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Life Cycle Management in the value chains - UNEP's activities worldwide Sonia Valdivia Oficial de Programa UNEP DTIE Tom Swarr Five Winds International.

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Presentation on theme: "Life Cycle Management in the value chains - UNEP's activities worldwide Sonia Valdivia Oficial de Programa UNEP DTIE Tom Swarr Five Winds International."— Presentation transcript:

1 Life Cycle Management in the value chains - UNEP's activities worldwide Sonia Valdivia Oficial de Programa UNEP DTIE Tom Swarr Five Winds International Forum Greening ICT Supply Chain

2 Life Cycle Management & the Capability maturity model Introduction Overview Next steps

3 LCT and the 3 pillars of the sustainability …without compromising the ability of future generations to meet their own needs. Sustainable development meets the needs of the present …

4 Life Cycle Management UNEP and SETAC (2012)

5 Why Life Cycle Approaches? Adapted from Fava (2011)

6 Life cycle challenges and opportunities 6 80% of current management effort covers only 20% of the available opportunities for value creation Opportunities for value creation through environmental and social responsibility Upstream Opportunities: Building up better alliances with suppliers, access to limited resources, stability of supply, etc. hig h low Environmental and social impacts Product Chain Disposal ConsumptionRetail Manufacturing/ Processing TransportationProduction Source: Adapted from WWF-UK 2003 Downstream Opportunities: Customer satisfaction and loyalty, improved brand image, etc.

7 20 Xerox saved 400M $ in 2009 by implementing D4E (=LCA) Some of Wall-Mart suppliers saved up to 71% of their annual energy bill by implementing the Wall-Mart footprint approach Through implementation of LCA results, detergents producers in US saved over 1.8 Mm3 of water, t of plastics, t of cardboard, and several millions of dollars in transportation costs over 3 years Every 1$ spent on sustainability saves 2$ in operating costs. Bloombergs sustainability efforts have resulted in over 25M$ in net savings in By implementing Life Cycle Management principles, 3M has saved over 1.2 billion $ over 30 years Philips uses LCA as an eco-innovation tool to develop their green products. From 2007 to 2010 they increased their sales of green products of about 50% (from 20 to 38% of total sales) Most of the top 500 companies listed in Forbes are using LC based tools... Economic benefits of applying LCA based approaches Figures based on real cases Imola Bedő

8 No metrics Binary, Yes – no Legal compliance Procedures in place Process, Inputs/outputs Efficiency, prevention Waste minimized Life cycle perspective, Integrated across Value chain New markets/products Sustainability, Resilience Focus on capital Preservation & long- Term prosperity Metrics / qualified / efficient / effective /adaptive / chaotic

9 - Management system approach - Continual improvement - Monitoring plan - Adapted to current level of organizational capability - Multiple P-D-L-A Cycles - Gradual expansion system boundaries for added capability and enhanced business value Alignment with ISO 9000 and 14000

10 ScopeBusiness case Socio- technical system Enhanced well being- sustainable prosperity Value chainStronger balance sheet- long- term competitive advantage EnterpriseTop line growth - Innovative products, new markets FacilityBottom line gains- efficiency, cost reduction Unit operationRisk avoidance- Legal compliance ACTION LEARNING

11 Management commitment Qualified: implement basic procedures to protect people and the environment End-of-pipe measurements: -Waste -Air emissions -Water discharges Teaching on: -Compliance -Basic procedures (e.g. planning) Sources of learning: -Inspection reports -Root-cause Analysis? -Corrective actions -Working rules -Employee training Identify key measurement Gaps for next cycle? Legal compliance Risk avoidance

12 Management commitment Efficient: upgrade procedures Facility approach (Input/output): -impacts -energy consumption -water balance -toxic chemicals use Risk assessment to set priorities: -Risk assessment -Pollution prevention -Waste minimization Sources of learning: - Management system results -Define KPIs and targets -Assess training & development needs -Management &monitoring plan -Employee development plan -Report performance to public Identify performance gaps that require redesign/innovation? Process efficiency Eliminated waste

13 Management commitment Effective: Life cycle thinking in progress Value chain perspective: -hotspots and impacts -scopes 1,2&3 GHG -water footprint LCA/LCM training: -Ecodesign/design for environment Annual program review: -Resources use reduction - Extend KPIs to value Chain - Trend analysis - Stakeholder feedback Reporting involving Stakeholders and the Value chain: Ecolabels, EPDs, Green marketing & Stakeholder Engagement plan Identify key external barriers For enhanced well being New markets Innovative products

14 Management commitment Adaptive: becoming a mean towards SCP Product system: -socio-economic profile -sustainability index for production systems -market barriers - Stakeholder assessment Action learning: -System innovation -Public private Partnership to overcome market barriers Sources of information: -Stakeholder review performance -Baseline sustainability assessment -Sustainability management System -Public reporting (transparency) Co-create new markets for Enhanced well-being Focus on capital Preservation & long- Term prosperity

15 Adaptive: becoming a mean towards SCP

16 UNEP/SETAC: Next Steps Conduct Phase 2 pilot to validate with quantified benefits Refine self- assessment protocol & assess integration with MNC supply mgmt Refine training materials and deploy to internal (MNC) and external (local network) trainers Confirm ability of SME suppliers to plan their own improvement programs & balance local/ global sustainability objectives


18 Merci! Contact

19 20 The entire sequence of activities or parties that provide or receive value in the form of products or services (ISO 26000) Value chain (ISO 26000)

20 Benefits of Capability Approach Global companies – Extend supply chain programs to a much broader base than practical with internal staff – Focus company programs on strategic partners, material issues – Leverage previous investments in lean manufacturing SME suppliers – Faster learning, more successful projects – Framework to rationalize competing requirements of customers & develop a more cohesive improvement strategy – Facilitates integration of life cycle issues into existing procedures, routines – Local sustainability Communities – Emphasis on localized decision- making ensures action aligned with significant environmental issues and development priorities – Job creation (better jobs) for organizations to support suppliers locally Capable suppliers, vibrant communities, and resilient value chains!

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