Yesterday I gave another lesson to Japanese high school students on the SDGs. This time, I explained the difference between value chains and supply chains in market mapping.
The same student asked two related, but completely different questions, which I was surprised to find out later were connected.
Q1: "Do we have to sacrifice ourselves to achieve the SDGs?"
Q2: "Why do I need to study the value chain?"
These two questions may seem separate, but they are intrinsically linked.
First of all, this is a survey of about 10,000 people worldwide about climate change and energy. It's not a very, very academic survey, but there is some truth in it. One of the exciting differences between Japan and the rest of the world is this result.
60% of Japanese people think that taking action on climate change threatens their livelihoods, and only 17% think it is an opportunity to do so. On the same question, only about a quarter of the world's people think that acting on climate change is a threat to their livelihoods, and nearly 70% think that acting on climate change is an opportunity.
This shows why the Japanese student asked me, "Do we have to sacrifice ourselves to achieve the SDGs?". He thinks that he has to endure his life by responding to the environment, just like in this figure. But the SDGs are becoming the bedrock rules of politics and business around the world, and responding well to them will create new opportunities. Tesla's company is worth more than Toyota, which produces about 10 times as much. The share price of a renewable energy index, which is a tiny part of the world in terms of providing energy, is higher than the share price of ExxonMobil. This suggests that, even if we look at business alone, there is an opportunity to respond well to the SDGs. The same can be said for political and other initiatives, which is probably why Europe puts so much effort into the SDGs.
As for the second question, why should we study the value chain? It is because we need to know the present. Some people focus only on solutions, but people don't pay for solutions. They pay to solve problems. The problem is the difference between the target you want to achieve and your current situation. You can set your own target, but you can only find out what the current situation is. One way of looking at the current situation in business is to look at the supply chain. For example, the process of transporting coffee beans from a farmer to Starbucks and then drinking them. However, many people are now beginning to focus on the unseen. For example, whether the coffee farmer is appropriately paid, what energy is used to roast the coffee beans, whether you drink your coffee at Starbucks in a disposable cup or bring your own coffee cup. None of these things has any real bearing on the taste of the coffee. But we do care about the story that goes into getting the coffee beans from the farmer to our mug, the invisible "value". And it is this invisible value that is relevant to the SDGs. So if you don't look at this invisible reality, you can't identify the problems, the gaps between the target and reality, and you can't propose a solution. That's why we need to study the value chain.
And this leads us to the first question. Because we don't see this value, we may think that we have to sacrifice ourselves to achieve the SDGs.
Finally, the school teacher asked the third question, which again connects to the two questions above.
Q3: "How can I help my students to be imaginative?"
As I've written before, it's normal not to be able to imagine the future. It's because the student can't imagine that they can't become visionaries, and if you tell them that they have to believe before they can see, they won't believe. That's why I think it's better to experience. It's much easier to experience than to imagine. That's why the five steps of the vision also tell us to choose the easiest solution. By taking the first step, you will experience something and learn from that experience. From there, you can go one step further again. It's impossible to imagine a big picture 10 years from now, but it's relatively easy to imagine what you can do now. If we keep on doing that, we will get somewhere.
In the same way, rather than creating invisible value in the value chain, how about doing something and experiencing that value? From there, you will find the problems, and you will find the solutions.