Lifecycle Analysis Pays Off

April 16, 2008
The task of documenting an end-to-end product lifecycle can open up new avenues for cost reduction and revenue growth.

Lifecycle analysis (LCA) refers to the documentation of all aspects of the "lifecycle" of a product, from raw material production, manufacture, distribution, use and disposal and including all intervening transportation steps necessary or caused by the product's existence. While it represents a stricter standard than a simple manufacturing emissions-based footprint, a comprehensive LCA can open up new revenue opportunities, says AMR Research's John Davies.

"For example, Caterpillar expanded their remanufacturing opportunity into a multibillion dollar business," remarks Davies (see "Caterpillar's LCA Experience"). "This was driven in large part by leveraging their salvaging technologies to look at additional product lines with a more environmentally focused perspective."

Caterpillar's LCA Experience

Remanufacturing has proven to be a carbon saver for Caterpillar Inc., among other benefits. For example, taking a look at the comparative environmental impact of remanufacturing a cylinder head versus creating a new one has revealed many positive metrics.
Environmental Impact Category Remanufactured vs. New
GHG emissions >50% less
Water use >90% less
Energy use >80% less
Material use >99% less
Landfill space >99% less
Eaton Corp.'s Joe Wolfsberger says that his company is also taking a hard look at its product portfolio. "We've just contracted to do some LCA on several products which will shine a light on the entire value chain of the product, from the raw materials going into it, how much goes into mining the copper that makes the wire, or how much petroleum goes into the PVC coating on those wires, and what's the end-use requirement, and how much of the product gets recycled."

Better than that value chain visibility, however, is the experience and training that his engineers are getting, says Wolfsberger. "We've contracted for two LCAs of two of the products in our electrical group, but part of our contract is them training our people to develop the in-house capacity to do LCAs ourselves. This outside contract is the first step, but then we're looking forward to having the knowledge of the lifecycle assessment that will then become part of our product development process."

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