Environmental Strategies

Business & Environment

Receiving increased attention
Focus is more on manufacturing
companies
Environmental impacts of service
companies is also significant
Companies also offer environmental
services
 Environmental Services
Waste disposal
Cleaning services
Environmental lawyers
Environmental consultants
 Environmental Management and Profitability
Financial Performance

ROI, ROE
ROA, EPS

The Triple Bottom Line

Minority% of workforce, Hazardous chemical

Family-friendly forces Emissions, energy use
Living wage for international labour Solid waste recycled

Social Performance Environmental Performance

 Poor environmental performance
Can lead to fines
Litigation and its costs
Damage to the company’s brand

While sound environmental management

Leads to cost reductions, quality and yield
improvements, improved relationships with
regulators, reduced insurance costs and
enhancement to the company’s revenue streams and
brands. Positive mention in the media about a
company wrt environmental issues have contributed
positively to the share price.
Delta Airlines achieved significant cost reductions when
they pioneered the practice of using only one engine
while taxiing. It effected substantial fuel cost savings
while fuel not burned contributed to energy
conservation and pollution reduction.
 UPS example
UPS redesigned its packaging making
its next day air service packaging
both lighter and reusable.
Saved UPS – 1.6 mn USD per year,
conserved enough energy to light
20,000 light bulbs for a year,
eliminated 550 tons of solid waste
and saved more than 2200 tons of
trees.
 Market for environmental services
In US alone worth 200 mn USD
An environmental service co alters the
environmental performance of another
company.
BCG undertook many projects with significant
environmental implications
PriceWaterhouseCoopers offers a wide range
of environmental services. Their services
range from raw material use and disposal to
developing sustainable product strategies to
advice related to global climate change.
Both BCG and PWC are members of WBCSD
(World Business Council for Sustainable Development)
 LEED Certified Buildings
Architects and Builders offer important
environmental services.
Leadership in Energy and Environmental
Design (LEED) programme sets guidelines
for designing and constructing
environmentally friendly buildings.
LEED emphasizes five design areas:
1. Building site selection and erosion control
2. Water efficiency
3. Energy and atmosphere
4. Materials and resources
5. Indoor environmental quality
 Environmental Services
Degree of interaction and customization
Low High

Service factory Service shop

Traditional •Hospitals and Auto Repair
•Airlines and Hotels
Degree of labour intensity

Environmental
Low Environmental •Hospital environmental
•Solid waste management services and hazardous
and facilities management waste management

Mass service
Professional Service
Traditional
Traditional
•Retailing and Schools
High •Lawyers and doctors
Environmental
Environmental
•Environmental Standards
Environmental consultants,
Organizations like
Architects and auditors
ISO 14000
 Environmental Issues for Service
Degree of interaction and customization
Low High

Service factory
Service shop
Airlines
Hospitals
Solid waste from cabin service, fuel
Solid waste from rooms, biohazards,
use, engine emissions, hazardous
Energy uses from lighting and climate
chemicals from aircraft maintenance
Degree of labour intensity

Control, water use from laundry, cleaning

blue water
Chemicals.
Low Hotels
Auto Repair Shops
Solid waste from restaurant and
Hazardous chemicals to clean parts,
room operations, energy use,
Waste oil, solid waste of replaced parts,
Lighting and climate control,
Hazardous chemical-soaked rags
Water use from laundry
Mass service Professional Service
Retailing Operations Consultants
Fuel and emissions from product Fuel and emissions from travel, paper
distribution, urban sprawl from location Use, carbon dioxide emitted during client
High decisions, solid waste from packaging
meetings
Schools
Energy use from lighting and climate
control, food waste, hazardous Dentists
cleaning products, paper use from Biohazard waste, toner cartridges, paper
copiers and printing and other office waste
 Coalition for Environmentally
Responsible Economies - CERES
Protection of the biosphere
Sustainable use of natural resources
Reduction and disposal of wastes
Energy conservation
Risk reduction
Safe products and services
Environmental restoration
Informing the public
Management commitment
Audits and reports
 Services and their environmental impact
Hotels offer guests the choice not to have
sheets and towels changed every day which
saves water, electricity and saves the amount
of residual laundry soap discharged into the
sewer system.
Office waste – paper/cartridges
Medical wastes from doctors include
soiled/blood soaked bandages, used surgical
gloves, instruments, needles, cultures,
swabs, glassware and removed body organs.
Auto repair shops work with hazardous
cleaners, worn out parts, motor oil and other
hazardous wastes.
 Environmental Strategies for
Service Operations
Process Opportunities
1. Process improvement (TQEM)
2. Process certification – ISO 14000, Self-
certification or subscribing to
environmental standards like CERES
principles
3. E-commerce – Migrating to paper
based processed to e-commerce model.
E-ticketing, E-statements
 Product opportunities
Product Redesign – Change from high
contact design to low contact design
impacts costs
Value-added services along
environmental dimensions – UPS –
Service Parts logistics group manages
critical repair component distribution
systems for telecom and computer
companies.
Dematerialize
Thank You