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Greening for Future Growth: Leader Lessons in Profiting From End-of-Life Planning
Having
recently moved, I thought I could easily donate my two old computers.
Wrong. No one wanted them. I also have two old cell phones sitting in
the glove box of my car. They are now obsolete, and I have no idea what
to do with them. I had a bad experience with a flat-panel TV that
developed a black line across its screen on the day that the warranty
expired. I’d like to give it away-maybe even toss it out the window-but
how do I even throw it away? As a consumer, what do I do with obsolete
consumer electronics products as lifecycles become shorter and shorter?
We
all are familiar with the automotive answer: the acres and acres of
rusting cars beside the highways buried in automotive graveyards. When
the eyesore was just too much for the public to take, it became a great
platform for Lady Bird Johnson to launch her Beautification program.
Slowly this program led to the planting of trees, helping eradicate the
problem, albeit at public expense. Of course, there was no automotive
brand owner that stepped up to the plate to help solve this problem.
I
wonder if consumer electronics companies could establish better market
positioning if they took ownership of the product lifecycle from cradle
to grave. Should we not be designing our products for demanufacturing
and remanufacturing as we do for new product launch? Could this be an
advantage in product positioning?HP partners with the planet, Office Depot
Every
day that an obsolete item sits it loses value. The cell phones in my
glove box had more value when I placed them there than now, two years
later. On Friday, I received the 2006 Hewlett-Packard Global
Citizenship Report, a 107-page document on HP’s progress on social
responsibility. Its work on demanufacturing and remanufacturing caught
my eye.
HP introduced the Planet Partners return and recycling
program for LaserJet print cartridges in 1991. Here’s what’s happened
since:
* HP inkjet print cartridge return and recycling was introduced in 1997.
* Since 1997, 92 million LaserJet cartridges and 20 million HP inkjet
print cartridges were returned and recycled through its global
operations.
* In 2003, HP made it easier to recycle cartridges
by including a postage-paid, return-for-recycling envelope in products
sold in the United States and parts of Europe.
* Today, in many channels, customers are given coupons as a reward for recycling.
A
parallel program for computer hardware return and recycling began in
1987. In 2005, HP recycled approximately 70 million pounds of
electronic hardware in Europe, nearly 4 million pounds in Asia, and 40
million pounds in the Americas. Cumulatively, HP has recycled 757
million pounds of electronic products and supplies since 1987 through
this and other programs (details can be found on HP’s website). Its
goal is to recycle 1 billion pounds of electronic products and supplies
by the end of 2007.
Another example is HP’s partnering with Office
Depot to offer the first free, nationwide, in-store electronics
recycling program in the United States. In this program, 10.5 million
pounds of products were collected from 200,000 customers and
transported to one of HP’s U.S. recycling facilities.
HP is a leader
in redefining good engineering to include recyclability, making it
easier to recycle electronic equipment. As a result, in 2004 HP
introduced standards into its product launch process to do the
following:
* Focus on modular designs that can be removed, upgraded, or replaced
* Eliminate glues and adhesives through the use of snap-in features
* Manufacture plastic parts weighing more than 25g according to ISO
11469 standards to speed up materials identification efforts using
single plastic polymers
* Use molded-in colors and finishes instead of paint
Look
to the recyclability of HP’s print cartridges as a good example. Since
1992, the average number of parts in the monochrome HP LaserJet print
cartridge has been cut in half and the average number of plastic resins
by more than two-thirds. This redesign greatly improves HP’s ability to
remanufacture the print cartridges.
Big green?
My colleague Eric
Karofsky recently visited IBM’s Asset Recovery Center in Endicott, New
York. This center and others were originally built to ensure that when
excess, surplus, and scrap products from business channels needed to be
disposed of, processes met environmental compliance standards.
Today
the Endicott facility has become an essential part of IBM’s larger
social responsibility efforts. It is one of the regional asset recovery
centers IBM uses to manage end-of-life products. Annually, the facility
demanufactures and scraps 28 million pounds, producing 1.5 million
usable parts that are resold. More than 98% of this volume in the
demanufacturing process is recycled, with less than 2% of the materials
sent to landfills.
The Endicott facility looks like an assembly line
factory, but its intent is to demanufacture: to quickly, efficiently,
and safely disassemble finished goods to support downstream commodity
material value chains. The disassembly process focuses on reclamation
for the following:
* Part reuse, the harvesting of parts to
support internal IBM service organizations, or the resell of parts
externally. For example, do you know that one of your children’s toys
may contain a chip that came from the Endicott center reclamation
center, having been sold to a toy manufacturer?
* Precious metals that are reclaimed from printed circuit cards and components by specialized recyclers.
* Commodity type materials, like plastics and metals, that are processed by approved reclamation companies.
The
processes at the Endicott facility and the other asset recovery centers
help make IBM more socially responsible. The tightly controlled
recovery center also helps ensure that IBM is in compliance with all
regulatory requirements.
Green for greenbacks and customer loyalty
According
to the United Nations Environment Program, 20 to 50 million tons of
electronic waste are generated annually. WEEE, the European Union’s
directive regarding electronic equipment waste, is an attempt to
address the issue by making brand owners responsible for reclamation.
While the directive is rife with implementation problems, it is helping
propel the reclamation discussion globally. In the United States, this
subject is mandated at the state and federal level, with additional
initiatives cropping up globally.
Instead of being forced by
governmental directive, though, what if brand owners act now to learn
from early leadership in companies like HP and IBM? And as a part of
this redesign, shouldn’t we redefine the customer buying experience by
including this in brand positioning? The program needs to be developed
based on a joint value proposition that allows both to win: the
consumer needs to win by gaining easy disposal, and the manufacturer
needs to win through established and profitable processes for
remanufacturing. This change is pervasive, affecting the definition of
design for supply initiatives and how companies go to market.
Also
needed are collaborative systems for information and tools and support
systems for selling, donating, or recycling used computers and
electronics, much like eBay’s Rethink program
Customers are becoming
more green minded, increasingly showing buying preference to companies
that take this responsibility early. In the meantime, I’ll be here
dusting my obsolete objects.
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