Sustainability and the supply chain: three companies offer solutions
You don’t usually hear companies advocate for more regulation, but Stephen Segebarth is convinced that’s what it will take to improve sustainable practices in the glass manufacturing business. Segebarth was one of several corporate experts who came to Krannert Oct. 5 to share information and insights during the Fall Operations Conference on Sustainability.
Industry leaders, faculty and students discussed challenges and opportunities for businesses when it comes to improving sustainability in supply chains. The conference was hosted by the Dauch Center for the Management of Manufacturing Enterprises and the Global Supply Chain Management Initiative at Purdue University.
Segebarth discussed the unique challenges of glass bottle manufacturing and the importance of recycling to sustainability. Seventy percent of glass that is currently recycled and used to make new bottles comes from just 10 states that all have bottle-bill legislation, according to Segebarth, senior vice president for government relations, regulatory affairs and law at Verallia North America. “That’s why I’m out advocating for bottle-bill legislation,” he says.
The legislation calls for a deposit on glass, metal or plastic bottles, which is returned when the consumer brings the bottle back for recycling. Currently about 3 billion glass, aluminum and plastic containers go to landfills each year at a cost of $60 million. “We are the market for recycled feedstock. We will buy all we can get. We can’t get enough.”
When 10 percent recycled glass is used in the manufacturing process, energy usage drops two to three percent and emissions are reduced. The key to sustainability and competitiveness for glass manufacturers is collecting glass for recycling and making sure it gets back into the manufacturing cycle.
“American citizens have bought into the idea of recycling. Our problem, for the most part, is the lack of infrastructure for dealing with recycling,” Segebarth says. “My view it bottle bills can provide the foundation and funding.”
Although recycling may be the answer for the glass industry, Subaru of Indiana Automotive, Inc. has found that eliminating waste and avoiding disposal issues altogether works better in vehicle manufacturing.
Located in Lafayette, Indiana, SIA is a zero landfill automobile manufacturer, the first automotive assembly plant to receive that designation. Nothing from the manufacturing process is sent to a landfill. “If you had a cup of coffee this morning and threw that cup away, you’ve already put more into the landfill today than our entire facility,” says Tom Easterday, executive vice president, secretary and general counsel for SIA, Inc.
“Recycling is not very cost effective,” Easterday explains. “If you don’t create the waste in the first place, you don’t have to worry about disposing of it and the energy associated with disposing of it.” SIA’s top two strategies for eliminating waste involve associate ideas and suppliers willing to make adjustments.
Using the Japanese philosophy of Kaizen, which focuses on continuous improvement, SIA solicits ideas from all employees and changes procedures based on those suggestions to reduce waste and conserve energy. “We want to make sure we continue to reduce the waste we put into the land and the air and the water,” he says.
Using suppliers that are located within a two-hour delivery radius, SIA also asks its suppliers to eliminate unnecessary packaging and invest in plastic containers rather than cardboard, so containers can be sent back on return trips and re-used several times. It not only reduces the amount of materials being recycled, but also generates a long-term cost savings.
Cost savings and conservation can go hand in hand. John Deere, a leader in agriculture equipment, sees efficient water management as a key sustainability issue when it comes to growing crops to feed the world.
Seventy percent of the world’s freshwater withdrawals are used by agriculture, according to Sharlin Barfield, manager of environmental compliance – supply management at John Deere World Headquarters and a proud Purdue graduate. Using new irrigation technologies, John Deere hopes to reduce freshwater usage by 30-60 percent.
Using suppliers who comply with labor and human rights regulations is also a key factor impacting profit and sustainability for John Deere. “We have to have oversight of our supply chain. We have to manage our supply chain,” Barfield says.
To ensure that suppliers are meeting regulations, John Deere has a compliance hotline where possible violations can be reported. “Communicating is key. After we communicated this in 2009, a lot of people began using the system,” Barfield says.In addition to Verallia, SIA, and John Deere, other companies presenting at the conference included 5 Kingdoms Development, LLC; WALCO Tool & Engineering; ArcelorMittal Americas; ArcelorMittal Indiana Harbor, General Motors and Caterpillar.