From cleaner production and value management to sustainable value

Abstract

Being part of an institution, where the main objective is research and its application to support enterprises in their challenges to improve competitiveness, innovation and sustainable development, leads to the dialogue between different research teams about the tools used and the results obtained. When the results of applications of cleaner production (CP) and value analysis (VA) were confronted, the possible synergies between them, the benefits of a joint approach and the complementarities seemed apparent and worth a research work, where these aspects could be developed. Bringing together the different experiences in the application of CP and VA and the state of the art of those methodologies, a new approach – sustainable value (SV) – was developed, materialised in a manual and tested in several companies. The results show the great potentiality of using this approach within companies namely in what concerns the reduction of useless and unnecessary efforts (and resources), and encourage the orientation of limited resources towards areas, where they can lead to SV increase and to attain sustainability.

Keywords:

• sustainable value
• cleaner production
• value analysis
• entrepreneurial environmental management
• eco-efficiency

1. Introduction

Entrepreneurial activities must change when taking into account sustainable development (SD) paradigm, which is, according to Brundtland Commission (1987), ‘meeting the needs of the present without jeopardising the needs of future generations’. This means economic growth that does not deplete irreplaceable resources, does not destroy ecological systems and helps to reduce some of the world's gross social inequalities (DeSimone and Popoff 2000).

Therefore any organisation can no longer work as a ‘black box’. Society wants to know about the impacts of inputs and outputs of companies' activities and, therefore, a continuous process of transparency, communication and continuous improvement is required. The value of a company can no longer be seen only as the profit for its shareholders, but must be extended in an objective way to the other elements of sustainability: environment and society (Henriques et al. 2006).

Companies have then a difficult challenge to answer: create wealth, survive in an increasing competitive market, generate stable working sources, promote the economical and social development, guarantee the workers' welfare and reduce their products and processes environmental impact (WBCSD 2006).

Eco-efficiency appears as an important concept to prove the idea that economical and environmental efficiencies can be attained simultaneously, without prejudicing one another, focusing on the improvement of resources productivity and on ‘producing more with less’.

Cleaner production (CP) and eco-efficiency are often used interchangeably, but they should be viewed as complementary concepts. They differ in their strategic intent: eco-efficiency focusing on the strategic side of business (‘value creation’) and CP on the operational side of business (‘production’) (Glavič and Lukman 2007, Howgrave-Graham and Van Berkel 2007, Van Berkel 2007).

Eco-efficiency becomes then a management strategy, which aims at improving the economical and ecological efficiency of companies, attaining a higher value with less inputs, materials and energy and less outputs, waste (i.e. pollution in the form of emissions and waste). It lays on the prevention of materials, water and energy losses at the origin, leading to functioning costs reduction and to the improvement of the products environmental profile. The result is a higher value for companies as well as the increase in their competitiveness.

Several studies and reports confirm that pursuing eco-efficiency does in fact improve environmental performance and can result in economic benefits (Five Winds International 2001).

Its practical and theoretical importance is in the fact of combining two of the three axes of SD, the environmental and the economical performances (Ehrenfeld 2005) and although eco-efficiency does not directly address the social dimension of SD (Brattebo 2005), it is an important element in aligning any business with long-term social needs (DeSimone and Popoff 2000).

By promoting change towards sustainable growth, eco-efficiency enables a company to grow in a qualitative way (by adding value), while reducing adverse effects on the environment. It also signals a significant shift in focus to concentrate on real user needs (DeSimone and Popoff 2000).

This concept was popularised by the WBCSD as the ‘business link to SD’ (Schmidheiny 1992, DeSimone and Popoff 2000) and is now widely accepted as one of the primary tools for advancing SD. The key aspect of eco-efficiency is that it harnesses the business concept of creating value (Five Winds International 2001) and most companies have adopted it as their guiding principle (Dyllick and Hockerts 2002, Seiler-Hausmann et al. 2004).

And it is exactly on the entrepreneurial concept of creating value that this work is focused. It shows the developed research on value concept as defined on value management (VM) standards and its quantification according to SD.

Stakeholders may have different understandings in what concerns value meaning. VM aims at harmonising those different points of view, enabling an organisation to progress in the best way towards the settled objectives at the lowest resources consumption.

According to Annex A of EN12973 ‘VA originated in the United States around 1947 and was first applied to redesign existing products. It has rapidly been put into practice for new product development. Areas of application have widened to include non-material subjects such as administrative procedures or organisation systems. The widening of the field of application of VA, the expansion of VA techniques, particularly the application of functional analysis and the value concept in management practices, has given birth to VM, of which is one of its core techniques’. VA is the basis from which VM has developed being a method used when undertaking VM studies. VA is there defined as an organised and creative approach that uses a functional and economic design process, which aims at increasing the value of a VA subject. Applying VA makes it possible for the producer and the user to design, produce, maintain and use the study subject (new product or existing one, process, service, system) effectively.

On the EN 12973, value is described as the relationship between the satisfaction of need and the resources used in achieving that satisfaction. Therefore, the higher value is achieved with lower resources used and/or higher satisfaction of needs.

If in the terms of this relationship, economic, social and environmental aspects are taken into account, in a systematic and objective way, then we are talking about what we have defined as sustainable value (SV).

VM, involving the quantification and monitoring of value and the focus on what things do rather than what they are (functional approach), requires the development of a value culture within the organisation and the focus on users' and other stakeholders' requirements (EN 12973 2000). The challenge is to understand customer's real needs. Increasingly these needs are more for intangible sources of value – goods and services that contribute to quality-of-life (Five Winds International 2001).

VM methods and tools, namely value analysis (VA), are considered mainly economic aspects in value quantification (EN 12973 2000). But today, in order to lead the company to SV creation, this methodology also has to integrate environmental and social aspects.

VM and eco-efficiency together can constitute an instrument to integrate the three components of sustainability in the strategic management of companies and to create SV.

To put into practice and test this idea, a tool from VM – VA and another from eco-efficiency – CP were applied together, in order to evaluate the benefits resulting from the synergies and complementarities between them.

Good results were already obtained when applying CP in companies – resources (materials, energy, water, etc.) savings and waste reduction. The application of CP in companies as a strategy to become more eco-efficient, if it is applied through successive CP cycles, also helps in continuously improving the environmental, economical (and social) performance (EN 12973 2000). Eco-efficiency has a high potential for effective contribution to SD, primarily at company level. The strategy oriented to eco-efficiency allows, not only an increase of companies' ecological and economic performance, but also seeks to respond to the increasing concerns on the environmental safeguard at the regional level, where the companies are located (Duarte et al. 1999, Duarte et al. 2005).

In what concerns VA, good results were attained namely in the optimisation of value, as defined above, by improving satisfaction of the needs of users and/or reducing the resources involved (Henriques et al. 2003, Henriques et al. 2006, Maia et al. 2006, Alexandre et al. 2006a, Alexandre et al. 2006b).

With these results and the experience acquired, the question was how could those approaches be matched and profit be taken from the synergies between them. The answer was the concept of SV and the definition of a new approach materialised in a methodology.

Will companies benefit from an approach that uses the synergies between VA and CP? Will the concept of SV work? These are the questions, this paper tries to answer.

2. Aim

The objective of this paper is to present SV methodology (SVM) and the results of its application in seven companies during Desenvolvimento Empresarial e Urbano Sustentável em Aveiro/Entrepreneurial and Urban SD in Aveiro (DEUSA) project considered as representative ones by the associations in the region, where the project was developed.

3. DEUSA project

The SVM was developed and the corresponding working forms were elaborated in order to support the application of SVM within companies (Catarino et al. 2007).

The different steps of DEUSA were:

1. Three entrepreneurial associations showed their interest in applying the SVM in seven companies. They got financial support to the development of DEUSA project with the following objectives:

   • • to improve the opportunity of increasing SV of companies and their products and to promote eco-efficiency in the companies involved in the project through the implementation of preventive management strategies and tools such as CP – to do more with a better quality with less materials, energy and water, and VA – to evaluate the influence of performance improvement (economical, environmental and social) of a product and/or process in the creation of more value for the company;

   • • to develop new competences in order to contribute for more responsible companies and

   • • to promote the demonstration effect in Aveiro region.

2. An initial conference took place in order to present the project, its objectives and the different working phases. National and local institutions (financial entities, municipalities, local associations and university) were invited to attend as well as companies, students and consultants.

3. The top management of each company engaged themselves personally in the project and in the application of the SVM. They signed a letter of agreement and paid a symbolic fee to participate.

4. INETI team trained the SV working teams from every company involved – company internal team and elements from the associations; an e-learning platform was designed and adapted to the SVM application; and this platform was online for two more years after the end of the project.

5. Each SV working team with the support of the INETI team implemented the SVM during 12 months.The analytic characterisations of emissions and waste were performed by one of the associations involved.

6. There were two more open conferences, one in the middle of the project and a final one, where each company showed the results attained.

7. After validation, the methodology was published in a manual (available in Portuguese) [17].

8. A brochure was published with the results of the project within the companies. It was largely spread in the Entrepreneurial Associations and in the press.

4. SV Methodology

Starting from the value concept, as defined in the European standard: value α satisfaction of needs/use of resources, the possibilities of profiting from the synergies between the two methodologies VA and CP were explored, thus leading to SVM. On one hand, being the VA methodology characterised by a functional approach allows the problem to be formulated in terms of end results and not in terms of solutions which will enrich the creativity phase. Introducing the ecological and social aspects beyond the traditional, technical and economic ones enables the team to go deeper in the study. The functional analysis is a good tool to quantify the way, the study subject satisfies the user's needs. Using the CP methodology with the identification and quantification of all the inputs and outputs allows the team to quantify exhaustively the use of resources and, therefore, to quantify what is here called the SV (because it considers the three dimensions of sustainability). This is a good indicator for the study subject that will lately be compared to the ones obtained with the alternatives generated during the study. This approach also points out the inefficiencies, not only the eco ones (ecological and economic), but also the social ones and the ones derived from an incorrect satisfaction of needs.

The SVM is applied through an iterative process composed by eight phases. In order to support the application, for each phase, a certain number of working forms must be filled and dated, and the person responsible for completing them be identified.

Phase 1: general data about the company

Each company collects its general data: identification, labouring conditions, staff flowchart and relationship with stakeholders – Table 1.

Table 1 SVM Phase 1 – company general data.

General identification

Name, Address, Localisation (industrial, urban, rural, mixed), Contacts (phone, fax, e-mail…), Workers (number), Main products, Invoicing (total/year), Net value added (€/year), Sector

Labouring conditions

Labouring period (daily, weekly, yearly), Shift (number, timetable)

Staff flowchart

(Environmental manager should be identified)

Relationship with stakeholders

Workers, Suppliers, Clients, Local community, Society, …

Phase 2: specific data about the project

In the five forms to be filled during this phase, the company top management has to define the study subject (product and, or process), the working team, the objectives and constraints. When the study subject is a product, more information has to be collected namely in what concerns the market – Table 2.

Table 2 SVM Phase 2 – project specific data.

Study subject
Process – Total or partial (choose and identify) Product – Identification, Quantifying basis, Periodicity, Relationship towards total production (%), Relationship towards total company invoicing (%)
Working team
Name, Function, Department, Contact
Objectives
Innovation (radical or incremental), Costs,^a Satisfaction of the users' needs,^a Product design,^a Eco-efficiency,^a Marketing,^a Others
Constraints
Internal (Product or Company) – External – Other aspects
Information about the product
Needs to be fulfilled
Market definition	Yearly sales expectations, Market distribution, Price the user is willing to pay, Target consumers (age, purchasing power), Needs/demands not satisfied by the market, Competition products, Selling places
Technical data	Catalogues, Drawings, Photos, Standards, Patents, Claims, Final destination, Package destination
Product (stocking and distribution)	Kind of package, Package alternatives, Needed protection, Used transportation (type, space management and course), Storage period and conditions
Others	Delivery times, Materials whose cost has increased, Rejections %, Technological status, Specific after selling needs
a To keep or to improve (what aspects).

Phase 3: global inventory

During this third phase, a global inventory is structured based in the CP methodology (Peneda et al. 2001) and the costs (labour and equipment) are quantified. The working team designs the study subject manufacturing diagram. All the unitary operations are identified, as well as the inputs and outputs of materials, energy and water for each of them. The study subject is then divided into its components, and displayed in a diagram.

All the collected information is treated and gathered in the SVM 18 forms – Table 3. The detailed costs for each operation related to the components are quantified in what concerns labour, equipment, energy, materials, water, and emissions and waste management. The diagram can then be completed leading to a cost model.

Table 3 SVM Phase 3 – global inventory.

General manufacturing diagram
(for global process: unit operations sequence, input and output identification)
Specific manufacturing diagram
(for study subject: unit operations sequence, input and output identification and coding)
Study subject components
(tree diagram)
Operations description
Operation code and designation, Finality, Equipment, Equipment utilisation costs/operation, Energy costs/operation, Labour costs/operation, Operation time, Opportunities
Raw materials
Code and designation, Operation, Annual amount, Annual cost, Physical state, Composition, Origin, Resource^a, Hazardousness, Observations^b
Auxiliary materials
Code and designation, Operation, Annual amount, Annual cost, Physical state, Composition, Origin, Aim, Resource^a, hazardousness, Observations^b
Packages
Code and designation, Operation, Kind of package, Annual cost, Toxic compounds, Composition, Origin, Weight, Resource^a, Recyclability, Annual amount, Observations^b
Water
Code and designation, Operation, Availability, Annual consumption, Aim, Quality, Requests, Treatment wastes, Origin, Costs, Observations^b
Energy
Code and designation, Operation, Type of energy, Aim, Nominal power, Energy consumption, Observations^b
Final products	By products	Intermediary products
Code and designation, Operation, Annual amount, Composition, Standards, Destination, Other relevant data, Observations^b
Waste
Code and designation, Operation, Annual amount, Composition, EU waste list, Physical state, Management procedure, Management costs, Legal compliance, Observations^b
Air emissions
Code and designation, Operation, Flow, Composition, Management procedure, Management costs, Legal compliance, Observations^b
Wastewater
Code and designation, Operation, Flow, Destination, Composition, Management procedure, Management costs, Legal compliance, Observations^b
Noise
Code and designation, Operation, Equipment/sector, Noise level, Compliance, Observations^b
Mass balance
Material, Input, Output, Stocked, Waste
Cost model (€)
Labour, Equipment, Energy, Materials, Water, Emissions and waste management
a Rare, renewable, …
b Impacts (water, air, soil, human health…), opportunities, other aspects.

For this purpose, each company has to list all the raw materials, components, auxiliary materials, packages, water, energy, final products, intermediary products, wastewater, emissions, waste and noise. All of them are characterised (in environmental, economic and social terms) and quantified, thus allowing to build the cost model and to detect the manufacturing inefficiencies (mass and energy balances). In each form, there is a field to be filled with an immediate analysis, mainly in what concerns the effects on the environment and the improvement opportunities. These results are the starting points for the formulation of improvement proposals.

Phase 4: functional analysis

Functional analysis is one of the phases of the VA methodology, and is a systematic process to describe completely the study subject's functions and their relationships. They are systematically identified, characterised, classified and evaluated (EN 1325-1 1996).

The study subject is no more analysed only as the assembling of components, but is also characterised by a set of functions. The level of satisfaction of the user will depend on the performance of those functions, being the user more and more aware of the environmental and social aspects associated with the goods he uses.

In order to contribute for a progressive orientation of companies towards sustainability, it is essential that when performing this functional analysis phase, the stakeholders' needs (expressed in functions terms) take into account not only social and economical worries, but also the environmental aspect, so that companies will adopt the new concept of SV.

During this phase, questions related to the study subject, its interactive agents and functions are identified. The relationships between cost and function as well as cost and importance are evaluated. The level of performance is defined and finally the SV is estimated. All this information is quantified in the six forms designed for this phase and will be used for the formulation of improvement proposals – Table 4.

Table 4 SVM Phase 4 – functional analysis.

Functions listing

The study subject functions are listed. Each function is expressed in two words, a verb and a noun.

Functioning characterisation

Criteria (technical, environmental, social), Performance existing level, Performance desired level, Observations

Function weighting

Not all the functions are equally important. Therefore, a weighting figure must be allocated to each of the functions listed and characterised. A weighting matrix can help in this process.

Cost/function

The cost/function matrix sets out the costs of the study subject by function as well as by parts/operations.

Cost/importance

Function cost is compared with function weight (%)

SV

Φ, weighting figure for each function; Pen, Existing performance satisfaction factor; n, function number

At the end of the phase, it is possible to quantify the initial SV of the study subject (SV₀). It is compared later with the one that will be obtained by implementing the proposals generated in Phase 6 (SV₁). Value will then be quantified by the relationship presented in Figure 1.

Figure 1 Value definition.

The indicator SV for the study subject is quantified through the relationship in which Φ weights the relative importance of each function, Pen its performance and n the number of functions. The sum (Σ) of Φn·Pen quantifies the satisfaction of needs for the existing study subject, while the resources come directly from the Global Inventory. To compare function importance with its cost, both must be presented in terms of relative percentage.

Phase 5: problems synthesis

During this phase, the eco-inefficiencies of the process and its environmental impacts (Phase 3) are synthesised. And from the analysis of the cost function matrix (Phase 4), functions and components with high costs are identified. Eventual non-conformances between costs and relative importance of functions are detected.

This information will enable the working team to evaluate the performance of the study subject and to identify areas, activities or operations, where attention must be focused – Table 5.

Table 5 SVM Phase 5 – problems synthesis.

Phase	Form	Topics
1. Company general data	Relationship with stakeholders	Any aspect related with stakeholders that should be improved or considered.
2. Project specific data	Objectives	Highlights the objectives in order to be compared with final results
	Constrains	Points out the constraints during the study
	Information about the product	Market, technical data, other aspects
3. Global inventory	Operation description	Necessary information to fill cost model
	Raw materials and auxiliary materials	Total amount of raw materials and components; Costs per product unit kind of resources (scarce, …); Hazardousness; Amount of dangerous materials versus total amount of used materials; Compares with waste; Data from the immediate analysis field; Indicators
	Packages	Total amount; Costs per product unit; Recyclability; Compares with waste; Indicators
	Water	Relates the water amounts and their origins with the most consuming operations; Relates to wastewater; Amount of reused water versus total of consumed water; Indicators
	Energy	Energy consumed in each operation; If it exceeds 1000 TOE, the company is subjected to specific regulation (energy auditing and energy rationalisation plans); Energy contribution to global heating (TOE; Euro; kgCO2eq); Indicators
	Final products	Amounts
	Byproducts	Amounts
	Waste	Total; Hazardousness; Valourised amount (compared with the total produced); Management costs; Relates costs and amounts by operation; Relates with input materials
	Atmospheric emissions	Management costs; Legal compliance; Number of emission sources Amount of pollutants/year (the objective being to monitor and/or reduce)
	Wastewater	Total; Relates to input water (amount); Legal compliance; Management costs (relate to the total amount or with several partial effluents); Recycling rate
	Noise	Noisier equipments; Compliances; Existent levels; need of individual protection equipments (IPE)
	Mass balance	Summarises the previous forms in what concerns materials inputs, incorporation in the product, waste and storage
	Cost model	Summarises the costs allocated to items and to operation
4. Functional analysis	Function characterisation	Checks which criteria and functions are below the performance desired level
	Function weighting	Checks the relative weight of functions
	Cost/function	Checks functions, components, operations with higher costs
	Cost/importance	Diagram to compare the information from the previous steps in order to identify functions whose weight is not in accordance with its costs
	SV	Establishes the relationship between satisfaction of needs and cost and estimates the study subject value which will be the reference to evaluate the improvement in the company performance (economic, environment and social levels)

This synthesis of the information gathered until this phase is essential to identify and generate ideas to solve the detected problems.

Phase 6: previous identification and selection of ideas

The working team identifies ideas to improve the study subject through creativity sessions or research of already existing solutions for similar problems. The team lists, classifies and eventually groups the ideas in order to make a pre-selection of those whose viability will be analysed during the next phase – Table 6.

Table 6 SVM Phase 6 – previous identification and selection of ideas.

Ideas listing and classification
For each idea:	Time for implementation	A. Short term
		B. Medium term
		C. Long term
		D. Absurd
	CP practice	Good housekeeping
		Process modification
		Material substitution
		Product changes
		Internal valourisation
		Other
	Eco-efficiency elements	Reduce material intensity
		Reduce energy intensity
		Reduce dispersion of toxic substances
		Undertake recycling
		Maximise sustainable use of resources
		Extend product life cycle
		Extend products service intensity
Ideas description
Potential advantages: environmental aspects, functional aspects and others
Definition of groups of ideas
Grouping complementary ideas

Phase 7: viability analysis

The team will now make the viability analysis of the ideas selected during the previous phase in what concerns technical, environmental and social aspects, and evaluates and selects the ideas taking into account their SV (relationship between needs' satisfaction and used resources) – Table 7.

Table 7 SVM Phase 7 – Viability analysis.

Technical viability

Technical criteria (ex. satisfactorily proved technology) are defined and weighted. The way each group of ideas comply with those criteria permits to evaluate its technical viability

Environmental viability

Environmental criteria (ex: materials consumption) are defined and weighted. The way each group of ideas comply with those criteria permits to evaluate its environmental viability

Economical viability

As to the economical aspects the investment and exploration plans are designed and the investment is analysed through economic indicators – payback period, internal rate of return, net present value)

SV

For each idea or group of ideas:

Φ, weighting figure for each function; Pi, New idea performance satisfaction factor; n, function number

To quantify the SV of each idea, or group of ideas, the same procedure of Phase 4 will be used – which means that in the relationship, Φ weights the relative importance of each function and Pen the new idea performance factor. The sum (Σ) of Φn·Pen quantifies the satisfaction of needs, while the resources represent the total costs for each idea.

Phase 8: action plan

Finally, action plans are defined their implementation being dependent on top management decision.

This plan consists of the information needed to implement the ideas selected in the previous phase, such as the name of the responsible for the idea implementation, the necessary resources (financial, human and others), the time needed and which are the main benefits expected with this implementation (economical, environmental, social and SV).

5. Results

All the companies, in the DEUSA Project, were small and medium enterprises (SMEs) and certified either at the product or the process level. Two of them (A and F) were larger, with 250 and 220 workers and an invoicing higher than €20,000,000 The smallest one (B) had only 17 workers and an invoicing less than 1,000,000. They were all in the metal mechanics area. Five of them selected the process as the study subject, and the other two (F and G) selected the product. While three companies (A, B and D) chose only part of the process, the other two (C and E) decided to study the whole process (Table 8).

Table 8 General data about companies.

	Company
Item	A	B	C	D	E	F	G
Workers	250	17	90	115	50	220	52
Certification	ISO 9001:2000	ISO ITS 16949:2002	ISO 9001:2000	ISO 9001:2000	ISO 9001:2000	ISO 9001:2000	ISO 9001:2000 14001:2004 OSHAS 18000
Type of products	Ironware (screws)	Automotive components	Ironware	Ironware	Progressive tool	Bicycle components	Wood stove
Invoicing (€)	25,500,000	958,000	6,100,000	6,500,000	1,750,000	20,600,000	3,500,000
Study subject	Part of the process: zinc coating	Oil stick manufacturing process	Total manufacturing process	Part of the process: zinc coating	Total manufacturing process	Product: new pair of wheels supporting a tubeless wire	product: new panoramic wood stove

The study span depends mainly on the study subject and on the orientation given by the top management.

On the examples presented in this article, the span was subjected to the duration of the project in which those cases were included and, therefore, it took about 12 months. Normally, with a supportive top management and a motivated team, 1 year will be enough to develop the project until the implementation. This one will depend on the proposals involving more or less development work.

On analysing the costs on Table 9, it can be concluded that those concerning raw materials contribute to 27–74% of total costs, while the labour ones represent between 2 and 34% (for those companies there seems to be an inverse ratio between dimension and labour costs). As to energy costs, they vary between 1 and 19% and the equipment ones between 2 and 31%. Water costs are low, especially for those companies that get water supply from bore holes and only consider, as a cost, the energy for pumping it. The costs with emissions and waste management are also low and only have some weight for those companies that studied surface treatment processes and have waste water treatment plant.

Table 9 Cost analysis.

	Company
Costs	A	B	C	D	E	F	G
Raw materials (%)	31	63	66	27	30	70	74
Labour (%)	2	24	20	17	34	10	11
Energy (%)	19	5	8	11	1	9	1
Equipment (%)	11	6	2	27	31	11	13
Water (%)	16	1	< 1	1	< 1	< 1	< 1
Waste management (%)	21	1	4	17	4	< 1	1

Table 10 is a summary of global inventory for environmental aspects and shows that companies A and D use zinc (surface-treatment processes) and company C several different metals (in this company several unit processes were studied) and all the others use steel. The percentage of waste from raw materials is related to percentage of costs with emissions and waste management: companies A and D are those who produce a larger quantity of waste and spend more with waste treatment (both studied surface-treatment processes). The companies having products as their study subjects identified lower waste percentage from raw materials and lower waste management costs. In what concerns toxicity, 100% of the auxiliary materials used by companies A, D and G are harmful: A and D due to the use of CrVI and G due to the use of a large amount of oils and solvents. In all the companies, there are problems with noise and also with atmospheric emissions in stationary sources and diffused sources (companies B, C, D and E).

Table 10 Global inventory.

	Company
Item	A	B	C	D	E	F	G
Raw material	Zinc	Steel	Zamak, aluminium, steel and inox, brass	Zinc	Steel	Steel	Steel
Raw material (kg/year)	62,671	31,371	838,000	2540	137,170	4000	56,564
Waste from raw material	91%	31%	21%	90%	25%	7%	7%
Auxiliary materials (kg/year)	62,670	615	46,000	915	2200	16.7	334
Toxicity/hazard substances	100% (CrVI)	92% (oil, grease cleaner)	70% (oil, grease cleaner, paints, metal treatment)	100% (CrVI)	15% (oil)	80% (oil, solvents)	100% (oil, solvents))
Water consumption (m^3/year)	10,737	314	3739	700	9053	10,000	59.4
Energy consumption (TEP/year)	122	21	464	20	60	52	13.8
Waste (kg/year)	58,872	12,140	261,864	151	60,737	338	4974
Hazard waste	4%	5%	20%	100%	40%	2%	4%
Noise	Point source (in compliance)	Point source l (three places not complying)	Point source (three places not complying)	Point source two places not complying)	Point source (in compliance)	Point source (three places not complying)	Point source (three places not complying)
Atmospheric emissions	Two-point sources (not complying)	Two-point sources and three diffused ones (not complying)	Five-point sources and six diffused ones (in compliance)	One-point source and several diffused ones	Diffused sources (oil emulsions, solvents)	Three-point sources (in compliance)	Six-point sources (in compliance)

The functional analysis results summarised in Table 11 show that companies identified between five and nine functions for the selected study subjects.

Table 11 Functional analysis.

	Company
Item	A	B	C	D	E	F	G
Number of functions	5	5	6	9	5	8	7
VS0	3.4	0.4	2.0	18.4	0.01	15.8	3.9

The different SV₀ estimated for each company cannot be compared between them. They are only indicators that allow the comparison, in each company, of the study subject value, when beginning the project with the different proposals resulting from the development of the methodology.

During creativity sessions, using brainstorming, in each company an average of 61 ideas were produced. Only five of them, on average, were developed in each company during this project. From the ideas produced, an average of 17.3% were ideas for immediate implementation, 39.3% ideas to be studied and implemented at a medium term, 27.9% at a long term and 15.6% to be eliminated (Table 12).

Table 12 Generated ideas.

	Company
Item	A	B	C	D	E	F	G
No. of generated ideas	32	66	65	95	30	84	56
No. of developed ideas (at the end of the DEUSA project)	3	3	7	6	7	5	6

From all the ideas and in what concerns eco-efficiency elements, an average of 41% had to do with materials reduction, 17.6% with energy reduction, 19.4% with toxic dispersion reduction, 12.3% with incentive to recyclability, 12.4% with maximisation of renewable resources consumption, 2.4% with the increase in products durability and 3.9% with the increase in the intensity of goods service. As to CP techniques, an average of 28% of the ideas were related to process changes, 40% to good practices, 10.4% to materials changes, 12.5% to product changes and 12.6% had to do with options for internal valorisation.

The reductions attained by the companies, and resulting from the development of the ideas selected by them, vary from 0.5% up to 70% in what concerns water consumption, 10% up to 30% as to energy, 3% up to 100% for waste water generation, 3% up to 10% for materials consumption, 2.9% up to 44% for waste generation, 21% up to 62% for hazardous materials consumption, 30% up to 90% for generation of atmospheric emissions and 3% up to 12% for the generation of hazardous waste. The toxicity linked to the product (CrVI was substituted) were also reduced in A and D. The closed nature of the cooling circuit (company B), the improvement of the product environmental profile (in five companies) and the reduction of times and steps in the process (company E) are also results attained with this project and to be mentioned. Also to be mentioned is the development of products with new functions – a new wheel supporting a tubeless tyre in company F and a new panoramic wood stove, with improvement of aesthetics and warming functions, for company G.

The ideas studied by the companies led to the study subjects' performance improvement, which varied from 11 to 57%, and to resources reduction from 3 to 20%, except for companies A and G. Company A did not get costs reduction, because when changing into less toxic materials, it had higher acquisition costs, this being neutralised by lower management costs. As to Company G, designing a new panoramic heat recoverer needed to incorporate bigger quantities of raw materials with the resulting increase in necessary resources.

All the companies got an increase in their SV from the 5% attained in company G up to 86% in company D. This company presented the highest costs with energy, emissions and raw materials waste management, toxicity and hazardous waste. It was also a company, where a high number of ideas was generated during brainstorming and where disparities at functional level were found, therefore presenting a high potential for improvement (Table 13).

Table 13 Evaluation.

Item	Company
	A	B	C	D	E	F	G
Water consumption reduction	0.5%	28%	32%	44%	–	–	70%
Energy consumption reduction	–	–	–	10%	22%	30%	–
Waste water reduction	3%	100%^c	32%	73%	–	–	–
Materials consumption reduction	3%	–	–	7%	10%	–	–
Waste reduction	3%	20%	32%	44%	0%	–	∼
Hazard materials reduction	21%	–	37%	–	62%	–	–
Noise reduction	–	25%	–	–	–	–	–
Atmospheric emissions reduction	–	90%	–	–	–	30%	–
Hazard waste reduction	–	–	12%	–	3%	–	–
Others	Cut out CrVI < product toxicity	Cooling water in a closed circuit	Improvement of the product environmental profile	Cut out CrVI < product toxicity	Red 53% of production time	Development of a new wheel supporting a tubeless tyre	Development of a new panoramic wood stove with improvement of aesthetics and warming functions
Performance	↑ 36%	↑ 11%	↑ 11%^a	↑ 49%	↑ 14%	↑ 20%	↑ 57%
Resources	–	↓ 5%	↓ 4%^a	↓ 20%	↓ 14%	↓ 3%	↑ 50%
SV1	↑ 36%	↑ 17%	↑ 16%^a	↑ 86%^b	↑ 33%	↑ 24%	↑ 5%
a In zamak foundry process.
b In a specific zinc coating process (MZAS).
c Cooling water in a closed circuit.

It can be concluded that the global results of the application of this methodology, during the project, in the seven SME were as follows:

At economic level: diagnosis of manufacturing processes at economical level and optimisation of manufacturing processes; identification, control and reduction of cost; reduction of materials, energy and water consumption; companies' eco-efficiency improvement;

At environment level: diagnosis of manufacturing processes at environmental level and adoption of environmental best practices; reduction of materials, energy and water consumption; waste preventive approach; reduction of toxic dispersion; companies eco-efficiency improvement;

At social level: diagnosis of manufacturing processes at social level; improvement of internal and external communication; attitudes and behaviour change, namely in what concerns health and safety working conditions; new competences development in companies and entrepreneurial associations; adoption of more social responsible behaviour by the companies.

The implementation of the methodology also led to a more precise expression of user's needs and for the companies that had chosen the product as study subject, the development of new ones.

For all the companies, there was an increase in the SV, which will be reflected in the companies' competitiveness improvement.

The demonstration effect in Aveiro region was attained through the news in local newspapers and technical magazines, as well as the final conference where the seven companies presented posters and an oral presentation about the work developed in the project. This conference had the participation of technical and scientific community at the national level.

6. Three years later…

As seen on the previous item where the results were presented, when the project ended, only an average of five of the proposed ideas had already been developed in each company. Three years later, all the involved companies were questioned about further developments:

1. The company not only replaced the use of CrVI but, also changed all the zinc coating line where that chemical was used. This meant a higher investment than the one previously foreseen, but with greater process improvements such as the removal of chlorides from wastewater and with easier operations in the waste water treatment plant. After the end of the project, the company tried to apply by itself the SVM to other areas of the process, and succeeded in doing it.

2. Several ideas were studied and implemented during the development of the project such as closing the furnace water cooling circuit replacement of the outlet valve in the drilling operation and implementation of a new exhaustion system in the degreasing operation. Nowadays, the production of the part that was studied has decreased, and the company is now manufacturing new products to answer the market needs.

3. The company changed the whole surface treatment line (lac), where the bigger environmental and cost problems were detected. For the last three years, after the end of the project, the environmental management system has been implemented and the company recognises the importance of the project to this implementation, namely in what concerns the gathering and management of the information.

4. The ideas concerning good practices were implemented during the project. Meanwhile, the working team members responsible for the SV implementation were transferred to other companies in the group, and the action plan was not completely implemented.

5. The ideas not requiring investments were implemented immediately. The way of evaluating the resources allocated to each product changed with the project and the company adopted the new one proposed by the SVM.

6. The pair of wheels developed during the project was commercialised. The measures for resources reduction were not implemented.

7. Two years after the end of the project, a new panoramic wood stove was on the market, with changes relatively to the prototype resulting from the SVM application.

Several papers were presented in national and international conferences showing the development and results of this project. Two academic works (master thesis) were developed based on the implementation of the SVM in the companies.

7. Comments and conclusions

The SV concept worked and helped the companies to direct their options towards sustainability.

The SVM used enabled the companies to diagnose the main problems concerning their manufacturing processes and products (for those that made an integrated study of the product), leading to the quantification of the total costs including the environmental and social ones.

Summarising the results, it can be said that the application of the SVM that brings together VA and CP, leads to:

• improvement in the functional performance of the study subject, improving the satisfaction of user's needs, taking into account a pollution preventive approach. Therefore, the eco-efficiency principles were used (namely, the progress in recyclability and product durability, the reduction of toxic dispersion and the maximisation of the use of renewable resources and of the service intensity) to quantify the increase in the satisfaction associated with each function and

• reduction in costs associated with the study subject, taking into account the minimisation of resources intensity (materials, energy, water, operation time, …) of products and processes.

The application of the SVM leads to ideas that enabled to increase the SV of the study subject of each company and to improve communication. It also led to the adoption of more responsible corporate social behaviour by the companies as well as to the increase of their competitiveness. The methodology shows a high potential to be used as an operational tool for the development of sustainability at entrepreneurial level, as its application lead to improvement of the sustainability of the companies involved and Aveiro region. The success of such an approach depends on the effective support of company's top management, namely in what concerns the working team and on implementing the ideas, even when they imply investments.

Future developments of the methodology will include better characterisation and quantification of social aspects, namely in what concerns a more accurate quantification of needs and the way they are satisfied (functional analysis quantification). Other aspects to be considered are the improvement of the SV working team operation as well as the warranty of the real involvement of top management in the implementation of the methodology in the companies.

Another objective for future actions is to continue implementing the methodology in other companies and areas of application in order to enlarge the sample and confirm the results attained until now.

Acknowledgements

The authors thank the entrepreneurial associations that promoted DEUSA project and the enterprises involved in the project. They also thank the PRIME Program that financed the DEUSA project through its Measure 6 – Apoio à cooperação, observação, Informação e Apoio Especializado às PME's (Support to cooperation, observation, information and specialised support to SME).

Additional information

Notes on contributors

José João Henriques

1

Anabela Maia

2

Jorge Alexandre

3

Fátima Rodrigues

4

David Camocho

5

Notes

1. Email: [email protected]

2. Email: [email protected]

3. Email: [email protected]

4. Email: [email protected]

5. Email: [email protected]