Business as Unusual: Trash to Cash

Posted on 15 Jul 2010 by The Manufacturer

Anand Sharma: Regulatory compliance is no longer the sole objective for manufacturers concerning the environment

When it comes to the environment, regulatory compliance has long been the sole objective of many manufacturers. Anything more would just increase operating costs. So the thinking goes.

But over the past decade, and the past five years or so in particular, more and more manufacturing executives have made environmental stewardship a core part of their company values. They are motivated both by growing customer demands for earthfriendly manufacturing practices and cradle-tograve assessments, and a genuine concern for the condition of the world we inhabit and that those who follow us will inherit. After all, as an environmental engineering manager at one of the companies that we work said in a recent conversation, “Who doesn’t want to create a better natural environment?” As manufacturers have wrestled with doing what’s best for their customers, business profitability and the environment, some have found creative ways to overcome false tradeoffs between higher costs and green priorities. The environmental manager mentioned above works for a manufacturer of construction, agricultural and other outdoor equipment. They cut, bend, weld, clean and paint hundreds of tons of steel every year. By combining their operational excellence initiatives with a proactive green program, the company has made dramatic waste and operating cost reductions.

Like a lot of manufacturers, they have had recycling bins in production areas for many years.

But when a process improvement team analyzed their actual recycling practices by spreading out the previous day’s rubbish on a tarp, they found that 70% of what was being sent to the landfill could be recycled. The company has since reduced offsite waste disposal by over 760 tons per year.

They did it by adding segregated recycling bins on carts that operators empty after every shift, defining new recycling procedures and re-training everyone, reducing the number of rubbish bins, and generally making it easy to recycle and inconvenient to toss stuff away. Supervisors have reinforced the recycling habit by making it a part of each work area’s weekly 5S audit. The percent of total waste sent to the landfill has fallen from more than 60% to less than 30%, and it’s still falling. Increased recycling has yielded $230,000 in annual disposal fee savings and recycling credits.

“It hasn’t been any additional work,” the environmental manager reports. “If you’re going through a kaizen event and you’re thinking about eliminating waste, it doesn’t take any longer to think about eliminating green waste as well as processrelated waste. It’s been embraced very positively by our employees.” Much of this company’s environmental progress can be attributed to changing how people think.

In addition to the seven wastes familiar to anyone applying lean manufacturing principles, trainers now talk about applying the three Rs (reduce, reuse and recycle) to the seven green wastes: energy, water, materials, garbage, transportation, emissions and biodiversity. Continuous improvement teams make the opportunities more visible by mapping the amount of energy and water consumed, the amount of scrap generated, and how much pollution is emitted at each stage of the value stream. After applying such techniques to analyze a part-washing line at one of the company’s plants, subsequent process improvements reduced water usage by 20% in the first year and by 55% to date, saving more than $114,000 annually.

I tour manufacturing facilities on a daily basis and see hundreds of opportunities like this one to extend waste-elimination initiatives to environmental priorities, and save money at the same time. Energy and waste disposal costs are only increasing.

Check your rubbish bins. You may be surprised to find how much money you are throwing away.

It’s impossible to write about industry and the environment without mentioning the oil still gushing into the Gulf of Mexico from BP’s ruptured well at press time. Blame will ultimately fall somewhere between a highly improbable series of unanticipated events, hubris and the global thirst for petroleum that encourages deepwater drilling. From more responsive abnormality management to redundant fail-safes and total risk analysis, this man-made ecological disaster will shape industry practices for decades to come and hopefully prevent such a natural and economic disaster from ever happening again.

Anand Sharma