1. © C.Hicks and O.Heidrich University of Newcastle IGLS02/1 Waste Management: a Strategic Supply Chain Issue Chris Hicks Oliver Heidrich University of Newcastle

2. © C.Hicks and O.Heidrich University of Newcastle IGLS02/2 Waste is a strategic issue Because: Companies are facing intense competition which leads to strategies that seek to reduce costs through minimising all types of waste National and international regulation and legislation is increasing Customers are increasing concerned with the environmental impact of products and services

3. © C.Hicks and O.Heidrich University of Newcastle IGLS02/3 Manufacturing view of waste “Any activity which consumes resources or creates costs without producing any offsetting value stream” Ohno’s 7 wastes –Overproduction –Waiting –Transportation –Inappropriate processing –Unnecessary inventory –Unnecessary motions –Cost of defects Bicheno added untapped human, waste of inappropriate systems, wasted energy & water, wasted materials, wasted customer time,defecting customers

4. © C.Hicks and O.Heidrich University of Newcastle IGLS02/4 Legislation Protection Preservation Regulation Planning Authorisation to operate Control of operations Product performance and disposal Decommissioning impacts Industrial processes and society Consortia and voluntary agreements Transparency Public perception Public involvement Corporate societal responsibility

5. © C.Hicks and O.Heidrich University of Newcastle IGLS02/5 Legal definitions “Any substance or object which the holder discards or intends, or is required to discard” (Framework Directive on Waste) “Wastes are substances or objects which are disposed of, or are required to be disposed of by national law” (Basel Convention) The first definition is absolute whereas the second is relative to national law. “Discard” is viewed as having broader meaning than “dispose”

6. © C.Hicks and O.Heidrich University of Newcastle IGLS02/6 EU Court of Justice Definition “Something can simultaneously be ‘waste’, a product, good, raw material or substance, irrespective of economic value, collection, processing etc. This definition is independent of qualitative or commercial value, possible market, geographical purposes or destination of waste” This definition makes no distinction between waste and non-waste

7. © C.Hicks and O.Heidrich University of Newcastle IGLS02/7 Waste EU has “waste streams” that are receiving priority attention – packaging, end-of-life vehicles, batteries, electrical and electronic and hazardous household waste. May be considered in terms of processes – caused by variability, it may be turned into non-waste by additional processes Waste is relative – to primary function, process or owner Categorised according to source – household, industrial and commercial Classified by properties, hazardous / non-hazardous, radioactive etc.

8. © C.Hicks and O.Heidrich University of Newcastle IGLS02/8 EU Principles Prevention principle Producer responsibility and polluter pays principle Precautionary principle Proximity principle

9. © C.Hicks and O.Heidrich University of Newcastle IGLS02/9 Environmental and operations management Companies may see environmental management as an external constraint. A narrow legal function concerning compliance with legislation Operations managers can plan, influence and leverage environmental issues for competitive advantage. Environmental technologies can reduce operating costs, create competitive advantage and long-term risk whilst pre-empting regulations

10. © C.Hicks and O.Heidrich University of Newcastle IGLS02/10 Approaches Clean design – majority of life cycle costs committed at the design stage. Design largely determined waste during construction, operation and decommissioning. Bicheno 4 Rs Redesign, reduce, recover, recycling and remanufacturing Life cycle costing Life cycle assessment.

11. Waste Management HierarchyMethods PreventClean Design Design for: manufacture, assembly, maintenance, dismantling, standardisation Extend product life expectancy Manufacturing technology e.g. near net-shape forming. Lean Manufacturing, Just-in-Time Manufacturing Total Quality Management Process monitoring and control Environmental management systems (EMS) Reuse (no physical or chemical changes necessary) Primary / secondary function After use Repair Recycle (changing the physical or chemical properties) Remanufacture Reclamation of materials Regeneration Composting Material recovery Energy recoveryIncineration to produce energy Safe disposalIncineration without energy recovery Landfill Table 1 An indication of the methods that apply at each level of the waste hierarchy

12. © C.Hicks and O.Heidrich University of Newcastle IGLS02/12 Raw materials Process A Process BProcess CProcess DProcess E Product Waste Reuse Recycling Energy Recovery Landfill Waste Reuse Recycling Energy Recovery Landfill Reprocess Process steps A functional model of waste Management in supply chains

13. © C.Hicks and O.Heidrich University of Newcastle IGLS02/13 Case study preparation batchesmoulding finalpackaging Product 68317t Raw materials 100000 t Wastes (5%) Wastes (11%) Wastes (3%) Wastes (2%) Wastes (15%) 95000t 80750t 71867t 69711t Reuse (0%) Recycling (0%) Energy (0%) Landfill 100% Reuse (20%) Recycling (25%) Energy (0%) Landfill (55%) Reuse (0%) Recycling (10%) Energy (0%) Landfill (90%) Reuse (10%) Recycling (15%) Energy (0%) Landfill (75%) Reuse (0%) Recycling (15%) Energy (0) Landfill (85%) 100% value of final product Initial conditions

14. © C.Hicks and O.Heidrich University of Newcastle IGLS02/14 Functional model after application of new strategy preparation batchesmoulding finalpackaging Product 68317t Raw materials 100000 t Wastes (5%) Wastes (11%) Wastes (3%) Wastes (2%) Wastes (15%) 95000t 80750t 71867t 69711t Reuse (0%) Recycling (90%) Energy (0%) Landfill 10% Reuse (40%) Recycling (45%) Energy (0%) Landfill (15%) Reuse (10%) Recycling (70%) Energy (0%) Landfill (20%) Reuse (60%) Recycling (30%) Energy (0%) Landfill (10%) Reuse (30%) Recycling (45%) Energy (0) Landfill (25%) 100% value of final product

15. © C.Hicks and O.Heidrich University of Newcastle IGLS02/15 Conclusions Many interpretations of the word “waste”. Manufacturing focuses upon value, whereas legislation and regulation focuses upon physical waste. Poor integration of organisational functions can be a barrier to effective environmental management. Majority of cost and environmental commitments are made at the design stage. A functional modelling method has been proposed for waste management. A case study has demonstrated how waste can be minimised through the strategic development of supply chains.