Cost Savings: Setting and Meeting Targets
SC Johnson, family-owned and family-managed for 112 years, has a long history of responsible environmental management. Sam Johnson, owner and chairman, made history in 1975 by announcing his company's voluntary and unilateral decision to eliminate CFC propellants from its aerosols worldwide--the first company to do so. It is not surprising that this global manufacturer of products for the home and workplace helped coin the term eco-efficiency and is one of the pioneers in practicing it. In 1990, the company formalized its environmental management program and set long-term goals to drive continuous action to improve the environmental performance of products and processes, setting specific measurable targets for progress worldwide.
These targets have been achieved. While the company enjoyed over a 50% increase in production from 1990 through 1995, significant progress was made in preventing and reducing waste to improve the environmental, financial, and efficacious performance of products and processes.
New targets for the year 2000 have also been set. Significant progress towards meeting these new reduction targets has already been madel.
Continuous Environmental Improvement Through Setting Targets
1990 to 1995:
SC Johnson's comprehensive campaign for environmental excellence began by setting several targets to be reached by 1995 or 2000. They were as follows:
- Cut virgin packaging material use as a ratio of total formula by 20% by 1995.
- Cut combined air and water emissions and solid waste disposal by 50% by 1995.
- Cut VOC use by 25% by 2000.
By the end of 1995, SC Johnson had cut virgin packaging as a ratio of total formula by 26.8%, clearly exceeding the stated target. The main contributions came from increased use of recycled materials and progress with light-weighting containers.
Worldwide manufacturing operations reduced combined air emissions, water effluents, and solid waste disposal as a ratio to total production by 46.7%, just slightly short of the reduction target of 50%.
The ratio of VOCs to finished formula weight was down 16.5% between 1990 and 1995. This showed good progress, being over half way to the 2000 goal.
1995 to 1998:
SC Johnson's efforts to improve their environmental performance did not end with the achievement of the 1995 targets. New targets have been set, and progress towards previous targets has improved. Furthermore, new, long range goals have been announced as well. They are as follows:
- Reduce virgin packaging material by an additional 30% by 2000.
- Cut combined air emissions, water effluent, and waste disposal by an additional and challenging 25% with respect to a 1995 base level.
- Complete VOC use reduction of 25% by 2000.
- Reduce energy usage as a ratio to production volume by 15% compared to the 1995 level.
- Expand the company's database on ingredient toxicity for improved product and process risk assessment.
- Establish new financial and product eco-efficient measurement systems.
- Maintain open dialogue on local and global fronts with community neighbors, business partners, environmentalists, consumers and end-users in continual pursuit of new and enhanced partnerships for sustainable development.
Combined air emissions, water effluent, and waste disposal has already been cut by an additional 5% with respect to 1995 levels. Considering an increase in production of 11% from 1995 to 1998, this represents significant progress.
VOC use has been reduced by 24% of 1990 levels. Thus the company has nearly reached its 2000 goal, with a few years to spare.
Considering the many new and expanding facilities at SC Johnson, reducing energy use has proven to be a very challenging target indeed. Even so, the company's energy use remains flat with respect to 1995 levels.
SC Johnson has made significant progress toward expanding their toxicity database. In addition, much work has been done on new eco-efficiency measurement systems, including the development of a unique computerized STEP (Success Through Environmental Progress) tool to help SC Johnson further integrate eco-efficiency decision-making into product concept and product design processes and systems.
SC Johnson has also made a dedicated commitment to corporate social responsibility. In 1927, then-president H.F. Johnson, Sr. said his famous quote: 'The goodwill of the people is the only enduring thing in any business. It is the sole substance...The rest is shadow!' SC Johnson continues to live by these words. In Racine, Wisconsin, the company's world headquarters, SC Johnson catalyzed partnerships that have led to the Sustainable Racine initiative. In July, 1996, the company organized a Forum that drew together a broad cross-section of community leaders with national experts on sustainable development to begin an open discussion on community needs and to initiate a long-range plan for meeting them. Today, dedicated individuals throughout the community are working together and applying resources toward a common vision. This is just one example of corporate social responsibility at SC Johnson.
The whole of these eco-efficiency efforts have paid off immensely for SC Johnson. Since 1992, SC Johnson has eliminated over 420 million pounds of waste from its products and processes, and saved over $125 million U.S. in the process.
Customers have benefited as well. SC Johnson has increased customer value through light-weighting, packaging reduction, waste reduction, and toxics reduction. Although customers may not specifically say they are looking for better environmental performance, they do ask for things such as doing more with less, simplifying, and having less waste to deal with. All this can be delivered through eco-efficiency.
Product Eco-Efficiency Examples
- Glade candles.
Through a 7% light-weighting of the glass container, a 6% reduction of candle weight (without reduction of candle life) and increased shipping carton efficiencies, material use has been reduced by1,536 tons (3,072,000 lbs.) for an annual cost savings of $3,632,000.
- Reduction of material use in Aerosol products.
These efforts include: Aerosol plastic cap light-weighting (1200 tons or 2,400,000 lbs. less plastic needed); recycled aerosol shippers (600 tons or 1,200,000 lbs. less virgin corrugate needed); and recycled aerosol scant flaps (110,000 lbs. reduction). This yielded a combined annual cost savings of $1.45 million since 1992.
- Isomodularity for packing and refill packs in Europe.
In Europe, isomodularity for primary and refill packs has reduced cardboard usage by 25% (50 tons), eliminated 180 tons of corrugate, reduced transport needs, and has resulted in an annual cost savings of $730,000.
- Low solvent 'VECTRA.'
SC Johnson Professional products created a low solvent 'VECTRA' formula (an institutional cleaner and stripper) which reduced VOCs by 42% (150 tons or 300,000 lbs.) for a 2% reduction in total raw material costs. This same business unit developed the award-winning 'Solutions Center,' a controlled dispensing technology for concentrated products. This technology reduces product waste generated by the end-user by up to 50% with less packaging, freight, handling, storage and solid waste disposal costs for SC Johnson.
- DFE applied in construction of new facilities.
SC Johnson has applied the Design for Eco-Efficiency principle in the construction of new facilities. The new NA Professional manufacturing facility has been designed to meet corporate energy efficiency guidelines and to reduce scrap and obsolescence, as well as cut product making and transfer losses. This has resulted in an annual cost savings of $492,000. In Friesland, The Netherlands, the Cogeneration Energy Center saves 669,000 m3 of natural gas annually as compared with conventional utilities. Hence CO2 emissions have been cut by 1,200 tons (2,400,000 lbs.). This facility also recovers and reuses 95% of all wastewater, and employs environmentally sensitive valves to reduce fugitive emissions from piping by 85% over traditional methods. At the corporate headquarters building, the campus energy systems have been re-engineered to reduce energy consumption by 45,000 btu/sq.ft. for annual cost savings of $284,000.
The Bottom Line
SC Johnson attributes its significant progress toward meeting environmental goals to a combination of a green ethic, good business sense and enlightened and dedicated employees. By translating waste prevention and reduction efforts into traditional cost-savings measurements, the company has built eco-efficiency into the product development process and is driving the integration of environment into new product development programs. From product concept, to research and development, to packaging design, from manufacturing to marketing, multifunctional teams work to continuously improve product, package, and process design to meet both business and environmental goals.
These efforts have led to significant environmental improvements. By setting challenging targets, and by setting new targets after the first have been met, the company has motivated itself to realize continuous, impressive achievements. As a general measure, reducing waste generated by 420 million pounds is quite admirable. This has proceeded hand in hand with extraordinary economic gains as well, as SC Johnson has realized $125 million in savings since 1992. For SC Johnson, and for the environment, eco-efficiency has paid off quite well.