Delivering More Value, Less Mass

Howard Brown

Is it possible to find the elusive environmental metric – an indicator that aligns environmental and business management performance?  I’ve seen many companies try and fall short with systems that are either too complex or so simplified they become useless. Metrics are important because they not only measure success, they also drive behavior.  They create incentives – some you intend, and some you don’t.  In short, you get what you measure.

A good illustration of this adage is the case of a manufacturer who sought my advice while launching a new initiative to measure environmental performance.  The client had begun tracking tons of scrap metal recycled, out of concern for the large amount of scrap being produced at their plants. When the plant managers learned they would be rewarded by recycling more scrap, scrap recycling quickly increased, and company managers thought they had a success on their hands.  As the tons of scrap recycled continued to grow, however, it eventually became clear that plant managers were paying too much attention to recycling scrap, and too little attention to minimizing scrap production in the first place.

I approached the problem from another angle, reflected in this simple principle: “If you don’t use it, you can’t spill it.”  My advice to management was to look at the total resource inputs (in tons) required by their manufacturing and delivery processes in relation to their output, or the product delivered to their customers.

If my client could reduce the mass of resources at the front end without compromising the value they delivered, they would not only reduce scrap use and improve overall environmental performance (due to fewer spills and emissions),but also reduce their purchasing, production and warehousing costs; the fuels used in manufacturing, transport and throughout the entire supply chain; the potential for fines related to environmental impacts and their carbon footprint, while enhancing brand value.

Any company grappling with measuring sustainability performance needs to measure inputs and outputs and then manage the relationship between these critical factors.  You can measure input in terms of total tons of fuels and materials required to source, produce and ship a product.  You need to think of output as value delivered – not units produced or revenue generated, but value delivered to customers.

The process of reducing the total mass required by your organization and your products while actually increasing the value of what you deliver is the key to creating business value in the 21st century.  Improving the relationship between resources used and value delivered is a simple way to align environmental performance and business performance.   In an increasingly crowded, unpredictable and polluted world with a diminishing resource base, this is the future of business and the future of environmental management.

What do you think?  How can you improve a product or process to deliver the most benefits to people with fewest tons of resources?

 

About Howard Brown

Howard Brown is co-founder of dMASS Inc. and chairman of o.s.Earth. For more than 20 years as CEO of Resource Planning & Management Systems Inc., he worked with companies such as Duracell, General Electric Co. and Whirlpool Corp. to establish or enhance their environmental practices and performance. Follow him on Twitter at @BrownHowardJ.

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3 Comments
  1. Tse-Sung Wu

    December 3, 2010

    The idea of using a materials or mass balance or accounting to aid in eco-efficiency makes good sense. The idea of delivering more value with less mass is very interesting (one extreme is Second Life).

    However, an important characteristic that deserves attention is the relative inherent hazard of the mass. In research I conducted during graduate school, I found, for instance, that while the total mass of emitted Toxic Release Inventory materials decreased from 1987-1991 as expected, the mean relative toxicity appeared to rise. People were dematerializing as one might expect. But apparently they were replacing large quantities of less toxic materials with smaller quantities of more toxic materials.

    I agree that large examples of waste are the low hanging fruit that need to be picked; however, let’s not forget that some types of waste is more harmful, pound for pound, than others.

    A hazard-weighted measure of waste might be more useful for decision making (a pound of Pb dust is worse than a pound of Fe). And this can be hazard writ large: it can be the inherent relative toxicity of the material or the ecological footprint associated with procuring, processing and providing the material (the footprint of a gallon of water delivered in S. CA is bigger than in Seattle).

  2. Howard Brown

    December 6, 2010

    Tse-Sung Wu made a really important point regarding the problem of achieving mass reduction with toxic substances and I have written some about it in the book I’m working on.

    The simple answer is that mass reduction is an imperfect indicator of environmental performance because there is no such thing as a perfect one. The world is far too complicated to be summed up in one number. But I spent years working in companies of all types trying to identify the best metric I could.

    I concluded that resource performance measured by a ratio of mass to delivered benefits was the most comprehensive approach I could find. No other approach to metrics seems to provide an overall indication of as many important factors. More specifically, we can think of toxics this way. In the coming years, as we learn to more precisely measure mass performance, the use of toxics could be accounted for as a negative benefit.

    For example, if the point of an alkaline battery is to deliver the most possible portable KWH to customers safely and reliably, mercury and lead could certainly be considered to be benefit reducing substances. Lastly, I think that as nanotechnology and biomimicry become more central in product design as a way of targeting and delivering function/value with minimum mass, the use of toxics could decline as an issue.

    We are already seeing their potential to eliminate major sectors of toxic substance manufacturing and transport.
    A few examples are window surfaces that clean themselves with rainwater, carpet stabilizers that don’t need toxic adhesives, and kitchen counter surfaces that don’t need antiseptic cleaners because they retard quorum-sensing communications among bacteria.

    HB

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