How Lean can be Green?
In the recent years, sustainability can be seen similar Megatrend as Lean. After centuries of industrialization and improving the production efficiency, new challenges have emerged. Today our society is facing generational challenges relating to the environment. How to maintain economic growth while managing scarce resources? How we improve our social conditions and equality and ethical standards?
Introduction
Since Henry Ford introduced his revolutionary methods of mass production in early 1900´s, industries have aimed for efficiency and shorter work phases and this has been an essential part of their competiveness. During the next decades, this evolved into Lean thinking, when Toyota introduced their Toyota Production System (TPS) (Womcak & al. 1990). Since introduction of TPS, different industries have followed and further developed the Lean Thinking. Maybe the most famous concept together with TPS is Lean Six Sigma, introduced by Motorola in the 1980`s. The real turning point of Lean Six Sigma was when General Electric made it popular in 1995 (Pepper & Spedding, 2010). Lean thinking is centered around manufacturing improvement and continuous improvement.
Lean and Sustainability
How can we utilize the new technologies such as the Internet of Things (IoT) or machine learning to improve our living standards and conditions? Corporations and business possess a significant role when meeting these challenges. However, are they making long term investments in intellectual and human capital environment friendly solutions or are they focusing on quarterly and annual earnings? One way to overcome these challenges is following sustainable structures.
Sustainability has a future loading as it is often referred to as sustainable development (Jokela & Halinen, 2015). On other words, sustainability has become increasingly important for all companies and industries, since it makes a big difference and huge impact in the way that companies work. In short, sustainability refers to impact that the companies have on the social, economic and environmental aspects of their operations and businesses across the globe are implementing innovative strategies aiming at promoting these aspects in their business.
Sustainability is a Megatrend and today debating whether it needs to be incorporated into business strategy is no longer an option. When developing business strategies, considering sustainability as value proposition can be essential to long-term success. It is becoming critical for companies to close the gap between knowing and doing by embracing sustainable practices.
The innovative leaders have seen their interested to focus on creating value through sustainability and companies are improving their competitiveness by addressing these sustainability issues proactively. Hence, the companies have changed their ways of conducting business and they are integrating sustainability to their strategy and business operations. Especially in industrialized countries, companies are aiming to be more and more green. They are realizing that this change, aiming for reducing pollution, waste, supply chain risk they can increase profits simultaneously (Sroufe, R. 2018). Companies leaving out from this trend are likely to lose their competitiveness compared to companies integrating sustainability.
Business Strategy, Lean Production and Sustainability
Lean thinking can be seen as one way of facing the challenges and increasing sustainability, especially the environmental aspect of it. As the basic idea of Lean thinking is to reduce waste and increase efficiency, it can be assumed that this automatically reduces also the environmental impact during the process. The relation between lean manufacturing and environmental sustainability has also been studied. Barbara Resta, Stefano Dotti, Paolo Gaiardelli and Albachiara Boffelli from Universita degli Studi di Bergamo, Bergamo Italy explore the relations between lean manufacturing and sustainability aspects in their article from 2017.
Their definition of Lean production was “an integrated socio-technical system whose main objective is to eliminate waste by concurrently reducing or minimizing supplier, customer and internal variability” (Resta & al. 2017. p 1-2). This is often forgotten when companies are developing their sustainable business strategies.
Eliminating waste can be implemented to every business and industry. Whether we reduce design or installation time or amount of work phases or for example use of material, this is eliminating waste and it has also impact for the sustainability. It is more of a matter of control and measuring of the results and how the environmental impact is validated. Companies are naturally, also without Lean, aiming for lowering their production costs, but this is usually only measured from the financial point of view. If companies would define KPI´s also for the environmental impact, for example carbon footprint, the connection between Lean and green would be more visible.
Lean is Green on Shipbuilding
Shipbuilding process can be used as an example, more specifically steel stairs construction. The stairs construction was also used for a case study in the Thesis work “GreeNIT – Lean sustainability”, by the main author of this article. In the case study, existing steel stairs construction was re-designed and the environmental impact was measured before and after by calculating the carbon footprint of stairs. The target of re-designing was not actually to reduce the environmental impact, but reduce the use of materials and installation time -> to be more lean.
First, installation team was interviewed and the existing structure was reviewed. This caused several changes and improvements for the connection methods and details between the stairs and ship hull and the actual work phases during installation were reduced and the estimated installation time in total could be reduced. Next, the stairs structure was re-designed in 3D-enviroment.
The way of 3D modelling was also improved and build as parametric, so this also reduced the design time over 80%. Next step was making FEM analysis for the stairs structure to optimize the material thicknesses and weight. Each part was optimized and as a result, weight of individual stair module was reduced app. 250 kg per module. For example in this case example there are 24 stairs each consisting of 10 to 20 modules, which means the overall weight saving (and saving of steel) is significant. Especially with the current steel prices, this naturally has a significant cost impact as well.
So regarding lean, the benefits of re-designing stairs were evident. Design- and installation time were reduced and use of materials were used less. How does this relate to environmental impact? The carbon footprint of old and new stairs design were calculated. GWP (Global Warming Potential) index of the new design was 719 kg CO2e lower than old design, meaning a 21% reduction of Carbon Footprint. This example shows, that even with relatively small changes aiming for cost savings and improvements for manufacturing can have great impact for the sustainability. And this calculation does not even consider the indirect impact of weight savings to ships fuel consumption.
Conclusions
The example above is a small part of a cruise ship, but similar development could be made through the ship and this is naturally done all the time. All the companies, also in other industries, want to be more efficient and more competitive. What they do not realize, that this has a huge environmental impact as well. This should be seen as a low hanging fruit when there is a global strive to reducing emissions. Small creeks form a great river.
References
Womack, J. P., Jones, D. T., Roos, D., & Massachusetts Institute of Technology. (1990). The machine that changed the world: Based on the Massachusetts Institute of Technology 5-million dollar 5-year study on the future of the automobile. New York: Rawson Associates
M.P.J. Pepper, T.A. Spedding, (2010),”The evolution of lean Six Sigma”, International Journal of Quality & Reliability Management, Vol. 27
Sroufe, Robert. Integrated Management: How Sustainability Creates Value for Any Business, Emerald Publishing Limited, 2018. P. 24 ProQuest Ebook Central, https://ebookcentral.proquest.com/lib/turkuamk-ebooks/detail.action?docID=5522649.
Jokela. P., & Halinen, A. (2015). Sustainability in B2B relationships – Focusing on economically responsible actions. Annual Industrial Marketing and Purchasing Conference. http://www.impgroup.org/uploads/papers/8552.pdf.
Resta, B., Dotti, S., Gaiardelli, P. & Boffelli, A. (2016). Lean Manufacturing and Sustainability: An Integrated View. IFIP International Conference on Advances in Production Management Systems (APMS). Sep 2016, Iguassu Falls, Brazil. pp.659-666. https://doi.org/10.1007/978-3-319-51133-7_78.P. 2-8.