Worldwide demand for water for manufacturing is skyrocketing, placing increasing stress on a limited yet vital resource. Last spring, MIT students took on this real-world problem in a research project for Colgate- Palmolive organized by the Sustainable Business Laboratory (S-Lab), an outgrowth of MIT Sloan School of Management’s Sustainability Initiative that is one of several Sloan “action learning labs.”

“I learn best by doing, so ‘mens et manus’ really grabs me, and action learning is part of what drew me here,” says Sarah Kalloch, a second-year MBA student who worked on the project during an S-Lab course called 15.913 Strategies for Sustainable Business. “I came to Sloan to study sustainable supply chains in a global context.”

Kalloch and four teammates evaluated the advantages and disadvantages of Colgate-Palmolive adopting a “positive water balance program”— a business strategy designed to minimize the impact of manufacturing on local communities by reducing water usage and replenishing supplies. The project was one of more than a dozen sustainability challenges addressed by students for MIT corporate and nonprofit partners during the spring 2015 class. Topics ranged from exploring ways to drive down corporate carbon emissions to evaluating the market for sustainably harvested lobster.

In the case of Colgate-Palmolive, the multinational consumer products company came to S-Lab for help evaluating whether to adopt a “net zero” water strategy for factories in India.

“Water scarcity is becoming a challenge for companies,” says Kalloch, noting that she learned through her S-Lab research that Coca-Cola has had to close factories in India due to concerns about groundwater use. “The private sector is looking to emerging markets to find more customers, and for them to be successful they have to look at these issues.”

While it is common today to offset carbon emissions in one place with trees planted halfway around the world—essentially producing net zero emissions—it is not acceptable to balance water usage the same way, she says. “Net zero water is a concept built on net zero energy, but the difference between climate change and water is geography,” Kalloch says. Water taken from one community cannot simply be provided elsewhere, she explains. “The community isn’t made whole in the same way.”

To address the company’s challenge, the S-Lab team investigated a range of approaches to water scarcity, then developed a decision matrix that enables Colgate-Palmolive to examine available water resources in a region and assess local options for supply and replenishment.

“I think the biggest challenge was aligning corporate interests with sustainability interests and optimizing both,” says Macauley Kenney, a master’s degree candidate in MIT’s Technology and Policy Program who teamed up with Kalloch on the project.

Noting that such optimization is critical to the practical application of sustainability strategies, Kenney praised S-Lab for giving her the chance to bridge the gap between academia and the corporate world. “Sloan’s action learning labs are letting students be in both worlds at once, and that’s a great goal, because the transition to the corporate world can be difficult,” she says.

Another benefit of the class, students say, was the chance to learn from peers as well as academic and corporate mentors. According to Kenney, teamwork is a major strength of S-Lab. “You can get a diverse set of backgrounds working on a short-term sprint project,” she says.

Kalloch agrees. “To be a good manager and leader, you need to be very good at working in teams,” she says. “That’s something Sloan is teaching us through action learning.” Noting that she is on the job hunt now, she adds, “This is a perfect example of what I can offer a company—great analysis around challenging supply chain problems.”

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