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Manual on Product-Oriented Environmental Work

4 The Productoriented Approach in Practice

Once you have obtained an overview of the significant environmental impacts in your products' life cycles and clarified your objectives and expectations concerning your product work, you must translate your knowledge and decisions into practice and thus incorporate the product dimension in your environmental work.

This chapter focuses on two main action areas: the external area, with cooperation in the product chain (section 4.1) and the internal area, which concerns how the various departments within the organisation can incorporate the product dimension in their environmental work (section 4.2).

In section 4.1, The product-oriented approach is based on dialogue, cooperation and environmental improvements in the product chain, three relationships are stressed:

	4.1.1 the cooperation with the customers (here the manual differentiates between industrial customers, public purchasers and retailers)
	4.1.2 the cooperation with the suppliers
	4.1.3 the cooperation with the transport suppliers.

Section 4.2 of the manual deals separately with the individual departments within the organisation and suggests methods that the departments can use. Figure 4.1 gives an overview of methods for the various functions.

4.1 The product-oriented approach is based on dialogue, cooperation and environmental improvements in the product chain

The product chain, i.e. the process from the time the raw materials are extracted and made into components that are then assembled to form the finished product, is of fundamental importance for the entire process of product-orienting your work. The players that you have most chance of influencing and cooperating with are your immediate customers and suppliers. It is usually more difficult to have a close dialogue with links that lie further away in the product chain, and it costs resources to include all links. Therefore:

Start with the customers and suppliers that are close to you because it is with them that you have the biggest common business interests. Transport suppliers may also be important cooperation partners if transport is a major link in your product chain.

If you use or have used resources on environmental improvements, you may find that you have more environmental knowledge than your customers and/or suppliers. In that case, you will need to make an extra effort to convince them of the benefits of serious, combined action.

Before you start contacting customers and/or suppliers, there is some "homework" you should do first:

1. Look at the result of the life cycle overview you obtained by means of Chapter 3 (or in another way). Where in the product chain are the biggest environmental impacts and the biggest potentials for improvement? For example, do the environmental impacts depend on how the product is used or has the user (almost) no influence on that?
        
2. Who determines the design and quality of the products, including the use of different substances and materials? Is it only the customers or is it you yourselves, or do the design and quality depend on the raw materials you can get from your suppliers? Which of your customers/ suppliers are important for achieving improvements, both in the form of developing less environmentally harmful products and in the form of reducing impacts during use and disposal? Assess your options and whether there are any parties on which you are particularly dependent.
         
3. Where are you yourselves placed in the product chain? If you are the end-producer for the retail market, are your customers either retailers or the end-users, with whom it can be difficult to cooperate individually? The suppliers, on the other hand, are potential cooperation partners. If you yourselves are a supplier to other companies, you may have a limited number of large customers to consider. On the other hand, your possibility of influencing their decisions is limited. In other words, where do you think you have the greatest possibility of exerting influence/getting cooperation?
        
4. What are the benefits of cooperating - both to you and to the customer/ supplier? Identify areas that can produce benefits for both parties (in other words, create a "win-win" situation), for example, in the form of larger market shares, savings in production costs, greater supply reliability, closer business relations with greater loyalty, a good image, etc.You will find it easier to get cooperation going if you can point out potential benefits.
         
5. How high priority does your management give to incorporating the product dimension in the product chain? What resources will you use on it and is it an important element of your environmental policy or going to be an important element in the future? The answers are undoubtedly closely related to the above questions concerning benefits and will give you an idea of how proactive you should be.

Focus on the benefits of cooperation - both to you yourselves and to those you want to cooperate with. It is hard to say no to the possibility of "win-win".

It is natural to focus on environmental and occupational health improvements in your production, and more and more companies are demanding that their suppliers reduce their own internal environmental and occupational health impacts. However, with the life cycle approach, there are a couple of vital considerations. Firstly, it is important to ensure that your own environmental improvements do not create environmental problems elsewhere in the product chain. Secondly, you should consider how to make it easier for your suppliers, customers, waste disposers, etc. to care for the environment and achieve environmental improvements. If you yourselves can achieve environmental improvements or other benefits at the same time, so much the better!

When you have done your "homework", you can decide whether you are going to focus on your customers, your suppliers or your transport suppliers - or on all three.

4.1.1 Dialogue and cooperation with the customers

Your possibility of influencing or cooperating with your customers naturally depends on your relationship with them. Some particular types of customers are discussed below, but there can of course be others.

You will find further inspiration for incorporating the product dimension in your cooperation with your customers in the Danish EPA's manual "Environmental Dialogue with Customers" (see the reference list). This provides guidance on choosing the right customers for an environmental dialogue, identifying customer needs and evaluating the dialogue with the customers.

4.1.1.1 Industrial customers

If your principal customers are other companies, you can start with the question of whether it is the customers or you yourselves that determine the product's design and function. If the customers "dictate" how the product should look, you can investigate whether the function that your product must fulfil can be achieved in another way or by the customer using the product in a less environmentally harmful way. A couple of examples are given below.

As the examples show, there are benefits for both parties in the cooperation. In the Henkel-Ecolab/Berendsen cooperation, Berendsen (the customer) has reduced the amount of detergent used in its laundries, while Henkel-Ecolab has expanded its business area within development and supply of dosing equipment.

At C.C. Jensen and its customer, the benefit for both parties is a reduction in resource consumption, both on the raw material side - steel - and in connection with the processing of the finished ship propeller. Besides that, the lower weight means less fuel consumption for transport from C.C. Jensen to the customer.

If you yourselves design the product, you should also in this situation find out how your customers use the product and whether you can help to reduce the environmental impacts during use.

Another important option is product development and product modification, where you yourselves systematically assess the possibility of using less environmentally harmful materials and generally work to reduce the environmental impacts during the product's entire life cycle. This is described in detail in section 4.2.3: Product development. Here, too, the customers' needs and wishes are a parameter that should be considered in the development work.

In the industrial market, some customers are normally more important than others, and with these customers you can build up close relations over the years - possibly in the form of real development cooperation. For your product-oriented environmental work, this gives you the possibility of achieving both environmental benefits and market advantages. With selected customers you can, for example, build up shared knowledge about the environmental impacts during the life cycle of the product and a shared database that you can use to set up product chainbased targets with related key figures and indicators.

4.1.1.2 Public purchasers

If public institutions are among your principal customers, cooperation with them will often not be very close, and you may have to relate to a large number of customers. Public purchasers are a large group, and tools have been developed in recent years for them to use to asses the environmental aspects of different types of products. As mentioned in Chapter 3, in the case of the Danish market, these tools include the Green Buying Guides and various checklists that have been drawn up by National Procurement Ltd. Even if your product(s) is/are not at present covered by specific guidelines, you should acquaint yourselves with the types of requirements that are suggested in the existing guidelines.That will give you a good idea of the environmental aspects to which special attention is paid and public purchasers' environmental priorities.

Use the Green Buying Guides. Many others that do that, and when many parties focus on the same environmental impacts, it promotes the wish for action.

Spend time supplying the desired environmental documentation for your products because that may be the only information the purchasers have on which to base their choice of supplier. It is a very good idea to structure your documentation in line with the guidelines used by public purchasers.

Section 4.2.5: Procurement includes references to tools for use in incorporating the product dimension in connection with procurements. If you yourselves are suppliers, you should decide how you can/are going to meet the requirements mentioned.

4.1.1.3 The retail trade

The environmentally aware part of the retail trade wants to sell ecolabelled products and other products with documented low environmental impacts. The retail trade is, in the nature of things, very sensitive to consumer wishes and choices, and these can change from day to day, especially if a given product receives attention in the media. Here, it is important to build up mutual trust, so that the buyers know that they can rely on you to handle any problems sensibly.

Regardless of how much importance your retailers attach to environmental issues, you should keep an eye on the market trends and have a contingency procedure for communicating with the press and others in any critical situation.That is particularly important if your products contain substances that might give rise to environmental and occupational health concerns, even though they are not at present documented as harmful.

The growing sales of organic products and the serious problems experienced by Shell in the Brent Spar case (dumping of a worn-out oil platform in the North Sea) show that the consumers have immense power - but also that the "power" in the form of demand or lack thereof is not necessarily based on environmental knowledge.

4.1.2 Dialogue and cooperation with your suppliers

If you already have a certified environmental management system or are building one up, you have/must have some form of structured evaluation of your suppliers' environmental performance, because purchasing and supplier control are elements of the system.

With the knowledge you have acquired about the products' environmental impacts throughout their life cycle, you should decide whether you need to take a closer look at the cooperation with some of your suppliers. If you have previously given priority to avoiding substances that can cause undesirable environmental impacts in your own production, you could decide to look at relevant aspects in other phases of the life cycle. For example, you could investigate whether some of the substances your supplier uses in the product cause problems in connection with recycling or disposal - or whether product development at your supplier is the key to getting the complete product's energy consumption in the use phase reduced.

As in the case of customers, you should select your main suppliers and spend most time on them. If you have not already settled this question, you can use the manual "Environmental Dialogue with Suppliers" (see the reference list). This manual contains a collection of practical experiences and recommendations from the wide range of environmentally certified companies in Denmark.

In addition, section 4.2.5: Purchasing of this manual gives examples of tools in the form of checklists etc. that you can use in the cooperation with your suppliers.

4.1.3 Dialogue and cooperation with the transport suppliers

In connection with your environmental management system or an environmental approval, you may already have considered your transport suppliers' environmental impacts in the form of noise on the way to and from your company or handling of hazardous substances. In a product/life cycle context you can supplement this with other aspects, such as:

	reduction of need for transport
	logistics planning
	choice of form of transport
	choice of engine technology with a view to reducing both fuel consumption and emissions.

This is most relevant if you yourselves provide the transport. The first step then is to investigate your transport needs and normal practice. Can the volume of transport be reduced, for example by changing some internal routines or by rationalising your transports?

Next, you should consider the form of transport used, i.e. whether products and materials are transported by road, rail, sea or air. Companies often use a mixture of forms of transport. There is no clear answer to the question of which form of transport is the most or least environmentally harmful. However, for long-distance transport, a rule of thumb says that transport by air is more environmentally harmful than transport by rail or sea. In the case of road transport, the main parameter is how fully packed the lorries are. If you have to transport one tonne one kilometre, it is better to carry out the transport with one fully loaded 16-wheel lorry with trailer than one fully loaded Ford Transit because the environmental impact is allocated to all the products in the lorry/van. If you are transporting goods in an almost empty 16-wheel lorry, it is worse than transporting them in an almost empty Ford Transit.

For the chosen form(s) of transport, you can then look at the possibilities of rationalising fuel consumption and reducing emissions.

If you buy transport services from other companies, you should control this through requirements for the transport suppliers. Bang & Olufsen mention transport specifically in their life cycle-based environmental policy: "For environmental reasons, we require our transport suppliers to ensure a high level of capacity utilisation and optimum use of technology for the transport units." This was amplified as follows in the company's environmental report for 1998/99:

Some transport firms are themselves environmentally certified and therefore work to ensure continual improvements.You can contact them to find out where you might be able to achieve improvements and what you as a transport buyer have to consider.

The transport sector, with the potentials that exist there for reducing environmental impacts is an extensive topic in itself. The following manuals contain some specific recommendations and checklists:

	"Environmental Management and Transport. Manual for Small and Medium-sized Enterprises". Published by COWI, 1999, with support from the Danish EPA and the Danish Agency for Trade and Industry.
	"Environment and Safety - Manual for Road Transport". Published by the Danish Shippers Council and the Association of Danish International Road Hauliers, 1997.

Section 4.2.8: Logistics in this manual gives selected examples from these two manuals.

4.2 How does one work with the product dimension in the different departments in the company?

Companies with experience of the life cycle approach have an important message for others: make sure that you anchor tasks and responsibilities in the organisation. Results are created not by having a fine plan written at a desk, but through the daily work.

That means that training and exchange of knowledge and experience are very important.To make decisions that are best for the environment - and for the customers - one must understand what consequences one's own choices and actions have elsewhere in the life cycle of a product and in the organisation. At the same time, it is important to strike a balance. It is not necessary for all employees to be environmental experts.

Very few companies are able to make a major effort in many places at the same time, but no matter where you start, the employees in the department in question will need one or more tools to help them to use the life cycle approach and incorporate the product dimension in their work. In other words, where, when and how the environmental aspects of a product or products should be incorporated in the daily work.

For the departments in which you decide to make a special effort, you should establish a policy that supplements and amplifies your corporate environmental policy. An environmental policy is seldom sufficiently specific to mark out guidelines for the individual departments, so you should draw up a policy with related objectives for "green" purchasing, "green" product development, etc.

Selected functions are discussed below, with a short description of their options and suggestions for tools in the form of checklists and similar. In some cases, the tools have been "borrowed" from other sources; where that is so, there will be a reference to the source. In these cases, you should obtain the original publications so that you have the complete material. The tools are for inspiration, and it is up to you yourselves (typically through cooperation between the environmental function and the function that is to use the tool) to develop or adjust your own tools.

Figure 4.1 shows suitable tools for the different functions and the sections in the manual that deal with the various functions.

Figure 4.1
Functions and tools

4.2.1 The management must be actively involved

It is generally the task of the management to establish your environmental strategy and priorities, assign responsibility and resources on that basis and ensure that the organisation as such is equipped to undertake the tasks.That also applies to incorporating the product dimension in the company's work. Here, the management's role is particularly important because of the need to coordinate and prioritise across the organisation.

In other words, the management must decide whether the existing information flows and decisions are sufficiently effective for the productoriented work. As shown by the example below, lack of coordination can have serious consequences beyond the environmental work itself.

A company's product-oriented environmental strategy is also far more visible in the marketplace - to suppliers, customers and consumers - than traditional environmental management. The management therefore has to decide what profile the company is to have and how much importance is to be attached to environmental aspects in your cooperation with, particularly, customers and suppliers.

To ensure the necessary effect, the product-oriented policy and declarations of intent must be translated into actual targets that the management must follow up on; if you have an environmental management system, the targets can be incorporated in it. The product-oriented environmental targets can be directly related both to the product itself - e.g. phasing out a problematical substance in the product - and to other areas of your activities, e.g. incorporation of the product dimension in x% of the procurements for the administration. It is important to think right across the organisation so that the environmental targets are supplemented by other targets.When you set a target for development of a less environmentally harmful product, the sales department should have a sales target for the new product. In other words, the responsibility for achieving the environmental targets must be spread out in the organisation, although this must be done in a way that ensures that the success criteria relating to the responsibility are reasonable.

Ensure that the success criteria for the individual function/employee suit the product-oriented objectives or at least that there is no conflict.

Experience shows that to achieve satisfactory results, the management must back up and visibly prioritise the environmental action. The management should express the priorities in many different contexts - including, particularly, ensuring the necessary resources for the tasks.You can also work with organisational targets to promote the action. If you do not already work with such targets in your environmental work, you can take the opportunity of doing so when you incorporate the product dimension. More and more employees are being drawn into environmental work in their daily lives, so it is extra important to ensure motivation and efficiency. The following examples of organisational targets are intended as inspiration.

	Motivation of employees. Bonus schemes to which various employee groups contribute and benefit from promote motivation. A scheme of that nature could, for example, be linked to reducing the quantity of selected, non-renewable resources used during a product's life cycle.That encourages product developers and buyers to find better alternatives, while sales representatives and others in contact with the customers can work to promote return schemes and recycling.
	Supplementary training in product-oriented environmental work. Set targets for the number of employees taking relevant internal and/or external courses.
	Environmental responsibilities in job descriptions. Set targets for the proportion of managers/middle managers and key employees whose job descriptions include environmental responsibilities, resulting in the setting of success criteria that affect their salary and career prospects.
	Reporting to the management. Particularly in large companies, it is common for managers/middle-managers to have to report periodically to the top management on selected areas. Here, environmental performance and initiatives should be reported together with other business elements.
	Information across the organisation. In companies with a line organisation, the information flows typically go up and down along these lines.You can work to promote information across the organisation both by calling for this and through incentives, but you can also formalise cross-flow of information. For example, persons from a line/function can be required to participate in certain meetings or decisions in another function.

4.2.2 The changing role of the environmental department

In a traditional environmental management system, the environmental manager naturally focuses on what is happening in the production and directly related departments. The knowledge gathered from outside very often concerns official requirements and various other stakeholders' requirements. The environmental manager will often also be charged with motivating and "training" his colleagues, carrying out actual environmental assessments and keeping the management informed - and many other things as well.

When you work with a product-oriented approach, many of the tasks will be the same, but new dimensions will emerge. They naturally include the entire environmental life cycle perspective, with which the environmental manager must be conversant, and which he must communicate to his colleagues. They also include supporting many different functions with new tools and ensuring coordination of the action between the departments. Besides these dimensions, however, the environmental managers' role vis-à-vis the management changes. When the environmental perspectives spread beyond the company's own boundaries, the management will need far more extensive assessments than previously.That means that the environmental manager must also think in terms of market strategy, the organisation of the company, etc. - or at least know how to ally himself with others who can contribute to that knowledge.To ensure the necessary impact in the management, the environmental manager needs to be something of a "universalist" as well as an environmental expert.That is a real challenge - and one that you should take seriously.

As mentioned earlier, not all your company's employees need to be environmental specialists. It is important, however, that you determine what knowledge the individual employee needs (for example, some general knowledge about the product's environmental impacts during its life cycle) or has a duty to acquire (for example, knowledge about the environmental consequences of the choices the employee makes).You should build up sufficient knowledge to be able to carry out the regular assessment and decisions, but can purchase from external experts any oneoff assessments you need, such as assessment of the environmental impacts of the chemicals you use.

You can also use external experts in cases where you yourselves do not know enough. However, it is a good idea to start on the basis of your knowledge.That increases the chance of good practical solutions that the individual employee can use because he himself has been involved in finding the solution. If you do use experts, you should ensure that the knowledge they add is firmly anchored in your organisation so that you yourselves can take over.

4.2.3 Product development

For companies that develop products themselves, incorporation of the product dimension in their product development work is a must.The materials chosen and the way they are combined determine much of the product's later function and the environmental impacts associated with its use and disposal. It is therefore here that one finds the best potentials for reducing the environmental impacts from products. If you do not develop your products yourselves you can instead seek influence by presenting your wishes, requirements or proposals concerning the product and its environmental aspects to the company or companies in the product chain that carries/carry out the product development.

Incorporate environmental and occupational health aspects in connection with product development and specification. It is here that the basis is laid for the product's environmental and occupational health impacts during its life cycle.

Besides achieving environmental improvements, experience shows that working systematically with environmental aspects during product development can have beneficial side effects - in the form, for example, of savings, quality improvements, better contact with the market and greater customer satisfaction. If you make consumer durables, production equipment or similar with high added value, where you yourselves control the product development, and where there are well-defined distribution channels and perhaps also return schemes, you have many possibilities. If you make goods for the private consumer, the situation may be more diffuse. For instance, it is somewhat harder to clarify consumer wishes, and most ordinary consumers' considerations concerning the environmental aspects of your product or products are far less systematic than those of professional buyers.

In some cases, there may be a shift in costs during the product's lifetime. For instance, the development phase and the launch of the new product may cost more - particularly if you have to invest in new equipment to make the new product. On the other hand, using and disposing of the product may cost less, which could mean bigger sales.You thus need acceptance by the management and a clear policy with clear objectives for what you want to achieve. Precisely this means that there is an obvious link between product development and environmental management and that objectives for continual improvements must include objectives for product improvements.

4.2.3.1 All products can be improved

Irrespective of the type of product, there will always be some potential for reducing its environmental impacts, and that potential must be looked into - see the following rules of thumb. With such a list, it may be tempting to tackle each problem separately, but if you choose a stepbystep solution, you must be careful to avoid suboptimisation - in other words, it is no good achieving improvements in one place if you thereby create greater problems somewhere else.

Table 4.2:
Rules of thumb for environmental improvements in connection with production development

4.2.3.2 Tools for use in the life cycle approach to product development

Training is a key parameter when you start working systematically with the life cycle approach to product development. It takes more than a few fiery souls to ensure continual improvements. Everyone involved should therefore have sufficient basic environmental knowledge for their needs.

Besides that, you can draw up lists of acceptable and unacceptable substances and checklists with questions that the product developer must always consider.You can, for example, use the above overview from WICE (table 4.2) as your basis and supplement it with things that are relevant for your own types of products.You can also appoint a team to act as the Devil's Advocate and ask critical questions about the product developers' proposals, and you can set up score systems and environmentally based criteria for when a new product is acceptable.

You should, of course, use life cycle assessments in your product development work, so that you think thoroughly about the environmental impacts in all phases of the product's life cycle. Here, you can start by setting up an environmentally ideal concept for the product in the different phases and, on that basis, consider the real potentials and alternatives. Figure 4.3 shows an example of prioritised ideal requirements for a seat. The ideal requirements are prioritised, so cleaning, repair and disposal should preferably be unnecessary or - as the next best alternative - minimised.

Figure 4.3:
Ideal concept for a seat – example for the use and disposal phases

Source: Based on the Institute for Product Development's seminars for industrial designers, 1998

To support use of the life cycle approach in product development, PCbased analytical tools have been developed for quantifying environmental impacts. However, to use the tools, you must have some data available. The tools are therefore easiest to use if you have an existing product with which to compare the modifications. In addition, the results must always be used with caution because some of the data embedded in the tools are average figures for different processes and thus not sufficiently specific for your particular product. In Denmark, the most popular tools are LCV (Life Cycle Tool), developed in connection with the EDIP project, and SimaPro, developed by Pré in the Netherlands (see Annex 1 in Part C).

EDIP (Environmental Design of Industrial Products) is a comprehensive method, and companies without any knowledge of LCA and detailed environmental assessments may have difficulty in getting going on it.To facilitate its use, the method has been simplified and described in "Manual on Environmental Assessment of Products" (see the reference list), which supplements this manual's recommendations in several areas.

4.2.3.3 The phases in product development

The development of new products "from scratch" normally comprises a number of phases, from idea, through development of a product concept and detailing, to launching the product on the market, as shown in the following example from Grundfos.

In the early phases, there are great degrees of freedom, but the information is qualitative and not very detailed - particularly in the case of entirely new product concepts, where direct comparison with "old" products is not possible. Later in the process, there is more possibility of obtaining quantitative data, including data concerning the potential environmental impacts. Here, on the other hand, the options are more limited, and that means that it becomes more difficult to make basic changes to the product. In other words, you must consider the environmental aspects as early as possible in the development process, particularly if you are aiming for major and more radical changes.

4.2.3.4 The level of ambition

A decision you have to make is how extensive the product improvement action is to be. For most companies, it is natural to start with gradual improvements in order to gain practice in incorporating environmental aspects and methods, and at this level, you will find it reasonably easy to deal with both the work and the consequences.Very extensive "sustainable" environmental improvements, on the other hand, call for complete redefinition, not only of the product but also of the need covered by the product, and thus redefinition of the patterns of use. In some cases, the infrastructure in society and the way companies cooperate may have to change in order to fulfil our needs in new, sustainable ways.Very extensive solutions of this kind are hardly within the scope of a single company - here, cooperation in the product chain and with other stakeholders in the different phases of the product's life cycle is essential.

As will be seen from the following figure, the scope of your product development can be divided into four levels that reflect the extent of the action and the product changes.

Figure 4.4:
Levels in product development

(Source: Stevels, 1997, Stevels and Van der Wel, 1998)

Level 1, which is the starting point for most companies, concerns adjustments and minor modifications, e.g. substitution of certain substances. The work is carried out at your company, and the product retains its original function and can be used as it is usually used.Typical tools for the product developers are +/-lists of recommended/undesirable substances and simple rules of thumb, e.g. those given in the previous overview. However, you must remember that such tools do not in themselves produce environmental improvements. Both Grundfos and Coloplast have found, for example, that it is essential to have close cooperation between the product developers and environmental experts because environmental assessments are often complicated to carry out.

Establish good cooperation between the product developers and the environmental experts in the organisation.

At level 2, you check the product more thoroughly. This might also lead to changes in the way the product is manufactured and used. Basically, however, it is still the same product. Because the changes are bigger, it may be necessary to carry them out in cooperation with, for example, suppliers or customers. As support in this work you will need more detailed tools, e.g. PC-based tools for life cycle assessments (EDIP, SimaPro or others, see Tool 1 of the manual for further information).

At level 3, you will investigate whether the users' needs can be met in entirely different ways than with the existing product. Here, it is not enough to use environmental assessment tools because the product's basic function, the users' way of using it, the infrastructure during the product's entire life cycle and possibly in society, and many other factors, must also be assessed.

Level 4, which corresponds to translating the sustainability principles into practice, is a further development from level 3 and will include real quantum leaps, both technologically and organisationally. At the present time, this level is more theory than practice.

If you lack experience in taking the life cycle approach in product development, you should start at level 1 by preparing simple checklists and training your product developers - possibly in the form of "on-thejob training", where an environmental expert is directly involved in discussions and decisions.

For action beyond level 1, you should actively involve other parts of the organisation from the start, for example, via an interdepartmental working group, so that their knowledge, wishes and reservations can be considered before it is too late - or very much costlier - to change something. By appointing an interdepartmental working group, you help to highlight the product development work, and more people/departments are now engaged in gathering knowledge that can be used in the development of new products and concepts. For example, it is important for the economic analyses also to be seen in a life cycle perspective - in other words, for the consequences for other links in the product chain, for the users, and for society, to be assessed. Will the product be more expensive or cheaper to use and dispose of? What is the supply horizon for the raw materials, and will that effect the price over time? These are just a few of the questions that must be asked.

4.2.4 Production

It is naturally important to involve the production department in the development work so that the proposals discussed do not prove impracticable when the time comes to make the product.

Some companies do not have a separate product development department. There, the necessary and desired modification and development take place in the production department. Contract manufacturers, in particular, can use some of the recommendations given in the above section on product development, with the limitation that the process itself calls for close dialogue with the customers.

Another important function for the production department in productoriented work is to procure data per unit produced and/or per functional unit. This may prove a big challenge because the available data - for example, on energy consumption and emissions, are calculated for the production as a whole and not for the individual product. "Environmental Project No. 488, 1999" from the Danish EPA (see the reference list) provides examples of how the company Teknos Schou, which makes metal paint, has gathered and processed data from its production department for use in a life cycle assessment.

4.2.5 Procurement

The buyers' function is to procure the right goods of the right quality at the right price. In addition, the goods should be environmentally efficient by getting more out of less, i.e. they should contribute to greater added value with lower environmental impact, and this need not be at variance with the quality or price requirements. The buyers can also be involved in assessing the suppliers and their environmental performance and in establishing expanded relations and cooperation with selected suppliers.

In the following, procurement and supplier control are dealt with separately, but in practice, there is some overlap. Procurement focuses on the products themselves, while supplier control is about how good/credible suppliers are with respect to environmental issues.

4.2.5.1 Purchasing for your own products and production

In connection with procurements, you should differentiate between the raw materials etc. that are used directly in your products or in their production and other products, such as office materials, furniture, etc. In the case of the environmental profile of your own products, it is the first group that is the most important, but changes in the form of purchasing alternative, less environmentally harmful materials etc. cannot be decided by the buyers alone. Product developers, the production department and the environmental department should assess the potentials together because it is important to ensure that the products continue to function as intended and live up to the customers' needs and expectations. The potentials for changing practice relate particularly to the development of new products or modification of existing products.

The buyers must translate the environmental requirements into practical action.

One particular role of the buyers will be to specify the requirements to be made of the suppliers and the products purchased and to clarify any consequences for price, supply reliability, etc.To do that, the buyers will have to build up environmental knowledge and be provided with clear guidance on what it is they are to find out. Like the product developers, the buyers also need to work in close tandem with environmental experts and others that can assist in assessing the alternatives found by the buyers.

No matter what products you want, you should always assess the need for the purchase and see what function the product is intended to fulfil. The less you have to purchase, the more you will save, both in environmental impacts and financially.

4.2.5.2 Other procurements

With the other type of procurements, which is not in the same way vital for your own products or production - for example, PCs for the office - there is greater flexibility. Here, the buyers - possibly together with the environmental department - can themselves check out and purchase less environmentally harmful alternatives. And that is important because your demand helps to build up the market for less environmentally harmful products. In the following we discuss some selected tools and sources from which you can obtain further information.

Your demand is part of other companies' market. Wherever possible, use "official" recommendations about environmentally sound purchasing so that the total demand for a given "green" product does not become too diffuse and difficult to live up to.

If you want to work systematically with the product dimension in connection with your procurements, you should start with a single product category in order to build up experience. It is a good idea to choose a category that is visible to many employees or in which there are big potential environmental benefits, e.g. within office operation or cleaning. Start by assessing the need and ask few, simple questions about the products and the suppliers' environmental aspects - and remember that you must be able to use the answers you receive.

With a view to strengthening the demand for less environmentally harmful products that are used by many, various guidelines, checklists, etc. have been issued in the last few years for use in procurements (addressed particularly to public sector purchasers). In Denmark, we have the Danish EPA's "Green Buying Guides for Public Procurements" and National Procurement Ltd.'s checklists.You can obtain the Green Buying Guides free of charge from Miljøbutikken (phone +45 33 95 40 00) or download them from EPA's website www.mst.dk.You will find National Procurement Ltd. (SKI)'s checklists and recommendations at the website www.ski.dk.

If there are Green Buying Guides on (some of) the products you buy, it is best that you use them. Standardised requirements concerning both performance and documentation make life easier for the suppliers, in addition to which, you yourselves do not have to carry out environmental assessments of the products. In the same way, whenever possible, you should buy eco-labelled products (the Swan or the EU's Flower). An overview of these product categories is available at www.ecolabel.dk. If the product uses energy in the use phase, you should find out if there are energy labels for the product category. On SKI's website you will find a list of various labels and where they are used.

If you want to incorporate health and safety considerations in your procurement activities, the Danish Working Environment Authority (WEA) has supported the preparation of guidelines on incorporating occupational health and safety considerations in the procurement and use of desks, office chairs, floorings and lighting. By agreement with WEA, the guidelines, together with a short background report on such procurement, are to be found at www.dk-teknik.dk. WEA has also supported the preparation of guidelines on the procurement and use of office machines: "Standardised tests and Guidance on Installation and Procurement" and "Where does the cupboard go - fitting out offices". You will find these guidelines at www.teknologisk.dk/1026 or /775.

If you want an alternative approach to procurements, the GRIP Center in Norway has prepared guidelines with many questions, points systems and cost-benefit analyses.You can download this material from www.grip.no.

4.2.5.3 Environmental assessment of suppliers

If, through product development or in some other way, you have defined some areas where it is important that your suppliers act in a specific way, you must obviously specify these requirements to the suppliers and ensure the necessary documentation. The requirements could, for example, concern the suppliers' use of undesirable substances or processes.

Your own environmental profile will be affected to some extent or other by your suppliers' environmental profiles. Besides that, it is often good for long-term supplier-customer relations that the suppliers become ever better and are able to keep step with both your needs and those of your customers/the endusers.

Demanding customers are an important factor in the development of suppliers.

You cannot and should not turn every stone with respect to your suppliers' environmental impacts, but you can ask a few questions that will give you an idea of whether the suppliers are working actively on environmental improvements - for example, whether they have an environmental policy, prepare green accounts, have environmental certification, or set objectives for improvement of their environmental work. The manual "Environmental Dialogue with Suppliers" (see the reference list) gives some examples of relevant matters to ask about. The sources mentioned under purchasing also include simple questions to clarify suppliers' environmental aspects. With supplier control, too, it is best to start in a small way and then gradually develop the system.

It may be difficult for suppliers to obtain the desired documentation if they do not have an environmental management system or similar, documented environmental work. Grundfos therefore started by convening its suppliers to seminars at which they were told what Grundfos expected from them.

4.2.5.4 Use of questionnaires

A questionnaire is an obvious way of obtaining information from your suppliers. However, questionnaires easily become too general if you ask all suppliers the same questions, and in that case, the answers are of relatively little value.

If you decide to use a questionnaire, you should consider:

	for what purpose you are sending it out. If you primarily want to get the suppliers going on systematic environmental work, general questions concerning, for example, environmental policy, environmental objectives, environmental management and environmental accounts are suitable. If, on the other hand, you want specific information, e.g. the products' content of substances and production methods, you must ask for exactly that.
	how you intend to react to suppliers that do not respond to the questionnaire.
	how you are going to process the answers. If you receive many identical answers, you can gain an overview by using a scoring system.
	how you are going to follow up on the answers. It is important to give the suppliers some feedback. They should at least be told what you are using the answers for.
	how often you will send questionnaires out and thus what priority you give to getting information from the suppliers.

The scope of the questionnaire should depend on what you are going to use the answers for. If you are going to use them actively to assess the suppliers' environmental performance, it is important for the suppliers to have the possibility of giving a balanced answer. If you simply want to send a signal about the focus areas in your environmental work, your questionnaire should not be larger than a single A4 page.

Hartmann has focused on its suppliers' environmental performance for a long time now and have arrived at the following model, which, although ambitious, is simple to handle for both the company and the suppliers.

4.2.5.5 Practical support for the suppliers

You should also decide how much time you are going to use on the environment related cooperation with the suppliers. Will you, for example, spend time keeping the suppliers informed about new measures and help them build up knowledge. This can be particularly important if your suppliers are very small and do not themselves have sufficient resources to keep up with the latest environmental news or build up documentation systems.

You will find further recommendations and examples of cooperation with suppliers in the Danish EPA's manual "Environmental Dialogue with Suppliers" (see the reference list).

4.2.5.6 Include occupational health and safety aspects

If you want to include your suppliers' health and safety conditions, you can use a tool developed by WEA: "Companies' occupational health and safety profile", which is addressed to both purchasers and suppliers.You will find the tool at www.dk-teknik.dk. Each company can itself examine its health and safety situation from A to Z and provide its customers and others with documentation in the form of a profile of the company's working environment. The profile covers seven areas: ergonomy, noise, children & young people, chemicals, indoor climate, occupational accidents and incidents, and psychological working environment. By means of the tool, a company can examine both the loads that exist and the preventive work carried out. Buyers can request suppliers to use the tool and send them the resulting working environment profile, which gives them a good impression of the suppliers' working environment and of the action taken by the suppliers to improve it.

4.2.6 Sales and marketing

In this section we differentiate between the sales and marketing departments as follows:

	the marketing department gathers and disseminates information from and to target groups (groups of individual customers), competitors, the market and society in general
	the sales department (sales representatives) is in direct contact with the individual customers.

In practice, there is a natural overlap - for example, via their knowledge of individual customers, the sales representatives can help the marketing department to gain a complete overview. The reason for differentiating between the two functions here is to show clearly the potential of each of them and thus also the tools they need.

People in sales and marketing do not normally know very much about environmental matters. The knowledge has to be built up.

That means that they need close cooperation with the environmental department and preferably some systematic methods they can use to incorporate the product dimension in their work. Examples of such tools are given below.

4.2.6.1 The marketing function's potentials

The marketing function can:

	create an overview of the market and its potentials and threats, including environmental aspects
	pass on customer requirements/wishes and market trends to the other departments in the organisation
	create - or at least work to achieve - the environmental profile you want
	establish - or contribute to the development of - an environmentally based marketing strategy, including identifying the most important market segments from an environmental point of view.

Precisely because demand to a very great extent determines how attractive it is for companies to develop cleaner products, every company needs to market its environmental advances.With a view to preventing companies from misusing environmental arguments and thus from misleading the consumers, the Consumer Ombudsman has issued guidelines that provide a clear definition of good marketing and describe the documentation on which it must be based.You can download the guidelines from www.fs.dk.

The guidelines are based on the fundamental principle in the Danish Marketing Act (section 2), which states: "It shall be an offence to make use of any false, misleading, or unreasonably incomplete indication or statement likely to affect the demand for or supply of goods, real or personal property, and work or services. It shall be possible to substantiate the correctness of indications or statements on real facts."

The guidelines' main recommendations are as follows:

1. Investigate whether there are special marketing rules in special legislation, e.g. the Act on Chemical Products and Substances.
2. Procure documentation on how the product affects the environment.
3. State clearly the background for your environmental argument.
4. Judge the overall impression.
5. Verify facts in advance.
6. Do not generalise without having information about the entire life cycle of the product.
7. Compare like with like.

If you want to use environmental arguments actively in your marketing, it is a good idea to have an independent expert look through your documentation.

Establish your marketing strategy

When you are planning how you are going to use environmental aspects in your marketing, you can look at the relationship between your products' environmental impacts and the market potentials.

The figure on the next page is a very simplified outline of the reality, but it can be used to illustrate some relationships between environmental impact, market potential and choice of strategy - and thus be included in the management's basis for decisions, which could take the form of a management group seminar in which all the department managers participate and have the opportunity of passing on their experiences and views.

Figure 4.5:
Establishing your environmental strategy

Quoted from EEA's LCA Guidebook, p. 39 (see the reference list)

"Low" environmental impact

If you know that your product has a low environmental impact or expect it to have a low impact, compared with similar products on the market, the first step you must take is to ensure that you can document that. Many companies choose to apply for an eco-label (if that is possible) or to prepare an environmental product declaration if the product's environmental profile is to be used in connection with marketing.

Demand exists

Within some product categories, including paper, printing services and domestic appliances, a market has been built up for products with a low environmental impact. The market for low impact paper and printing services has developed mainly through demand from public sector purchasers. The market for energy-efficient domestic appliances has arisen through a combination of two factors: the first is that the EU has introduced compulsory energy labelling of domestic appliances so that the consumers can compare the products' environmental performance, while the second is the desire by consumers to reduce their electricity bills.

Even if your products correspond to the demand and you have your documentation ready, it may be necessary to market the products' environmental characteristics in order to exploit the market potential.

No demand

However, the market for low impact products is still limited to very few product categories. Within all other product categories, you will have to create a market for low impact products before you can gain market advantages. Experience shows that a market does not develop by itself - you have to work actively to create it.

"High" environmental impact

If you have products with a relatively "high" environmental impact, it is the market's requirements and your product's position that determine whether it will pay you to try to reduce the product's environmental impacts or whether it is better to concentrate on incorporating environmental aspects in the development of new products and phase out the old ones as new and environmentally "better" products become ready to take over.

The management can use an overview from the above figure when deciding on the company's environmental strategy.

4.2.6.2 The sales representatives' potentials

From an environmental angle, the sales representatives can:

	influence the customers to make more environmentally sound choices
	inform the customers about relevant environmental aspects - also relating to use and disposal of the products, so that they build up knowledge about these matters
	gather information about the customers' wishes, expectations and needs and answer questions from the customers
	help to build up closer cooperation with the customers.

Many sales representatives experience problems in using environmental arguments when trying to sell to customers. Most of the difficulty is due to lack of knowledge and training - among both the sales representatives and the customers. The Danish EPA's manual "Environmental Dialogue with Customers" (see the reference list) sheds light on these problems and recommends ways of overcoming them - for example, by having an employee from the environmental department accompany the sales representatives on calls to customers, if the customers are ones with whom you have good relations, and where you want to get the environmental dimension incorporated.

It is important for a sales representative to be able to give the customers fast and precise answers to environmental questions. It is therefore a good idea to prepare overviews, guidelines, etc. and to give the sales representative an understanding of the underlying environmental problems.

Three such tools are outlined below.

1. a question guide to clarify customer needs etc.
2. an overview of customers' questions and good answers to them
3. environmental directions for use of products.

1. Question guide to clarify customer needs and how the product is used

The main purpose of a customer-oriented question guide is to clarify how the customers use your products and what environmental consequences that has. This will enable you to find out whether your customers experience real environmental problems that you can help to solve and - particularly - a potential for improvement that you can help to utilise. It is also important to gain an impression of your customers' environmental attitudes and how that can affect your cooperation with them.

By going on the offensive with your customers you can at the same time give yourselves a strong environmental profile - if, let it be noted, you are prepared to take the consequences of the information you receive. If you do not know what you will use the information for, do not ask for it. The question guide is particularly suitable if you have relatively few large customers because it takes time to use it and follow up on the results.

You can use the question guide as your basis for an interview, but you must also do some homework - gather as much information as possible beforehand.You should also consider what benefits you can offer and what you yourself want to get out of focusing on the environment. In other words, where is the win-win potential greatest? Here, it is important to think long-term because it can be difficult to find equal benefits in the very short term.

Examples of topics that can be included in the question guide are given below. Some of them may concern confidential information that you will only get provided you and the customer enjoy a mutual trustful relationship. It is assumed that you have already obtained available information on the customers, such as environmental policy, certification, green accounts, etc. Otherwise, start with that.

The customer's general environmental attitude and action:

	What does the customer consider to be the main impacts in connection with the production and the products?
	What factors does the customer prioritise in its own production and in relation to the products?
	Has the customer any proposals or wishes about what you should prioritise?
	Does the customer want you to introduce more environmentally sound production technology? Has the customer any special requirements or wishes?
	How much do the environmental aspects matter in the customer's market? You should preferably try to obtain concrete examples of the demand.

Use of the products

	How is the product used? (ask if you can see this for yourself)
	Is the product used together with other products and, if so, does this affect the total environmental impact?
	How are the users instructed in limiting the environmental impacts in connection with use and disposal?
	How much of the product does the customer use per operation/unit?
	What emissions and discharges are there in connection with the product, and how big are they? (Any data can be used to improve your life cycle assessment, which is initially based on estimates or calculated evaluations of the potential impacts.)
	How much wastage is there and how much is reused/recycled or disposed of?
	Do the users experience any health impacts or other problems from using the product?
	Does the customer use alternative products or has he considered doing so? If so, which and why?
	How is the product disposed of? Are parts of it reused for other purposes?
	Does the customer know of any environmental or health problems later in the life cycle to which your product contributes? If so, what problems?
	Has the customer any suggestions for improvements to the product and/or in the cooperation with you?

2. Overview of questions frequently asked by customers - and good answers to them

If you have sales representatives that are in close contact with the customers, you have a good possibility of keeping yourselves informed about the customers' interest in environmental issues. The sales representatives will often encounter a variety of questions, and it may be a good idea to gather these questions together systematically and then find good answers to them. Put the questions and answers together in an overview that the sales representatives can use (and that can be used in your environmental training of sales representatives).You can also include the most obvious questions and answers in your environmental reports or other material that you send to your customers and other stakeholders.

3. Environmental directions for use/guide to proper use and disposal

If your products have a long lifetime and there are big environmental impacts in connection with their use or disposal - and particularly if the users' behaviour affects the extent of the impacts - you should prepare environmental directions for use that tell the users how to use your product with the greatest possible care for the environment.

There is not at present a standard for environmental directions for use, but the instructions should be short, concise and easy to understand, so that the user only has to read them once to know what to do and what not to do.You could sell the message together with the benefits for the user along the lines: "We have developed a table with a surface that is easy to maintain.You only need water with a little washing-up liquid in it to keep the table clean. Do not use harsh cleaning agents.That way, the table will last longer and you will be helping to protect the environment."

The following are suitable subjects to include in environmental directions for use:

Use:

	cleaning (e.g. furniture, surfaces)
	maintenance (e.g. vehicles, electrical appliances)
	repair and service (products with a certain lifetime)
	possibility of renewing parts of the product (e.g. for design or fashion reasons)
	dosage and handling (e.g. chemicals).

Disposal:

	reuse/recycling
	special handling
	separation at source
	return scheme.

Extract from APC's environmental product declaration for Uninterruptible Power Supplies (UPS) "After use, the system can be returned to the supplier for environmentally sound recycling or disposal. Please contact the supplier for information about the return scheme. The system contains the following parts, which contain valuable materials and that should be disposed of in an environmentally safe way: Batteries, leads, printed circuit boards, fans, transformers, covers (steel), condensers, relays, fuses, power supply (copper), plastic parts (PC and ABS), aluminium frame."

You must yourselves make it easy for the user to use and dispose of the product in an environmentally sound way. It is no good just writing to the users, telling them that they must do such and such to benefit the environment - you still have a (moral) responsibility to ensure that they can do as asked in the circumstances in which the product is normally used. If you can combine eco-friendly behaviour with other benefits for the users, you will have a greater chance of success.