Innovation

About the innovation:

One of the goals at the forefront of ICA’s work is Goal 13, Climate action. In short, Goal 13 aims to take urgent action to combat climate change and the impact it has on the globe (United Nations, n.d.). ICA has, in line with the 13^th sustainability goal, set the goal to be climate neutral by 2020. In their latest quarterly sustainability report, they report a 52% decrease in carbon dioxide emissions from their base year 2006, indicating they are likely to reach the goal by 2020 (ICA group, 2018). In order to get to where they are today, a number of improvements both in terms of logistics and in-store have been made. "In-store, ICA only use green energy in addition to installing new equipment which operate more effectively and therefore reduces the electricity consumption"(Fredriksson, 2018).

The new cooling system operates at one degree celsius higher than before, resulting in less energy consumption as well as a way of taking advantage of the heat generated by the cooling system.

More about the business:

ICA Group is a Swedish conglomerate with its core business being the trading of groceries. The group also includes the home decoration chain Hemtex. The company was founded in 1917 in Västerås on the basis of the ICA-idea, earlier called "the impossible idea", which was a way of letting small dealers remain self-employed yet reap the benefits a company of scale could offer regarding purchases and marketing. ICA has a wide selection of products and brand and even have their own brands such as ICA Basic, "I love eco" and ICA Selection. By 2016, ICA has 22,000 employees with net sales of 104 billion SEK (4,7 billion SEK EBIT). The company has over 2,100 stores. ICA Sverige has around 1,300 stores and an estimated market share of 50%, which makes them the leading retail operator in Sweden. Their operations are run together with the ‘ICA-traders association’, which are owned and run independently to ensure that customers local needs are met by adapting their concept and offers. ICA has been working on sustainability issues for a long time and their sustainability work is based on strong common values and the insight that each link in the supply chain is important, from supplier to employee and customer. The Groups’ strategy is based on six long-term strategic themes, which together form the basis of the ICA Group's operations. One of these is to be a leader in Corporate Social Responsibility (CSR) and Sustainability.

Inspiration

Klas has been working for ICA group for several years and for almost 20 years he has been involved in environmental and sustainability issues. As ICA has the goal to be climate neutral by 2020, the new cooling system is one, of many, solutions implemented under the direction of Klas, among others, in order to reach that goal. In his long career, he's worked with the cooling system for a long time and has thus put a lot of effort into creating a more efficient system.

Fredriksson also mentions the following: "We worked hard to introduce a new cooling system that is stronger and better, thus becoming more energy efficient. By raising the temperature in the freezer with one degree we have made a significant change in our energy consumption. The work with cooling systems is a prime example of how acting sustainable can lead to more comparative profit". Their goal is to lower the energy consumption, and by doing so, the company will save capital from reduced energy consumption. In the logistics department, ICA Group has converted to renewable fuel in their trucks, further decreasing their environmental footprint (Fredriksson, 2018)

Overall impact

The new cooling system has brought several positive impacts. Since the heat from the system is used to heat up the facilities, it has reduced the original cost of heating up the facilities.

Furthermore, the new cooling system is more efficient and has in that way further reduced the energy consumption since less energy is being used to keep the same temperature.

In short, it has, in multiple ways reduced the energy consumption of several shops in Sweden but mainly at the warehouse in Kungälv.

Business benefit

The main benefit of the innovation for the business is the reduction of energy consumption, which in turn has led to a reduction of energy cost. This, of course, results in a greater profit to the organization and so on more money to use for further improvements.

This goes in line with theTriple Bottom Line, a theory in which three aspects are taken into account, People, Profit, and Planet. By reducing the energy cost, ICA has managed to be sustainable while begin profitable.

Social and environmental benefit

As previously mentioned, the energy consumption has gone down significantly. This contributes to less energy consumption in society as a whole as the ICA's carbon footprint has reduced as well.

Here is the Triple Bottom Line applicable as well. Only, here, it is the planet and people being regarded. The reduction of the energy is beneficial to the planet, and in turn, the people.

Interview

Klas Fredriksson, Sustainability & Corporate Responsibility Coach