A Few Notes about This Blog

This blog shares my insights on the design, introduction and active management of effective sustainability programs in hospital settings. Unlike the thousands of discussions on sustainability's altruistic, conceptual and technical aspects, though, this blog approaches the discipline from organizational management and development perspectives.

Over the past few years there has been a lot of discussion in the trade media around the American Hospital Association's new "Sustainability Roadmap for Hospitals," which complements the association's excellent work in its recent "Executive Primer on Hospital Environmental Sustainability." (
http://www.hospitalsustainability.org/)

With the AHA - as well as Practice Greenhealth, Healthcare without Harm and other organizations - staking authoritative claims to the topic, why do I think it necessary to add my two cents? Here's why. The AHA executive primer covers several of the big concepts any good sustainability program should have. Further, its roadmap details many of the high-level steps needed to create and run it. However, neither will be able to adequately explore institution-specific details for successful organizational design, change management and program effectiveness.

That's not a failing of AHA's superlative work; it is simply recognition that when it comes to management programs, such as sustainability, one size does not fit all. Each hospital needs to custom design its own sustainability program to meet its specific needs, including working within its resource limits and opportunities. Helping you and your institution work through the details is where this blog comes in.

The first few blog posts address basic concepts, including the special challenges healthcare delivery organizations face whenever they create new performance capabilities. After that the discussion will shift to the key questions a hospital – or, any other organization for that matter – must answer in creating and running a sustainability program and, by extension, an all-encompassing corporate social responsibility program. Then, the discussions dive into the "how-to-do-it" details with a big emphasis on anticipating and controlling obstructions to success.

Rather than prescribe rigid off-the-shelf methods that may have worked well elsewhere – yet, might not work so well at your hospital – these discussions will pose key questions that must be answered by the best minds at all levels of your institution to create a customized program.

This blog is a serialized body of work. So, if this is your first visit, I highly recommend that you start with the oldest post date and work forward from there. The entries will make a lot more sense that way.

For those of you who work in other industries, substitute the words "hospital" and "healthcare" used throughout the posts with the name of your industry or company. You'll probably find the information in this blog fits your field and organization quite well.

Lastly, if you are a sustainability professional, I would be honored if you sign-up to follow this blog and share it with your colleagues. Also, please feel free to share your views and experiences.

Thank you for stopping by.

Tuesday, March 6, 2012

MAKING MONEY BY DOING GOOD: SUSTAINABILITY'S VALUE PROPOSITION AT FOR-PROFIT COMPANIES

Foreword
Despite this post’s title, it really isn’t focused exclusively on for-profit enterprises.  In fact, it’s not focused on the healthcare-delivery industry, either.  However, because it is applicable to any organization that raises and spends money to operate, I think you might find it highly useful. 

This is especially true if you are a technical professional in one of the sustainability specialties.  Harkin back to all the discussions you’ve heard or been a party to where someone makes the point that technical specialists just don’t:

  • Know how to talk with organizational leaders in management terms, or
  • Understand what organizational leaders really expect of them.

Further, in recent months it has become apparent during discussions with people interested and involved in sustainability that many simply do not understand the motives of those private-sector, for-profit companies that are embracing green disciplines.  In fact, many people who work at these for-profits don’t quite understand the motives, either. 

So, I wrote this article to explain why for-profits are now finding the idea of sustainability so appealing.  It was recently shared through the Orange County Sustainability Collaborative in California.  (http://www.ocsustainability.org/)

For those of you who have read every post in this blog, the ideas presented here will certainly sound familiar.  That’s because you’ve read them before, albeit scattered throughout 14 blog posts.  However, the value of repeating these ideas is this:  they are now collected into one unified, easy-to-share primer on sustainability’s value-proposition at for-profit companies . . . or any other enterprise for that matter.


oOo


INTRODUCTION
Rather than examine sustainability from a technical, academic, political or altruistic perspective, this article considers the idea from a business perspective.  It is important to do so because many of the discussions around sustainability by technical professionals, academics, politicians and activists center on what business should be doing to be more socially and environmentally responsible. 

However, these groups share little of the for-profit business paradigm and, therefore, have an often limited understanding of what motivates companies to enthusiastically embrace the idea of sustainability.   Hence, there can be a bit of suspicion around corporate motives.  To help dial-down such suspicion, this article is provides insight into sustainability's business management concepts to enable greater understanding, if not mutual respect, among all parties. 

It is fair to say that throughout the history of the environmental movement the for-profit economic sector has filled a critically important and melodramatic role, i.e., the Bad Guys!   So, what are these “bad guys” really up to when they take up the cause of corporate social responsibility and its subset, sustainability? 

What's in it for them?  Quite a lot, actually.

But, before digging into why and how a company goes green, let's look at a basic definition of sustainability in a corporate sense.  Then, we'll move on to exploring its business underpinnings through:

  • The relationship between the no-money, no-mission and the people-planet-profit (3P) concepts
  • The green-efficiency concept, and
  • The supply chain, value system, value engineering and lifecycle dimensions of green efficiency.


CORPORATE ENVIRONMENTAL SUSTAINABILITY
Here's a basic definition of sustainability from a business management perspective:  

Sustainability is the way an organization creates value throughout the entire closed-loop lifecycle of a product or service by maximizing the positive social, environmental and economic effects of its activities while minimizing their adverse impacts.

Notice how John Elkington's triple-bottom-line corporate responsibility concept is integrated into this definition of sustainability. The triple bottom line is a true-cost-accounting concept that considers the full impact of business decisions in terms of ecological and social values, as well as economic value. It is also known as The Three P's of Corporate Responsibility, i.e., people, planet and profit.

Operating within this definition involves the following, as illustrated on The Five Corporate Functions of Sustainability:  (Click on Figure Below to Enlarge.)

           Systematically managing all aspects of a sustainability program within an organization's resource limits and opportunities

           Avoiding and controlling risks, including – but not limited to – environmental, health and safety regulatory compliance, as well as compliance with an ever-expanding myriad of industry-specific standards

           Reducing costs by eliminating all kinds of waste, including administrative, operational and environmental wastes

           Growing revenues with green-attribute products and services, and

           Leveraging competitive advantages through greenwash-free organizational transparency.






HARD FINANCIAL REALITIES IN THE FOR-PROFIT, NOT-FOR-PROFIT AND PUBLIC-AGENCY WORLDS:   NO-MONEY, NO-MISSION
By all appearances the triple-bottom-line concept assigns co-equal – and perhaps even balanced – status between financial, social and environmental performance.  However, in practice the prime directive of finance ekes-out a bit of preeminence on behalf of fiscal performance over the other two . . . and for good reason.

Let's define that strange Trekkie-sounding term, the prime directive of finance. Every organization must obey it above all else.  It's the "No Money, No Mission" concept. The only way it can be achieved is by:

Balancing all organizational activities within resource limits and opportunities.

Of course, the no-money, no-mission concept looks a bit different at for-profit companies, not-for-profit institutions and public entities. For example, because of the body of law regulating for-profit corporations – particularly publically traded corporations – their view of the concept is this:

The only reason for-profit organizations exist is to increase the wealth of their equity holders.

Yes, it's cold, hard capitalism at its best – or worst – depending on your perspective. Unless a for-profit company is financially healthy enough to produce profits – and therefore build-up its balance sheet – it will not survive.

Before those of you at not-for-profit institutions and public agencies start feeling a bit smug, though, remember your organizations have a prime directive of finance, too.  Here it is:

An organization must secure adequate financial resources to minimally sustain and ideally expand its mission.

In either case without money – i.e., the financial dimension of the triple bottom line – the social and environmental missions are not possible at any organization. Sacrilege?  Maybe, maybe not?  It's something to ponder, though, isn't it?


GREEN EFFICIENCY
When any organization embraces sustainability, it begins achieving its prime directive of finance by collating the essential business-based concept of green efficiency into all of its basic management policies, strategies, tactics, procedures and activities.  Here's the green efficiency mandate:

Achieve the organization's people, planet and profit objectives with least cost, effort and risk throughout the entire closed-loop lifecycles of its services and products.

The suspicious among you have probably figured out that a company can set high standards or it may set low ones.  Either way, it may claim to be a corporate "good guy" by simply achieving its 3P objectives no matter how spurious they might be.  However, leaders at ethical companies know when it comes to "corporate reputation" it doesn't pay to set anything but high-level, yet realistic, green performance standards. 


GREEN MANAGEMENT PERSPECTIVES THROUGH SUPPLY-CHAIN, VALUE-SYSTEM, VALUE-ENGINEERING AND LIFECYCLE CONCEPTS
To truly go-green a business must eventually redefine its corporate responsibilities within the frameworks of its product and service lifecycles.  Let's consider the four key concepts in this redefinition:  supply chains, value systems, value engineering and lifecycles.  Why these concepts?  Because it is through them a company manages risks, reduces costs, increases revenues and leverages other competitive advantages. 


Supply Chains – The redefinition starts by expanding the industrial-engineering-based view of its supply chains, which are:

The movement and storage of raw materials, work-in-process inventory and finished goods from point of origin to point of consumption.

Did you notice how this definition of supply chains stops with the point of consumption?  That's not very sustainable, is it?  You're right!  It's missing the reverse-logistics element!  Reverse logistics is:

The discipline of planning, implementing, and controlling the efficient flow of materials, production inventory, finished goods and related information from the point of consumption to the point of origin for the purpose of recapturing value or proper disposal.


Value Systems – Well, as you might imagine, such conceptual limitations have inspired others to expand the supply chain idea.  For example, Harvard professor Michael Porter expanded it in these paraphrased terms by introducing the idea of value systems: 

A value system includes all of the supply chains of an organization's suppliers, the organization itself, the organization's distribution channels, and the organization's downstream buyers and so on until the product or service has reached the end of its useful life.

As products – as well as services – pass through all sourcing, production and distribution activities in order, they should gain some value.  Of course, being systems designed and operated by humans, they have built-in inefficiencies and also accumulate more over time.  As a result, contemporary operations management is focused on identifying and eradicating inefficiencies.  Such management activities even have a name:  value engineering.   


Value Engineering – Value engineering is a body of operations management and industrial engineering techniques that identifies and removes unnecessary expenditures, thereby increasing value for producers and their customers.  The basic idea of value engineering is this:

Get the junk out of corporate activities because for every dollar put into production and/or service delivery the organization should have more product and/or service capacity to sell by eliminating that waste!

It's not too hard, then, to understand that each activity in a value system presents significant risks to the desired achievement of value gain.  In standard value engineering terms, the junk that diminishes or prevents value gains includes: 
  • Delays
  • Mistakes
  • Defects
  • Waste of all kinds
  • Work-arounds and rework, which are two rather insidious forms of wasted labor effort and other production resources
  • Accidents, and
  • Negligence.

However, when a company goes green, it focuses even more heavily on solid, hazardous, gaseous, aqueous, and energy wastes than before.  The reason is that these wastes are the ones that cause significant adverse changes in the environment over the lifecycles of products and services, and thereby create risks and liabilities for the company. 

Further, any potential or actual social or economic harm to internal or external individuals, groups or communities arising from corporate activities is wasteful.  Here's why.  It requires diversion of scarce corporate resources to manage unnecessary, avoidable problems. 

Hence, eradication of these wastes through continuous-improvement methods has critical business importance in terms of:
  • Managing risks
  • Reducing expenses
  • Creating green-attribute and otherwise socially responsible products and services to increase revenues, and
  • Leveraging competitive advantages through greenwash-free transparency.

With inefficient junk of all sorts removed from its various corporate activities, a company has a better chance of achieving not only its financial objectives, but its environmental and social ones, too. 


Lifecycles – The lifecycle concept expands the idea of value systems with these two additional dimensions.

  • The first dimension is a clear focus on the upstream, current and downstream lifecycle phases like those shown on the figure, Basic Closed-Loop Lifecycle Phases.  (Click on Figure Below to Enlarge.)   Effective management of lifecycle phases generally offers several advantages.  Here are two of the primary ones.
    • By influencing upstream suppliers to become more sustainable, an organization may create specific opportunities for lower production and service-delivery costs.
    • Likewise, specific opportunities may arise by influencing downstream product and service users and end-of-design-life reverse-logistics agents to reduce corporate risks and their associated costs. 


  • And, the second dimension is recognition that all value-systems must be closed-looped through effective use of the 3-R concepts to manage wastes in every lifecycle phase by reducing, reusing and recycling.

So, as you can see by this discussion, the lifecycle concept may be regarded as the most evolved consideration in value system management.  As such, the lifecycle perspective opens-up a new core organizational management view of corporate success by providing: 

A closed-loop production and service-delivery framework spanning a product or service's entire lifecycle within which an organization may achieve all of its 3P objectives with least cost, effort and risk thereby enabling achievement of the prime directive of finance.


CONCLUSION
So, again, what does all of this really mean?  Why are the bad guys really going green?   Simply this:  corporate environmental sustainability, when done right, enables a progressive for-profit enterprise to:

Make money by doing good!

Granted, there is a lot of well-deserved fear and loathing out there for many corporations.  However, we've got to give the good ones their due for finding a sound business-based value proposition for environmental sustainability . . . even if we do so begrudgingly.  Why?  Because as the preceding discussion illustrates . . . and as Kermit the Frog says . . . 

"It's not easy being green."




Friday, February 24, 2012

SO, YOU WANT TO DITCH HEALTHCARE AND BECOME A PROFESSIONAL SUSTAINABILITY MANAGER? FINDING THE RIGHT CORPORATE SUSTAINABILITY MANAGEMENT DEGREE PROGRAM

Even before my work in 2009 to design a couple of courses for a large university system serving working professionals, I was fascinated with the concept of an ideal undergraduate or graduate degree program in corporate environmental sustainability management.  It all started back in the mid-1990’s while I was at Midwest Research Institute as a principal scientist completing an MBA on the side.  Of course, at that time there were no green MBA programs.   So, I did the next best thing and wrote my thesis on corporate environmental management system design and implementation.

It only seemed natural for me to write a business administration thesis on an environmental management topic.  By that point in my technical career I realized that although solutions to environmental problems often involve logic, science, engineering and technology, implementing those solutions requires advanced management skill sets.  Management skill sets are needed to lead groups of differentially motivated, highly emotional and often reluctant people through planning, organizing and controlling to beneficially transform an organization’s functions and outcomes. 

Okay, it’s time for an epiphany . . .  if you’ve been relying on reason and altruism alone to effect green changes at your hospital, you now know why you struggle so much. 


A PERSPECTIVE ON SUSTAINABILITY MANAGEMENT EDUCATION
As Groucho would say, you can’t swing a cat these days without hitting a certificate, bachelors or masters program in sustainability.   But, how many of them are really any good?   I think an appropriate answer could be:

Not as many as one might hope.

I came to these generalized conclusions about academic sustainability programs while researching the state-of-the-art three years ago: 

           Far too many programs consisted of retreaded – but essentially unchanged – science and management courses “tarted-up” with sustainability buzzwords

           Publishers – when they did print sustainability-themed textbooks – were guilty of the same sins as academia

           There wasn’t much information being provided by juried journals, whereas, the popular sustainability e-press was bursting at the seams with a never-ending flow of useful information drowning in drivel

           Professional societies and their publications viewed the broad range of sustainability disciplines almost exclusively through the myopic lens of their particular specialty, and

           Despite all the buzzword-centric programs and courses, few, if any, were defining and teaching real-world systematic processes to actually do sustainability work in corporate settings.


WHERE DO THINGS STAND IN SUSTAINABILITY MANAGEMENT EDUCATION?
Three years later I’d like to think things have changed . . . but, I have my well-founded doubts.   So, last summer in a brilliant display of self-absorbed chutzpah I assembled a fairly complete template – or so I thought – for an undergraduate or graduate degree program in corporate environmental sustainability management. 

First, I masochistically ran it past close colleagues and other cronies for their review and amendment suggestions.  Then, I sent it out to a few arm's-distance-chums in academia, who happen to be deans and department chairs.  Just so you know, the academia sample size – which was utterly inadequate in a statistical sense – included six public and private universities from the middle Atlantic, southern and western states. 

Two of the schools are in the early stages of developing new programs, while four of them have existing ones.  It’s important to note that of the existing programs, one is very highly regarded nationally and the others are well regarded in their respective regions. 

The responses back from the colleagues were extremely useful, as were those that came back from the academics . . .  only in different ways.  Here are some of the responses received from the deans and department chairs.   (BTW, I love the last comment!)

  • “We don’t have any faculty who can teach these subjects and due to budget constraints we can’t hire any new ones who do, even if we could find them.”
  • “There aren’t any textbooks on these subjects.”
  • “We don’t have money for new curriculum development.”
  • “We’re a top-tier school in sustainability.  We feel our existing curricula are adequate.  We don’t need to create new programs and courses.”
  • “We don’t understand how business management fits into the science of sustainability.”

Wow!  Even though these responses could hardly represent all of academia, just the same, they were real eye-openers!   Here we have private-sector companies leading a sustainability revolution.  Yet, some schools – hopefully not all of them – are taking inadvertent and, in some cases, intentional “follower” positions in the development of the field. 


FINDING THE RIGHT PROGRAM
So, should you want to broaden your professional skill sets in sustainability management, you have your work cut out for you.  Indeed, collect every bit of detailed comparative information you can find on academic rigor, programs, courses, and faculty qualifications from as many schools you might be able to attend. 

Uh-oh!    Another one of my very strongly held biases just slipped out.  Unlike traditional disciplines, such as history, where an online program may be perfectly adequate, I’m of the opinion – and, it’s just a personal opinion – that management courses should be taught sparingly online. 

Why?  The management disciplines are as much art as they are science.  Through these disciplines a student learns how to lead organizations, i.e., groups of people.   Leading groups of people is a high-touch activity requiring a well-developed emotional-quotient (EQ) to understand and motivate human beings in all of their varieties, especially the neurotic and sometimes psychotic ones.  Following this line of reasoning, I can’t fathom how a future organizational leader could possibly develop a high EQ while holed-up hermit-like in front of a computer monitor.  

So, I’d suggest finding a really good on-the-ground program where you can mix-it-up nose-to-nose with other students and faculty.   Plus, if a school requires internships and other real-world interactions, all the better yet.  

In your research for the perfect sustainability management program I’d suggest comparing available programs to the curriculum template presented at the end of this post.  If you can find something that comes close to the template’s suggestions, go for it. 

However, don’t waste your precious tuition dollars on wannabe programs.  If you can’t find a good program, become a discerning self-teacher/self-learner and get yourself some green project experience.  You’re a smart person; you can do it.  You may just end up farther ahead in your professional development than you would otherwise.  Plus, you may just have a lot more money in the bank for starting-up that new green enterprise of which you’ve been dreaming. 


 oOo


A SUGGESTED CURRICULUM FOR
AN UNDERGRADUATE OR GRADUATE
BUSINESS DEGREE PROGRAM IN
CORPORATE ENVIRONMENTAL SUSTAINABILITY MANAGEMENT

A business-focused environmental sustainability program has five essential elements:
  • Strategic, Tactical and Operational Environmental Sustainability Program Management
  • Regulatory and Industry Standards Compliance 
  • Efficiency in Product and Service Value Systems and Their Lifecycles
  • Increased Revenue Generation through Green-Attribute Products and Services, and
  • Tangible and Intangible Competitive Advantages through "Greenwash-Free" Corporate Transparency.

Divided into these five elements, basic courses are suggested below.  In addition to sustainability courses, standard business management prerequisites are also suggested.  As currently outlined, there are 25 3-unit courses, including the prerequisites.  Of course, there are opportunities to reduce the number of courses down to a 60-unit curriculum by merging related topics.

 
STANDARD BUSINESS MANAGEMENT PREREQUISITES
  • Introduction to Business Management
  • Financial Accounting
  • Managerial Accounting
  • Finance
  • Statistics
  • Macro and Micro Economics
  • Information and Communications Technology
  • Ethics
  • Marketing
  • Business Law/Corporate Risk Management
  • Operations Management (Emphasis on Systematic Continuous-Improvement Concepts and Methods, Administrative and Industrial Process Design, Project Management, Active Process Management and Performance Improvement Methods)
  • Organizational Behavior/Structured Change Management (Emphasis on the Change Agent Roles and Tactics of Corporate Loyalist, Provocateur, Insurrectionist and Diplomat to Measurably Achieve Corporate Objectives)
  • Strategic Planning and Implementation


ELEMENT ONE – STRATEGIC, TACTICAL AND OPERATIONAL ENVIRONMENTAL SUSTAINABILITY PROGRAM MANAGEMENT

  • Introduction to Corporate Environmental Sustainability
    • Relationship of Sustainability to the Concept of Corporate Social Responsibility
    • Common Developmental Phases of Corporate Social Responsiblity Programs
    • Historical Perspective:  From the 19th Century Preservation Movement to the 21st Century Concept of "Making Money by Doing Good"
    • Essential Sustainability Science Concepts
      • Chemistry/Physics
      • Earth Sciences
      • Atmospheric Sciences
      • Biotic Sciences
      • Environmental Management Technical Principles and Practices
    • The Business Case for Environmental Sustainability
    • Environmental Sustainability's Role in Achieving the Prime Directive of Finance
    • Sustainability 1.0 Versus Sustainability 2.0 and Beyond
    • Integrating the Five Elements of Corporate Environmental Sustainability into the Overall Enterprise Management Structure

  • Sustainability Program Strategic, Tactical and Operational Planning, Organizing, Controlling and Leading
    • Sustainability Program Organizational Structures and Work Processes
    • Sustainability Intelligence Gathering and Analysis to Produce Actionable Information 
    • Strategic and Tactical Sustainability Planning
    • Methods to Link Strategic and Tactical Intentions to Administrative and Operational Activities and Accountabilities
    • Methods to Achieve Sustainability Innovation in Administration and Operations Functions
    • Management System Standards Including ISO 14000, ISO 26000, OHSAS 18000, ISO 50000, Global Reporting Initiative (GRI) Requirements, etc.

  • Financial and Other Quantitative Methods for Sustainability Program Management
    • Sustainability Program Operating and Capital Budget Planning, Approval Processes, and Controls
    • Sustainability Program Performance Measurement and Analytical Methods, Including the Definition of Critical Performance Baselines and Periodic Production of Green Dashboards and Balanced Scorecards
    • Environmental Cost Accounting
    • People, Planet and Profit Financial Analytical Methods, Including Full-3P-Dimension Return-on-Investment Techniques
    • Principles and Practices of Green Financial Investment
    • Sustainability Financial Indices – Dow Jones Sustainability Index, FTSE KLD Global Sustainability Index, Ethibel/Standard and Poors Sustainability Index, etc.
    • Accessing Capital Markets for Green Ventures, Initiatives and Projects
    • The Fundamentals of GHG and Other Cap-and-Trade Schemes    

  • Green Information Technology
    • Sustainability Information Management Systems:  Survey of Software Applications, Systems Analysis, and Design, Implementation and Management
    • Green IT Facilities Design and Management, Including Hardware Procurement, Energy Management, and Hardware End-of-Life Disposition
    • Innovative Uses of IT to Reduce Corporate Environmental Impacts


ELEMENT TWO – REGULATORY AND INDUSTRY STANDARDS COMPLIANCE

  • Principles and Practices of Regulatory and Industry Standards Compliance
    • Overview of Compliance Activities within the Overall Corporate Risk Management Function
    • Environmental, Health and Safety Regulations
    • Current and Future Securities and Exchange Commission Reporting Requirements
    • Survey of General and Industry-Specific Environmental Sustainability Performance Standards
    • Strategies, Tactics and Operations Methods for Regulation and Standards Compliance
    • Auditing Program Design, Implementation and Management
    • Corrective Action Implementation and Control


ELEMENT THREE – EFFICIENCY IN PRODUCT AND SERVICE VALUE SYSTEMS AND THEIR LIFECYCLES

  • Management of Green Value Systems
    • The Lifecycle Dimension of Product and Service Value Systems
    • Basic and Advanced Lifecycle Analysis Methods
    • Enhancing Continuous-Improvement Methods with Sustainability Methods – Including Japanese Union of Scientists and Engineers, Toyota Lean and Six Sigma Techniques – to Drive All Waste Out of Value Systems and Their Associate Lifecycles
    • Green Procurement Principles, Practices and Methods
    • Green Manufacturing
    • Green Service Delivery
    • Green Logistics
    • Reverse Logistics

  • Principles and Practices of Pollution Minimization and Eradication
    • Basic Reduce, Reuse and Recycle (3R) Concepts and Methods Applicable to All Types of Wastes
    • Applications of Lifecycle Assessment Methods to Identify Opportunities to Minimize or Eliminate Wastes in Value Systems
    • Specific Requirements and Methods for Gaseous Waste Management
    • Specific Requirements and Methods for Aqueous Waste Management
    • Specific Requirements Methods for Hazardous Waste Management – Including Chemical, Biological and Radioactive Wastes
    • Specific Requirements and Methods for Solid Waste Management

  • Energy, Greenhouse Gas, Water Stewardship and Other Key Resource Management Concerns
    • The Business Case for and the Principles, Practices and Methods of Greenhouse Gas (GHG) Reduction
    • GHG's Role as a "Common Currency" in Measuring the Efficacy of Energy Management Efforts
    • Strategies, Tactics and Operations Activities for Reducing Energy Consumption and Shifting to Sustainable Energy Sources
    • The Design and Economics of Internal Sustainable Energy Generation
    • Green Vehicle Fleet Management
    • Carbon Trading Markets, Strategies, Tactics and Methods
    • Quantitative Methods for Tracking, Analyzing and Reporting GHG Reduction Progress
    • Principles, Practices and Methods for Corporate Water Stewardship
    • Principles, Practices and Methods for Corporate Land Resource Management

  • Green Facilities
    • Basic Design-with-Nature Concepts and Techniques
    • Leadership in Energy and Environmental Design (LEED) Standards
      • Facility and Structure Certification Processes
      • Professional Certification Processes
    • Other Standards, Including BREAM, Istidama and State of California
    • Retrofitting and Operating Existing Facilities and Structures
    • Designing, Constructing and Operating New Facilities and Structures


ELEMENT FOUR – INCREASED REVENUE GENERATION THROUGH GREEN-ATTRIBUTE PRODUCTS AND SERVICES

  • Green Product and Service Design
    • The Need for Breakthrough Performance in Product and Service Design
    • The Critical Role of Lifecycle Analysis in Green Product and Service Design
    • Green Materials in Packaging and Products
    • Principles and Methods for New Green Tangible Product Design
    • Principles and Methods for Imbuing Existing Tangible Products with Green Attributes
    • Principles and Methods for New Green Service Design
    • Principles and Methods for Imbuing Existing Services with Green Attributes

  • Greenwash-Free Marketing and Sales
    • Green Marketing Intelligence Gathering and Analysis to Produce Actionable Information
    • Principles, Practices and Methods of Ethical Marketing and Sales to Drive Revenues from Green-Attribute Products and Services
    • Risks of and Obviation Methods for Greenwashing in Promotion and Public Relations Initiatives
    • Receptivity of Market Niches to Green Marketing and Sales Efforts
    • Green Product and Service Pricing
    • Other Green Marketing Mix Product, Price, Place and Promotion (4P) Considerations


ELEMENT FIVE – TANGIBLE AND INTANGIBLE COMPETITIVE ADVANTAGES THROUGH GREENWASH-FREE CORPORATE TRANSPARENCY

  • Greenwash-Free Corporate Transparency
    • Corporate Transparency Ethics
    • Use of Transparency Programs to:
      • Protect Corporate Reputation
      • Enhance Access to Capital Markets
      • Enable Access to New Markets
      • Support Stakeholder Outreach Activities
      • Build and Sustain Customer Loyalty
      • Attract and Retain High-Performance Employees
    • Designing, Implementing and Managing a Corporate Transparency Program
      • Systems and Work Processes to Capture and Analyze Relevant and Accurate Data and Other Information
      • Regulatory Compliance Reporting
      • Industry Standards Compliance Reporting
      • Global Reporting Initiative (GRI) Participation
      • Expand the Scope and Effectiveness of Corporate Strategic and Tactical Planning Efforts


oOo


IN THE NEXT POST:   Making Money by Doing Good:  Sustainability's Value Proposition at For-Profit Companies

Sunday, February 19, 2012

LIFECYCLE ASSESSMENT FOR HEALTHCARE ORGANIZATIONS – PART C



This is the last of three posts on lifecycle assessment (LCA) methods.  Part A (August 17, 2011) considered basic definitions and concepts.  Then, Part B (September 25, 2011) explored work processes for defining a:
  • LCA project scope (Step One), and
  • Product or service's lifecycle (Step Two).

This post, Part C, outlines processes for:
  • Assessing significant impacts (Step Three)
  • Prescribing obviation and mitigation measures (Step Four), and
  • Integrating LCA information into a hospital's environmental sustainability program management system (Step Five).


STEP THREE:  ASSESS A LIFECYCLE'S SIGNIFICANT IMPACTS
Step Two, Define the Product or Service's Lifecycle, borrows from industrial-engineering problem-assessment methods.  In contrast, Step Three borrows from physical-, biotic- and social-science impact-assessment methods. 

These methods – which are commonly used in environmental impact reports (EIR), statements (EIS) and assessments (EIA) – enable the identification of sustainability-related "junk" throughout the closed-loop lifecycle of a value system.  Once identified, this junk can be avoided, eliminated or minimized to achieve organizational goals with least cost, effort and risk.  

Let's get started by taking a look at:
  • What an "impact" is and isn't – plus, why it's important to avoid assessing "positive" impacts to prevent appearances of "greenwashing"
  • The typical categories of environmental and other significant impacts, such as health and safety ones, as well as Global Reporting Initiative (GRI) concerns
  • How to prepare a matrix-format impact-assessment worksheet using Step Two's LCA flowchart, and 
  • How to define an impact’s causes and assess its risk in terms of frequency, severity and exposure.

Then, we'll examine some completed sections of an actual LCA impact assessment.


What Impacts Are . . . and What They Aren't For the purposes of this discussion, an environmental impact is:

A significant adverse change in the natural or human environments.

Readers in the United States who are familiar with EIA laws and guidelines will realize that this definition is based on the strict California Environmental Quality Act definition of an environmental impact. 

This strict definition precludes assessments of "positive" or "beneficial" impacts.  By doing so, attention is focused exclusively on "identifying and removing junk" from proposed projects, value chains and lifecycles. 

Further, this definition precludes a form of greenwashing where intentional or inadvertent attempts are made to balance, buffer, neutralize or otherwise excuse bad impacts with good ones. As a result, this failsafe definition is especially useful in preventing corporate leaders, marketing staff and others from embarrassing an organization – or worse – through good-intentioned misuses of LCA findings.


Typical Categories of Environmental and Other Significant Impacts – There are two causes of adverse impacts:
  • Those human activities that affect the environment, and
  • Those human activities that can be affected by the environment.

Further, there are all kinds of ways to categorize these environmental and human impacts, including:
  • Short- and long-term
  • Direct and indirect
  • Cumulative, chronic and acute
  • Site-specific, local, regional, global, etc., and
  • Avoidable and unavoidable.

To assess impacts, these categories need to be matrixed with physical, biotic and human environment considerations, including: 

  • Physical impacts involving:
    • Atmospheric conditions
    • Geologic resources
    • Aquatic and marine resources
  • Biotic impacts involving:
    • Ecological systems
    • Botanical resources
    • Zoological resources, and
  • Human impacts involving not only physical and biotic impacts, but also those associated with such cultural factors as:
    • Land use activities, including facility design, construction and operation
    • Micro and macro economic activities
    • Energy production and use
    • Chemical, biologic-agent, ionizing-radiation and other hazardous material use
    • Controlled and uncontrolled gaseous, aqueous, solid, hazardous and energy waste releases
    • Health and safety at the organization, community, regional and/or larger geographic levels
    • Demands on public infrastructure and services
    • Transportation and other logistics systems
    • Protection of prehistoric and historic resources
    • Social justice inside and outside an organization, and
    • Aesthetics.

Plus, there are more detailed human impact categories defined by the Global Report Initiative (GRI) and other social responsibility standards, including:
  • Human rights indicators
  • Labor practices and decent work indicators
  • Society indicators
  • Product responsibility indicators, and
  • Economic indicators


A Matrix-Format Impact-Assessment Worksheet Based on a LCA Flowchart – As you've seen above, there are dozens of assessment factors to consider in defining adverse changes and their significance.  Believe me; you don't want to juggle this complexity in your head . . . and risk certain madness!  

Why should you, especially when there is a far simpler and saner method that uses a fill-in-the-blanks worksheet like Figure 13?  Even better, yet, if your hospital's sustainability program ever becomes sold on the value of LCA's, you might be able to convince the leaders to buy a LCA software package to make things easier for experienced lifecycle assessors.

Figure 13, LCA Impact Assessment Worksheet, is based on an actual LCA worksheet produced in 2010.  In addition to considering environmental impacts, this worksheet considered health and safety risks, too.  (NOTE:  Although you can click on the figure to enlarge, the font is too small to be useful.  Download the original MS Excel™ file from https://docs.google.com/open?id=0B-43ksRRuoFQZGNjYzIwZWEtY2NjYi00YWIyLWEzMGMtODEwODlkZTA3OWRj .)

Please note that omission of the GRI factors from Figure 13 is not a suggestion that they should be excluded from your hospital’s LCA's.  It's simply a matter that their inclusion here would complicate this blog discussion far more than it already is.  So, feel free to add in those GRI factors that are important to your hospital.

FIGURE 13
LCA IMPACT ASSESSMENT WORKSHEET


Impact Assessment Method
Okay, now that you’re familiar with the various types of impacts, let's get started on a basic assessment method.  First, we'll transfer information from the LCA flowchart produced in Step Two to the LCA Impact Assessment Worksheet.  Then, we'll explore a process to define and assess significant adverse changes. 


  • Step 3A:  Transfer Information from the LCA Flowchart – Complete the following tasks in Columns 1 and 2 of the worksheet.  Please note that these instructions assume ideal conditions where all necessary information is readily available.  You’ll need to make adjustments to this assumption as you realize:

In the real world, there is no such thing as “ideal conditions”.

    • First Column – Enter the name of the applicable lifecycle phase from the LCA flowchart into Column 1, “Lifecycle Phase".

    • Second Column – For each lifecycle phase, tersely list all of the major work activities shown on your LCA flowchart in Column 2, “Work Activities”.  (Note:  This may take an additional bit of “out-on-the-operations-floor" research to create a realistic and complete list of activities.)

    • Third, Fourth and Fifth Columns under the Heading of “Work Activity Inputs” For each “Work Activity” listed in the second column state the types and quantities of input materials (Column 3), water (Column 4) and energy (Column 5) required to accomplish it. 

    • Sixth through Eleventh Columns under the Heading of “Waste Discharges” – For each “Work Activity” listed in the second column, state the composition of the waste discharges and sort those discharges into Columns 6 through 11, as appropriate.  Then, state the rate of each waste discharge.


  • Step 3B – Impact Assessment in Terms of an Adverse Change's Frequency, Severity and Exposure – With the basic analytical inputs entered onto the Figure 13 worksheet, let’s continue with the impact assessment sections.   For each of the “work activities” and “waste discharges” answer these complex questions in consideration of the various types of environmental and other significant impacts discussed above: 

    • Have there been, are there currently, or will there be any adverse changes to the physical, biotic or human environment resulting directly or indirectly from a work activity or an associated generation of waste?  If so, what are the changes?

    • Have there been, are there currently, or will there be any work-activity and waste- discharge risks arising from extant physical, biotic or human environmental conditions?  If so, what are the risks? 

For each change or risk:

    • State the change or risk’s contributing factors in terms of what caused, causes or will cause the change and then state what has been, is being or will be changed

    • Explain why the change or risk should be considered adverse in both qualitative and quantitative terms when possible.  

    • Describe the adversity’s past, current and/or future temporal characteristics.  Then, explain how these temporal characteristics contribute to the impact’s adversity, Be sure to consider these temporal characteristics: 

      • The frequency and duration(s) of change, and

      • Whether the change or risk will be a one-time “acute” or an ongoing “chronic” or “cumulative” issue.

Enter this information into the worksheet’s Columns 12 through 19, as appropriate. Please note that individual work activities and waste discharges may have multiple physical, biotic and human environment impacts. 

As you might have guessed by now, not all adverse changes are significant in terms of:
    • Severity of change
    • Frequency of occurrence, or
    • Size of an exposed population or amount of a resource.

Therefore, it is important that when we identify and describe a potential adverse impact that we also assess its relative significance to other impacts using the Failure Modes Effect Analysis (FMEA) technique introduced on Figure 4 (September 8, 2010) .  To save you from having to hunt it down, the part of that figure used for assessing adverse risks is slightly altered and presented again as Figure 14. (Click on the figure to enlarge.)

Use the criteria and formula on Figure 14 to characterize the relative degree of risk for each of the adverse impacts.  Then, enter the risk score for each impact in Column 16.  When all of the impact assessments are complete, calculate a “significance cut-off point” to determine which impacts require obviation and mitigation measures.

FIGURE 14
FMEA EVALUATION FACTORS FOR ADVERSE IMPACTS



  • Example from an Actual LCA Impact Assessment – Figure 15 shows an actual LCA impact assessment using a worksheet similar to the example in Figure 13.  (Click on the Figure to Enlarge.)  It addresses a small portion of environmental – as well as health and safety – impacts associated with an LCA phase called “Decontamination during Operations and Maintenance”.   The assessed product is a mobile field hospital structure, which is used by governments and NGO’s around the world to provide healthcare services in the field.

FIGURE 15
PART OF AN ACTUAL LCA IMPACT ASSESSMENT


STEP 4:  PRESCRIBE OBVIATION AND MITIGATION MEASURES
The definition, assessment and short-listing of significant impacts, as described in Step 3, above, produces a body of actionable information.  This information requires organizational management and technical responses to adequately mitigate existing problems, as well as to avoid or minimize risks of future ones.  This step in the LCA process outlines many of the basic tasks involved in obviating and mitigating significant impacts.

It is almost always preferable to avoid – or obviate – adverse impacts.  The most effective ways to do this are alterations to the inputs and work activities in a production or service-delivery process.  Such alterations often involve modification – including elimination – of process steps and/or elimination or substitution of impact-causing materials. 

However, absolute obviation isn’t always possible.  So, the next best thing is to mitigate – i.e., reduce – impact adversity in terms of severity, frequency and/or exposure to an acceptable level.  The same process-alteration concepts used for obviations apply to mitigations as well.

Of course, determining an acceptable level of mitigation can be highly problematic.  What is acceptable to an organizational leader or lawyer may differ from a technical practitioner’s perspective.  Plus, it almost goes without saying that leaders, lawyers and practitioners can be way out of line with regulators' and activists’ views of acceptability.  So, as you gain experience in prescribing mitigation measures remember these little words of wisdom:

You can be legally correct and technically correct.  But, if you aren’t politically correct, too, you ain’t correct!

Okay, how does one go about prescribing acceptable obviation and mitigation measures?  You start by asking questions like these for each significant impact. 

  • Can the causal factors leading to an adverse impact be removed from a production or service-delivery process, thereby eliminating the impact’s risk of occurrence?

  • If the risk of an impact cannot be eliminated, what is the impact’s significance threshold?  In other words, how bad does an impact have to be in terms of severity, frequency and/or exposure before it is considered legally, technically and politically significant?

  • How can the severity, frequency and exposure factors in a production or service delivery process be modified so that the risk of an adverse impact is no longer significant?

By answering these questions, you’ll have a fair idea of what is needed conceptually to avoid or adequately mitigate an adverse impact.  Then, it is a matter of working out the details using the 5W’s-&-1H-Plus-Check format from the August 18, 2010, post as Figure 3, which is reproduced here.   (Click on the figure to enlarge.) 

Answers to these questions, when fleshed out using the 5W’s-&-1H-plus-Check format, produce a fairly detailed action plan for implementing the obviation or mitigation measure.  Summarize this information in Column 20 on the Figure 13 LCA worksheet.

FIGURE 3 (From August 18, 2010)
5W’S & 1H + CHECK FORMAT


Figure 16 shows the corresponding mitigation section from the impact assessment presented in Figure 15.  Please note that Figure 16’s format differs somewhat from the one shown on the Figure 13 worksheet.   (Click on the figure to enlarge.)


FIGURE 16
EXAMPLES OF MITIGATION MEASURE PRESCRIPTIONS


STEP 5:  APPLY THE LCA'S FINDINGS AND PRESCRIPTIONS THROUGH THE SUSTAINABILITY PROGRAM'S MANAGEMENT SYSTEM
With the completion of an LCA, the obviation and mitigation measures prescribed in Step 4 to manage the significant adverse impacts assessed in Step 3 need to be included in the hospital’s sustainability management system.  That management system is, of course, the subject of this blog’s first 10 posts. 

The big question is: 

Where do the findings from an LCA – i.e., impact assessments and obviation and mitigation measures – plug into the hospital’s sustainability management system?

Figure 8 in the March 20, 2011, post shows the major functions in a model closed-loop sustainability management system.  (Figure 8 is presented again, below. Click on the figure to enlarge or download the original MS PowerPoint(tm) file at:  https://docs.google.com/open?id=0B-43ksRRuoFQMDJhZDE3OGEtMDgyNC00ZjE2LWFmYzUtOWM4ZWY5OWJkZmVk  .)   An LCA’s significant obviation and mitigation measures enter the management system through the activities of Element 3 on Figure 8.  This is the point where the decision-support function distributes performance data and information to the hospital’s Green Teams.

FIGURE 8 (From March 20, 2011)
A RUDIMENTARY SUSTAINABILITY PROGRAM MANAGEMENT PROCESS


You may be wondering why a LCA project team shouldn’t just start implementing the obviation and mitigation measures it defines.  For “quick-hit” and “small-tests-of-change” kinds of measures – i.e., the little ones that can be completed in an afternoon or two – go ahead. 

However, for the more complicated measures requiring significant resources to implement, it’s better to run them through the sustainability management system as proposed projects.  Why?  Because they must be considered in relation to the organization’s other most pressing needs before committing any resources and assigning personal performance accountabilities.  By preventing “loose-canon” projects, the management system assures that all prioritized sustainability initiatives can be successfully completed within the organization’s resource limits and opportunities.


oOo


As you’ve seen from this and the previous two posts, LCA is a complex process that has the potential to comprehensively reveal a service or product’s significant adverse impacts.  More importantly, it makes it possible to prescribe effective avoidance and mitigation measures to remove inefficiencies from the lifecycles of entire value systems.  Metaphorically:

A good LCA can comb all the fleas off a dog.

It’s because of this complexity that organizational leaders need to understand there is a lot of easy to identify “low-hanging-fruit” that does not require LCA.  However, once that low-hanging fruit has been “picked” during a sustainability management system’s early iterations, LCA is the go-to methodology to identify and resolve an organization’s major, but less-obvious sustainability problems.



IN THE NEXT POST:   So, You Want to Ditch Healthcare and Become a Professional Sustainability Manager?  Finding the Right Corporate Sustainability Management Degree Program.