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Analysis Methods for Design Decisions 191

to subjectively weigh the environmental benefits of a product im -
provement against the costs. For example, BASF has developed an
eco- efficiency analysis tool that quantifies economic-ecological trade-
offs (see Chapter 13). Some economists have also tried to assign
monetary values to environmental outcomes, but these practices are
rarely used for business decision making. The next section provides
two straightforward examples of cost/benefit analysis for design
decisions.
When the scope of decision making extends beyond an indiv-
idual firm, cost/benefit analysis can become more challenging. For
example, in a collaborative supply network or an industrial ecology
network, companies may be considering a variety of alternative tech-
nologies and pathways for reducing their non-product output streams.
Should a component manufacturer implement a reverse logistics sys-
tem to recover shipping containers from its customers, or arrange for
a third party to recover and recycle them? Should a company send
its organic wastes to a composting facility or invest in an anaerobic
digester to convert them into a biogas that could be sold as a by-
product? Here the costs and benefits are distributed over multiple
parties and may require formation of new business relationships.
Advanced decision support tools have been developed to analyze
multiple-agent design problems that involve material processing
and transport among industrial clusters or networks. One approach
is to use mathematical programming models to determine the net-
work design and optimal flows among the processes that minimize
total cost and/or environmental impacts.

Example: The Department of Public Utilities in Columbus, Ohio, used such
an optimization model to conduct an analysis of its wastewater biosolids
operations across multiple plants. It concluded that up to $2 million a year
could be saved, representing nearly 25% of annual operating costs. In addition,
the model identified opportunities for greenhouse gas emission reductions of
up to 40% and energy use reduction of up to 64% [23]. The city is continuing
to use the model as a means of evaluating new technologies and alternative
operating policies.

Examples of DFE Decisions
The following two scenarios provide a simplified illustration of
how life-cycle cost/benefit analysis principles can be applied to a
product design decision and a process design decision respectively
[24]. Although fictitious, they reflect realistic technological alterna-
tives based on actual case histories.

Consumer Electronic Product Design
This example illustrates how DFE principles could be applied dur-
ing the design of a consumer electronic product for global markets.