Using Operational Excellence to Achieve Sustainability and a Competitive Advantage
September 19, 2013
This is part two of the exclusive three-part Manufacturing Sustainability series intended to delve deeper into the dynamics of sustainable manufacturing, what it means, how it is achieved, and the value it can bring to the business enterprise and customers. This week, Mark Coleman examines the importance of integrating sustainability at the operational level of the manufacturer.
As part of a customer-and-market-facing sustainability strategy, manufacturers can differentiate their business and become supply chain partners of choice. Businesses that have pursued sustainable manufacturing goals have also achieved superior operational excellence and enabled their business to:
- Reduce greenhouse gas (GHG) and carbon footprint
- Reduce water consumption footprint
- Reduce fossil-based energy consumption
- Minimize or eliminate solid, hazardous, and other wastes
- Optimize the productivity of employees, equipment, and machines
- Optimize the use of alternative and renewable energy generation sources
- Optimize the ingenuity of employees for continuous improvement
- Legitimize and pass on tangible and quantifiable energy, environmental, economic and value-added benefits to customers, vendors, and the local community
The process requires a well-planned and executed strategy that also has a long-view. Creating value from investments in new technologies and operational practices can be achieved when strong management systems are linked to a disciplined approach to measuring, collecting, monitoring, and analyzing the right data.
Energy use represents a large impact for many manufacturing environments. By evaluating energy use in all facets of operations -- from the equipment level to the power grid -- informed decisions can be made on how to take action on energy efficiency and management.Harbec’s Journey
Harbec Inc., a custom injection molder and precision component part manufacturer based in Upstate New York, committed itself to efficiency in all facets of its business, but particularly with regard to the use of natural resources and energy. In the process, the company can more accurately predict its energy and operating costs and make plans for optimizing energy expenditures.
The company’s decisions about management systems, new tools and technologies, and specific policies and practices are integrated into an overall approach to sustainable value creation. The table below presents a sample of its management systems and practices.
|Management Systems and Governance||Tools, Policies, and Technologies||Energy Generation, Innovation, Leadership|
In pursuit of sustainability, manufacturers realize that energy is the most significant element of their impact and responsibility. Harbec has worked hard to create an integrated approach to improve operational efficiency and the infrastructure of its facilities.
There are pragmatic steps, processes, and technologies that can be used to improve energy efficiency. To address its energy footprint, Harbec had to understand its energy baseline and energy demand and cycling of injection molding machines in-step with production schedules, and the diversity of CNC machines and other tools used at their facility. In addition, the company made significant energy efficiency and resource utilization improvements including:Adopting proactive energy measurement and management systems, including ISO 50,001/SEP. The “SEP” certification associated with the ISO 50001 stands for “Superior Energy Performance”. SEP is a program that enables facilities to verify their energy performance with a transparent and globally accepted system. It also ensures companies have the right data to support continual improvements for energy efficiency. Optimizing equipment performance and life through embedded sensors and data acquisition. As part of their ISO 50001/SEP process, Harbec is putting into place an energy management system which will ultimately be able to measure energy at the equipment/machine level for each of its 40 injection molding machines, 40 CNC machines, laser sintering, and other specialty equipment. This will enable the company to proactively manage its energy use and the reliability and durability of its equipment. The adoption of sensors which can relay energy data at the sub-machine/component and machine level will allow operations managers to assess equipment health/performance and thereby its reliability. Proactive data acquisition and management will lead to less down time, better servicing of equipment/machines, and a more optimally performing business in the long run. On-site deployment of renewable and alternative energy technologies which enable the business to achieve fixed energy costs and increased energy utilization. To achieve this, Harbec has deployed two wind turbines rated at 250kW and a 850kW respectively and has integrated a combined heat and power (CHP) and distributed generation (DG) system consisting of 25 Capstone micro turbines rated at 30 kW providing a 750 kW potential. Approximately 50 percent of Harbec’s electrical power is provided by its two wind turbines. The balance is purchased from 100-percent green power sources. Eliminating the concept of waste. Hot exhaust generated by Harbec’s 25 micro turbine generators is directed to a heat exchanger which transfers the heat to water. The hot water is then used to heat the building through radiant in-floor systems and pre-existing forced air systems. During the summer, the hot water is sent to an absorptive chiller, which creates cold water for air-conditioning. This co-generation operation produces less than 10 percent of the CO2 emissions that the most efficient oil or coal burning utilities produce to manufacture the same amount of energy. Heat and air conditioning are free by-products of the combined heat and power (CHP) process. Adopting eco-economic equipment procurement guideline. Harbec has created and adopted an “Eco-Economic Decision Criteria” for all new equipment that includes parameters for assessing equipment energy efficiency and performance. Targeting high efficiency project opportunities. Harbec conducted its own in-house analysis and relied on external consultants to evaluate such energy efficiency projects as high efficiency lighting and daylight gathering, building envelope, HVAC, and thermal energy efficiency improvements. Lighting technology improvements have reduced the electric requirement for lighting by 50 percent. Investing in new equipment for long-term gains. Implementation of efficiency solutions within manufacturing processes included insulating the barrels of every injection molding machine in the facility, which reduced the energy used in the molding process by 40 to 50 percent. In addition, Harbec has purchased electric injection molding machines that have further reduced energy consumption while having a positive impact on processing speed and cycle time. Translating Efficiency into Value
The adoption of alternative energy technologies such as distributed generation or CHP systems requires a thorough understanding of energy consumption, peak energy demand, utility pricing, and other factors. Based upon its findings, Harbec realized energy costs can account for 6 to 8 percent of total operational expenses, yet they greatly contribute to the overall GHG and carbon impact of the business.
As Bob Bechtold, president of Harbec noted, “Six to eight percent may not seem like a lot, but for a tight margin business it adds up to quite a bit…further these figures equate to the level of investment we can absorb to support new energy projects…it’s not about the ROI for individual technologies, it’s about acquisition of high value assets (infrastructure) while achieving a net positive ROI for earning future business based upon our operational efficiency and ability to market our accomplishments.”
Mark Coleman is business development manager for Harbec Inc. He is the author of the book The Sustainability Generation: The Politics of Change and Why Personal Accountability is Essential NOW!. Throughout his career, Mark has developed a strong focus on the critical areas of energy, environment, and sustainability. His career has spanned strategic and leadership positions in government, applied research, technology development, and management consulting organizations. This rich and diverse experience has enabled him to have access to, engage, and work with a broad range of regional, national, and international leaders on the subject of sustainability. Mark resides in Auburn, N.Y., with his wife, Aileen, and two sons, Owen and Neal. Read part one of this series, Sustainable Manufacturing Is Shaping America’s Industrial Future. Read part three of this series, Sustainability Happens When People and Innovation Collide.