Upwards of 40 percent of industry’s energy efficiency improvement opportunities can be realized through low or no-cost projects rooted in corporate culture change, according to a white paper from DuPont.
In Optimizing the Success of Industrial Energy Efficiency Improvement Programs By Driving Culture Change, global practice leaders Davide Vassallo and Chris Smith, both of DuPont Sustainable Solutions, say the company has found this to be true in its experience as the owner/operator of more than 150 diverse production facilities around the world. For example, the company’s multi-disciplinary, cross-functional site team have enabled the company to carry out energy consumption workshops, identifying improvements that have saved the company billions.
Vassallo and Smith write that many companies believe that they can only effectively improve energy efficiency through significant use of capital. But these are not the first actions that companies should consider, the pair say.
Laying the cultural groundwork must come first, he argues, for several reasons. First, capital projects will often be more effective and bring a faster payback if the “energy culture” is optimized first. DuPont has learned from its own experience that if the right roles and responsibilities aren’t in place, or if all the people involved don’t fully understand the aims of the capital investment, the project may not realize its projected efficiency gains.
DuPont has also seen smaller efficiency projects return impressive savings that can be re-invested into larger capital projects. In a recent two year period, these small projects generated an internal rate of return of about 75 percent for DuPont.
According to the white paper, many companies’ biggest efficiency misstep is their failure to bring about corporate-wide acceptance and implementation of their energy management system. DuPont has found that the to create a culture to foster such acceptance, companies must:
Get clear commitment from top leaders: If possible, this commitment should be included in core values statements, and energy efficiency should have similar weight as production, quality and profitability in management decisions. Management should discuss energy efficiency priorities in speeches and demonstrate personal commitment by providing resources and awarding staff. One member of the senior staff should also be designated the Energy Champion or Energy Guru.
Set measurable goals: These should include long and short term energy consumption and cost reduction goals, and they should be integrated with production, financial, quality, safety, cost and all other metrics tracked by the company. The energy metrics should be written in such a way that ever employee can understand how their daily decisions impact energy efficiency.
Give ownership to line management: DuPont has found that placing all responsibility with an energy department will not lead to success. Line leadership must see energy efficiency as essential to running their operations.
This is one of the more challenging parts of changing corporate culture, and can only be overcome by strong leadership from the C-suite, so line managers realize the changes are not temporary or arbitrary. And they must be rewarded for meeting goals, with energy efficiency performance quickly becoming part of performance reviews, bonuses and incentive arrangements.
Create a Center of Competency: A CoC is a virtual organizational structure connecting all site energy leaders with the senior energy guru and other energy experts in the company. The center owns the corporate energy management system and helps to share best practices across the organization.
Invest in training: Staff development is a key to instituting culture change. This includes training staff to detect efficiency improvement opportunities, as well as specific training related to the equipment that they operate.
Search deep: Companies must create cultures where all staff are empowered to identify problems and bring them to the attention of others. In many cases, employees notice issues and discuss them informally, but there is no obvious mechanism in place to analyze the issue, or to look for opportunities below the surface.Most industrial sites have dozens or hundreds of these opportunities, Vassallo and Smith say.
At DuPont, the company maps energy consumption to identify the areas of highest potential and holds workshops with staff who have intimate knowledge of the equipment. The best ideas are studied to test potential changes’ impact on safety, quality and production goals. Multi-disciplinary, cross-functional site teams, with insight from operators, maintenance, mechanics, core process experts, energy experts, engineers and management, are key to this method’s success.
The key to this model is the formation of multi-disciplinary, cross-functional site teams, with insight from operators, maintenance, mechanics, core process experts, energy experts, engineers and management. This model has saved DuPont billions, the authors say.
Correction: DuPont informed EL that the original white paper did not carry the name of one of the authors, Chris Smith. This has now been corrected in the article above.