Politics aside, sustainable practices make good sense

Most companies today are taking steps to improve the sustainability of their products and processes in response to both consumer and public pressure and impending regulatory requirements. No matter where you stand on the issue of global climate change, there are good business reasons to reduce energy usage, cut down on waste and look for sustainable components and materials as substitutes for their non-sustainable counterparts. Operations management and supply chain professionals are increasingly involved in leading their respective organizations on the path to more earth-friendly operations.

Sustainability is defined as the capacity to endure. For humans, it is the potential for long-term maintenance of well being, which in turn depends on the well being of the natural world and the responsible use of natural resources (per Wikipedia). For businesses, this means two things: Reduce usage of any and all resources to the minimum necessary, and wherever possible, use resources that are renewable.

On the first point, the hierarchy of waste reduction is as follows: reduce, reuse, recycle or reprocess, and finally responsible disposal. The ultimate waste reduction is to not use the resource in the first place. Operations management has long been focused on waste reduction, so this is nothing new. Modern management programs like Lean Manufacturing represent today's best practices in this area.

Second on the waste reduction scale is reuse. This effort is most evident in a move toward reusable packaging and containers. Many companies now use more durable packaging materials (crates, cartons, pallets) that can be used a number of times instead of just once. Recycling is familiar to everyone today. Companies now consider recycling and reprocessing possibilities in product design, making sure that the products can be conveniently disassembled at end of life so valuable materials can be affordably recovered for use in new products and to prevent toxic materials from entering the waste stream.

The economics of waste reduction can be impressive. Using fewer resources inherently lowers costs. And most recyclable materials can be sold, generating revenue while reducing waste collection and landfill costs. In addition, some consumers are very concerned about environmental issues and actively seek out products from "green" producers and are even willing to pay a premium for products that are documented as sustainable or "earth friendly." Being "green" is good for your company's image even if you don't offer these kinds of premium priced products.

The other side of sustainability is the use of renewable materials wherever and whenever possible. Renewable materials (forest products and recycled materials as replacements for petroleum-based materials, for example, such as recycled paper burger boxes instead of foam plastic) often cost more and/or don't perform as well as the non-renewable counterparts, but companies are becoming more willing to pay the price for three reasons — regulatory pressure, consumer demand, and because it's the right thing to do.

Don't forget in all of this that energy usage is a prime concern for environmental sustainability. Electricity generation accounts for half of the carbon dioxide produced, and carbon dioxide is the definitive "greenhouse gas" that is the focus of so much attention among the environmental community. Other large sources of greenhouse gases are heating and transportation. Energy conservation must be high on the list of any company seeking to become more "green." In addition to energy conservation efforts in the plant, office and store, transportation management and optimization can significantly reduce the miles driven and fuel used in getting products through the supply chain. One such effort is the intelligent planning of "reverse logistics" for returning recyclables and bringing raw materials back to the plant in the same trucks that delivered the product.

Education is Key to Resource Management

To a great extent, business success is a result of effective management of operations and resources.  That is the focus of APICS — the association for operations management — an international organization with more than 40,000 members. 

APICS is focused on education and professional development. Offering certifications in production and inventory management for manufacturing and distribution specialists and supply chain management (Certified Supply Chain Professional) which is valuable to professionals in fields as diverse as health care, retail, insurance, services, and logistics, APICS is dedicated to helping members and their companies better manage operations and get the most from all resources — people, equipment and facilities, materials, funds and trading partners.

APICS chapters throughout the world offer a professional development meeting that consists of either a presentation on an operations management topic or a plant tour. Recent topics in our local chapter include lean operations and six sigma quality, "green" energy management, capacity management, and the logistics infrastructure in China, among others.

The group also tours local plants and discusses the products, markets, and operations. At each of these companies, members are usually given a tour of the production areas and warehouses, learn about the company business and operations, and discuss their challenges and successes.

As an education-oriented association, APICS also offers classes on a wide range of operations management topics. There are programs leading to certification for individuals and others focused on operational improvements such as lean manufacturing and global sourcing. CPIM certification classes are offered through local chapters and colleges, and all classes and workshops are available on-site at host companies in the area, and at public scheduled sessions.

APICS members come from plant and warehouse operations, procurement, customer service, general management, logistics, information technology, and other business areas. The association publishes a magazine for members and offers a weekly newsletter to all (members and non-members) highlighting operations management issues in the news. For more information and to sign up for the newsletter, visit www.apics.org Many local chapters also publish newsletters with local activity schedules and items of interest.

APICS offers business professionals the opportunity to learn best practices in operations and resource management, enhance job performance and career advancement through education and certification programs, and helps companies advance productivity, innovation and competitive success.


Dave Turbide, CFPIM, CMfgE, CIRM, CSCP, is president of the Granite State chapter of APICS and vice president for education.  More information can be found at www.daveturbide.com.

A Capacity for Action

While this doesn’t seem logical, the “plan materials first, then check capacity” process has been with us since the 1960s, when MRP first was defined and computer resources were scarce and expensive.  Today, the computing power necessary to plan material and capacity simultaneously is readily available, as is the software to accomplish this feat in a relatively short period of time – mere seconds in many situations.  
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