BUSINESS MANAGEMENT UNIT 4
A case study of change management: Greenfox at Linfox
Pressures on organisations to adopt environmentally sustainable policies and practices are growing.
The following case study examines the successful development and implementation of change arising
from pressures for the business to become more environmentally sustainable and to reduce negative
environmental impacts of the activities of the organisation. Linfox’s GreenFox policy is an example of
a business implementing organisation-wide change with positive results, both for the environment and
its balance sheet; all this from a business working within the transport sector, not one that has been
traditionally bestowed with ‘green credentials’.
Background
Linfox is the largest privately owned supply chain solutions company in the Asia-Pacific region. The
business was founded in Melbourne in 1956 by Lindsay Fox as a one-truck operation delivering soft
drinks in summer and solid fuel for heating in winter. Currently, the business:
 operates more than 1.8 million square metres of warehousing space
 utilises a fleet of 5000 delivery vehicles
 employs more than 15 000 people
 has more than 260 operating sites
 operates across 11 countries in the Asia-Pacific region.
Linfox caters for other businesses that outsource their warehousing and delivery requirements. Major
clients include:
 Campbell Arnott’s (biscuits and snack foods)
 BlueScope Steel
 Kellogg’s
 BHP Billiton
 National Foods Ltd.
Linfox annually:
 delivers more than 4.5 billion litres of fuels and 15 million pallets of goods to retailers annually,
as well as 1 million tonnes of wood products
 serves nine of the Asia-Pacific region’s top consumer goods moving producers.
Linfox is divided into three business units:
 Retail Business Unit
 Fast Moving Consumer Goods (FMCG) Business Unit
 Resources and Industrial Unit.
Pressures for change at Linfox
In 2006 Linfox’s North American customers began to ask questions about the impact that the
transport industry was having on the environment. This showed that sustainability was becoming a
core interest of important stakeholder groups, as well as longstanding issues like safety and
operational efficiency and effectiveness.
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There was also a general increase in pressures on large organisations to adopt sustainable business
practices around this time, emanating from:
 increased community awareness of and about ‘green’ issues, such as global warming,
prompted by scientific research, environmental pressure groups and media coverage such as
Al Gore’s film, An Inconvenient Truth—this placed pressures on both organisations and
individuals to act in order to reduce their carbon footprint
 the possibility of increased productivity and reduced costs of production through a potential
decrease in the use of resources, for example reduced fuel costs
 a potential competitive advantage is being seen as socially responsible through the adoption of
a sustainable business model
 the introduction of a carbon tax on polluters, which will force all transport companies to adopt
environmentally friendly and sustainable practices in order to survive and comply with
government requirements.
GreenFox
Linfox initially developed a strategic plan for the 2008–11 period known as ‘GreenFox’. This program
was designed to cut Linfox’s greenhouse gas emissions by 15 per cent of its 2006–2007 levels.
Linfox’s energy consumption for the 2008–09 period was 95 per cent from transport fuels and 5 per
cent from electricity.
The three areas of focus were:
 improved business practices
 the introduction and development of environmentally friendly technologies
 changing the behaviours of people within the organisation.
Linfox management accepted climate change as a reality from the onset. They saw themselves as
having a responsibility to both their customers and to wider society to act on the environmental
problem of greenhouse gas emissions.
Every Linfox Board meeting now begins with a discussion about the company’s social obligations,
including environmental responsibilities.
The Linfox view of climate change
We have accepted the scientific evidence that Climate Change, caused by Global Warming is a
reality.
We have accepted that, on balance, it is most probable that man-made emissions play a part in
Global Warming.
We have accepted that Transport is a significant contributor to manmade CO2-e emissions.
We have accepted that everyone must play a part in reducing CO2-e emissions.
We have adopted a plan based on a Greenhouse Gas Reduction Cycle that impacts on all aspects of
our business.
We regard reducing the use of energy and thereby emissions is good for the environment and good
for business.
Source: http://pdf.aigroup.asn.au/environment/GreenFox_Sust_transport.pdf
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Key objectives and activities of GreenFox
Leadership
 Lean organisation through business units for operating environmental controls.
 Adopting emissions controls.
 Coach/mentor/train all front-line leaders in environmental management.
Behaviour
 Develop a visible environmental emissions minimisation culture.
 Involve our people in solutions to manage environmental emissions.
 Train our people to work in an environmentally sensitive way.
Systems
 Comply with legislative requirements.
 Integrate environmental emissions into business processes.
 Improve efficiency through fleet reductions, information technology, and the supply chain
solutions group.
Initiatives to reduce greenhouse gas emissions
Initiatives trialled by Linfox aimed at reducing greenhouse gas emissions included:
 2007—Linfox engaged an accounting firm to identify areas of potential carbon emissions
reduction.
 Eco Driver Training. Linfox drivers are encouraged to complete this program based on 10
principles of fuel-efficient driving. Those who complete the program are given a badge to wear
on their uniform. Many have also opted to become ambassadors who go to schools to talk
about climate change.
 Introduction of carbon-mapping software as part of supply chain optimisation. This software
provides detailed analysis of carbon emissions from each element of the supply chain, right
down to individual vehicle measurements of carbon emissions. This will help with identification
of the environmental impact of logistics choices; for example, determining if the most efficient
route is being taken, or to ensure that trucks never travel back from a job empty, or that the
most efficient mode of transport is being selected. This carbon accounting system generates
monthly reports, down to the level of individual trucks. It is an accurate tracking of emissions.
 A new fleet tracking system, with the aim of achieving improved vehicle utilisation.
 A hybrid or four-cylinder hire car policy.
 All company cars were to be replaced with hybrid vehicles at trade in.
 A tyre pressure-monitoring program designed to reduce fuel use, reduce emissions and
improve safety.
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 Electricity savings: project ‘Switch Off’ for all lights, computers, chargers, photocopiers in order
to achieve electricity savings. Also, the installation of smarter warehouse lighting systems and
the launch of a Linfox Energy Efficiency Guidebook in 2011, which was distributed to all
employees.
 Use of ‘green’ energy.
 Introduction of paper recycling throughout the entire organisation.
 A Greenhouse Home Gas Calculator to be provided to all employees to educate them about
greenhouse gas issues.
 Appointment of GreenFox workplace environment champions across the business to mentor
and educate colleagues about greenhouse gas issues.
 Registering for the Energy Efficiencies Opportunity Legislation Act.
 Working with Monash University on the development of more aerodynamic vehicle designs.
 The 25C Project, which trials environmental initiatives at 25 sites.
 Participation in global environmental events such as World Environment Day and Earth Hour.
 GreenFox is directed to achieve cultural change regarding energy awareness and energy use.
It focuses on individual actions and behaviours to inform, educate and change behaviours, both
at work and at home. The creation of a new ‘green’ workplace culture is the ultimate goal.
 GreenFox is supported by newsletters, weekly tips and publications; all are designed to focus
on reductions in energy use.
 In early 2011 an Environmental Management System (EMS) was introduced. This is designed
to identify, control and record environmental performance on an ongoing basis across the
company. It also ensures that a proper reporting system is in place, so that all sites meet legal
obligations.
 Participative management styles and the participation of employees and customers in
workshops have been used in order to identify the most practical and valuable initiatives. This
staff engagement program is aimed at making better use of what the organisation has rather
than investing in new technology. Staff are involved in initiating and implementing change in
their own workplace.
‘Linfox has tried to inculcate its employees with a green approach to
life generally which makes for a better environment wherever they’re
operating.’ (David McInnes, Group Manager of Environment and
Climate Change, Linfox)
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Results/evaluation
 Between 2006–07 and 2008–09 a 16 per cent reduction in total energy use was achieved at
Linfox. This was despite the fact that the total number of kilometres travelled by Linfox vehicles
had increased by 21 per cent over that period of time, and the company had experienced 40
per cent growth over the period. Linfox is aiming to continue this trend.
 The rate of greenhouse emissions by Linfox has decreased each year since 2006–07
significantly. The 15 per cent target, originally set for 2010, was met in 2007–08 and a
reduction of 28 per cent had been achieved by 2009. A further 10 per cent reduction was
achieved during the 2009–2010 financial year.
 Massive savings have been made by Linfox in its fuel costs. Already these savings have
outweighed the cost of implementing the GreenFox program.
 The Chairman of Linfox, Peter Fox, has since announced a new target: ‘Linfox will reduce its
rate of greenhouse gas emissions from its global operations by 50 per cent by 2015 based on
2006–2007 emission levels’.
 Linfox was the recipient of the Logistics Magazine 2009 inaugural Best Green Initiative Award.
 Linfox was also awarded the Mercury Award for Best Green Category for the development of
the carbon-mapping software.
Further information and updates on the GreenFox program can be obtained from:
 Scrutinising Suppliers: When Your Chain Gang Goes Green, Australian School of Business,
19 April 2010, http://knowledge.asb.unsw.edu.au/article.cfm?articleid=1112
 Linfox Logistics’ Sustainable Strategy, LInfox, http://www.linfox.com/Sustainability.aspx.
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Questions
Question 1
Define the following terms. For each term, provide an example relevant to a large-scale organisation
such as Linfox Pty Ltd.
a. Environmental sustainability
2 marks
b. Change pressures
2 marks
c. Cultural change
2 marks
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Question 2
Explain why it is important for Australian large-scale organisations to be able to respond to change
pressures and to successfully implement change if they are to survive in a global economy.
2 marks
Question 3
List three features of Linfox that indicate that it is a large-scale organisation.
3 marks
Question 4
Discuss how each of the following factors would have acted as pressures on Linfox to adopt
environmentally sustainable policies and practices.
a. Employees
2 marks
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b. Customers
2 marks
c. The federal government has proposed the introduction of a carbon tax on businesses that are
large producers of greenhouse gases.
2 marks
d. As a result of increased media attention and scientific research, the community has become
more aware of the potential effects of climate change on the environment.
2 marks
Question 5
Explain the potential benefits for Linfox of adopting sustainable business practices and policies in
terms of:
a. potential cost savings
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3 marks
b. ethical and social responsibility
3 marks
c. business competitiveness
3 marks
Question 6
List three stakeholders of Linfox. For each stakeholder group, explain how it is likely to be affected by
the adoption of the GreenFox policy.
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6 marks
Question 7
Outline the following aspects of the GreenFox policy at Linfox.
a. Initial goals and current goals
2 marks
b. Two initiatives designed to achieve the goals
2 marks
Question 8
Explain the difference between driving and restraining forces for change. Identify one driving force for
change at Linfox and one potential restraining force for change.
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4 marks
Question 9
Identify and analyse two likely impacts of the introduction of the GreenFox policy at Linfox on the
following structures, activities and key performance indicators at Linfox. Give reasons for your
answers.
a. The operations system
3 marks
b. Employee training and development
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3 marks
c. Employee motivation and job satisfaction
3 marks
Question 10
Outline three performance indicators (KPIs) that would be used by Linfox when evaluating the level of
success of the implementation of the GreenFox policy.
3 marks
Question 11
An aim of GreenFox is to achieve cultural change at Linfox. Explain what is meant by this statement.
Identify and outline the strategies that Linfox is using in order to change its corporate culture.
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4 marks
Question 12
‘The implementation of the GreenFox policy at Linfox has been a great success.’ List and explain
three factors that support this viewpoint.
6 marks
Question 13
Linfox has used the eight-step model for change developed by JP Kotter in implementing the
GreenFox model for sustainability.
Explain and analyse the Kotter model of change management. In your answer, explain the steps that
Kotter recommends should be implemented for successful change management.
Discuss the strategies that Linfox would have adopted at each stage in order to implement the
GreenFox program in line with Kotter’s theory.
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10 marks
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