Design For Recycle

If you work your way through the posts on the automotive sector, the top supply tips, and the virtues of contract management and dive into the Corporate Social Responsibility & Sustainability posts, you’ll find a gem hidden deep in the mine – and that gem is Design for Recycle (also known as Design for Disassembly). As highlighted in his posts Sony to Turn Sustainability Into Money Maker and How Can You Do Good? Take a Page From HP’s Book, Tim points out how recycling is turning out to be a huge success for HP and Sony, from a financial perspective as well as a corporate social responsibility and sustainability perspective.

Not only is this a gem, but we’re not too far from the point where it will be critical for this to be part of every product manufacturer’s supply chain. Why? First of all, skyrocketing demand for raw materials in the developing nations is causing serious inflation across the board – and you can’t just expect to pass that cost on to your consumers who expect your product to hit a certain price point and, more importantly, may not be able to afford your product if you miss this price point. Secondly, you’re going to start to see a lot more regulation coming into play globally with regards to not only restricted materials and environmental impact, but also on disposal regulations and what YOU are responsible for. Europe led the way with the End of Life Vehicles (ELV) Directive and the Restriction of Hazardous Substances (RoHS) Directives. Starting this year automotive manufacturers must provide free take-back for all vehicles they’ve put on the market and make sure this is a local drop-off center for such vehicle in every market they sell in. Computer and Electronics manufacturers are now banned from using dangerous chemicals, must be 100% transparent with what they do use, and conform to all chemical directives, such as those found in Registration, Evaluation, Authorization and Restriction of Chemical substances (REACH). Parts of Asia are now proposing similar regulations, and with 71% of voting-age Americans believing that corporate America’s reputation as a whole is either “not good” or “terrible”, it’s not going to be able to stay off of the political agenda for much longer. (Is Your Corporate Reputation a Liability on Your Balance Sheet, Directors & Boards, p 32)

Then, there’s probably the most pressing gap of all – the forthcoming talent crunch. At first glance, you might think these are two completely unrelated subjects, but that’s just not the case. If you’re hiring today, you’re not only looking for Generation X‘ers (born between 1964 and 1979), but Generation Y‘ers (born between 1980 and 2000) as well, and these generations are very concerned about the environment, sustainability, and the responsibility of the corporation to address these issues. So much so that it may not matter how big of a paycheck you’re offering, because Generations X and Y, although they expect a big paycheck in return for what they can offer you, also value other things and won’t take a job that does not fit in with their lifestyle – which is becoming more socially cognizant by the day. Thus, those corporations who Design for Recycle at the beginning of New Product Development will be much more likely to answer “Yes” when someone asks if they Got Talent? compared to their competitors, which could be fighting much harder to hold their own in the talent war.

In other words, if you don’t adopt Design for Recycle, or at least Design for Dissembly soon, in addition to plunging sales in markets where environmental impact and sustainability are on the minds of every consumer, you also stand to face skyrocketing material costs and a lack of fresh talent to bring those products to market. A grim future, especially since those companies who have already adopted it are not only increasing market share, controlling raw material costs, and attracting the best and brightest – but making money off the deal. How can you beat that?

As far as I’m concerned, we’re already paying too much!