Memorandum submitted by Walter R Stahel
1. SUMMARY
1.1 Opportunities of waste prevention exist
at each stage of the production chain, from mining to waste management.
1.2 This paper looks at durable goods and
opportunities of waste prevention during the utilisation phase;
it does not consider technologies of clean production: strategies
of product-life extension, strategies of a more intensive use
of goods (ie efficiency), strategies of alternative ways to fulfil
needs (ie sufficiency).
1.3 A comparative analysis of best optimisation
between these strategies often has to consider systems, products,
components and material in parallel.
1.4 Waste prevention in this sense is linked
to a number of issues, which are summarised in the figures at
the end of the paper:
— A shift from a linear or throughput
focused economy, in which waste means higher revenue, to a loop
economy and eventually a performance focused service economy,
in which waste means reduced profits. Waste prevention is achieved
primarily through the re-use, remanufacturing and technological
up-grading of goods and components;
— A change in business strategies towards
a higher resource productivity, through sufficiency and efficiency
strategies of involving closed material loops (technical and design
strategies) and closed liability loops (commercial and marketing
strategies). Waste prevention is here primarily the result of
a higher resource productivity;
— A new definition of quality defined
as system functioning over longer periods of time which encompasses
the two issues above and includes the "Factor Time".
Waste prevention is here linked to
loss prevention, and the issues of liability and product responsibility,
in addition to the factors mentioned above.
1.5 Corporations and economic actors will
make a choice between these options according to incentives and
framework conditions. In general, more liabilities and voluntary
responsibility mean higher uncertainty and thus potentially higher
costs that need to be balanced by higher profit margins. In each
case, a market must exist (ie demand and supply must be present).
1.6 An analysis of successful examples,
such as GE Medical Systems, Eastman Kodak's single use cameras,
textile services for towels and uniforms, Xerox's photocopier
leasing (selling customer satisfaction), Caterpillar's diesel
engine remanufacturing activities all show the waste prevention
potential inherent in a loop economy and a performance economy,
and the changes in corporate strategies necessary to profit from
the new strategies.
1.7 An analysis of less successful examples,
such as Interface's green lease for carpets (20 year leasing contracts),
Electrolux cancelled strategy of "rent-a-wash", the
commercialisation of re-treaded tyres and re-refined engine oils
enable to show the obstacles and problems encountered in moving
from a linear to a loop economy.
1.8 On a national level, Japan may be most
advanced in applying waste prevention through re-use of goods
through its strategy of reversed manufacturing. This strategy
is strongly supported by the fact that China offers a huge market
for remanufactured goods, which are "as good as new"
but do not always meet the latest design criteria.
1.9 Waste prevention along these lines can
be promoted through measures along several lines.
Technical issues:
— product design for re-manufacturing,
design for out of sequence dis-assembly;
— system design for re-use (eg tolerances
adapted to goods of different batches, eg ATM and banknotes, bottling
machines and re-useable bottles);
— multi-product component standardisation
by manufacturers (eg Xerox's commonality principle, platform concept
of Volkswagen group).
Free market issues:
— free access to used goods and components
for all including independent remanufacturers (principles of Roman
or German Law: a clash of property (dominium) v. common goods
(patrimonium));
— free sales of remanufactured and
used goods with warranty in the market.
Legislative issues:
— performance based technical standards
instead of material based standards;
— consumer protection through performance
instead of new-ness obligation; and
— component standardisation.
Walter R Stahel
5 January 2003
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