Months after the European Union's July 1 Restriction of Hazardous Substances Directive (RoHS) deadline, an ongoing RoHS directive (not a law) survey revealed that 83 percent of respondents were at severe to high risk of not being able to demonstrate compliance, Michael Topolovac, CEO of PLM provider Arena Solutions, told IndustryWeek.

Although initially viewed as costly burdens, regulatory requirements such as RoHS have emerged as competitive tools for manufacturers.

However, this is not a one-time project at the end of the compliance process, as two IndustryWeek articles aptly point out this week. Rather, it is an ongoing process, which, if done properly, can bring competitive success to manufacturers.

The winners will be those manufacturers who recognize that hazardous substance directives (like RoHS) are also business change agents that require new corporate-wide strategies, not simply reporting, according to Tom Maurer, global marketing director, high tech and electronics, with product lifecycle management (PLM) solutions provider UGS.

Dramatizing the need for high-level attention is the rapidly growing number of environmental regulations. There are at least 37 RoHS category bills in U.S. state legislatures.

Companies that view environmental compliance as only a reporting issue face recurring costs and increased risk that arises from late-term changes, manufacturing process delays and slow market launches, Maurer told IndustryWeek in a separate article today.

"Without new strategies, pre-compliance business processes will endanger customer satisfaction as well as market retention and growth," he said.

And the strategy and process must be ongoing.

Environmental compliance isn't a project that manufacturers can ever be 'done with. With restricted substances regulations becoming more commonplace, manufacturers will have to make compliance an essential element of their business activities and have systems in place to meet the requirements in all major markets.

In other words, as environmental/hazardous substances regulation becomes a growing characteristic of global trade, corporations must stop treating such restrictions as solitary one-time events.

Said a recent Aberdeen report on product compliance (via IndustryWeek):

Leading companies are adopting organizational approaches that encourage compliance, measure compliance performance more frequently and use appropriate enabling technologies to support designers in the right compliance choices at the point of design.

The report further notes that these same companies are "moving toward identifying and meeting compliance requirements early in the product design process" and achieving significant results:

• Twenty-seven (27) percent product-recall reduction;
• Fifteen (15) percent reduction in design failure rates; and
• Thirty-one (31) percent improvement in the number of products in compliance.

So where to begin? Via IndustryWeek, here are some start-up guidelines from Arena's Topolovac:

• Consider the compliance management capability as a significant PLM differentiator.
• Establish and communicate C-level commitment to compliance.
• If you haven't already, get the products compliant.
• Develop internal controls to assure maintenance of compliance. Include design for compliance.
• Make sure you're ready to report on compliance. One way is to demonstrate that a compliance-dedicated process is operating.
• Establish controls to assure that products stay in compliance.
• Plan and build the foundation for future compliance beyond RoHS.
• Organize regulatory compliance as a marketing opportunity by investing in information technology that can automate compliance as well as demonstrate your "green" commitment.

Sources

RoHS -- Don't Ignore the Opportunities
by John Teresko
IndustryWeek, Dec. 1, 2006

Still Not RoHS Compliant?
by John Teresko
IndustryWeek, Dec. 1, 2006