Page 364 - Design for Environment A Guide to Sustainable Product Development

Service Industries 339

year of material flow, mainly wastes that are discarded somewhere
along the supply chain. Similarly, the energy expended in the eco-
nomic supply chain to support a household is ten times greater than
the direct energy purchased in the form of gasoline and electric power.
When one accounts for the total energy derived from eco system
services, including the large amount of solar energy embedded in
biomass, the energy consumption of a household is a million times
greater than the direct purchased energy.

DFE in Service Industries
At face value, fulfilling human needs by providing services rather
than selling products appears to be less environmentally burden-
some. Indeed, one of the largest opportunity areas for DFE, as dis-
cussed in Chapter 8, is Design for Servicization. Examples include
transportation services such as Zipcar, telephone answering ser-
vices, and leasing of office equipment. However, as illustrated by the
above life-cycle assessment data, care must be taken to assure that
the manner in which these services are provided is indeed environ-
mentally efficient. A fair comparison of product vs. service should
include the supply chain resources necessary to deliver an equiva-
lent functional unit of value to the customer. As with any business,
the same DFE design guidelines and metrics can be applied to improve
the environmental performance of these supply chain processes.
One of the most important categories of service industries is
transportation, which was addressed in Chapter 12. Note that there
are significant differences in environmental performance between
different modes of travel; for example, transporting a ton of freight
by rail requires only a fraction of the energy of transport by truck.
Likewise, electric utilities, discussed in Chapter 18, are effectively
service providers, although their generation plants resemble manu-
facturing sites. Again, there are large differences among generating
technologies in terms of cost, reliability, capacity, and environmental
footprint.
More generally, many manufacturing businesses offer some form
of services, especially when their markets include industrial cus-
tomers. Depending on the business model, these services may gen-
erate additional revenue streams or may be simply bundled with the
product to create additional value for the customer. Broadly speak-
ing, there are at least three ways that service providers can incorpo-
rate DFE principles into the design of their business:

1. Design innovative services that replace traditional products
(i.e., servicization).
2. Design services that improve customer environmental per-
formance, such as energy efficiency consulting and technical
assistance.