University of Vermont

School of Business Administration

Beyond Waste in a Sustainable World

Joe Fusco

As a part of our sustainable business series we have had the opportunity to interview several sustainability leaders in Vermont businesses who are taking steps to make a difference not only in the state of Vermont, but across the country.

Most recently we had the chance to sit down with Joe Fusco, who is an advisor to the chairman and chief executive officer of Casella Waste Systems, Inc., is currently chairman of Vermont’s Comprehensive Economic Development Strategy steering committee and serves on the Board of Advisors for the University of Vermont’s Sustainable Entrepreneurship MBA (SEMBA).

What are the challenges Casella now faces around sustainability and, ultimately, staying in business?

That’s a really big question. Let me address the “staying in business” part first. Every year we undergo a strategic planning process and one of the fundamental principles we use is to understand that the external environment around our business is changing all the time, so we have to comprehensively and deeply examine that environment. We do this because when leaders get disconnected from changes in their external environment they get disconnected from the truth of their markets, and the truth of their products and services, and then every decision they make is wrong. That’s when businesses go broke and die. 

 

So we looked at our business model a few years ago and came to the conclusion it was unsustainable over the long term. It was based on three words: consumption, consumption, and consumption. 

We have historically served a consumptive society. Meaning, people consume, and we’re paid to cart it away and bury it.  Secondly, we consume resources to transport and dispose of it like fuel and oil and, lastly, we consume resources like airspace and land to dispose it in landfills. Three “consumptions” needed to happen in order for us to make money. That was our business model and, quite frankly, it simply is not sustainable 10, 20 or 30 years down the road. 

We had to ask ourselves: what will the world expect from us, and pay us for, in 10, 20 or 30 years’ time?

What we realized is that we would get paid for, and the world would expect us to be masterful at, solving problems around the world’s limited resources.  America has always been built on the idea that things are unlimited.  Our thinking has been that opportunities are unlimited, time is unlimited and resources are unlimited.  As a nation we have never had to psychologically or spiritually confront this idea of limited resources. Now, a few billion people in China and India are attempting to build modern, prosperous economies, and building middle class lifestyles. That’s a lot of competition for natural and other resources, and of course, we’re all realizing the world is no longer a bottomless well. Suddenly, the whole world is confronted with the fact of limited resources.

So, from a long-term strategic perspective, we saw a threat and an opportunity to begin embracing a new business model where we would be the kind of company that would make money helping the world, helping our communities, and helping our customers solve the problem of limited resources.  Be a sustainer and creator of resources rather than a consumer, and change your market before it changes you.

Next you asked about challenges regarding sustainability. Being sustainable changes not only the internal things you do, but those externally as well.  A lot of our customers at universities, hospitals, institutions, and local governments are now saying we don’t want to just throw things away.  We have a problem with resource limits and we want you to help us with that problem.  The ask us, how can we use less resources and how can we make the most out of limited resources?

This creates opportunity and invites innovation, and the really neat thing about this moment in time is that there is now a wonderful intersection between an environmental necessity and an economic imperative.

It’s so important that the economic justification be as powerful as the environmental rationale. We started to invest in things like hybrid and compressed natural gas vehicles, which have both an economic as well as an environmental benefit. That’s a strong driver behind our, and any businesses’, sustainability efforts. It makes us more competitive because it lowers our costs.  It makes us more sustainable as an organization, because the better we manage our costs the more profitable we are in the long-run. And it’s great for the planet, of course.

We have a whole list of sustainability practices, including fuel consumption targets and electricity usage targets. For example, one of the biggest contributors of greenhouse gases is methane, which comes off of landfills so we have targets to reduce our greenhouse gas footprint. In doing so, we capture the methane and produce (and sell) electricity. Again, not only are these initiatives about being environmentally savvy but they’re about being economically shrewd.  

When you reevaluated and started making changes what was your first move that seemed most important. 

We were fortunate for the most part because we started doing some different things 30 years ago, particularly around the areas of recycling. However, as we reinforced this commitment it also caused us to look for ways to provide existing and new services our customers wanted.  I think we got a lot more customer focused: what can we do that our customers want and will pay for that we can make money at?  What are things that we are already doing that we can make more profitable or shift a little?  You look for ways to improve your internal processes, ways to lower your cost, ways to service your customers better, so it becomes more strategic.  You do things that have both business and environmental sustainability potential.

If your business was in a different area other than Vermont, do you think you would have been as successful in making these changes and marketing them to your customers?

That’s a good question. I think there is a bit of Vermont DNA that exists around sustainability and if your company is lucky to live and work and operate in a culture that thinks about these things, then all the better. Maybe they don’t think about these things in other parts of the country and that’s what makes Vermont unique. It’s tough to say because a lot of things we are doing are beginning to show up in other parts of the country as well. That’s not surprising, because resource limits are a global challenge.

How are you incorporating sustainability into your everyday actions in the office?

Little things add up, of course. We put in motion detector lights so they turn off when no one is in the room.  We are very aggressive about recycling in our offices; you cannot walk more than 15 feet without seeing a recycling bin in any part of the office.  We also spend more time teaching our people why we are doing what we are doing, and why we are focusing on a particular service or type of business or doing something new in a specific way.

How are you finding out what your customers want?

You talk to them, they talk to you.  You also make a change every once in a while and say this is the right thing to do and share your vision, and then you convince them that they need it and they see the wisdom of it. 

How long have you been publishing an annual sustainability report and what does it include?

I think this will be the fifth year and, as I mentioned before, it changes what you do internally as well as externally. The report typically includes environmental categories, carbon footprint categories, energy use, HR practices, community and social responsibility practices and measurements. It provides a framework for our efforts and how we did.

When you are looking to hire staff, what are you looking for?

We look for people who are really good at solving problems around the challenges of resource limits. That’s our dream employee. Do you understand resource limits, are you good at being creative and innovative at problem solving? The good news is nowadays there are a lot of people that are excited to work in the field of sustainability.

Where are these new people who have these qualities coming from?

They come from all over, and tend to be people who are younger, people who don’t need to be convinced. People leaving college and graduate school now are already in a frame of mind that understands sustainability and wants to work on these problems.

How do you plan to stay ahead and keep a competitive advantage?

You stay ahead by constantly innovating, although any innovation over time simply becomes a commodity. For example, we pioneered something called Zero-Sort recycling, meaning you don’t have to sort your recyclables. It gives you an advantage for a time but then soon everybody adopts it. The challenge is to always innovate and think about the next great or interesting or disruptive thing you can do that’s an innovation.

You been quoted about being the whale eaten by 1000 minnows; what did you mean by that?

When you do a lot of things in the modern economy, anything you have to do you have to do really well -- be the best at it, actually. So if you are doing a lot of things you have to be the leader or the master of each of those things. That’s much more difficult to do because when you are fighting off competitors that want to concentrate on just one slice of expertise, it has the effect of a thousand minnows nibbling away at you, or the death by 1000 cuts. To survive, or better yet be sustainable, your business has to be the absolute best problem solver, or offer the best quality, in any given category of a service or product.  

Big thanks to Joe and UVM star student reporter, Rachel Burt for the interview.