3.1 eco efficient system innovation vezzoli-13-14

Carlo VezzoliPolitecnico di Milano / DESIGN dept. / DIS / School of Design / Italy

course System Design for Sustainabilitysubject 3. System design for eco-efficency

learning resource 3.1

Eco-efficent system innovation

carlo vezzolipolitecnico di milano . DESIGN dept. . DIS . School of Design . Italy

Learning Network on Sustainability (EU asia-link)Learning Network on Sustainabile energy systems (EU edulink)


CONTENTS . Resume: sustainability and system innovation. Traditional sales model: eco-efficiency constraints. Moving towards system eco-efficiency. E-E Product-Service System (PSS): definition . Eco-efficient PSS typologies

. Adding value to the product life cycle

. Providing final results to customers

. Providing enabling platforms for customers. Not all PSS are eco-efficient + rebound effects. Barriers to PSS diffusion. Eco-efficient PSS innovation: summing up


IN 50 YEARS A WORLD-WIDE EQUITABLE SYSTEMS OF PRODUCTION AND CONSUMPTION SHOULD USE ~90% LESS RESOURCES THAN THE INDUSTRIALISED CONTEXTS ARE DOING TODAY

SUSTAINABILITY: SIZE OF CHANGE


SUSTAINABILITY: QUALITY OF CHANGE

PROMOTE (EVEN) SYSTEM INNOVATIONS broader than product innovation, not only technological, but even socio-cultural and organisational innovations

RADICAL CHANGE (DISCONTINUITY)


WITHIN THE ENVIRONMENTAL AND ECONOMICAL CRISIS WHICH ARE THE OPPORTUNITIES?

DO WE KNOW ANY OFFER/BUSINESS MODELS CAPABLE OF CREATING (NEW) VALUE DECOUPLING IT FROM THE MATERIALS AND ENERGY CONSUMPTION?> significantly reducing the environmental impact of traditional production/consumption systems?

A KEY CONTEMPORARY QUERRY:


ECO-EFFICENT PRODUCT-SERVICE SYSTEM EXAMPLES AND TYPOLOGIES


offers lubricants + service on-site identification (movable lab) of equipment inefficiency, and the potential reduction of emissions’ impact

the innovative interaction between the company and the client, make the companies’ economic interest to be other than only selling higher amount of lubricants

lubricant > LUBRFIICATION

KLUBER LUBRIFICATION


KLUBERLUBRICATION

Kluber sells to engineering industry lubricants and ...

LAB

... a service of analysis for the lubricants effectiveness and environmental impact reduction (movable lab)

BENEFIT FOR KLUBER. Offer diversification. Customer loyalty

BENEFIT FOR CUSTOMER. Improved efficiency > Cost reduction

. Less environmental issues to solve



KLUBERLUBRICATION

Kluber sells to engineering industry lubricants and ...

LAB

... a service of analysis for the lubricants effectiveness and environmental impact reduction (movable lab)

BENEFIT FOR ENVIRONMENT. Reduction of lubricants use > reduced environmental impact

E-E PSS of Type IPRODUCT-ORIENTED PSS:PSS ADDING VALUE TO THE PRODUCT LIFE CYCLE



a company (alliance of companies) provides additional services - maintenance, repair, up-grading, substitution and product take back - to guarantee life cycle performance of the product (sold to the customer)

it is reduced the customer reaponsibility in the use and/or disposal of the product/semi-finished product (own by the customer)

E-E PSS of Type IPRODUCT-ORIENTED PSS:PSS ADDING VALUE TO THE PRODUCT LIFE CYCLE


Ricoh offers a package deal (Pay per Page Green) and installs, maintains and collects at the end-of-life the printers and photocopiers (not owned by the customer); the customer pays for the number of delivered pages and copies.

the innovative interaction between the company and the client, make the companies’ economic interest to provide (and design) long lasting, reusable and recyclable photocopiers, i.e. environmentally friendly.

RICOH: PAY PER PAGE GREENphotocopiers/printers > PRINTED PAGES AND COPIES


RICOH offers a package deal (products + services).

... and RICOH installs and maintain photocopiers (not owned by the customer), collects at the end-of life.

The customer pays per page...

BENEFIT FOR RICOH. Directly profit from components re-use and material recycling from discarded products. Directly profit from resources efficiency

BENEFIT FOR CUSTOMER. No need to invest in the machine

purchase and overall cost reduction in use

RICOH: PAY PER PAGE GREEN


RICOH offers a package deal (products + services).

... and RICOH installs and maintain photocopiers (not owned by the customer), collects at the end-of life.

The customer pays per page...

BENEFIT FOR ENVIRONMENT. Increased products’ lifespan and resources efficiency > reduced environmental impact

RICOH is not a photocopier producer only.RICOH: A DOCUMENT COMPANY!

RICOH: PAY PER PAGE GREENE.E. PSS (TYPE II)RESULTS-ORIENTED PSS:PROVIDING FINAL RESULTS TO CUSTOMERS


a company (alliance of companies) provides a customised mix of services, instead of products, in order to provide a specific final result to the customer

the client does not own the products and does not operate on them to obtain the final satisfaction (the client pays the company to provide the agreed results)

E.E. PSS (TYPE II)RESULTS-ORIENTED PSS:PROVIDING FINAL RESULTS TO CUSTOMERS


payment is based on number of washes and includes: delivery of a washing machine at home (not owned), electricity supply (not directly paid), maintenance, up-grading and end-of-life collection.

the innovative interaction between the two companies and the client, make the companies’ economic interest to provide (and design) high efficient, long lasting, reusable and recyclable washing machines , i.e. environmentally friendly

washing machine > ABILITY TO WASH

ARISTON + ENEL: PAY-PER-USE


The partnership offers a package deal (product + services).

BENEFIT FOR CUSTOMER. No need to invest in the machine

purchase and overall cost reduction in use

ARISTONHouseholdappliances

The customer pays forthe number of washes he/she will do ...

ENELEnergyprovider

PARTNERSHIP

+... and delivers the washing machine (not

owned by the customer) and supply energy (not directly paid by the customer), maintenance,

up-grading and end-of-life collection.

BENEFIT FOR THE PARTNERSHIP. Directly profit from energy efficiency. Re-use of components from discarded products



The partnership offers a package deal (product + services).

ARISTONHouseholdappliances

The customer pays forthe number of washes he/she will do ...

ENELEnergyprovider

PARTNERSHIP

+... and delivers the washing machine (not

owned by the customer) and supply energy (not directly paid by the customer), maintenance,

up-grading and end-of-life collection.

BENEFIT FOR ENVIRONMENT. Increased energy efficiency and products’ lifespan > reduced environmental impact


E-E PSS (TYPE III): USE-ORIENTED PSSENABLING PLATFORMS FOR CUSTOMERS


company (alliance of companies) provides access to products, tools, opportunities enabling clients to get their “satisfaction”

the client does not own the product/s, but operates on them to obtain the “satisfaction” (and pays only for the use of the product/s)

E-E PSS (TYPE III): USE-ORIENTED PSSENABLING PLATFORMS FOR CUSTOMERS


ECO-EFFICIENT PSS INNOVATION TYPOLOGIES

- adding value to the product life cycle

- providing final results to customers

- providing enabling platforms for customers


“an offer model providing an integrated mix of products and services that are together able to fulfil a particular customer demand (to deliver a “unit of satisfaction”), based on innovative interactions between the stakeholders of the value production system (satisfaction system), where the economic and competitive interest of the providers continuously seeks environmentally beneficial new solutions”

[Vezzoli et al., 2014]

ECO-EFFICINET PRODUCT-SERVICE SYSTEM INNOVATION: A DEFINITION


pro

duce

r

suppliers

custo

mer

client

end-o

f-life

man

ager

retailers

designer

[e.g. washing machine]

[e.g. satisfaction-syetem= to have cleaned cloths]

discrete resources optimization:phase/stakeholder-based

[e.g. detergent] [e.g. energy supply]

pro

duce

r

suppliers

custo

mer

client

end-o

f-life

man

ager

retailers

designer pro

duce

r

suppliers

custo

mer

client

end-o

f-life

man

ager

retailers

designer

SYSTEM ECO-EFFICENCY: moving out of traditional product sales/design

wide system (multiple life cycles) resources optimization: demand/satisfaction-based

system (life cycle) resources optimization: product/function-based


- phase’s transformation (processes):interest in reducing resources consumption

- phase’s transaction (semi-finished/products): indifference in reducing resources consumption or interest in increasing resources consumption

- cycles’ combinations (products/services): indifference in reducing resources consumption or interest in increasing resources consumption

TRADITIONAL PRODUCT SALES MODEL: ECO-EFFICENCY CONSTRAINTS

low interact. between product-system’s stakeholders

low interact. between satisfaction-system’s stakeholders


TOWARD THE SYSTEM ECO-EFFICIENCY decoupling the economic interests from

environmental impact increase

shift/allocate,on the stakeholder responsible for the products and/or the services development/design,the direct economic and competitive interest to reduce their environmental impacts


TOWARD THE SYSTEM ECO-EFFICIENCY which characteristics of the offer (company/ies models)?

INNOVATIVE STAKEHOLDERS’ INTERACTIONS

A. STAKEHOLDER’S INTEGRATION (controll extension) vertical: one stakeholder > IN Product life cycle

horizontal: one stakeholder > IN Ps + Ss life cycles

B. STAKEHOLDERS’ INTERACTIONS EXTENSIONS vertical: (multiple) stakeholders > IN Product life cycle

horizontal: (multiple) stakeholders > IN Ps + Ss life cycles


PSS INNOVATION WIN-WIN POTENTIAL

SYSTEM ECO-EFFICIENCY innovation in which is the company/companies’ economic and competitive interest that leads to an environmental impact reduction (i.e. system eco-efficiency)


PSS ECO-EFFICIENT POTENTIALS

the economic interest of a stakeholders foster:. product life cycle optimization. materials life extension. “in use” resources minimization

system eco-efficiency given too by: . provider: higher available investiment allowing

most advanced and effcient technologies. product sharing > faster replacement of ware out

products with new and more eco-efficient ones (on equal number of units produced in time)


> CRITERIA AND GUIDELINES ARE NEEDED> METHODS AND TOOLS ARE NEEDED to orientate design towards system eco-efficent stakeholder interactions (and related mix of products and services)

NOT ALL PSS ARE ECO-EFFICENT!


NOT ALL ECO-EFFICENT PSS ARE WITHOUT (ENVIRONMENTAL) REBOUND EFFECTS!> may generate unwanted (enevironmentaly damaging) side effects

e.g.1 access to product, rather than their ownership, could lead to careless behaviour (shorter product lifespan > higher environmental impact)

> some rebound effects are too difficult to be predicted, but as far as they are, design attention should be given to avoid those eventual side effects


WHY ECO-EFFICIENT-PSS ARE NOT YET DIFFUSED?

IN FACT, PSS IS NOTHING NEW

every most of the products involve services and vice versa and change towards service economy is happening anyway

services (not products) generate:. more than 50 % of GDP in Europe . more than 75% of GDP in USA


BARRIERS FOR THE ECO-EFFICIENT PSS DIFFUSION:

. for the customers/users: in industrialized contexts the cultural shift necessary in accepting behavioural change, e.g. a ownerless consumption, …

. for companies: the difficulty in changing the corporate culture and the traditional business model, …

. for governments: the difficulty in defining and implementing policies to facilitate EE-PSS oriented companies, …


DIFFUSED INERTIA (CONSOLIDATED HABITS) IS LIMITING ECO-EFFICIENT SYSTEM INNOVATIONS DIFFUSION

. PSS are not simply leapfrog business strategy: a transition path is many time needed

. there is a lack of knowledge on SPSS development: we need a new generation of designers (and design educators) and other professionals capable of operating for (complex) system research and innovation


… ANYHOW A PROMISING WIN-WIN MODEL

“nevertheless, PSS development, seen as a whole, present a potential for generating win-win solution which promote profit, environmental and social benefits”

“they have the potential to provide the necessary, if not sufficient, conditions to enable communities to leapfrog to less resources intensive system of social and economical standards of living”

[UNEP, 2002]


PSS MAIN CHARACTERISTIC

ROOTED IN A SATISFACTION-BASED ECONOMIC MODELeach offer is developed/designed and delivered in relation to a particular customer “satisfaction” (unit of satisfaction)

STAKEHOLDER INTERACTIONS-BASED INNOVATION radical innovations, not so much as technological ones, as new interactions/partnerships between the stakeholders of a particular satisfaction production chain (life cycle/s)

INTRINSIC ECO-EFFICIENCY POTENTIALinnovation in which is the company/companies’ economic and competitive interest that may leads to an environmental impact reduction (system eco-efficiency: decoupling the creation of value from resources consumption)

3.1 eco efficient system innovation vezzoli-13-14

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