Achieving sustainability in manufacturing via organisational and operational learning

Abstract

The contribution contained in this paper focuses on providing a possible framework or approach in respect of how manufacturing companies can economically introduce environmentally friendly practices to their production operations, whilst at the same time encouraging organisational and operational learning with the aim of eventual evolution of the firm into an eco-efficient concern. A key premise associated with the approach advocated is economical organisational and operational learning over time, thus providing a sequential movement of the company through various stages of cultural change and technological capability to eventually achieve eco-efficiency in its production activities. At each stage in the process, it is suggested that a balance must be maintained between on the one hand, a reduction in operational economics consistent with on the other hand, an improvement in the environmental sustainability of company activities. To that end, some previously suggested monitoring metrics are examined in the text for their efficacy and economic rapport via hypothetical examples of how they might be applied in practice to monitor movement towards industrial–environmental sustainability.

Keywords:

• organisational/operational learning
• industrial–environmental sustainability

1. Introduction

The key premise for any manufacturing company is that it should be a profitable concern. If a firm is to be sustainable in the long term then it must be capable of generating profits from its day-to-day activities in order to remain in business, supply its customers, service its debts, pay dividends to its shareholders and provide employment for its workforce. This is the challenge faced by an organisation's management and to a certain extent, all other considerations are secondary. However, it does not mean that they should be ignored, for in today's world companies have to operate within a global business environment made up of a variety of factors, not all of which are in the control or influence of company managers. One such factor is environmental sustainability, and minimising the impact of company operations in this respect is rapidly becoming a key concern for senior manufacturing management.

Leaving aside the altruistic nature of contributing to environmental sustainability minimising pollution and the impact this has on society, for the management of a manufacturing concern the problem of coping with this particular factor in the business environment has several facets associated with it. These facets are linked to the primary challenge faced by company managers which involve as a minimum, compliance with environmental – health and safety legislation, societal and customer attitudes plus competitors practices. On the face of it, and to most managers, action to improve environmental sustainability would mean an unavoidable rise in the cost base associated with production. However, on reflection, senior personnel within most manufacturing firms would recognise and accept the need for their company to evolve in this respect, meeting the challenge presented to them of conforming to this change in the business environment without a loss in competitiveness or profitability (Sarkis 2001).

As a consequence, four primary management policies have been previously identified within the operational sub-strategies of most industrial companies via which manufacturing concerns can seek to improve the environmental sustainability of their activities over a period of time (Rashid et al. 2008). These are

Waste minimisation, Material efficiency, Resource efficiency and Eco-efficiency.

It is suggested here that the four policies outlined above form a natural hierarchy of implementation within the majority of industrial concerns that have manufacturing activities, and also fit neatly into the Japanese philosophy and extended concept of just-in-time, lean and agile production. The approach indicated implies a sequential or stepwise implementation of these four policies over an extended timescale, and is therefore a framework that is compatible with organisational and operational learning, company economics and efficient–effective company management. In short, we can state the overall resulting strategy as

Attempting to produce at a profit, using only the minimum of resources and in an environmentally friendly manner, that which is required by a customer, when it is required by the customer in the quantity and quality demanded by the customer.

Historically, it is noticeable that when manufacturing firms try to deal with new factors occurring within their business environment such as product innovation, a change in production technology or for that matter environmental sustainability, a clear distinction appears between organisational and operational learning. This is usually based on the measure of performance or metric applied in each case to monitor the learning effect. For operational learning, which in this context may be defined as a phenomenon that occurs when individuals alone or in collaboration within an organisation attempt to improve a task or process that is perceived to be inefficient, the measure of performance is normally direct labour output. This is as opposed to in the former case of organisational learning, defined here as the collective improvement via experience of the capabilities of individuals, processes and systems within an organisation, company profitability. It is important to note that both these aspects of learning are interlinked and that organisational decisions in effect pre-condition operational learning performance (Davies and Cherrington 1993). A more detailed breakdown of the factors involved in both operational and organisational learning together with their interaction in a system improvement situation such as implementing policies to achieve environmental sustainability is shown in Figure 1.

Figure 1 Interaction of different aspects of learning in a manufacturing company.

The three main results of organisational learning, namely improved system task definition, material flow and product quality, relate directly to the requirements for company competitive advantage, whereas results obtained from operational learning such as product redesign and the consequential changes to manufacturing methods or processes are usually categorised as productivity improvements. It should at this point be recognised that achieving industrial–environmental sustainability is a long-term goal, with improvements being brought about in a variety of different ways as the company learns what is now required of it in the new business environment (Senge 2006). A lack of foresight, planning and/or investment by the firm in environmental improvements to their operational activities may in this respect contribute to poor company performance, by maintaining at best only a staid product portfolio, an adequate level of manufacturing output and a focus on day-to-day problem solving.

It is noticeable in previous studies that many firms appear to improve the production facilities within their organisation in a very ‘ad-hoc’ manner, often based on a dubious cost justification and perhaps an emotive presentation by a dynamic personality within the management team (Davies and Cherrington 1993). This is obviously not the best way to proceed in respect of environmental improvements where a large amount of capital investment may be involved, for without a proper corporate plan which lays down the objective, precedence and conditions for each item of expenditure the company runs the risk of purchasing equipment which they cannot use to its best advantage, thus effectively negating the desired improvements. It should also be noted that the lack of experience in respect of environmental sustainability at any particular management level within the company, along with the lack of a suitable organisational infrastructure appropriate to that level, is likely to combine to reduce the effectiveness of equipment implementation and progress towards eco-efficient manufacturing.

Accordingly, each stage of movement an organisation makes towards environmental sustainability must be carefully considered in relation to the company and its operations as a whole, together with its overall business strategy. Senior management must be satisfied that conditions within and without the firm are such that implementation can be allowed to proceed and that tangible benefits accrue from the development in terms of economic and competitive advantage as well as environmental sustainability. Thus, a well thought out plan, which integrates all the necessary steps required to achieve environmental sustainability and its implementation on a suitable timescale, is an essential requirement for any manufacturing concern. Such a plan is suggested as shown in Figure 2, which indicates conceptually and in outline form, the stages of movement and policies required to ensure that a smooth and rapid transition takes place within the organisation from a profile of no sustainability to one of eco-efficiency in its manufacturing activities. In order to better understand each of the policies represented in Figure 2 and the implications involved in their adoption by manufacturing concerns, it is now important that we look at each area in turn.

Figure 2 Conceptual progression curves for increasing levels of sustainability.

2. Waste minimisation

This is fairly easy to understand and implement within an industrial concern. A simple definition has been promulgated as:-

The reduction in the quantity and in the hazardousness of waste produced at its source (OECD 1998).

Of course waste can be defined in many ways and it is a prime tenet of the Japanese philosophy of manufacturing that all forms of waste should be eliminated from the production system and enterprise. This aspiration is of course a perfect fit with both the economic and green outlook now being adopted and expressed by most industrial concerns. Consequently, in a manufacturing context a more detailed definition of waste can be expressed as

Anything other than the minimum amount of labour, equipment, materials, parts, space, money and time which are absolutely essential to add value to and ultimately produce the product.

Typical examples of manufacturing waste have been cited by many sources (see, e.g. Russell and Taylor 2000), but can be characterised in an operational sense as follows:

1.	Loss in manufacturing labour productivity: due to unnecessary activities such as excessive movement within workspaces, counting work-parts or product inventory, reworking defective products, waiting for machinery or equipment to complete an operation or for material, parts or tools to be made available, etc.
2.	Loss in manufacturing equipment productivity: due to poor logistic control of labour, tooling, material and work-parts, machinery setup, maintenance or breakdown, etc.
3.	Loss in manufacturing system productivity: due to waste generated by overproduction, poor process design, excessive work-part and product transportation, unnecessary inventory storage, poor product design, quality control and defective work-parts, etc. The above list is not by any means exhaustive in respect of the sources of waste in a manufacturing organisation, and we can say with confidence that the scope of this policy is wide ranging. It will in fact involve dealing with a fourth category which is often overlooked and that is
4.	Loss in organisational productivity: due to not ensuring the reduction in raw material usage in all its forms, along with the use of ingredients, scrap or other product losses. In addition, the amount of energy used, water consumption and effluent generated, together with the quantity of paper and packaging employed in the factory and office, are all directly attributable to organisational neglect. A lack of minimisation of all forms of wasted effort in both the administrative offices and on the shop floor, together with that of all other forms of solid, liquid and gaseous waste, contributes to this loss of organisational productivity (Modified, rewritten and presented in a manufacturing context from the Department of the Environment 1998).

As previously noted, the above is not an exhaustive list and it should be recognised that waste can take an almost an infinite variety of forms. In concept therefore, the policy is to

Reduce waste to an absolute minimum where possible in all the operational and organisational activities within a company, thereby saving the firm money, reducing pollution and minimising any environmental impact.

It is a direct, practical and simple strategy to adopt and in some way or another most manufacturing companies try to have this or a similar type of policy in place, albeit one which may currently be informally enforced. The idea of waste minimisation while not new is thus quite obviously attractive in terms of the cost reductions and competitive position which may be achievable as a consequence of it, but these benefits could well come at a cost to the firm. Treating and reducing manufacturing process waste, for example can be expensive in terms of the capital cost for the plant required and in its operational or running costs. So each expenditure proposal that may be desirable in terms of pushing forward the overall eco-strategy must also be evaluated for its cost effectiveness via a cost/benefit analysis. Thus, while implementation in one form or another is therefore possible at various if not all levels within the company, it may be limited in scope by the economic factors involved.

In practice, waste minimisation is quantitative in nature and in theory easily measured; however, it should be noted that detailed data collection and analysis for action may be either cheap or expensive depending on the activity concerned. In addition, while its impact within a single company may be high, across a supply chain of numerous disparate companies it may be quite low due to a lack of influence, interest or enforcement of the policy within independent firms. In a company-wide sense, it is proposed here that the most suitable measure to use in respect of waste minimisation is that of the cost base. This value is reflective of a change both in the efficiency and in the effectiveness of an organisation, a fact which in turn implies a change in all forms of waste within the company. As shown in the simple example given below, movements in the cost base Figure (CBF) indicate how this value may be used to some effect in monitoring the overall effectiveness of a waste minimisation policy operating within a manufacturing concern. Indeed, as a global company metric, an over arching CBF can measure the implementation effectiveness of all four environmental sustainability policies, although in the case outlined below its use as a waste minimisation sub-metric only is illustrated.

2.1 Example

In the last 12 months, a small domestic appliance manufacturing company has attempted to reduce the cost base of its operation by instituting a waste minimisation programme. Monthly data relating to the cost base value are available in deflated monetary units and presented in the table below. Determine to what degree the waste minimisation programme has been successful, assuming that a stable product demand has been experienced over the period concerned and therefore an identical level of production output maintained in each month.

Month	Jan	Feb	Mar	Apr	May	Jun	Jul	Aug	Sep	Oct	Nov	Dec
CBF (£ × 10^3)	250	248	247	245	249	248	251	243	247	244	247	245

2.2 Solution

Taking January as a monthly budgeted baseline value, it is evident from the figures given that in only one of the succeeding months costs rose. To that extent the programme appears to be successful. The occasional rise in the CBF values can be attributed to the sources of waste yet to be tackled in the programme and in the remaining 10 months costs fell below the baseline January figure. The savings accrued over the 12-month period were

Obviously, the time series cost data given above can be analysed in many different ways and towards the end of the period concerned a steady reduction in the cost base is noticeable in the raw figures. A least squares error (LSE) fit to the data would reveal any trend in the time series as shown in Figure 3 and could possibly also provide a target for subsequent months by using the LSE fit on say a moving 12-month information window. However, as shown in the figure there is a large amount of scatter in the data around the simple linear trend line and this would indicate that any such forecast would be unreliable without using an improved prediction model and possibly analysis over a wider data set.

Figure 3 Cost base time series information with linear LSE data fit.

If we were to assume a standard production call off of 1000 units per month it is possible to obtain an estimate of the amount of learning taking place, although it should be noted that because the CBF figures are a global measure across the whole company, even when relating to a single product line as in this case, both organisational and operational learning are subsumed into this estimate. Assuming a straight forward learning model is in operation whereby the cost is decreased by a fixed percentage each time the total accumulated volume of production in units doubles then from the data given

Although the data used in the example above are hypothetical, it should now be obvious that waste minimisation can be regarded as the foundation block in the hierarchy of an over arching sustainability strategy. As shown in the example, use of the CBF values gives a practical metric for monitoring waste improvement in a company-wide sense, monitoring both organisational and operational learning, although at a lower level within the firm its implementation may be easy or hard depending upon what is being attempted in any specific case and the accounting support available. In effect, this policy may be regarded as the first step that a manufacturing company can take on the road towards environmental sustainability via organisational and operational change (Rashid et al. 2008).

3. Material efficiency

This in a way has a direct link to waste minimisation and is an obvious step for manufacturing concerns to take. We can define material efficiency in a general way as

The ratio of the material output in products to the input of raw materials for the production transformation process to make those products (Modified, rewritten and presented in a manufacturing context from Rashid et al. 2008).

As stated above this strategy has a wide scope, covering not only material utilisation in all its forms, but also the generation of scrap or defective products within the manufacturing system and any form of material waste in the company. A more realistic view is that it is concerned with reducing the consumption or use of manufacturing materials without substantially affecting the operation, quality, service or function of a product. In this sense, it is not a new idea and many material utilisation studies and models have been recorded in the literature over many years (see for example Haslehurst 1972 or more recently Ashby 2009).

Conceptually, we can write material efficiency in mathematical terms as

	M e = M o/M i (Rashid et al. 2008), where
	M e is the material efficiency, M o is the material output and M i is the material input.

In practice, determining material efficiency in this way can be tricky. If we accept a narrow definition and confine ourselves to only considering material built into a product, then the value of material efficiency may have some useful meaning as shown in the example below, it being linked to the efficiency and effectiveness of the product design process. Conversely, if we widen the definition to consider all the materials used in a product's manufacture, such as coolant, consumable items and processing chemicals for example, the measurement and assessment of these individual factors becomes costly and difficult to achieve with accuracy. The end result in terms of material efficiency then becomes something with only a doubtful relative value.

In principle, however, de-materialisation is obviously an attractive concept which can save cost and energy in both production and transport. Good material utilisation will result in lower cost components and in potentially smaller lighter products, which are more cost effective when they require to be transported. In a narrow sense, material efficiency is therefore a more complex strategy than simple waste minimisation and obviously linked closely to operational functionality and remanufacturing in both product and manufacturing process design (Kaebernick et al. 2003). It is an attractive policy due to the likely cost reductions that may result from its application and has been implemented in the past via efforts at material utilisation initiatives value analysis and value engineering (see for example Haslehurst 1972, Riggs 1987). Based on experience, the policy is best introduced at the early product design stage as retrospective component re-design can cause considerable problems within an existing manufacturing system. As an idea it is quantitative in nature and if restricted to the product material only, data measurement, collection and analysis for action are fairly straight forward.

3.1 Example

A batch of washing machine body shells is to be produced from a 1 m wide coil of steel strip, which has a thickness of 1 mm. The body shell blanks prior to processing are cut to an initial size of 1 m in width and 2 m in length. If the steel coil weighs 15.4 kN when delivered from the steel stockist and the density of this steel is known to be 7.8 g/cm³ then determine

1.	the number of body shell blanks which can be produced from this coil and the amount of scrap material remaining;
2.	the material efficiency of each individual body shell if after processing in the press shop it weighs 120 N;
3.	the cost of the coil, scrap and each shell before and after processing given that the cost of this material is £0.5/kg;
4.	the material efficiency as calculated in monetary units.

3.2 Solution

Mass = density × volume. In this case, volume of one body shell blank amounts to

100 cm × 200 cm × 0.1 cm = 2000 cm³

Thus, the mass of one blank body shell is equal to

2000 × 7.8 = 15,600 g or 15.6 kg.

The weight of the blank shell is equal to

15.6 × 9.81 = 153.036 N (9.81 = acceleration due to gravity in m/s²).

The number of blanks that can be produced from the coil is therefore

15400/153.036 = 100.6299 or 100 blank body shells.

The scrap weight = 0.6299 of 153.036 N or 96.4 N off the coil and 100 × 33.036 N off the processed blanks (153.036–120) or 3303.6+96.4 = 3400 N.

Material efficiency is thus equal to

120/153.036 = 78.41% (weight of processed shell to weight of blank shell).

Cost of the coil is found by first determining its mass

Mass of the coil = 15400/9.81 = 1569.82 kg.

Cost of the material coil is thus £0.5 × 1569.82 = £784.91.

Cost of the scrap material = 3400/9.81 = 346.58 kg.

Cost of scrap is thus £0.5 × 346.58 = £173.29.

Blank body shell mass = 15.6 kg and its material cost = 15.6 × 0.5 = £7.8 per shell.

Processed body shell mass = 120/9.81 = 12.23 kg and its material cost = 12.23 × 0.5 = £6.115 per shell.

Material efficiency = 6.115/7.8 = 78.39% (cost of material in finished shell/cost of material in the blank shell).

3.3 Crosscheck

Total mass of the coil = 15400/9.81 = 1569.82 kg.

Total volume of the coil = mass/density = 1569.82/7.8 = 201258.97 cm³.

Total length of coil = volume/area = 201258.97/10 = 20125.897 cm or 201.26 m. Thus, number of blank body shells is 201.26/2 = 100 (as above).

Weight of one blank shell is volume × density = 2 × 1 × 0.001 × 7800 = 15.6 kg (as above).

Weight of processed shell is 120 N/9.81 = 12.23 kg.

Material efficiency = 12.23/15.6 = 0.784 or 78.4% (as above).

Coil cost = [(15.4 × 1000)/9.81] × 0.5 = £784.91 (as above).

Scrap cost = [784.91–(12.23 × 100 × 0.5)] = £173.41 (as above).

So as the example shows, material efficiency can be calculated in either units of weight as a direct measure of material content in a product or by valuing the material content in monetary terms.

It is important to note that the strategy of material efficiency is inclusive of the upstream and downstream supply chain processes, in the sense that the product's design affects component supply, and the way in which after manufacture it reaches the customer. Hence, it has the potential for high environmental impact and may be regarded as the second step in moving the company towards industrial sustainability. The strategy of waste minimisation is mostly an internal company activity while that of material efficiency has both an internal and external aspect to it. It is possible to overlap these two strategies to a certain extent during implementation, but to do so a risk is run in the sense that too many simultaneous initiatives may cause fatigue in the culture change process, and consequently stall movement within the company towards environmental sustainability.

4. Resource efficiency

This sustainability strategy can be defined in the following way

A striving for the efficient use, reduction in flow and in consumption of both natural and human resources in manufacturing (Modified, rewritten and presented in a manufacturing context from Schmidt-Bleek 1996).

From the definition, we can see that this strategy is non-specific, more of an aspiration rather than a firm-defined policy. In scope, it has a focus on managing all the resources used within a company in a holistic way and not simply at one stage in any particular part of the organisation – manufacturing system or resource life cycle. In effect, it seeks to optimise the use of all resources in such a way so as to achieve the objective set out in the definition. To that extent, it encompasses all the techniques available in the area of manufacturing systems engineering and it is important to note that in companies that engage in production, nothing happens without human input. Consequently, this aspect of the definition should receive serious consideration by a company's management striving to achieve resource efficiency.

As a concept, we can write down the strategy mathematically as follows:

	Y r = Y o/Y i (Modified, rewritten and presented in a manufacturing context from Rashid et al. 2008), where
	Y r is the resource efficiency, Y o is the economic output and Y i is the economic input.

As with material efficiency, the equation proposed here is a simple dimensionless ratio and conceptually both factors could be stated in monetary units. In the narrow case of material resources, such an equation is fairly easy to solve with known values of the cost of material input to the manufacturing process and the subsequent value of that material built into the product by the transformation system. Company-wide economic input and output figures are a little bit more difficult to obtain depending on how they are defined by the accounting system in use. The simplest measures are, however, as shown in the example below, the value of the resources used by the manufacturing system to make the product as the economic input, and the value of those resources that are actually built into the product as the economic output.

4.1 Example

a.

A detailed cost analysis of a typical bulk order for a washing machine product has shown that the estimated average value of the resources used in the manufacturing process for a single machine amounted to £184.37. As part of the same analysis, the average value of resources actually built into the product was estimated as £165.89. Determine the resource efficiency value for this order.

b.

Following a cost reduction exercise in the manufacturing plant, a repeat order has been received for exactly the same product and quantity as that outlined in part (a) above. The estimated average single machine input and output resource figures for this order amount to £187.21 and 166.43, respectively. Determine the new resource efficiency value and explain what effect the cost reduction exercise has had if any on this figure.

4.2 Solution

a.	Y r = 165.89/184.37 = 0.8997 or 89.97%.
b.	Y r = 166.43/187.21 = 0.8890 or 88.90%.

A drop in resource efficiency of (89.97–88.90) = 1.07%.

On the face of it, the cost reduction exercise has had no effect on resource efficiency, with the cost of resource input rising together with the value of the resource output. This might be simply due to inflation, and as the example shows, there are dangers in using resource efficiency as a measure of sustainability performance at the operational level. Nothing has changed in the manufacturing system, the cost reduction exercise may well have reduced cost marginally, but this has been wiped out by inflation and resource efficiency appears to indicate a drop in company performance. Hence, there is a need to define this parameter clearly along with the correct deflated economic figures used in its calculation, to provide a sensible metric which is management informative and reflective of a company's resource efficiency. As explained previously and can be seen from the example, the use of cost base data to find an estimate of resource efficiency is easily accomplished.

Resource efficiency is thus a very complex strategy which attempts to maximise both human and natural resource productivity. A possible drawback that might occur during implementation is that individual middle management executives may view the policy from different perspectives leading to a clash of priorities in operation. In other words what might be efficient for one section of the organisation – manufacturing system might not be for another and system engineering techniques may need to be employed to resolve the conflict. The idea of resource efficiency is attractive conceptually and from the cost minimisation point of view, but in practice, it may be difficult to implement as many smaller firms do not have the sophisticated cost and accounting system it requires for practical use (the scope of such an exercise can be seen in a report by Vauxhall Motors 2004). For companies to progress along the path of sustainability this hurdle has to be overcome, and senior management must recognise the importance/contribution that an efficient and effective cost and accounting department can make to corporate profitability (see for example Lamberton 2005; or Schaltegger and Burrit 2000).

In the determination of resource efficiency, there is also a problem with inclusiveness, in effect where do we draw the boundaries in the company which enclose what we wish to include in the calculation? Obviously there is scope here for some manipulation by management to obtain the result required, and consequently careful metric definition is necessary. Although the calculation as set out in the above example is quantitative, practical data collection, analysis and measurement may be difficult. In addition, qualitative aspects may also be necessary to gain a full picture of resource efficiency and at present, it is not clear as to how this factor may be included in the calculation. Thus, the results can be open to interpretation. Nevertheless, the implementation of resource efficiency should be regarded as the third step in moving a company towards environmental sustainability, albeit that the procedure and metrics involved have yet to be precisely laid down and may in practice vary from firm to firm.

5. Eco-efficiency

This strategy is the top level in the hierarchy of strategies proposed to achieve industrial or environmental sustainability. It can be defined as

‘The production, delivery and use of competitively priced goods and services, coupled to the achievement of environmental and social goals’ (President's Council on Sustainable Development 1996).

As with resource efficiency, the definition outlined above is more a target to aspire to than a firm clearly defined and detailed policy for manufacturing companies. It is wide ranging and in scope covers waste prevention, dematerialisation, resource productivity and the minimisation of ecological impact consistent with improving the quality of life.

Conceptually, the definition can be restated as

Obtaining more value added in the product manufactured from a given amount of input resources with a lower or reduced level of emissions and waste (Modified, rewritten and presented in a manufacturing context from Rashid et al. 2008).

Eco-efficiency can be written mathematically as

	E e = V a/E ia (Schaltegger and Burrit 2000), where
	E e is the value of eco-efficiency achieved, V a is the value added and E ia is the environmental impact added.

In practice, for manufacturing companies, this ratio suffers from many of the same shortcomings as resource efficiency and really can only be measured sensibly in monetary units even though qualitative factors are obviously involved. Accordingly, and in some way which is yet to be defined, these qualitative factors have to be translated into economic units for the measure to be practical in an operational sense and useful to industrial manufacturing concerns. An example is given below of how it may possibly be used in practice at the operational level with the caveat that the situation described is purely hypothetical and the resulting solution may well be wide of the mark.

5.1 Example

The pickling and nickel-plating process for a washing machine outer tub costs £5000 to operate on a single shift basis over a five-day working week. In that period, 1000 tubs are processed and an estimate of the value added by the process amounts to 1/10th of the individual tub processing cost. The process solutions of sulphuric acid and nickel sulphate have to be disposed of on a fortnightly basis due to a ferrite sludge build up and the process tanks replenished with new solutions. The cost of treating the waste liquid such that it is safe for disposal amounts to 50% of the weekly operating costs. Determine the eco-efficiency of the process as currently set up and suggest how this figure might be improved?

5.2 Solution

The process costs at present £5000 to operate per week or £1000 per day.

1000 tubs are produced per week or 1000/5 = 200 tubs per day.

It costs £5000/2 = £2500 per week for solution treatment or £5000 per fortnight to safely dispose of the waste.

Individual tub processing cost equals £5000/1000 = £5 and the value added is 1/10th of this figure to give £0.50.

Solution treatment cost per tub is thus £5000/2000 = £2.5.

Eco-efficiency E _e = £0.5/£2.5 = 0.2 or 20%.

Assuming the process solutions do not deteriorate faster with an increase in tub processing, one solution to improve the situation might be to operate the plant 7 days per week rather than 5. This would make the weekly output of tubs 1400 rather than 1000.

Individual tub processing cost would then become £5000/1400 = £3.57 but the value added remains the same at £0.50. In both cases, the tub is identically processed; therefore, the value added must remain the same. Solution treatment cost per tub is now £5000/2800 = £1.78.

Eco efficiency E _e = £0.5/1.78 = 0.2808 or 28.08%. An improvement of 8.08%.

Although eco-efficiency is in general regarded as a broad, shallow, multi-dimensional strategy with at this point in time limited practical implementation possibilities and likely high cost in use, it might as the example shows have specific and useful application possibilities. In definition, it expresses a paternal and tenuous business – environmental link that may or may not be correct or entirely true in practice. Data collection, measurement, analysis for action and management all appear to be a costly and difficult exercise to undertake on a plant wide basis with the results being perhaps only of limited value. As a consequence, the effectiveness of this strategy for competitive advantage is at this point in time debateable, with the measure again suffering from definition, inclusiveness and boundary problems as with resource efficiency (Rashid et al. 2008). Conceptually, it may be regarded as the fourth and final step towards industrial sustainability, but its practical achievability notwithstanding the above hypothetical example is very much in question.

6. Conclusions

This paper has outlined a conceptual hierarchy of possible strategies to achieve environmental sustainability in manufacturing industry. Theoretically, it is a sensible and logical progression for companies to follow as they move towards the goal of sustainability in their industry. Many firms already practise waste management and material efficiency at present recognising the economic benefits that flow from these policies. However, it seems that few have moved on to resource efficiency and none as far as is known to eco-efficiency in its complete form.

Where companies have identified a market or detect a competitive advantage, they have utilised the ‘green’ agenda and instituted suitable methodologies, strategies or techniques to support specific claims for products or the firm as being eco-friendly. There are, however, some outstanding research questions in respect of this view of how industrial–environmental sustainability can be achieved. These are

1.	Within the main strategies outlined above, are there sub-strategies that can usefully be used to push the eco-aspect of sustainability forward, particularly in small- to medium-sized firms?
2.	Is the logical stepwise progression outlined above to be followed sequentially or can the strategies be implemented to a degree concurrently without stalling the culture change process within a company?
3.	What is the expected time frame involved at each stage of the learning, implementation and cultural change process before an organisation can move on to the next level of sustainability?
4.	Are the metrics suggested here or other alternative measures suitable for assessing progress towards environmental sustainability? Can they be clearly defined, easily evaluated, practical, informative and cost effective to use in practice?

As we have seen, strategy in this model of how industrial–environmental sustainability is achieved moves from a firm definition easy to measure and implement to a philosophical definition which may be difficult to measure and to implement (Rashid et al. 2008). However, a pragmatic view must be that at best the four strategies outlined above offer a logical framework which firms can follow in their search for industrial–environmental sustainability, but the detail of how to specifically achieve it in any or all of the stages is still somewhat vague, and requires specific research and case studies to outline it, this is especially so at the higher levels proposed and given the shortcomings outlined in the metrics examined.