AkzoNobel is a manufacturing company, so excellence in supply chain management and manufacturing operations is a fundamental requirement for success. Our businesses use established tools such as Six Sigma and Black Belt training to achieve improvements. During the year, the Decorative Paints business set up a Supply Chain Academy to build manufacturing capability and skills and accelerate cross-functional and cross-country learning.
Lifecycle assessments have indicated that for most of our businesses, the environmental footprint of our direct activity is low compared with the impact of raw materials and use of our products. However, we see improving operational eco-efficiency as a fundamental element of manufacturing excellence – helping us to achieve cost reduction, environmental protection and more effective use of raw materials and natural resources. In January 2010, we initiated an Operational Eco-Efficiency Program to achieve a step change in the environmental footprint of our own operations. The main indicators are energy consumption, greenhouse gas emissions, waste produced, fresh water intake and VOC emissions. Quick scan reviews to identify improvement opportunities were conducted at 75 production sites, which represent approximately 75 percent of the whole company. A more extensive, comprehensive diagnostic toolkit for waste and energy consumption has been developed. This has been applied at selected sites.
As a result, AkzoNobel has defined a program to improve its environmental footprint by 10 percent, delivering €70 million in cost savings over the next two years. This is a first step towards a higher ambition of a 30 percent footprint reduction during the years to come. This 30 percent reduction will come from improving existing processes, rationalization of the manufacturing footprint and the application of best available technologies for new investments. We have brought together cross-functional and cross-business Expert Groups to support this activity by sharing good practice and expertise across the company and have developed a rigorous benefits monitoring process to track improvements. The first wave of projects is now being implemented.
For 2011, we have two main goals. The first is to rigorously implement the findings from the quick scans and comprehensive diagnostics. Secondly, we will be embarking on the next level of improvements: identifying best available technology for all new investment projects and manufacturing technologies, which will drive further and more ambitious footprint reductions.
Waste, water, energy and VOC improvements
Improvement on Operational Eco-Efficiency is not dependent on a handful of large projects, but on many smaller site initiatives. Some concrete examples:
- A Surface Chemistry site in Sweden has reduced VOC emissions by 70 percent and saved €100,000 in fixed and variable costs by reducing the level of excess methyl chloride required in the process reaction
- An agreement with a local raw material supplier to reuse steel drums, together with improved drum emptying procedures, saved a coatings site in China more than €33,000 in four months. They have reduced waste by 14 tons and recovered more than eight tons of raw materials
- A combined heat and power unit at a coatings site in Birmingham, UK, supplies most of the site’s electricity and provides heat for the process and buildings. The €470,000 investment saves €116,000 from annual energy costs and reduces the site carbon footprint by 19 percent
- The impact of compressed air leaks was not fully understood at one of our Decorative Paints sites. However, following an ultrasonic leak detection survey, the site has repaired nearly 100 leaks with an estimated saving of €36,000.