Forum “Greening ICT
Supply Chain”
Life Cycle Management in
the value chains - UNEP's
activities worldwide
Sonia Valdivia
Oficial de Programa
UNEP DTIE
Tom Swarr
Five Winds International
Overview
Introduction
Life Cycle Management &
the Capability maturity model
Next steps
LCT and the 3 pillars of the sustainability
Sustainable development
“meets the needs of the
present …
…without compromising the ability of
future generations to meet their own
needs.”
Life Cycle Management
UNEP and SETAC (2012)
Why Life Cycle Approaches?
Adapted from Fava (2011)
Life cycle challenges and
opportunities
Environmental and
social impacts
80% of current management effort covers only 20% of the
available opportunities for value creation
hig
h
Upstream
Opportunities:
Building up better
alliances with suppliers
, access to
limited resources,
stability of supply, etc.
Downstream
Opportunities:
Customer satisfaction
and loyalty, improved
brand image, etc.
Opportunities for value
creation through
environmental and social
responsibility
low
Production
Transportation
Manufacturing/
Processing
Retail
Consumption
Product Chain
Disposal
Source: Adapted from WWF-UK 2003
6
Economic benefits of applying LCA based
approaches
20
Figures based on real cases
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, 43000 t of plastics, 57000 t of cardboard,
and several millions of dollars in transportation costs over 3 years
Every 1$ spent on sustainability saves 2$ in operating costs.
Bloomberg’s sustainability efforts have resulted in over 25M$ in net
savings in 2008.
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)
Imola Bedő
Most of the top 500 companies listed in Forbes are using LC based tools
Metrics
/ chaotic
/ qualified
/ efficient
No metrics
Binary , Yes – no
Legal compliance
Procedures in place
Process, Inputs/outpu
Efficiency, prevention
Waste minimized
/ effective
Life cycle perspective
Integrated across
Value chain
New markets/produc
/adaptive
Sustainability,
Resilience
Focus on capital
Preservation & longTerm prosperity
Alignment with ISO 9000 and
14000
- 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
ACTION LEARNING
Scope
Business case
Socio- technical
system
Enhanced well beingsustainable prosperity
Value chain
Stronger balance sheetlong- term competitive
advantage
Enterprise
Top line growth - Innovative
products, new markets
Facility
Bottom line gainsefficiency, cost reduction
Unit operation
Risk avoidance- Legal
compliance
Qualified: implement basic procedures to protect
people and the environment
Management commitment
End-of-pipe measurements:
-Waste
-Air emissions
-Water discharges
Identify key measurement
Gaps for next cycle?
-Corrective actions
-Working rules
-Employee training
Sources of learning:
-Inspection reports
-Root-cause
Analysis?
Legal compliance
Risk avoidance
Teaching on:
-Compliance
-Basic procedures
(e.g. planning)
Efficient: upgrade procedures
Management commitment
Identify performance gaps
that require redesign/innovation?
-Management
&monitoring plan
-Employee
development plan
-Report performance to
public
Process efficiency
Eliminated waste
Sources of learning:
- Management system results
-Define KPIs and targets
-Assess training & development needs
Facility approach
(Input/output):
-impacts
-energy consumption
-water balance
-toxic chemicals use
Risk assessment to set priorities:
-Risk assessment
-Pollution prevention
-Waste minimization
Effective: Life cycle thinking in progress
Management commitment
Identify key external barriers
For enhanced well being
Reporting involving
Stakeholders and the
Value chain:
Ecolabels, EPDs,
Green marketing &
Stakeholder
Engagement plan
Annual program review:
-Resources use reduction
- Extend KPIs to value
Chain
-Trend analysis
- Stakeholder feedback
New markets
Innovative products
Value chain perspective:
-hotspots and impacts
-scopes 1,2&3 GHG
-water footprint
LCA/LCM training:
-Ecodesign/design for
environment
Adaptive: becoming a mean towards SCP
Management commitment
Co-create new markets for
Enhanced well-being
-Sustainability management
System
-Public reporting
(transparency)
Sources of information:
-Stakeholder review
performance
-Baseline sustainability
assessment
Focus on capital
Preservation & longTerm prosperity
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
Adaptive: becoming a mean
towards SCP
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
http://www.avnir.org/documentation/congres_avnir/LCMacademylast.pdf
http://lcinitiative.unep.fr/
Merci!
Contact
• E-mail: ilci@unep.org
• Sonia.valdivia@unep.org
•
Value chain (ISO 26000)
The entire sequence of activities or parties that
provide or receive value in the form of products or
services (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!