Harvard Case - "The Wheels on the Bus" Go Electric: Highland Electric Fleets and Partners
""The Wheels on the Bus" Go Electric: Highland Electric Fleets and Partners" Harvard business case study is written by Rosabeth Moss Kanter, Jacob A. Small. It deals with the challenges in the field of Social Enterprise. The case study is 22 page(s) long and it was first published on : Mar 6, 2024
At Fern Fort University, we recommend Highland Electric Fleets (HEF) prioritize a strategic growth plan that focuses on expanding its electric vehicle (EV) fleet, leveraging partnerships, and strengthening its commitment to corporate social responsibility (CSR). This strategy should be underpinned by a robust impact measurement framework to demonstrate the value HEF creates for its stakeholders, including customers, employees, communities, and the environment.
2. Background
Highland Electric Fleets is a leading provider of electric school buses and other commercial EVs, driven by a mission to accelerate the transition to a cleaner transportation system. The case study highlights HEF's success in securing contracts with school districts and its commitment to creating a sustainable business model. However, the company faces challenges in scaling its operations, navigating regulatory hurdles, and demonstrating the social and environmental impact of its work.The main protagonists are:
- David Sclafani: CEO of HEF, a visionary leader passionate about sustainable transportation.
- School districts: HEF's primary customers, seeking cost-effective and environmentally friendly solutions.
- Partners: HEF collaborates with various organizations, including nonprofits, government agencies, and technology companies, to achieve its goals.
3. Analysis of the Case Study
This case study can be analyzed through the lens of Social Entrepreneurship, specifically focusing on HEF's efforts to create a triple bottom line impact by balancing profitability, social responsibility, and environmental sustainability. Here's a breakdown:
Social Impact: HEF's commitment to providing clean transportation solutions addresses critical social issues like air pollution, climate change, and public health. By electrifying school buses, HEF reduces emissions, improves air quality in communities, and promotes the health and well-being of children.
Environmental Sustainability: HEF's business model is built on a foundation of environmental sustainability. By transitioning to electric fleets, HEF minimizes reliance on fossil fuels, reducing carbon emissions and contributing to a cleaner planet.
Business Model: HEF's business model leverages a combination of impact investing and strategic partnerships. This approach allows HEF to access funding and resources while aligning with the goals of various stakeholders.
Challenges: HEF faces challenges in scaling its operations, including:
- Financing: Securing capital to expand its EV fleet and infrastructure.
- Regulation: Navigating complex regulations related to EV adoption and infrastructure development.
- Market Demand: Educating potential customers about the benefits of electric vehicles and overcoming any perceived barriers.
4. Recommendations
To address these challenges and achieve sustainable growth, HEF should:
1. Expand EV Fleet and Infrastructure:
- Strategic Partnerships: Partner with leading EV manufacturers and technology companies to secure access to cutting-edge technology and scale up production.
- Government Grants and Incentives: Leverage government funding programs and tax incentives to offset the upfront cost of EV adoption.
- Infrastructure Development: Invest in charging infrastructure development, including public charging stations and school bus depots.
2. Enhance Social Impact Measurement:
- Develop a comprehensive SROI framework: Measure the social and environmental impact of HEF's operations, including reduced emissions, improved air quality, and health benefits for communities.
- Partner with NGOs and research institutions: Collaborate with organizations specializing in social impact measurement to ensure data accuracy and credibility.
- Publish impact reports: Regularly communicate HEF's social and environmental impact to stakeholders, demonstrating the company's commitment to sustainability.
3. Foster Strategic Partnerships:
- Nonprofit Organizations: Partner with environmental organizations and community groups to raise awareness about the benefits of electric transportation and advocate for policy changes.
- Government Agencies: Collaborate with local, state, and federal agencies to secure funding, streamline regulations, and develop infrastructure.
- Technology Companies: Partner with tech companies to integrate innovative technologies like smart charging, route optimization, and data analytics into HEF's operations.
4. Embrace Corporate Social Responsibility:
- Diversity and Inclusion: Promote diversity and inclusion within HEF's workforce and leadership, reflecting the communities it serves.
- Ethical Supply Chains: Ensure ethical sourcing of materials and components for its EV fleet and infrastructure.
- Community Engagement: Engage with local communities to address concerns, build trust, and create a shared vision for a sustainable future.
5. Basis of Recommendations
These recommendations are grounded in the following considerations:
- Core competencies and consistency with mission: Expanding the EV fleet, leveraging partnerships, and enhancing social impact measurement align with HEF's core competencies and its mission to accelerate the transition to a cleaner transportation system.
- External customers and internal clients: These recommendations address the needs of HEF's customers (school districts), employees, and investors by providing cost-effective solutions, fostering a positive work environment, and maximizing return on investment.
- Competitors: HEF must stay ahead of the competition by continuously innovating, expanding its market reach, and demonstrating its commitment to sustainability.
- Attractiveness ' quantitative measures if applicable: Investing in EV infrastructure, securing government grants, and developing a robust SROI framework will contribute to HEF's financial viability and long-term sustainability.
6. Conclusion
By prioritizing a strategic growth plan that focuses on expanding its EV fleet, leveraging partnerships, and strengthening its commitment to corporate social responsibility, HEF can solidify its position as a leader in the electric transportation industry. By demonstrating the value it creates for its stakeholders and the positive impact it has on the environment and communities, HEF can attract investors, secure government support, and drive the adoption of electric vehicles, contributing to a cleaner and more sustainable future.
7. Discussion
Alternatives not selected:
- Focus solely on profitability: This approach would prioritize short-term financial gains over long-term sustainability and social impact.
- Ignore regulatory landscape: This would lead to legal and operational challenges, hindering HEF's growth and reputation.
- Limited partnership strategy: This would limit HEF's access to resources, expertise, and market reach.
Risks and key assumptions:
- Government policy changes: Changes in government regulations and funding programs could impact HEF's business model.
- Competition: Increased competition from other EV providers could erode HEF's market share.
- Consumer adoption: Slow adoption of electric vehicles could hinder HEF's growth.
8. Next Steps
To implement these recommendations, HEF should:
- Develop a detailed strategic plan: Outline specific goals, timelines, and resource allocation for each recommendation.
- Establish a dedicated team: Assemble a cross-functional team to oversee the implementation of the strategic plan.
- Monitor progress and adjust as needed: Regularly track progress against key performance indicators and make adjustments to the plan as necessary.
- Communicate with stakeholders: Keep stakeholders informed about HEF's progress and the impact it is making.
By taking these steps, HEF can position itself for continued growth and success, while making a meaningful contribution to a more sustainable future.
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Case Description
Founder Duncan McIntyre developed an innovative service-based business to electrify transportation fleets for school districts and scale through public-private partnerships while contributing to climate change solutions. The case covers the rationale for electric school buses, the leadership of its founder, its growth from one customer to many over five years, and relationships with multiple stakeholders in a complex system. Highland Electric Fleets contracted with school districts in the U.S. and Canada to supply and service electric school buses, offering to lower costs for the districts, even those who were not climate action supporters. Ancillary benefits included providing power back to the electric grid, reducing the use of fossil fuels and emission of greenhouse gases, and cleaner air for children. But just as McIntyre was envisioning expanding to electrify other transportation fleets, supply chain challenges leave McIntyre with the dilemma of how to deal with the possible defection of its largest customer because of buses failing to be delivered in time.
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