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Burgess COMMENTARY Peter Burgess Founder CEO TrueValueMetrics RE: The designer environment yesterday Peter Burgess |
The designer environment Redesign is what may change the supply chain for the better ... To actually make our supply chains efficient, there's nothing better than redesign, says Sandy Rodger. I used to be a factory manager. Over the years I was responsible for the production of various chemicals, soaps, detergents and drinks. I was expected to be efficient, in energy and waste, and to prevent pollution – in fact generally to do the right things for the environment. The same applied when I ran supply chains, distributing products to customers, or working with suppliers. For much of the time this stuff was my employers’ main focus in terms of environmental responsibility. But the scope for positive environmental difference in those roles was very limited – really just marginal increments of efficiency, and the avoidance of major incidents. What was completely out of my hands was the design of the product – it’s formulation, ingredients, packaging, range of variants – let alone wider matters – the consumer use of the product, and the overall business model for meeting. It is in these choices that the environmental footprint was really determined. If the product design was intrinsically wasteful of materials and energy, all I could do was keep the environmental damage to the minimum possible for that particular design. The new reality So here’s the new reality of pollution – it isn’t factories which cause (most) pollution – it’s the products they produce! And if the old mantra was “the polluter pays” perhaps now it should be “the product designer pays.” As a speaker said at last week’s London conference on Resource Scarcity and the Circular Environment, it’s no good companies saying “We Have a Green Supply Chain” or even “The Environment is in our DNA” – what matters is to be able to say “The Environment is in our Product.” This is scary. The product is what customers pay for; it’s what meets their need, what complies with regulation, what fits on the supermarket shelf, what represents the brand, and above all, what is familiar. Can’t we just keep the product the same and supply it with the minimum of waste and some nice clean renewable energy? Well, no. Let’s take printers and their toner cartridges as an example. The “razor and blade” model has been very profitable for suppliers – the surprisingly cheap £50 printer locking customers in to an expensive lifetime buying £49.99 cartridges. That means in effect that 50% of the technology – meaning 50% of the materials and embedded energy and water – is in the bit that’s thrown away (or, at best, recycled). Isn’t that bit just a box of toner? Evidently not. The conference speaker from Kyocera talked about their efforts to change this, first in the product design – their cartridge is just a box of toner. Then they needed to sell printing services rather than just a product with consumables, because people tend not to go for the £95 printer with £5 cartridges, because that £50 printer seems to win for a buyer focused on the upfront cost. A product redesign, then a business model redesign too. They have reduced waste x7 versus the worst competitor product. No amount of supply chain efficiency could have achieved this. Redesigning - just about everything When Amory Lovins set out his manifesto for a (profitably) decarbonised USA (in his book Reinventing Fire), he starts with redesign – of just about everything. Electric cars don’t just need to be electric, they need to be lighter, reconfigured completely around the different drivetrain. And since form follows function, they will look different. And so we don’t make more of them than we need, we’ll be leasing them and sharing them as never before. So we start off with a goal about energy, and we end up redesigning things, and their business models, completely. No amount of change to the energy infrastructure could achieve this. I was talking to an environmental academic recently who was saying that localism is important in tackling the “wicked problems” of sustainability – because the “total system” problem is just too difficult. I agree – finding pragmatic workable solutions in a given geography certainly makes sense for many aspects of our lives. But there is another kind of localism that may be even more valuable – instead of going town by town, go product by product, in each case redesigning the product and its business model. Geographic localism is great for fresh food, but will never create a sustainable supply chain for, say, cars, or, for that matter, solar panels. So each industry has its own redesign job to do, meeting its particular consumer need in transformed ways. I remember my MSc tutor’s surprised reaction when the class were asked to describe an environmental system they knew, and after several students had talked about water treatment plants, waste schemes, etc, my presentation was about the global Scotch whisky supply chain. This isn’t just a different slice of our industrial world, it is potentially a much more effective axis for driving change. There is much more chance of say Diageo dramatically reducing the environmental footprint of this total system with concerted overall redesign, than of local utilities, regulators, or consumers forcing a local factory manager or distribution manager to operate responsibly in a specific location. So no amount of traditional (geographical) localism could achieve this. So there really is no alternative to redesign. The good news is there is so much scope for this to be exciting and fulfilling, and profitable, for suppliers and consumers alike. A long-lasting product, built in a modular way to allow repair and replacement, can be a beautiful possession, satisfying to own and profitable to supply. Brands can build much deeper relationships with consumers if their stock in trade isn’t with products that constantly wear out, but instead with lifelong service, and products that work with the growing “C2C” space of sharing and swapping. With the re-use of materials and components integrated into design from the start, much less virgin material will be required and materials costs could actually fall – with the advantage growing as both material and waste costs rise in future. Reframing innnovation More challenging is the reframing of innovation, not to be about changing everything, all the time, to constantly persuade consumers to buy the latest version. More will be standardised, deliberately unchanging – could we start with mobile phone chargers perhaps? Innovators will need to get over what will initially feel like a constrained world, whereas much traditional product design has been allowed the luxury of unconstrained material input and waste. And in many cases there will be a long process of technological innovation required to find biology-based (and so inherently renewable) substitutes for some of the mineral-based materials we use so copiously today. But innovation has always been about solving such puzzles (and rather less than you might think about that glamorous blue sky thinking stuff) – so it’s nonsense to think it has ever been an entirely unconstrained process. So the issue boils down, in reality, to our ability to move beyond the familiar. Overcoming that kind of inertia is always a matter of leadership, of giving people a vision of something beyond today’s norms, and the confidence to believe they can get there. That’s why we’ve recently launched our facilitation service for circular supply chains, to help people turn their vision of resource-efficient products and services into reality, despite the complexities and inertia. Sandy Rodger held senior leadership roles with Unilever and Diageo, and is now a Director at Lighthouse Leadership Ltd, advising companies on sustainability leadership and strategy. Find out more on Lighthouse Leadership. Also of interest My scary toothbrush: Understanding circular supply chains Understanding energy...in one chart! Greening the Supply Chain: Best Practices and Future Trends ✔ Like ShareShare on facebook Share on twitter Share on linkedin Share on email More Sharing Services |
Blog post | written by Sandy Rodger, Lighthouse Leadership
10 May 2013 |
The text being discussed is available at http://www.2degreesnetwork.com/groups/supply-chain/resources/designer-environment/#response-8429 |
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