Although it's widely assumed that the economic downturn has pushed corporate green initiatives to the back burner, that's not always the case. Take electronics giant Hewlett-Packard, for example. Weak sales haven't deflected HP from its mission of becoming a global environmental leader, reports Judy Glazer, HP's director for global social and environmental responsibility operations. In fact, in HP's case, the slump has had the opposite effect. "In our company by and large," says Glazer, "the impact of the downturn has been that we have really pushed to get to the future faster."
Given HP's track record with environmental programs, that's not hard to understand. Over the years, the company has found that its eco-initiatives frequently bring benefits that go well beyond sustainability. For example, in 2008, HP began shifting freight to more energy-efficient transport modes —from air to ocean and from road to rail —to curb greenhouse gas emissions. That move not only decreased emissions, but also cut transportation costs and reduced HP's exposure to energy pricing volatility. And that's just one example. Glazer reports that HP's distribution network and packaging optimization programs have produced similar returns.
Glazer joined HP in 1989 and has held a variety of supply chain and engineering positions at the electronics concern, which she describes as the world's largest IT company. Today, she oversees programs to implement social and environmental responsibility policy into HP's products and supply chain, from design and materials through manufacturing, distribution, and end of life. This charter includes HP's programs to measure and reduce the carbon footprint of its $50 billion supply chain and implementation of HP's supply chain code of conduct to raise standards in the electronics industry supply chain. It also covers the company's efforts to track and remove potentially harmful materials from HP's products and packaging, as well as efforts to ensure substitutes have reduced environmental and human health impacts.
Glazer holds M.S. and Ph.D. degrees in materials science and engineering from the University of California, Berkeley. She spoke recently with DC VELOCITY Group Editorial Director Mitch Mac Donald about her career at HP, the programs she oversees, and a computer redesign that saved as much metal as was used to build the Eiffel Tower.
Q: Tell us first a little bit about yourself, your background, and how you ended up in your current position.
A: I have worked at Hewlett-Packard for roughly 20 years in a variety of engineering and supply chain functions. My formal training is in engineering —actually in material science and reliability engineering. I held some positions early in my career doing manufacturing process development for what was then cutting-edge electronic assembly processes.
Eventually, I came to lead a central engineering team. As director of that team, I was responsible for launching HP's program to meet a new requirement for electronics hardware —the European Union's Restriction of Hazardous Substances or RoHS directive, which took effect in 2006. It basically required that we change the materials for pretty much every hardware part in our products, certainly every one that had an electronic function. This was a pretty big cross-company initiative that cut across the entire value chain, and it was one of the things that led us to start focusing more on social and environment responsibility in the supply chain.
Q: You oversee programs to implement HP's social and environmental responsibility policy in the company's supply chain operations. What does that involve?
A: We look at it as taking a life-cycle view, starting with the design of the product and the materials used in its construction —both things that we choose to address voluntarily to make the product more environmentally preferable and things we're required to address to meet the laws in various parts of the world controlling the substances that can be in our product. In the manufacturing step, we think about supplier factory practices. We are interested in the labor, safety, environmental, and ethics practices of our suppliers. That has been a major focus of ours for the last seven or eight years and is now one that we engage in with a lot of the industry. The third piece is packaging and distribution, both of which can have a significant environmental impact. The last part is the end-of-life area, ensuring that the products customers return to us for recycling or disposal are properly dealt with. Part of that is making sure any hazardous materials are handled in an environmentally responsible way.
Q: Could you talk a little more about your team's logistics programs?
A: Sure. I have two members of my team who focus on packaging and logistics specifically and all the interaction between the two. Our focus areas include designing packaging to optimize logistics and increase capacity utilization. These programs almost always deliver significant environmental benefits. Examples would be designing a package shape to optimize the number of units that can go in a container, and shifting from wood pallets to reusable plastic pallets —which are lighter —for air shipments.
Then in the logistics domain, we have put quite a bit of work into measuring or approximating the carbon footprint associated with our distribution efforts and looking for opportunities to reduce it. These initiatives tend to deliver pretty significant savings as well.
Q: Have you established metrics so that you can see how the operation is aligning with the goals of greater social and environmental responsibility? And if so, what might some of those metrics be?
A: I think metrics are always a work in progress. However, we have established a number of metrics. We publish many of them externally in our global citizenship report, which we produce on an annual basis and put on our Web site. Some of those metrics include metrics for our own operations, things within our own four walls —things like CO**subscript{2} emissions, water usage, and waste. We have production goals for each of these. We have also measured carbon footprints for our own supply chain as well as those of our first-tier manufacturers. We would like to use those benchmarks, which we have also disclosed, as a basis for setting goals for reducing those footprints.
Q: You are now talking about outside parties —supply chain partners, logistics service providers, and so on?
A: Yes. We also have goals in terms of our suppliers' performance in meeting our labor, health, safety, environmental, and ethics standards. We put a lot of focus on delivering smart practical solutions that make it easy for customers to go green. We have goals around our product portfolio as well.
Q: It seems that just when green initiatives were getting into gear, the global economy crashed. Has it been a challenge the past 12 to 18 months to keep the momentum going while everybody's distracted by the economic downturn and its effects on business?
A: Pretty interesting question. I would say that in our company by and large, the impact of the downturn has been that we have really pushed to get to the future faster. It caused us to accelerate on most of our strategic directions rather than to back off —to really push ahead with changing our business and changing our products, operations, cost structure, or whatever it might be. I think that has been true in this area as well. Our standards have stayed the same. Our customers have continued to focus on this area.
What I would say is that we have probably put more emphasis on those programs that can deliver cost savings as well as an environmental benefit because our customers really need those cost savings and are looking for smart solutions that are good investments for them.
Q: Any closing thoughts or comments?
A: I'd like to mention an award we won from Wal-Mart for a design challenge last year. We won the award for an innovative packaging design that basically let us ship a notebook computer without a box. What the customer took home was a messenger bag containing a notebook computer, with all of its accessories set up inside the bag. It was in a plastic bag with the appropriate bar coding.
Accomplishing that required working really closely with the final manufacturer and also with Wal-Mart to figure out how to actually make that work in everyone's infrastructure. In the end, we delivered for the customer with a 97-percent reduction in packaging. I thought that was a pretty neat illustration of how by pulling together all the pieces in the value chain, you can do something really different.
The way we actually did it was by putting three notebooks into an over-pack. The over-pack never made it to the store shelf. It went right into Wal-Mart's recycling bin. To me, that is a great example of innovation providing a really different kind of solution for the customer and one that illustrates how packaging and logistics professionals can really be right in the center of making an innovation like that happen.
Q: I imagine a lot of Wal-Mart's customers were delighted to find their new computers weren't packed in popcorn or in cardboard boxes that had to be broken down and put in their recycling.
A: I thought it was cool.
Q: So with that one step, you both enhanced a product and service for Wal-Mart's retail customer and achieved some of your own internal objectives.
A: Yes. Because of the size of our company, even small changes can deliver huge benefits. For example, there was one line of PCs that we redesigned to make the units smaller. In the space of a year and a half, we saved as much metal as was used to build the Eiffel Tower.
Q: That is a great illustration of how sometimes even the littlest things can have a very positive and wide-ranging impact.
A: Exactly. I think every company should on the one hand, try to think big and broadly, but on the other hand, not be afraid to pursue specific projects or pilot efforts that may in and of themselves deliver a very large benefit.
Gartner, Inc.
