Tuesday, October 21, 2014

Industrial Ecology as a Source of Competitive Advantage

This came in via the Yale School of Forestry and Environmental Studies & the International Society for Industrial Ecology (IE).  The current issue is very timely, and I am particularly interested in this series of papers as a way to asses the progress that has been made in transferring the conceptual tenets of IE to practice.  The Journal of Industrial Ecology can serve as a springboard to push much needed ideas and technologies into the commercial environmental sustainability arena, and the now that the articles are currently available for download (for a period of time), this is a great opportunity for the ISIE to demonstrate the importance of their work. 

I think that IE as a whole has had a difficult time transitioning from lab/theory to practice, as many commercial initiatives that are framed under the IE rubric are oftentimes not exploiting the best available technologies and methodologies (ie, synthetic biology, sensors, advanced analytics, etc).  Hopefully, this issue can help to draw attention these ideas and project to a wider audience.

Industrial ecology has contributed important innovations to the pursuit of sustainability in business. Life cycle assessment and the use of life cycle thinking more broadly, industrial symbiosis and the exchange of resources among neighboring factories, loop-closing, material flow analysis, design for environment are innovations with the potential to reduce environmental impacts and to generate financial benefits for companies. Yet the case that these intriguing approaches actually contribute to corporate competitive advantage has not been made.

In “Industrial Ecology as a Source of Competitive Advantage,” a special feature of the new issue of the Journal of Industrial Ecology, cutting edge research is presented on how, when and why the use of industrial ecology by business can lead to cost savings, enhanced profits and a variety of more intangible business benefits.

Some highlights from the issue include:

• Johnathan DiMuro and colleagues from the Dow Chemical Company use replacement cost methodology and life cycle assessment (LCA) to systematically document the financial and environmental benefits of a constructed wetland at a Union Carbide Corp. plant in Texas.
• Christoph Meinrenken and colleagues from Columbia University and Pepisco present a tool that uses data mining and machine learning to rapidly generate product carbon footprints (PCFs) for PepsiCo and combine them with business key performance indicators on a routine basis in its strategy and business planning.
• Mark Finster and Michael Hernke of the University of Wisconsin develop a typology of strategic benefits related to competitive advantage that are enabled by industrial ecology concepts and methods, drawing on examples from Grohe, Interface, Maersk, Nestl√©, Procter & Gamble, and Unilever.
• Samuel Short and colleagues from Cambridge University explore the relationship between industrial ecology and business model innovation through a case study of British Sugar, the UK's largest sugar producer.
• Connie Hensler of Interface tracks the 20-year evolution of Interface's use of LCA as a tool guiding the company toward more-sustainable practices in carpet manufacturing.
• Mona ManYu Yang and colleagues of AU Optonics present a case study of how AU Optronics Corp., a global leader in thin-film-transistor liquid-crystal displays, differentiated itself from its peers and competitors by implementing IE approaches, most notably carbon footprint (CF) management and dematerialization.
• Joo Young Park and Hung-Suck Park present a case study of an industrial symbiosis involving a municipal waste-to-energy incinerator and the Hyosung chemical company in South Korea showing economic and environmental benefits of the project as well as an assessment of the competitive advantages for the participants.
Articles will be freely available online for a limited time at jie.yale.edu/comp-adv.

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