ecodesign; a trip to the deep rabbit hole
DESCRIPTION
Lifecycle thinking brought a revolution to the field of industrial design engineering. Today, the rules of the game are changing, and how is money spent at the demand side is key. The presentation includes a case study on Ecovalue. Masterlcass by Oriol Pascual for the course Business, Design & the Enviroment at Technical Univeristy Delft. More at oriolpascual.comTRANSCRIPT
Ecovaluea trip to the deep rabbit hole
by Oriol Pascual
for educational purpose only ;-)
Traditional eco-belief or trip to wonderland?
ScienceTechnology
Financialcommunity
NGOs
MANUFACTURING COMPANY
Governments
SuppliersVoters
Customers
External Value ChainThe Matrix
Two stop trip
Overview presentation
BlueEverybody should love eco
75%Global Fortune 500 claim to do Ecodesign
Relatively mature 30%
Not interested 26%
Way to maturity 18%
Publicity driven 14%Starter & good intent 6%
First movements 6%
Ecodesign maturity profiles
Companies can do more
Technology will save us all
Eco-solutionsseem not to appeal to mass consumers
Consumers can be educatedIf not green yet, you will soon get!
Consumers are rationalWhen doing the math, they act accordingly
Designers as decision makers out of control!
StrategyManagement
Suppliers Customer
Product management
Development Marketing
Production Sales
Purchasing Logistics
Internal Value ChainThe Internal Matrix
RedQuestioning reality
Low-hanging fruit pickedRapidly reaching the limits of physics
What design option is best?from a value chain perspective
Do you understand?Communication issues with the rest of value chain
10.000 Tones of CO2...what do you
mean?
!
What fish are you catching?For the resources invested, what are the opportunities?
Value creation
business valueenvironmental load
How is ecodesign contributing to it?
To solve the equationyou have to realize that...
Ecodesign is not alone
Demand side is keyEnvironmental impact directly related to consumption power
The market is diverseeven within the Guinea Pig food market!
How?
Ecovalue
Environmental load
Product valueEcovalue =
acceptable
non-acceptable
Product value
EnvironmentalLoad
-
-
+
+0
Eco-efficiency index
at strategic & product level
Supports decision making
Setting priorities
Action oriented
Value = perceived benefitFunctional & intangible benefit
Functional value
Intangible value
Paradigm shift
Traditional ecodesign (blue) is about reducing product environmental load only
Unbalanced with customer values
New paradigm (red) shift asks for products with low environmental load and high value - reduced environmental load per monetary unit
Why Ecovalue?
The environment is not alone, market forces apply
Sustainability is about how we produce and consume
Consumers have limited amounts of money in their pockets
How to make it happen?
Science and technology
Design
Product differentiation
Feelings and emotions
Setting priorities
Value creation = Environmental & economic profitability
Addressing;
✤ Product value
✤ Customer value
✤ Business value
Product value
Functional valueProduction costs
Design & tech
Subjective valueOrganizational costs
Design, brand, strategy
wholesaleprice
Retail priceWTP, pricing strategiesMarketing competition
Cost of ownership Efficiency
Energy prices
Supply side Demand side
Customer value
Price buyers Feature buyers Experience buyers
Each market segment perceives differently the trade-off product value/product price
Business valueConsumer
groupMarket size
Value captured
Price buyers 1/3 +
Special feature 1/3 ++
Experience/quality buyer
1/3 +++
Eco-efficiency index
Environmental load
Product valueEcovalue =
Ratio between environmental load & product’s use value (functional + intangible)
How does it work?
Pick a baseline (given environmental load & economic value)
Develop all possible scenarios (improve and/or reduce load & money)
Ecovalue scenarios
Price Env. load Ecovalue Target group
1 ++ + +++ experience
2 ++ - + feature
3 + ++ +++ experience
4 + -- - feature
5 - ++ + price
6 - -- --- not applicable
7 -- + - price
8 -- - --- not applicable
Visualization
acceptable
non-acceptable
Product value
EnvironmentalLoad
-
-
+
+0
Case study: displays
Case study displays
Model Tech. Screen size
Market Price
1 CRT 29” China 354,63
2 CRT 28” Europe 481,00
3 LCD 23” Europe 972,32
4 LCD 32” Europe 215.592
Case study displays
Model Env. load (mPt)
Shelf price (euro)
Ecovalue
1 69732 354,63 5,09
2 54169 481,00 8,88
3 50335 972,32 19,46
4 50595 2155,92 42,61
Product #1acceptable
non-acceptable
Product value
EnvironmentalLoad
-
-
+
+012
3
4
Product #2acceptable
non-acceptable
Product value
EnvironmentalLoad
-
-
+
+023
1
4
Product #3acceptable
non-acceptable
Product value
EnvironmentalLoad
-
-
+
+03
2
1
4
Product #4acceptable
non-acceptable
Product value
EnvironmentalLoad
-
-
+
+04
2 1
3
Conclusions
The environment is not special; traditional market forces also apply to ecodesign
It is possible to reduce a product's environmental load and increase its final value
How consumers perceive product value, determines ecodesign strategy: tailor-made solutions
Ecovalue helps to set up priorities based in profitability (environmental & economic)
