Manufacturing Executive - November 2008 - (Page 42) pierfrancesco manenti/opinion Green Values ver the past decade, reducing the corporate environmental footprint has become an increasingly important challenge for many manufacturers facing scrutiny from governments, consumers, and industrial customers. But the manufacturing industry is not a newcomer to the idea of “going green.” For many manufacturers, the environmental agenda merely starts with legal mandates. Over the years, governments have issued increasingly stringent regulations that call upon high-emitting industries, such as chemicals, to implement Environmental, Health & Safety (EHS) point projects, which run at the operations or factory levels. And the European Commission has issued new environmental regulations requiring more pervasive implementations. Among them we find RoHS (Reduction of Hazardous Substances), which bans the use of six chemicals in almost all electronics products; WEEE (Waste Electrical and Electronic Equipment), which requires high-tech manufacturers to recycle and dispose of used products; EURO 5 (and the forthcoming EURO 6), which reduces the emission limits for passenger cars; and REACH (Registration, Evaluation, and Authorization of Chemicals), which requires registration for chemical substances imported or used when higher than 1 tonne. More and more companies are developing marketing campaigns about their green processes, products, and services. For some, the focus is more on promotion than achievement — often referred to as “greenwashing” — but regardless of how serious their green strategies are, manufacturers’ efforts have typically made only limited contributions to business performance and have not captured board-level attention. Lately, though, skyURTHER READING rocketing energy, fuel, and ARTICLES: raw material costs have t The Business of Going Green raised awareness of a rewww.managingautomation.com/green2 turn on green investments. t Going Green To measure the induswww.managingautomation.com/green try’s maturity level against 2008 o As green initiatives show ROI, they are rising in importance, from the operations and shop floor level to the heights of boardrooms. environmental challenges, IDC Manufacturing Insights launched a series of surveys in 2008 exploring green issues and covering Europe, Asia, and America. The results suggest that going green is moving beyond hype and becoming one of the most scrutinized strategies for differentiation and cost cutting. The vast majority of European companies responding to our survey consider reducing their environmental impact extremely important, and the numbers are expected to rise in the next couple of years. Companies in the European Nordic regions and the United Kingdom are particularly attentive to their environmental impacts, and Eastern European companies plan to cover the gap quickly. The survey results also indicate that the manufacturing industry is starting to see the ROI connected with going green; companies are progressively incorporating green initiatives into their mainstream strategy. Although the main driver for sustainability initiatives remains governmental mandates, business objectives such as “cost reduction” are growing as key drivers. And companies are moving away from greenwashing, as there is low interest in “reducing carbon emissions,” per se. This is not to say that effective communication is unimportant; on the contrary, improving one’s image is a way to augment the results of green initiatives. Among manufacturers’ most scrutinized initiatives are the prioritizing of supply chain greening efforts that provide ROI in terms of cost reduction in transportation and raw material sourcing, and the design of green products, as there is clear evidence that the introduction of greener products enables a faster ramp-up than traditional products and consumer awareness of climate change issues is starting to drive product selection. We have high expectations for manufacturing’s contribution to environmental impact issues. Nonetheless, as any basic business rules would suggest, no initiative would be launched just for its environmental benefits; it must also improve business performance. s Pierfrancesco Manenti is the EMEA research director for Manufacturing Insights, an IDC company. 42 November Photo courtesy: Manufacturing Insights F http://www.managingautomation.com/green2 http://www.managingautomation.com/green
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