Lean and Green: Profit for Your Workplace and the Environment

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When it comes to believing that business can be profitable and environmentally sensitive, cynics abound on both sides. But in Lean and Green, Pamela Gordon proves that capitalism and environmentalism are not mutually exclusive-quite the contrary. She shows how "green" business practices enable organizations to save millions, even billions of dollars each year. Lean and Gree chronicles over one hundred examples of how people in twenty different organizations around the world-from clerks, farmers, and city employees to chemists and executives-have strengthened environmental practices and the balance sheet. She details waste-saving, profit-building acts as basic as Linda Gee at LSI Logic digging out usable pre-worn shoe covers to wear in the clean room, and as broad as the city of Santa Monica paving residential streets with white top to reduce urban heat and increase surface longevity. Drawing on her background as a leading business consultant, Gordon shows readers precisely how to sell their environmental ideas to management. She describes how to make the case in no-nonsense business terms, set concrete goals that the new practices will achieve, measure the economic results of the new practices, and make sure the right people hear about the results so that environmental initiatives continue. Each chapter includes a "Making It Easy" list of action steps for implementing lean and green improvements in the workplace easily and immediately. Lean and Green will inspire employees and employers alike to explore creative ways to simultaneously save the planet and bolster the bottom line.

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1 Question Wasteful Practices

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The groundswell associated with the environment is changing industry. Employees who completed school 10 and fewer years ago ask their managers, “Why are we doing such and such a thing?” They’re bringing in waste-reduction ideas.

—Ian McKeown, senior engineer
of Health, Safety, and Environment, Polaroid

THIS chapter focuses on the first of the four Lean and Green steps: Question wasteful practices, and design Lean and Green steps to benefit profit and planet. Get people in your organization to think creatively to arrive at Lean and Green solutions; for the most dramatic benefits, encourage them especially to think about steps before waste is created. Many of the Lean and Green companies’ best ideas for cost savings and environmental good come from employees without “environment” or “manager” anywhere in their titles. Let your creativity soar. Your idea could save money, trees, or likely both.

One of the reasons I wrote this book is to make more people aware of the tremendous impact organizations can have on the planet and its inhabitants’ health—both positively and negatively. Think about this: You and I can reduce waste at home and recycle our newspapers, cans, bottles, and paper. In fact, doing so happens to be my favorite household chore because I know that these items will not contribute to local landfills, which in my community are filling up the beautiful San Francisco Bay. Yet you and I can reduce the use of landfills and incinerators in several communities—perhaps around the world—when we create waste-reduction strategies for our organizations. This truly is a faster and more effective way to curb and reverse the trend on our planet to waste more and more resources.

 

2 Gain Lean and Green Endorsement Using Business Language

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We want to improve quality of life by means of our products and services. The usual business approach for quality of life is short term—generating profit in the year and earning annual bonuses. From a long-term perspective, however, quality of life means going for a sustainable society. It’s important to translate sustainability into pragmatic business achievements over the years, such as defining a waste reduction goal of 28 percent that yields savings of 250 million Dutch guilders and designing green products that win greater market share.

—Henk de Bruin, manager,
Corporate Environmental and Energy Office, Philips

I HOPE that Chapter 1 inspired you to create several ideas for exchanging polluting, wasteful practices for cost-reducing ones. The second Lean and Green step is to gain endorsement for Lean and Green ideas using business language. Introduce your environmental points with profit in mind—starting with strategies that yield the highest rewards to profit and planet.

Before you started reading this book, you may already have been convinced that your organization could be kinder to the environment and benefit from the associated cost savings or new sources of revenue. But if it seems to you that getting management’s approval for your Lean and Green ideas is like pushing a boulder up a steep hill, this chapter is especially for you. Here I offer practical approaches to convincing management to be leaner by being greener. I also tell you how to avoid discouraging your organization from being Lean and Green: you’ll find out which tactics are uninspiring and convince few managers to change their positions.

 

3 Collaborate to Achieve Lean and Green Goals

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The dream and the beliefs are at the corporate level and they trickle down to us. Nothing could be effective if we didn’t all believe in the same thing.

—Barney Little, general manager, Horizon Organic Dairy

ACHIEVING Lean and Green goals is not a lonely process. In this chapter, get an overview of the third Lean and Green step: Collaborate throughout the organization to meet Lean and Green goals. If you can, first get your organization’s senior leaders to support the Lean and Green way of improving the company’s profitability while helping to restore natural resources for the coming generations. Then motivate people throughout your organization to create and implement Lean and Green solutions.

Your organization will move faster toward becoming Lean and Green if you first obtain buy-in at the top. Water flows most easily downhill, and so do organization-wide directives. Once your leaders endorse the goal of using fewer resources, which will reduce costs and preserve the health of the planet, employees will follow suit—not only because they hold the planet dear, but also because they want to do well in their jobs.

 

4 Track Progress for Environment and Profit

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The successful companies are those who can relate environmental changes to business performance. Upper management has to meet financial analysts’ projections, as well as see the big picture—meeting quarterly goals five years from now.

—Walt Rosenberg, director of
corporate environmental affairs, Compaq

THE fourth of the Lean and Green steps measures and enforces all the progress you’ve made in the first three: Measure your organization’s Lean and Green progress, and strive continuously to improve. See that the Lean and Green steps your organization is taking are truly healthful both for planet and for profit, and keep raising the bar.

Here are three good reasons you should track the environmental progress your organization is making, along with the money being saved or earned:

I really want you to take this step of measuring your Lean and Green results, whether you are fluent in accounting and love business ratios or are intimidated by databases, profit-and-loss tables, and comparison charts. Why? Because most of your managers are in the former category, and it’s critical to demonstrate to them—with the data they respect—that environmental steps also make sense for the business’s bottom line. I want you to be successful in conveying your Lean and Green recommendations.

 

5 Make a Commitment to Being Lean and Green

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We made our environmental goals big, because of their direct effect on reducing costs.

—Paul Gowen, corporate environmental specialist,
Texas Instruments

HOW many times have you heard, “Be careful what you ask for… you might just get it”? I hope you’ve heard it many times and have found—as I have—that it tends to be true. Developing a two- to three-sentence policy about your organization’s commitment to a healthy environment, and getting the policy approved by top management, goes a long way toward making your policy a reality. A policy statement provides all employees with a vision, declares your stance to customers and the community, and starts the process of real savings for the environment and your organization.

This chapter’s nuts-and-bolts examples of how to develop and begin implementing an environmental policy will help you make Lean and Green steps 2 and 4 work at your organization: gain endorsement using business language, and measure your Lean and Green progress.

If your organization’s chief has not yet created an inspiring environmental policy to focus the entire organization on Lean and Green practices, you can start the process by drafting a policy, running the draft by stakeholders, then getting top management to endorse it. Yes—even if you don’t have a master’s degree in policy (I certainly don’t), you can manage to draft a two- or three-page statement. Use these guidelines:

 

6 Set Up an Environmental Management System

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Use a holistic approach to environmental management that focuses on people. You have to keep people motivated; it helps when they see that our company is supporting them to get involved in the environment as much as they want. Then employees begin to say, “Our company really cares about the environment.”

—Danny Martland, environmental advisor,
British Aerospace

HAS anyone ever accused you of saying the right words but not following through with action? I received this reprimand a few times during childhood, and it stung. If you haven’t been on the receiving end of this accusation, you probably have made or heard accusations about leaders or organizations being “all talk and no action” when it comes to valuing customers, treating employees well, or caring about the environment.

An insincere commitment to the environment stings not only the leader or organization who uses the “nice” words, but also the environment itself. And the consequences of wasting resources and failing to reduce pollution can be irreparable: lost species of plants and animals and an ozone beyond repair. By the way, to achieve the financial benefits of the Lean and Green promise, an organization also has to follow through on environmental words with effective results.

 

7 Meet and Exceed Customers’ Expectations for Environmental Practices

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Our market studies have indicated that environmental performance of our products rated “important” or “very important” in the buying decisions of customers in specific countries.

—Corky Chew, manager of environmental technologies
and strategies, Apple Computer

IT’S likely that some of your best current and prospective customers require you to follow certain environmental practices. You can assure management that if your customers have not yet asked about your organization’s green policies, they will. Don’t be caught unprepared. Your organization can protect current revenues and grab future sales by being on your customers’ lists of suppliers after that list has been environmentally pruned.

My friend and fellow writer and consultant Byron Swinford asked me recently if I fear that the change from a Democratic to a Republican presidential administration will affect organizations’ environmental practices. I was pleased to tell him that I’m not especially concerned—because of the very point made in this chapter: The world’s leading customers now are more environmentally demanding of their suppliers than are government regulations.

 

8 Translate Green Practices into Revenues

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If you consider the total cost of one TV set from production, through ownership, to the end of ownership, only 15 percent of the cost is associated with manufacturing; 85 percent comes from electricity and other running costs. So from a global perspective, when Sony designs and manufactures TV sets that consume less electricity during ownership, Sony is contributing more to overall energy savings.

—Nobuyuki Watanabe, vice president,
Corporate Environmental Affairs, Sony

CUSTOMERS like to save money; there is little doubt about that. Whereas some people are willing to pay more for green products—for example, a majority of Americans say they would spend more to buy energy-efficient kitchen appliances or a vehicle with higher fuel economy (according to Oxygen TV’s web site, www.oxygen.com, January 2001)—some are not willing to pay more. The good news is that green products often do save customers money because they use fewer materials in the product, generate less waste during manufacturing, and cost less to operate. Now that’s a point that sets on shaky ground the myth that businesses can be only Lean or Green.

 

9 Design Resource Savings into Products and Processes

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Pushing technology is one of the main ways to achieve profitable environmental steps—to become a leading-edge user. Even though Kyocera may have to pay a higher price for designing such technology, investing early gives Kyocera an early return.

—Hisashi Sakumi, general manager,
General Affairs Division, Kyocera

THE Lean and Green ideas that most benefit the environment and your organization’s profitability are those implemented at the early stage of product or process design. “Designing for the environment” means thinking environmentally early in a product’s lifetime—at the time of design. It is at this early stage that environmental problems or waste can be avoided before they occur. Thomson Multimedia’s Michel Compérat says, “I prefer to work at the origin of the pollution.”

The benefits of solving environmental issues at the design phase, according to Diana Lyon at IBM, number at least three:

Read on to see numerous examples of early design changes that reduced forever the need for precious natural resources, unnecessary purchases, and hazardous materials.

 

10 Reduce: The Best Strategy in the RRR Trilogy

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Conventional rhetoric, propagated by the chemical industry, is that if all farms went organic, the world would starve because of lower yields. We’ve proved that we are just as productive without using antibiotics, hormones, or pesticides.

—Barney Little, general manager, Horizon Organic Dairy

I CALL “reducing, reusing, and recycling materials” the RRR trilogy for Lean and Green results. Chapters 10, 11, and 12 describe how this trilogy spawns dramatic profit and environmental benefits through Lean and Green step 1: Question wasteful practices, and design Lean and Green steps to benefit profit and planet. Why reduce, reuse, and recycle? Because these activities diminish organizations’ impact on the planet and save or earn money.

Of the RRR Trilogy—reduce, reuse, and recycle—reduce should be your first choice for profit and planet, because even better than purchasing an item and reusing or recycling it is not having to purchase it in the first place. “At Philips, we say less is better,” says Henk de Bruin. “Less is better means that we can achieve more functions and intelligence in our electronic products with less material. Less is better also means that you can deliver a higher-value-added product.”

 

11 Reuse: The Second Best Strategy in the RRR Trilogy

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We’ve added nothing to the landfill for eight years, except when disposing of a plating line or tank after we’ve cleaned it.

—Nirmal Singh, director,
Environmental, Health, and Safety, ITT Cannon

WHEN I was in high school, a friend repeated to me what she had learned at her Mormon Church: the Earth can support unlimited human population growth if each family lives on and cultivates one acre of land. I remember wondering how it would be determined which family was assigned a plot in Death Valley and which received one in the south of France.

In reality, we humans are not equally dispersed around the planet. Where masses of us live, our natural resources are growing scarce, landfills are choking precious land and waterways, and air pollution from incineration and the generation and consumption of power is contributing to breathing disorders. By 2010, it is expected that 75 percent of the U.S. population will live within 50 miles of a coastline (according to Christopher J. Evans, executive director of the Surfrider Foundation, January 2001). This many millions of people will not be able to share the land without reducing, reusing, and recycling resources.

 

12 Recycle: The Third Best Strategy in the RRR Trilogy

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Any of our customers can send back to us anything LSI sends to them, including packaging materials and semiconductor chips. We see that these materials are easily recyclable.

—Linda Gee, environmental director, LSI Logic

RECYCLING materials is great for Lean and Green—but only if you really needed to buy the materials in the first place and can’t reuse them in their current form. Read why, from both an environmental and a business perspective, recycling is the third choice in the RRR trilogy.

Nonetheless, you and your organization can greatly reduce contributions to landfill and incineration by recycling materials. And I trust that after reading Chapters 10 and 11 you will be reducing the amount of material that leaves your facility and reusing most of the rest!

You can recycle all kinds of materials: raw materials and finished goods, solid substances and liquids. Read on for example after example of revenue-producing recycling that otherwise would have been waste for planet and pocket.

Recycle Solid Waste The most profitable recycling scheme I found among the 20 Lean and Green organizations was at Louisiana-Pacific, which generates $26 million of revenue each year for selling by-products that otherwise would have been waste. The Hines, Oregon, facility I toured—one of the smaller mills—earns $200,000 from selling what otherwise they would have to pay to dispose of.

 

13 Persuade Business Partners to Be Lean and Green Allies

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We try to drive our costs down through the environmental section of our supplier rating system.

—Danny Martland, environmental advisor, British Aerospace

THE Lean and Green promise that cost savings and environmental health are nearly completely compatible is based not only on steps your organization takes, but also on steps taken by your suppliers and the companies you acquire. Use appropriate-to-business arm twisting to get all your business partners to meet environmental specifications. Smart green practices used by your business partners can reduce their costs, and allow your organization to pay lower prices for those products and services.

Also, reduce the risk of being negatively associated with business partners whose practices are not Lean and Green. Partners who waste and pollute not only pass the buck—which harms your organization’s reputation—but also harm the natural environment in another community or global region. And it is one planet.

In NEC’s definition of a “green product,” suppliers share the center stage: “The product is designed to minimize its impact on the environment throughout its life cycle, and the management of the supplier company is active in pursuing environmental protection.” Harry Reid at Agilent says, “We and many of the large companies here in Scotland worry about our supply-chain management. We need to be not only socially responsible to our community, but also sure that our suppliers are responsible.”

 

14 Make Your Buildings More Energy-and Cost-Efficient

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Santa Monica now uses 100 percent renewable energy sources for electricity. The cost exceeds conventional electricity sources by approximately 5 percent, but the city has reduced electricity use through efficiency by 12 percent, so the monetary gain is still significant.

—Dean Kubani, senior environmental analyst,
City of Santa Monica

REGARDLESS of what product or service your organization provides, chances are that your organization leases or owns at least one building. If that’s the case, or even if you work from home, you have lots of opportunities to make your organization Lean and Green starting right where you sit during the workday. According to World Watch Institute, the construction, operation, and demolition of buildings collectively consumes up to 4 percent of the Earth’s energy and other natural resources.

Green buildings make financial sense not only because they save money, but also because they meet ever stricter government regulations and incentives. San Francisco is an example of a city with a municipal code that establishes resource efficiency requirements for city-owned facilities and city leaseholds. The city of Austin, Texas, created a green builder program, which has worked to encourage builders in the community to take environmental measures during building design and construction.

 

15 Become an Environmental Leader in Your Organization

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By training, educating, and empowering employees at all levels of our organization, Louisiana-Pacific will exceed environmental compliance standards.

—Mark Suwyn, CEO,
Louisiana-Pacific Corporation

I WANT to start the last part of this book by convincing you that environmental leadership will contribute to creating a Lean and Green organization more quickly than isolated actions by individuals.

Before you get frustrated and say, “But the leader of my organization is not really interested in what’s good for the environment,” realize that you can be an environmental leader, whether you are the head of your organization or you support the organization in any function and at any level. As the leader, you can make Lean and Green step 3 happen: Collaborate throughout your organization to meet Lean and Green goals.

Many of the Lean and Green organizations I visited have at their apex organizational leaders with the environment close to their hearts. (If this is not the case in your organization, be sure to read this chapter’s next section, “When You Are an Environmental Leader.”) Is it by coincidence or design that these leaders’ organizations are truly Lean and Green? You decide, after reading these examples of environmental leaders:

 

16 Work with Your Organizational Culture to Support Change

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As Intel grows, the importance of the environment snaps out at us. You better have your culture right when you’re growing this fast or you’ll have problems.

—Larry Borgman, director,
Environmental, Health, and Safety, Intel Corporation

EACH of the 20 Lean and Green companies has a unique company culture, just as your organization has. I witnessed repeatedly that the fastest way to make an organization Lean and Green is to adapt proven environmental steps to the existing organizational, regional, or industry culture—thereby minimizing resistance to change. Employees’ messages will be heard and understood when framed in the culture known by their peers and management.

“But my organization’s culture will never embrace environmental practices,” some of you are thinking. As you’ve read so far, however, not all of the 20 Lean and Green companies were always Lean and Green. Cultural change can be necessary to resolve an organization’s damaging practice environmentally.

In this chapter, learn how to use the best of your organization’s culture—and those of your job function and geographic region—to make fast progress in Lean and Green steps 2 and 3: Gain endorsement for Lean and Green ideas using business language, and collaborate throughout the organization to meet Lean and Green goals.

 

17 Be an Environmental Activist Using Tactics That Benefit Business

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I continually challenge the norm. People would say that the vast number of changes here is not because of my intellectual or technical impetus, but because I challenge people at the forefront.

—Harry Reid, facilities manager, Agilent Technologies

AN ACTIVIST is someone who takes positive, direct action to achieve a goal. You can apply your talents to becoming an environmental activist whose tactics are good for business, as these people did:

In this chapter, learn how presenting a business case with conviction is the best way to activate Lean and Green practices in your organization, and how using language that management respects is far more effective than using detraction tactics. You’ll make significant progress along steps 1 and 2: Question wasteful practices and gain endorsement for Lean and Green ideas using business language.

At your organization you may need to use business-appropriate scare tactics to sell environmental ideas to management. Some of the following tactics from the Lean and Green champions may fit your organization’s situation beautifully; others may inspire you to create tactics that work where you work.

 

18 The Fastest Route to Lean and Green

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First, stop thinking of “the environment” and “profitability” as two separate entities. For a company to be successful you have to stop the divisiveness. They automatically marry.

—Bill Brunson, facilities manager, Apple Computer

YOU’VE read more than a hundred Lean and Green success stories, chronicling environmental steps taken by organizations ranging from dairies to semiconductor companies and resulting in millions of dollars of savings and earnings. Now, where do you start at your workplace and other organizations you’d like to influence? As you read this last chapter, let the Lean and Green champions inspire you one last time to do all you can for the success of your organization and a healthy, thriving natural environment.

Let’s give our Lean and Green champions some final words about how we can make our organizations Lean and Green. Notice that woven throughout their recommendations are all four Lean and Green steps.

IBM’s Diana Lyon summarizes four main strategies for green and profitable solutions:

 

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