@ Supply Chain Management


Review of Energy use in Manufacturing

Manufacturing.net has an article about the efforts of an MIT professor to study energy use in manufacturing which led me to further searches and discovery. The article titled – MIT Prof To Study Energy Use In Manufacturing by Amy Radishofski talks about Professor Timothy G. Gutowski and his efforts to

study energy use in manufacturing processes from machining and grinding to injection molding and microelectronics fabrication methods

The article is cross-referenced at MIT news office in this article.
Amy notes,

Gutowski wants to compare the environmental performance of traditional methods versus that of alternative processes and product designs and proposed new processes.

In an earlier life of being a mechanical engineering student studying product design as an activity, the customer figured as one of the most important players (if not the most important) as well as durability, configurability etc etc. Today, another player has entered the matrix of competing demands or needs – environmental factors that were in the past dismissed as an externality.
Here’s an important thing to note from the article:

According to Gutowski, efficiency and increased production go hand in hand, thus the increased production would offset gains in efficiency. “Hence, energy efficiency alone has not resulted in an absolute reduction in energy use,” he added.

That is quite true because the market (local or global) is not even close to be satisfied yet. However, when looking at a firm which has innovated efficiency gains in their production, increased production would be the resultant if customers seek to take advantage of efficiency gains. But other firms in the competitive space who have not been able to innovate similarily would lose market share and thus production through inefficient technology or of inefficient technology would tend to decrease as long as customers actually desire to take advantage of the efficiency gains. I accept that this is a simplistic scenario because customers (such as I) are looking not only for efficiency gains, say in MPG with respect to cars, but a total value proposition or to be more specific (thanks to marketing genuises) a percieved total value proposition. If you watch cable TV in the US, you have been bombarded with the advertisement of a VW Jetta in an accident over, over and over again. Notwithstanding my general reaction that when I buy a car, I’m not thinking of accidents that might happen, passenger safety is one of the criterion that one must take into account. That’s what I mean by total value proposition or percieved total value proposition.

In the article, Professor Timothy notes,

Further, in the United States, the barriers to “environmentally benign manufacturing” differ from industry to industry and can be frustratingly complex. For instance, Gutowski said, automobiles, compared with other products, are already recycled very effectively, with only around 15 percent of the average car ending up in a landfill at the end of its life. So a suggested manufacturing alternative–using lightweight composites instead of steel–would solve one problem (making cars lighter and more fuel-efficient) while creating several others: Composite materials would increase waste because they are currently not recyclable, have no feasible recycling technologies on the horizon and increase manufacturing costs.

The Professor is highlighting the idea of tradeoffs inherent in product design. Product design tradeoffs are assessed in a matrix of competing interests and design parameters including cost, absolute must-haves and add-ons but the overarching constraints are percieved customer desires and needs, manufacturing constraints and the firm’s manufacturing capabilities.
What’s more, the adoption of technology or technology policies is often based on percieved effects and projections but what cannot be predicted is how adopters of the technology or policies involved often subvert some of the purposes of the technology or policy in the first place.

Gutowski hopes that problems like those can be surmounted via “the development of new technologies, the creation of new policies and the public’s willingness to foster change and absorb some of the costs.”
“People will pay more in the short run for environmentally friendly products,” he added. “There will be a cost to this, but I don’t think it will be something we can’t manage.”

The principal problem (and that which is left out in business costing as externalities) is that the public doesn’t want to change and absorb the cost. The rough analogy is that there is a great deal of difficulty in getting the public to pay for stuff on the internet (as many newspapers have discovered) because in the virtual world the costs of doing business are radically different from bricks and mortar businesses. So, visiting on a public environmental costs or taxes that they never paid for in the first place is either going to be very difficult to do or simply impossible.
I would place my bets on developing new technologies that will be suspectible to the problems outlined previously in the article. As for new policies to effect changes on this front, its going to be lobbied (opposed or for) by monied interests that represent businesses as well as other interest groups. Progress on this front, if any, is going to be sporadic and of an uncertain kind.
Nevertheless, I think its a good development that is making inroads into product design which is something new and I’ve been out of studying product design for less than 8 years.

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Category: Supply Chain Management, Supply Chain News


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December 2006