland’s Coop.

What?

The Switzerland Coop Group is an international retail and wholesale cooperative, which is not profit-oriented; yet, in effect, the company is managed and run just like a profit-oriented outfit.

By 2022, the Coop Group employed nearly 95,000 people and had two main areas of business: retail, with total sales of CHF 19.9 billion, and wholesale/production, with total sales of CHF 15.7 billion. The retail division operated exclusively in Switzerland, while the wholesale/production business was active in several countries.

Within Switzerland, the Coop Group operated over 2,000 stores, from small corner shops to megastore supermarkets, non-food specialist stores for home improvement, pharmacies, restaurants, and more.

Based on data from 2020, Coop led the Swiss food retail sector with a market share of 35.1%.

trolley coop

Why?

With sustainability challenges growing due to record high temperatures globally, the pressure was on to respond, with consumers expecting firms to act.

For Coop, worsening global and local sustainability challenges were more than a background threat; they endangered the company’s competitive advantage. Coop’s commitment to sustainability had turned it into a global sustainability leader in the food retail sector, attracting sustainability-conscious consumers to its stores.

But with Swiss food retail rivals beginning to leverage sustainability actions to differentiate themselves, Philipp asked Coop’s board to provide him with options for expanding the company’s portfolio of sustainability actions.

When?

It was in 2022 when Coop was assessing its sustainability offering.

Where?

The Swiss food retail sector consisted of Coop and Migros, each capturing roughly a third of the market, with discounters Denner, Lidl and Aldi accounting for around 15%.

Between 2019 and 2022, Swiss consumers’ spending on organic products grew more rapidly than non-organic products at 19% versus 7%, underlining the importance the nation’s people place on sustainability.

Key quote

“Is there more we can do on some of these topics? Are there areas where we could be more sustainable and innovative in the food retail sector?”
Philipp Wyss, CEO of Switzerland's Coop.

What next?

With Coop needing to do more to fill gaps in its current approach to sustainability, Philipp’s sustainability team identified five key challenges that required mid and long-term action proposals: reducing scope 1 GHG (greenhouse gas) emissions in logistics, addressing scope 3 GHG emissions in the value chain, avoiding food waste, enhancing biodiversity, and improving human rights.

A new portfolio of sustainability actions needed to be defined for the challenges.

AUTHOR PERSPECTIVE 

Author perspective

On the reasons for writing the case…

The authors said: “For several years, our approach to teaching corporate sustainability relied on traditional Harvard-style case studies, but we grew dissatisfied with the narrow focus on singular challenges.

“Recognising that sustainability encompasses a multitude of interconnected issues, we embarked on a journey to educate students on the complexity of addressing multiple problems simultaneously. Unlike other fields where technological solutions might be readily available, sustainability demands a nuanced understanding of diverse and intricate challenges. Firms must grapple with highly complex problems simultaneously rather than in isolation. We realised that we needed a comprehensive 360° case study, evaluating the sustainability of a company from various perspectives and outlining multifaceted solution pathways where managers must make trade-offs and reach compromises.

“We collaborated with a supermarket chain in Switzerland, Coop, a strategic choice given the familiarity of supermarkets in the daily lives of many students in our classes. This partnership proved invaluable in illustrating the real-world intricacies of sustainable business practices.”

On the case writing challenges…

The authors continued: “One of the major challenges in writing the case was to somehow capture and handle the diversity in class across many different dimensions: a diversity of challenges, a diversity of solutions, and a diversity of students in our courses with different experiences and expertise.

“Our approach to managing this diversity in the classroom was two-fold. First, we simplified the structure and format of the case documentation and reduced the complexity and diversity inherent across the different challenges. This allowed us to find a common way to allow students to assess the impact and viability of proposals without overwhelming them with metrics and details.

“Second, when we run the case in class, we actively seek to manage heterogeneous groups by deliberately placing students with different academic, cultural, and study programme backgrounds together, encouraging them to leverage the differences in worldview, life experience etc., during their discussions.

“Although diversity posed a challenge, it ultimately made our case more interesting and valuable, drawing the attention of researchers and industry experts from different fields. Students especially discovered that their unique strengths, effective collaboration and listening to peers, emerged as essential success factors in developing and evaluating solutions to sustainability challenges.”

On teaching the case…

They added: “Our case has become a versatile educational tool, reaching diverse audiences across various countries and presented in different formats. We have used it within shorter three-hour sessions, immersive one-day workshops, and comprehensive semester-long courses. The case works really well in executive courses, but also in master's level courses and even with high-school students.

“The case is broadly applicable and very effective in engaging learners across diverse educational levels and settings. This versatility allowed us to convey sustainable business principles to a broad spectrum of individuals and allowed us to nurture a nuanced understanding of complex challenges and solutions in the realm of corporate sustainability.”

stacked coop

On how students react to the case…

They explained: “What sets our case apart is its relatable setting - the familiar aisles of a supermarket where everyone can envision buying fruits, vegetables, and everyday essentials. Here, many people are already aware of sustainability challenges but lack easy solutions to them. Amidst these commonplace scenarios, negotiations unfold in unique ways. Executive students find it easy to adopt a broad corporate strategic perspective during discussions. Students with backgrounds in engineering or natural sciences gravitate towards scrutinising and evaluating the details of individual solutions. The case's impact extends even to high school students, offering them insights into the challenging reality of implementing solutions within resource-constrained corporate environments.

“This diverse engagement highlights the case's ability to bridge the gap between theoretical understanding and practical application across various levels of expertise and experience.”

On case writing tips…

The authors commented: “What helped us immensely when developing and writing the Coop case was that we started with a setting that genuinely fascinated us and added substantial value not only to our classes but also to our research projects.

“Our top tips for writing a good case? Invest ample time in crafting the case, with a particular emphasis on testing it across diverse audiences. Seek feedback not only from students and colleagues within your university but also from industry professionals to ensure real-world relevance. Opt for a case that resonates with a broad spectrum of students, making it easily relatable.

“Additionally, don't overly concern yourself with direct cooperation from the case company; even with large corporations, there is often abundant publicly available material. Maintaining independence from the case company can provide a valuable perspective.

“And don’t forget to continue collecting and implementing feedback from the students.”

Final word…

The authors concluded: “The case adopts a novel format known as a 360° case study, inspired by Sarah Kaplan's book The 360° Corporation: From Stakeholder Trade-Offs to Transformation.

“This innovative structure proves really valuable for facilitating role-playing scenarios centered around the inherent tensions and trade-offs within sustainability. Acting as board members, students engage in collective negotiations to address diverse sustainability challenges. Through this immersive experience, they train crucial soft skills such as negotiation and leadership, essential for effective sustainability communication and advocacy.

“We believe that the 360° case study format uniquely enables students to delve into a wide spectrum of issues, consider a longer time horizon, and grapple with the complexities inherent in sustainability-driven change.”

THE CASE 

The protagonist

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INSTRUCTOR PRESENTATION MATERIAL - Reference no. 323-0279-8C
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