Originally published on Planetsave.
By Piotr Jędrzejuk
Did you know that McKinsey & Co. has estimated that the world could save $2.9 trillion annually just by eliminating wasted energy? The following video explains how… and so much more!
In the video, Jonathan T. Scott, who has helped hundreds of companies in over a dozen countries save millions of dollars in costs, explains how and why businesses can reduce unnecessary expenses and increase profits by understanding the basic building blocks of sustainability.
The information he presents is as important as it is useful, and affects all forms of companies — from giant international corporations to small and medium-sized businesses (SMBs).
As Scott explains, sustainability in a business context begins with waste elimination leading to closed-loop, resource-life extension practices (the video explains this fascinating concept through animations). Just as important, in some cases, the process can begin with no capital costs.
The following are some mind-blowing facts and figures from the video and its accompanying free book: The Sustainable Business: 2nd Edition (which, as the video explains, can be downloaded for free):
- Closed-looped practices need less energy, less waste and pollution is created, and more people are employed. Materials recapture employees from 9 to 60 times more people per ton than the landfill site.
- Recycling has been credited with producing 1.1 million jobs and grossing over $236 billion in revenues. This means that, for every 10,000 tons of waste that are recycled, around 36 new jobs are created.
- DuPont Corporation reduced its energy use by 6% and increased production by 40%, thereby saving the firm over $6 billion. It also created revenues of $2.2 billion from the sale of waste products at a cost savings of $400,000. Further sustainability-based activities at other DuPont subsidiaries generated over $1.6 billion in revenue.
- General Electric waste initiatives generated $100 million in cost savings for the company’s bottom line while yielding a portfolio of 80 new products and services that generated $17 billion in annual revenues (greenhouse gas emissions were also reduced by 30%).
- Yahoo saves 60% of its electricity costs by opening the doors and windows where its servers are located and letting the hot air out.
- UPS teaches its drivers to reduce left-hand turns, pack trucks tighter with more packages, and drive fuel-efficient trucks more efficiently. As a result, the company saves millions of dollars every year in petrol costs.
- Sierra Nevada Brewing Company in Chico, California, has purchased solar panels that produce 203 kilowatts of electricity, in addition to four 250-kilowatt fuel cells. Thanks to rebates, tax credits, and other financial incentives, a 100% return on investment (ROI) is expected in six to seven years. Additionally, the company has saved $1 million in landﬁll fees and $2 million in waste haulage fees by finding ways to reuse or recycle what it used to throw away.
- Caterpillar has delivered years of record profits due to a manufacturing business model that makes high-quality components, collects them after they’ve been used, cleans them up, and reincorporates them into new products at a cost that is 30%–60% less than making them from scratch. Many of these parts are made once and sold three times. More than $1 billion worth of sales were reported in 2005 at one Caterpillar operation alone. And before the 2009 recession, this number was growing 15% annually.
- Interface Inc., the world’s largest manufacturer of commercial carpets, has, for 14 years, been using old carpets to make new carpets instead of sourcing petroleum as a raw material. During one 5-year period, proﬁts doubled, employment doubled, and the company’s stock price increased 550%.
- Wal-Mart issued an edict to its distributors demanding that they reduce their packaging by 5%. As a result, the retail giant is now saving $3.4 billion a year in waste disposal costs.
- 3M Corporation discovered that its pollution prevention efforts had lowered overall waste and emissions by 50% and had resulted in the company saving over $500 million in costs. In 2005, 3M’s program celebrated its 30th anniversary with enough accumulated data to reveal that Joseph Ling had saved the company over $1 billion in costs.
- A printing-and-publishing and integrated-operations team in New Jersey, designed, tested, and implemented a new system to recycle acetone/water waste solvent back into a production process for manufacturing toners. As a result, waste from drum disposal was reduced by 95%, $180,000 in capital expenses was avoided, the business saved $150,000 in annual costs, and the potential for worker spills and exposure to toxins was reduced.
- Lockheed Martin reported saving half a million dollars on its energy bills and enjoyed a 15% reduction in absenteeism after moving its ofﬁces to a building lit by natural light. The company subsequently discovered, much to its surprise, that a 2% increase in productivity equates to $3 million extra per annum. The increase in productivity alone paid for a new headquarters building in less than one year
- By installing skylights and additional insulation to improve lighting and temperature control, VeriFone’s credit card veriﬁcation facility in Costa Mesa, California, decreased energy consumption 59%, reduced absenteeism by 47%, and boosted productivity 5%–7%
- Frito Lay factory in Casa Grande, Arizona, is working to recycle 85%–90% of the water used in its plant combined with an intense energy-efﬁciency program. Faced with regional droughts and potential water use restrictions, the company decided to act fast and expects to save $60 million annually.
- A study of eco-industrial parks in Denmark (Kalundborg), Texas (Brownsville and Pasadena), New Hampshire (Londonderry) and Mexico (Matamaros), revealed that the annual economic beneﬁt enjoyed by participating companies in an industrial ecology arrangement is as high as $8 million, with an annual return on investment reaching 59%.
- A Polish metalworking plant allowed scrap metal to be incorporated straight back into the system, which led to a 30% reduction of raw materials and annual cost savings amounting to $70,500.
- Simon Fraser University in Burnaby, British Columbia, installed a closed system to reduce domestic water use and saw its water bills fall by $35,000 in one year.
On and on it goes… Are you and your business ready to begin?
Watch the video and then read The Sustainable Business and its accompanying workbook, The Sustainable Business WorkBook: Waste Elimination. Both books can be downloaded for free from the European Foundation for Management Development (EFMD): The Sustainable Business
Reprinted with permission.