Page 224 - Design for Environment A Guide to Sustainable Product Development

Pr oduct Life-Cycle Management 201

production and distribution facilities, while a specific facility typi-
cally handles multiple products over its lifetime. Each product and
major facility should have a cross-functional team assigned to con-
duct the LCM activities depicted in Figure 10.1.
Companies that practice LCM are arguably more sustainable and
competitive, since they are better able to understanding the full im -
pacts of business decisions across the value chain, and can identify
opportunities to enhance shareholder value by modifying their busi-
ness processes or inserting innovative technologies to enhance per-
formance, quality, and profitability. Many leading U.S. companies
have established life-cycle management programs; for example:
• In the chemical industry, Dow Chemical, DuPont, and Solutia
(formerly part of Monsanto) were early adopters of life-cycle
environmental accounting to support their product steward-
ship and waste elimination efforts.
• In the pharmaceutical industry, which has long and costly
product development cycles, most companies have instituted
some type of life-cycle review process. For example, Bristol
Myers Squibb estimates that each product life-cycle review
costs about $25,000 and yields an average of $340,000 in ben-
efits to the enterprise.
• Most major automotive firms have programs aimed at im -
proving quality, productivity, service, price, and environmen-
tal performance in the supply chain. For example, Chrysler
estimated that, over a 3-year period, LCM reviews avoided
$22 million of hidden costs and potential liabilities.
This chapter highlights the LCM practices of two highly respected
companies, Caterpillar and 3M, who have adopted life-cycle manage-
ment as an essential component of their new product development
processes.

Caterpillar: New Engines from Old
Extended Producer Responsibility
Caterpillar, headquartered in Peoria, Illinois, is the world’s largest
maker of construction and mining equipment, diesel and natural gas
engines, and industrial gas turbines, with about 100,000 employees
worldwide. Caterpillar views sustainability as intrinsic to its business
interests, including providing reliable and efficient energy solutions,
promoting responsible use of materials, enabling the mobility of peo-
ple and goods, and developing quality infrastructure for society.
Among its sustainability goals for 2020, Caterpillar is aiming to im -
prove its customers’ energy and material efficiency by 20% through
improved products and services. By 2020, the company also aims to