Using Lean Activities to Target Environmental Concerns
"I'm from the government and I'm here to help you." These nine words were said to be the most feared sentence of President Reagan. Over 20 years later, many companies still feel the same way when they hear three letters: EPA.
However, not all of the Environmental Protection Agency's work is based on regulation and enforcement. Many programs exist to help businesses go beyond compliance. According to the 2007 IndustryWeek/MPI Census of Manufacturers, 70% of U.S. companies are implementing lean in one form or another. EPA's Lean & Environment Initiative builds off of this trend and serves as a clearinghouse of information for companies at all stages of their lean journey. When companies use lean activities to target environmental concerns such as greenhouse gas (GHG) emissions or fossil fuel use, the results can be astounding. Two examples include General Electric and Canyon Creek Cabinet Company.
General Electric
General Electric's GHG emissions became a major target for some of the lean activities undertaken by the company. GE's plant in Peebles, Ohio, is a leader within the company in applying lean to address GHG emissions. The Peebles facility is a jet engine test facility that spans 7,000 acres of woodland and runs tests in the open air. The amount of testing conducted at Peebles is directly related to the amount of business airlines are doing, and recently the aviation business has been on an upward trend. In the case of Peebles, more engine testing means more jet fuel consumption, which leads to an increase in GHG emissions. As such, Peebles has focused on finding ways to continue growing in business while managing its GHG emissions, and these reductions have also resulted in significant cost savings.
The Peebles facility began production testing in the mid-1980s, and currently tests 1,200 production engines per year. The facility estimates that 1,400 engines will be tested in 2008, followed by 1,500 in 2009, along with a continual increase in engine size. Peebles generally receives the most payback after newly instituting a program, and thus, each year as a program matures it becomes more challenging to improve costs. For 2007, Peebles saw a 17% improvement in cost and the facility has found the benefits to be recurring, because when an improvement is made to one engine it can then be applied to every engine tested thereafter within that engine family.
Canyon Creek Cabinet Company
The Washington State Department of Ecology's Hazardous Waste and Toxics Reduction Program (Ecology) and Washington Manufacturing Services (WMS) partnered in a lean and environment pilot project to provide technical assistance to Canyon Creek Cabinet Company (Canyon Creek), a large manufacturer of custom frameless and framed style cabinetry in Monroe, Washington. Ecology provided environmental expertise, while WMS provided lean expertise and management of on-site activities at Canyon Creek from May through August 2006.
Pilot project participants formed teams that included cross-functional staff from Canyon Creek and Ecology. Each team used the lean value stream mapping (VSM) method to identify improvement activities, and participated in three, week-long kaizen events to implement lean and environment improvements. During the lean events the teams conducted additional analysis of the sources and costs of environmental wastes.
The collective efforts of Canyon Creek, Ecology, and WMS produced considerable operational, financial, and environmental benefits. Process improvements at Canyon Creek resulted in reductions in lead times, work-in-process (WIP), defects, overproduction, downtime, operator travel time, and material loss and damage. These improvements also reduced the company's hazardous wastes, solid wastes, wastewater discharges, energy consumption, and volatile organic compound (VOC) emissions. With the decrease in VOCs, Canyon Creek will avoid the need to address additional regulatory requirements. As a result of the project, Canyon Creek has realized $1.19 million per year in cost savings through November 2007.
Government Cooperation
While these savings were a result of internal actions, the outcomes are documented on EPA's lean website and can be accessed by companies looking to host similar events. The Lean & Environment Imitative is not a program that companies can sign on to; rather it offers a wide array of best practices to be used as models for future projects. However, one cross-governmental program that utilizes many of these lean and environment concepts is E3. Operating under the umbrella of the EPA's Green Suppliers Network, E3 is a coordinated federal and local technical assistance initiative that helps manufacturers adapt and thrive in a new business era focused on sustainability. The program provides technical assessments of production processes and training in four key areas: lean, clean, energy & GHG emissions. Participants include local businesses along with their utility companies and various government assistance programs.
Southern Folger, a detention equipment manufacturer in San Antonio, TX, identified energy efficiency opportunities through one of these E3 assessments that included:
- $85,000 in potential energy savings
- Reduced annual electric consumption of 159,000 kwh
- Reduced monthly electric demand of 48 kW
- Reduced annual natural gas usage of 36,000 CCF
Funding for these programs come from the Department of Energy's Energy Efficiency and Conservation Block Grants as well as contributions from the manufacturer, utility and city or municipality.
Through the utilization of government resources, there are many opportunities to enhance process improvement activities. While many environmental savings are indirect results of lean activities, one needs only to tweak the focus of various activities to see increased results. Pinpoint where your highest costs lie and create events to specifically examine how to decrease those costs. Lean is a continuous journey and it is essential to continuously look for new ways of improving business operations. Aligning with local and federal government can provide both technical and financial resources. Looking at what others have accomplished through lean activities helps frame potential endeavors and offers a starting point. There is always room for improvement and, sometimes, the government really is here to help.
Christopher Reed is part of the Lean & Environment Initiative, U.S. Environmental Protection Agency
This article was made possible by the Society of Manufacturing Engineers Lean to Green Sustainability Tech Group.
