An introduction to Life-Cycle Thinking and Management
9. Environmental cooperation in the product chain – using the enterprise’s network
A challenge in a life-cycle-based initiative is establishing cooperation and collaboration among the relevant partners in the product chain as well as with other interested partners.
Supply chain + Value chain + Cooperation = Product chain
With a product-orientated environmental initiative the focus shifts from within the enterprise's fence to the entire product chain.The product chain includes the following:
 | a flow of materials from acquisition of raw materials to production, to use, to disposal |
| a value and cash flow from the consumer to the producer |
| communication and cooperation in the form of mutual exchange of knowledge and experience. |
In an environmental context, interest up to now has been directed towards the flow of materials, for example, in a lifecycle assessment. In a life-cycle environmental initiative it is just as important to focus on the value flow.What expectations does the consumer have concerning the product's environmental characteristics? How do consumers rate environmental considerations relative to other product aspects such as price, quality, functionality, design, etc.?
For enterprises, the challenge is to connect the links in the product chain in such a way that there is focus on both environmental optimisation of the material flow in the supplier chain; and on the customer's expectations regarding environmental considerations in the value chain. Communication and cooperation between all the partners involved will build connections between the supplier chain and the value chain. This is illustrated in Figure 9.
Figure 9.
Communication and cooperation in the product chain
Development of a cleaner product which never makes it to the market is a waste
Thus, knowledge concerning environmental impacts must be balanced against what consumers truly demand, particularly in terms of the environmental characteristics of a product.
The platform for undertaking concrete environmental improvements of a product are described in Figure 9 and listed below:
| knowledge about the product's environmental impacts and possible improvements, |
| knowledge about markets' and consumers' priorities regarding environmental considerations, |
| knowledge about the demands of other collaboration partners. |
A combination of knowledge from all three areas is the best basis for a life-cycle based environmental initiative. An enterprise must decide how knowledge concerning both the material and the value flow can be continuously updated concurrent with the latest changes in consumer preferences, new technological advances, etc.
A possible means is to couple customerbased quality management with productoriented environmental management.The latest version of the ISO 9000 standard requires that quality management be customer-based in a much more overt way than just registering complaints. For example:What are consumer demands regarding quality and environmental considerations? How can the enterprise accommodate these demands? The combination of knowledge regarding the chain of values together with an enterprise's control over quality and environmental parameters in the supplier chain means that the enterprise is in a good position to reap the strategic advantages associated with a cleaner product, tailored to the consumer.
When establishing product chain cooperation it is wise to contact the sector organisations, as they are acquainted with the existing knowledge and can assist with advice and guidance. For example, environmental assessments of particular product groups / families are available, thus making it easier to tap into existing knowledge across enterprises within a particular sector (see Chapter 10).
Informal cooperation and partnerships in the product chain
A life-cycle-based environmental initiative requires the establishment of close cooperation between suppliers and consumers which will allow for an exchange of knowledge and experience regarding the product chain.This cooperation aims at creating concrete advantages for all partners. A close producerconsumer relationship provides a good platform for technological innovation, including integrating environmental considerations into product development.
For some enterprises, informal cooperation, where information is exchanged and new initiatives are planned ad hoc, is sufficient. Informal cooperation often occurs with direct contact between employees in the enterprises involved. Other enterprises are involved in formal cooperation or even partnerships to ensure integration of environmental considerations into product development.
For example, Henkel-Ecolab has, in collaboration with Berendsen, introduced a dosing and service system which reduces the consumption of laundry detergent. There are other examples of enterprises which advise customers on the environmental impacts associated with various choices, for example, in relation to choice of colour on packaging and printed matter.
Cooperation in the product chain may be formalised by establishing a working group which will coordinate collection of information concerning both a product's most significant environmental impacts, and the preferences and demands of consumers and retailers.Then, ideas for concrete environmental improvements to the product may be assembled by the working group. Formal cooperation has the advantage that the partners are mutually obligated to exchange information and experience.
Cooperation on environmental improvements in the product chain may also result in advantages in areas not directly related to the environment, for example:
| Supplier - certainty regarding the orders and a tailored solution |
| Consumer - certainty that the product will sell, a good image and a solution tailored to the consumer |
| Authorities - supervision adjusted to the enterprise, improved goodwill, opportunity to influence the agenda. |
The company Brdr. Hartmann has, for example, experience that a tailored solution developed in collaboration with the customer provides a greater degree of certainty that the customer will also select the product in the future.
"Little Enterprise Ltd." decides that Niels ought to participate in informal cooperation with a network group involved in product oriented environmental work so he can update his knowledge of this field. The informal cooperation group turns out to be a good source of inspiration and provides him with a network of resource people to whom he can turn when he has a question or problem concerning the environment. |
Experience Exchange Groups
Business associations and municipalities have had success with using experience exchange groups to introduce environmental management to groups of enterprises in the same field, or in the same geographic area.
Experience exchange groups also provide a good forum for introducing a lifecycle based environmental initiative to a group of enterprises.With productchain cooperation there are mutual obligations concerning, among other things, data exchange. In an experience exchange group the focus is on updating the level of knowledge within a certain field, exchange of experience, and mutual inspiration via discussion of concrete ideas for environmental improvements. Such groups lead to the development of networks where members are able to help one another with solutions to specific environmental problems.
In many enterprises, a single employee is responsible for environmental issues, including data collection and analysis, as well as specific initiatives regarding improvements to a product.This environmental responsible employee will often need to discuss environmental questions with colleagues in similar situations employed at other enterprises. Furthermore, such groups help to maintain employee's enthusiasm for environmental initiatives.
It is a good idea if several employees from the same enterprise are involved in this collaboration.The employee with responsibility for environmental issues should invite other employees to selected meetings. For example, employees involved in product development may be invited to a theme day about environmental considerations in design and product development.This will strengthen internal interest and cooperation within an enterprise, which will, in turn, contribute to the organisational integration of the efforts and finally contribute to the results from the productoriented environmental initiative.
Cooperation with autorities and a knowledge network
Authorities and a number of other institutions more or less closely tied to an enterprise may provide assistance with lifecycle based environmental initiatives focusing on developing and marketing cleaner products.
Various authorities have an indepth knowledge of requirements for production processes and products.These requirements are constantly changing, and in recent years, the majority are EU requirements.
A recurrent dialogue with authorities provides insight into these requirements, so an enterprise is not "caught sleeping". Local authorities have knowledge about where an enterprise may obtain information regarding energy, waste, subsidy programmes, etc.
Good places to get help - on the net and in person:
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An enterprise's knowledge network includes various types of consulting firms, Technological Information Centres, universities and research institutions, the occupational health service, sector organisations, approved technological service institutes, for example "dk-teknik" and "Teknologisk Institut", local / regional energy and waste companies, etc.
These knowledge network provide assistance with a preventative environmental initiative. Most of these "advisors" are also competent sparring partners in terms of development of cleaner products.