How to integrate Carbon Footprint Calculation via Cost & Value Management

Sustainability is THE major product value of the last years and one of the Top 5 driving topics for CxOs across industries. It is driving the development of new products, the re-engineering of supply chains and our daily commute to work – if we still have one. But how can sustainability be sustainable? 

As cost-driven people, we must ask a simple but important question: 

“What does sustainability cost?” 

Many people would answer with an opposing question “What will it cost us, if we do not become sustainable?” 

Sustainability must be sustainable 

Running into the risk of having an unpopular opinion, we still want you to know: Yes, the planet is changing in a way, that it will become much harder for us humans to inhabit it. Carbon dioxide is one of the main drivers of the challenge we call climate change. We need to do anything in our power to slow down temperature increase. There is no discussion about it. 

BUT (yeah, now it comes) if we overplay it, we, and the basis from what we make a living, will never be the same. Simply because we not yet understand, which decisions are the right ones, which technologies are the “greenest” ones. 

We should not reduce our efforts to optimize our carbon footprint, but we need to direct them efficiently and smart. And for that, we need to know where it comes from. 

Efficient integration of carbon footprint optimization is easy*

*If you implement Cost & Value Management  

Know where your products are generating emissions 

While many companies know where their product costs are coming from, most of them have no idea what process and which material is causing which CO2 equivalent. Combining a bottom-up approach together with an organization wide drill-down for company emissions, an exact calculation for each product, portfolio or organizational unit must be created. 

Adapt your product development process 

Many companies have implemented a product development process in the past two decades, thus many processes need to be updated. A continuously changing global business environment demands product development processes which can adapt accordingly – especially on cost and sustainability. 

Implement eco design principles 

 “Eco design principles” based on corporate sustainability projects and the known Design-to-Cost method ensure the integration of sustainability as a core product value. 

Ensure integration through a step-by-step approach 

It is important to integrate a sustainable development ecosystem sooner than later. But to not overload a company, proof-of-concept and lighthouse projects are needed followed by a global integration. 

Because sustainability must be sustainable.

A breakdown of company emissions onto your products is not enough

Since a “simple” breakdown of company emissions isn’t that detailed due to missing transparency – we at Horváth – created together with our experts from production and supply chain a holistic calculation approach that focuses on a bottom-up calculation. For that we are integrating your internal value and enhance and challenge them with our best practice database. 

Schaich, T. / Stefan, F.