Sustainability in Design and Operations Mgmt 510, Spring 2010

1. Sustainability in Design and OperationsMgmt 510, Spring 2010 Scott Marshall School of Business Portland State University

2. Type III Closed Loop Value Chain Type II Linear Value Chain Overview of Concepts • Eco-Design • Eco-Effectiveness • Bio-Mimicry • Eco-Efficiency • LEAN Manufacturing • EH&S and EMS • ISO 14001 • Closed Loop Systems • Life Cycle Analysis Design Operations & Supply Chain Design & Operations/SCM Measure Impact of Design and Manufacturing

3. Environmental Practices Type II: Eco-Efficiency Product or service value Eco-efficiency = Environmental influence • Environmental impact is related to business factors • Improving eco-efficiency means increasing product value or reducing environmental impact • Units and measurement methods are suggested

4. Environmental Practices Type II: Eco-Efficiency 1. Reduce Material Intensity of Goods and Services • WalMart set to reduce packaging in supply chain by 5 percent by 2013 based on a 2008 baseline. 2. Reduce Energy Intensity (to produce and consume) • Earth Advantage certifies residential developments. 3. Reduce Toxic Dispersion • Novartis (Swiss life sciences company) combines insecticide with pheromones

5. Environmental Practices Type II: Eco-Efficiency 4. Increase Recyclability • Dell reported recovery of 102 million pounds of IT equipment from customers during 2007, a 20 percent increase over 2006. 5. Increase Durability (extending the useful life of products) • Ricoh: increase durability of copy machines

6. Environmental Practices Type II: Eco-Efficiency • “Doing more with less” • Industry interested because eco-efficiency means greater economic benefit. • Companies quickly took up extensive programs promoting eco-efficiency. • Based on Reduce, Reuse, Recycle, and Regulate.

7. Environmental Practices Type II: LEAN Manufacturing • Origins • Toyota Production System (TPS) generally considered the source of the concepts of Lean Manufacturing. • The Usual Focus: • Set of TPS 'tools' that assist in the identification and steady elimination of waste (muda), the improvement of quality, and production time and cost reduction. • Muda has an intuitive and practical relation to Eco-Efficiency.

8. Environmental Practices Type II: LEAN Manufacturing • A second approach to Lean Manufacturing, as practiced by Toyota, focuses on improving the 'flow' or process variation (thereby steadily eliminating mura) throughout the system and not upon 'waste reduction' per se. • Maximizes contributions of people and materials… • Common Adaptation - Focus only on mura – tools approach. • Only temporary success without focus on BOTH mura and unevenness – a systems approach.

9. Environmental Practices • EH&S: Environmental, Health & Safety • Departments of Organizations • Derived from Compliance Perspective • Can be difficult to integrate into lines of business…as a business strategy. • EMS: Environmental Management System • Derived generally from continuous improvement standards of ISO 9001. Type II: EH&S and EMS

10. Environmental Practices Type II: EH&S and EMS Environmental Management Systems: Continuous cycle of planning, implementing, reviewing and improving the PROCESSES and ACTIONS that an organization undertakes to meet its business and environmental goals. • Major Components: • Policy • Planning • Implementation and Operation • Checking and Corrective Action • Management Review

11. Environmental Practices Type II: EH&S and EMS Environmental Management Systems This model leads to continual improvement based upon: • Planning, including identifying environmental aspects and establishing goals [plan]; • Implementing, including training and operational controls [do]; • Checking, including monitoring and corrective action [check]; and • Reviewing, including progress reviews and acting to make needed changes to the EMS [act].

12. Environmental Practices • What is Design? • A discipline that explores the dialogue between products, people, and contexts. • A process that defines a solution to help people achieve their goals. • An artifact produced as the result of solution definition. Type III: Eco-Design

13. Environmental Practices Type III: Eco-Effectiveness Central design principle of eco-effectiveness is: waste equals food (heard this before?) Instead of using only natural, biodegradable fibers like cotton for textile production (a pesticide-intensive agricultural process), why not use non-toxic synthetic fibers designed for perpetual recycling into new textile products? Instead of minimizing the consumption of energy generated from coal, oil, and nuclear plants, why not maximize energy availability using solar and wind sources? From ‘cradle-to-grave’ to ‘cradle-to-cradle’ – closed loop systems

14. Environmental Practices Type III: Eco-Effectiveness • To assist companies in (re)designing eco-effective products, Cradle to Cradle Design Protocol assesses materials used in products and production processes. • The four categories are: • Green: Little or no risk. This chemical is acceptable for use in the desired application. • Yellow: Low to moderate risk. This chemical is acceptable for use in the desired application until a green alternative is found. • Orange: There is no indication that this is a high risk chemical for the desired application, but a complete assessment is not possible due to lack of information. • Red: High risk. 'Red' chemicals (also sometimes referred to as 'X-list' chemicals) should be phased out as soon as possible. 'Red' chemicals include all known or suspected carcinogens, endocrine disruptors, mutagens, reproductive toxins, and teratogens. In addition, chemicals that do not meet other human health or environmental relevance criteria are 'red' chemicals.

15. Environmental Practices Type III: Eco-Effectiveness Human Health Criteria • Carcinogenicity • Teratogenicity • Reproductive Toxicity • Mutagenicity • Endocrine Disruption • Acute Toxicity • Chronic Toxicity • Irritation of Skin/Mucous Membranes • Sensitization • Carrier Function or Other Relevant Data Environmental Relevance Criteria • Algae Toxicity • Bioaccumulation (log Kow) • Climatic Relevance/Ozone Depletion Potential • Content of Halogenated Organic Compounds (AOX) • Daphnia Toxicity • Fish Toxicity • Heavy Metal Content • Persistence/Biodegradation • Toxicity to Soil Organisms (Bacteria and Worms)

16. Environmental Practices • Cradle-to-Cradle • MBDC’s certification • gDiapers – Cradle-to-Cradle Certified Type III: Eco-Effectiveness

17. Environmental Practices • “The conscious emulation of life's genius is a survival strategy for the human race, a path to a sustainable future. The more our world looks and functions like the natural world, the more likely we are to endure on this home that is ours, but not ours alone.” —Janine Benyus, author of Biomimicry Type III: Biomimicry

18. Environmental Practices • Orb Weaver Spider Silk • The spider’s fiber is stronger and more resilient than anything on the market today. This new renewable material could be used in parachute wires, suspension bridge cables, sutures, protective clothing, etc. Type III: Biomimicry

19. Environmental Practices Type III: Close Loop Systems Ricoh’s “Comet Circle”

20. Environmental Practices Type III: Closed Loop Systems From: Cleaner Production International LLC

21. Environmental Practices Type III: Life Cycle Analysis Stages of LCA • Definition of Goals and Scope • Life Cycle Inventory Analysis: measure materials and energy used and environmental releases that arise along entire continuum of the product or process life cycle • Life Cycle Impact Assessment: examine actual and potential environmental and human health effects associated with use of resources and materials and with the environmental releases that result. • Life Cycle Improvement Assessment: systematically evaluate and implement opportunities to make environmental improvements based on previous assessments.

22. Environmental Practices Type III: Life Cycle Analysis From the Institute for Lifecycle Environmental Assessment

23. Environmental Practices Type III: Life Cycle Analysis

24. Environmental Practices Type III: Life Cycle Analysis

25. Environmental Practices Type III: Life Cycle Analysis

26. Environmental Practices Type III: Life Cycle Analysis Hypothetical example of LCA impacts of Shoes A (leather) and B (synthetic)

27. Social Practices • Codes of Conduct • (Code of Ethics, Code of Business Standards) • Stated commitment of the behavioral expectations that an organization holds for its employees and agents

28. Social Practices • Standards, Certifications and Auditing • Fair Labor Association • Standards and Auditing • SA8000 • Standards, Certification and Auditing • Forest Stewardship Council • Standards, Chains of Custody, Certification and Auditing

29. Social Practices • Ethics • “Observers need jolting evidence of the tone at the top, often a resolute willingness on management’s part to miss revenue or earnings targets — or even lose key talent — in order to do things the right way.” Bob Lane, Chairman, John Deere. • “In the short term, a corporation’s commitment to integrity may cost it a project, or result in an individual employee, or the corporation, missing certain financial targets…The end results of such short-term losses, however, are virtually always long-term gains.” Charles Harrington, CEO/Chairman, Parsons.