A Roadmap to Zero Waste
Companies with environmental sustainability commitments used to be touted as progressive or ahead of the curve. Today they’re the norm: 70 percent of companies have permanently placed sustainability on their agendas in the past six years, according to an MIT Sloan Management Review/The Boston Consulting Group survey.
In recent years, a growing number of companies have also started to realize that our system of extracting natural resources into materials that will later be discarded for disposal is not sustainable. This reality, coupled with economic pressures, high-energy prices, population growth and less landfill space, has encouraged some to adopt a zero waste commitment. Zero waste is a philosophy focused on reducing the amount of generated waste produced by a company and its customers throughout the entire product lifecycle, from raw materials to final disposal. This new way of looking at the waste stream, in which trash is seen as a valuable resource, is at the core of Waste Management‚Äôs values.
Case Study: Bringing Caterpillar to Zero Waste
In 2008, Doug Oberhelman, chairman and CEO of equipment maker Caterpillar, announced a zero waste commitment. Within days, the company audited the business and identified ways to create more value from its waste output.
One of the first areas for improvement was ramping up recycling, including instituting the distribution of prepaid, shippable containers for recycling items like fluorescent lamps, batteries and electronics. The team placed several recycling kiosks and solar powered compactors around the site to encourage employees to recycle used bottles and cans. The team also recommended that Caterpillar begin washing more than 14,000 pairs of gloves per month for reuse rather than discarding them in the garbage, further reducing the amount of materials sent to the landfill.
After three years of work, Caterpillar‚Äôs focus on sustainability and zero waste netted significant benefits, including:
- Increased landfill diversion rate from 26 percent to 93 percent
- Reduced trash from over 500 tons/month to less than 100 tons/month
- Decreased their average waste cost from $95/ton to $22/ton
- Documented cost savings and avoidances of over $2MM
- Revamped their waste collection system to include collection points for: –Metal –Wood –Cardboard –Polypropylene Film –PET Banding/Tie Wraps/Caps –Cans/Bottles/Paper –Used Personal Protective Equipment
- Increased or introduced recycling of various items: –Wood ‚Äď From 50 tons/month to 750 tons/month
–Cardboard ‚Äď From 0 tons/month to 60 tons/month
–Plastic (Caps/Ties/Banding/Film) ‚Äď From 0 tons/month to 10 tons/month –Cans/Bottles/Paper ‚Äď From 0 tons/month to 0.5 tons/month –Personal Protective Equipment ‚Äď From 0 tons/month to 0.5 tons/month
Today, Caterpillar facilities recycle about 90 percent of the waste they generate, ¬†according to the 2011 Caterpillar Sustainability Report, 8 percent better than the company‚Äôs 2011 target. Caterpillar has also netted significant annual cost savings as a result of the changes recommended by Waste Management.
Benefits of a Zero Waste Strategy
As the Caterpillar story makes clear, there are many benefits of adopting a zero waste strategy, including:
- Building the brand: A zero waste approach is an investment in brand development. As customers begin to recognize the benefits of sustainable or ‚Äúgreen‚ÄĚ products, companies that can tout zero waste benefits will realize a competitive advantage that may result in new business. Zero waste strategies can also create a ‚Äúhalo effect‚ÄĚ for the organization. Products will have the opportunity to penetrate new markets by meeting the demands of sustainability-minded governments, consumers and businesses. Synergies with other manufacturing operations also allow companies to create closed-loop systems and generate revenue from byproducts. According to a study conducted by management consulting firm A.T. Kearney, in 90 percent of industries analyzed, companies with strong sustainability performance out-perform industry peers by up to 15 percent over 6-month periods, translating to $650 million in market capitalization per company.
- Reducing cost: Eliminating waste allows the organization to save money twice: first, by reducing costs through eliminating or reducing raw material consumption and second, by avoiding disposal costs. These cost savings can be reinvested in research and development, process improvements, business expansion or job creation programs.
- Manage risk: Adopting a zero waste strategy can help firms manage the health, financial and regulatory risks associated with conventional methods of waste disposal.
- Improve engagement: Employees at companies with zero waste goals tend to be more engaged. ¬†At Caterpillar, for example, employees ‚Äď some of whom who have been with the company for many years ‚Äď were supportive of the various sustainability changes, which was a key factor in making the program a success. Zero waste strategies also encourage a focus on innovation. Overall improvements in the working environment also give rise to more engaged employees. In turn, increased employee engagement can result in improved worker productivity and lower turnover.
Roadmap for Companies to Zero Waste
Implementing a zero waste strategy is complex and requires a cultural shift. Employees must learn to see any amount of excess waste as a missed opportunity. Here are a few critical steps for your organization to take before embarking on the journey:
- Gain Senior Leadership Buy-In and Engage Employees: The support of senior leadership lends credibility and clout to zero waste initiatives and demonstrates their commitment to employees. Educate employees about the program and encourage suggestions for improvement / employee ownership of progress. Involve all employees and make sustainability part of everyone‚Äôs job responsibilities, not just the purview of the sustainability department.
- Set the Goal to Zero: Set the goal to zero from the outset to demonstrate commitment to the zero waste process and avoid stopping short of the ultimate goal (for example, deciding that recycling alone is ‚Äúclose enough.‚ÄĚ)
- Gather Data and Develop Metrics: One cannot manage what one cannot measure. Understand the types and quantities of wastes generated as well as current methods of disposal to establish a baseline. Appropriate metrics, including economic cost reductions and a data-driven program, will help communicate success and progress and encourage the continued support of stakeholders.
- Obtain Supplier Commitment: Use contract language and supplier scorecards/questionnaires to ensure that vendors are on board with their customers‚Äô zero waste goals and are making progress towards the goal.
Zero waste is an ambitious goal, and no single strategy will achieve it. But as Caterpillar and other companies have shown, the benefits for businesses are more than worth the effort.
Tom Carpenter is the director of growth and development for Waste Management Sustainability Services, which helps companies like Caterpillar achieve zero waste. For more information, please visit Waste Management‚Äôs Sustainability Services.
 Mahler, D., Barker, J., Belsand, L., & Schultz, O. (2009). Green winners (A.T. Kearney). Chicago: A.T. Kearney.
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