Each of the scenarios to follow describes a sustainability- related cost item for organizations. For each scenario, identify which function of the value chain that cost would represent (R& D, design, purchasing/ producing, marketing, distributing, or customer service.) Note: The companies and products used in this exercise are real companies with a strong sustainable practices commitment.
a. Engineered Plastic Systems, LLC, a company that manufactures outdoor furniture, uses plastic lumber that is composed of recycled materials as a wood alternative for building its products. The plastic used is not only eco- friendly, but is also 50% recycled, 10% of which is post- consumer material. In promoting these eco- friendly features, the company is careful to make the distinction that it is not like other companies that falsely inflate their green efforts, stating specifically that it will always back up each of its claims with facts, and never mislead the customer about the actual amount of recycled plastic in its products. The cost of such promotions would fall into which function in the value chain?
b. The Hewlett- Packard Company, a manufacturer of computers and related products, established its own R& R program in 1987. This program enables consumers to return any defective or used electronic goods and ink cartridges, which helps decrease the company’s impact on the environment by avoiding landfills and allows the company to recycle the plastics and metals used in these products. The cost of recycling used computer products for consumers would fall into which function in the value chain?
c. The Coca- Cola Company is currently spotlighting one of its newest innovations in packaging: the PlantBottle. In one of its promotion ads, it is hailed as, “The first ever recyclable PET plastic beverage bottle made partially from plants . . . and recycles just like traditional PET plastic, but does so with a lighter footprint on the planet and its scarce resources.” The cost of the research necessary for the Coca- Cola Company’s newest foray into greener packaging would fall into which function in the value chain?
d. Able Plastics, a plastics production company, has very stringent audits on its carbon emissions, and puts a lot of effort into offsetting its carbon emissions. For instance, not only does Able Plastics invest in the Strzelecki Ranges replanting site, but Able Plastics also endeavors to cut emissions by requiring that all electronic devices be fully turned off at night in all company buildings. Able Plastics also uses carbon offsets for its delivery vehicles. The cost of these carbon offsets for delivery vehicles would fall into which function in the value chain?
e. GenPak, LLC, manufactures food packaging, and uses plastic in its products that is very conducive to recycling. In fact, much of its products are created from recycled plastic, much of which comes from GenPak’s own products’ post- consumer usage at the end of the products’ life cycle. The cost of designing the process for continuing the life cycle of these products would fall into which function in the value chain?
f. The Sharp Corporation manufactures electronics. Sharp purchases recycled plastic parts to use in its products. The costs of this practice would fall into which function in the value chain?