By Professor Sami Kara
Director of Postgraduate Research
Faculty of Engineering
University of New South Wales

Manufacturers in New Zealand and Australia are hearing a constant refrain: to remain competitive in the global manufacturing marketplace, companies must become more productive with fewer resources and must find ways to differentiate themselves from the competition. As well as becoming more ‘lean’ there is increasing pressure to become more environmentally sound.

The answer, according to our research at the University of New South Wales (UNSW), School of Mechanical and Manufacturing Engineering, could be Life Cycle Engineering (LCE). LCE is an approach to product design and manufacture that takes into account the entire product life cycle from beginning to end.

With increased resource scarcity there is an opportunity for manufacturers to minimise their environmental impact and improve return, by controlling the entire product life cycle. This is a dramatic departure from the traditional manufacturing approach, which generally concerns itself with the product’s life cycle only up until the end of its warranty period, which has resulted in a disposable society, where many products are simply sent to landfill.

The world has limited resources to sustain production. Approximately 89 million barrels of oil and liquid fuels were consumed per day worldwide in 2011 . By 2030 China alone is expected to consume 17.5 million barrels per day . Limited copper resources will cause similar issues. With this increased pressure on resources, manufacturers will eventually have to find alternatives to using high levels of raw materials. If products were designed from the beginning to be dismantled at the end of their lifespan, it would make the recycling process much easier and more cost-effective, and significant resources would not be wasted.

LCE would go some way to addressing this issue but to be truly viable it must also provide a tangible return for manufacturers, rather than simply using up more time and resources.

Some companies have already found this balance and are reaping the rewards of LCE by changing their business model to a product service system approach.

Life Cycle Engineering can save manufacturers money

Companies such as Fuji Xerox have been leasing rather than selling product for years and the model is now being adopted in other industries. Rolls Royce, for example, no longer mass-produces jet engines. Instead they are leased to airlines for a fixed period of time. When they reach the end of their life Rolls Royce collects the engines and re-manufactures them before leasing them out again. This minimises the need for raw materials, improves their cash flow and keeps production costs low. The benefits to the airline are lower up-front costs and reduced risk, due to service agreements being in place.
Even for those companies that cannot lease their products, LCE can provide cost benefits. Many commodities that are sent to landfill still hold value in terms of re-manufacturing.

LCE takes into account not only the raw materials used in creating products but also the processes used. Changing certain processes can deliver significant cost savings to manufacturers without compromising efficiency or quality.

For example, energy consumption is one of the most significant cost centres for any manufacturing organisation. Energy consumption has increased by approximately 30 per cent in the last decade and is likely to continue to do so unless manufacturers find ways to reduce it.

This can be achieved via an incremental approach. For example, UNSW researchers conducted an efficiency audit that revealed an aluminium factory was leaving its energy-intensive ceiling fans running continuously. By implementing a control system that simply turns the fans off when they are not needed, that factory achieved a net saving of more than $100,000 and reduced its environmental impact.

When it comes to product design, manufacturers must work with the designers to consider: what materials will be used; where they come from; how they will be delivered; what processes are required to make the product; how the product will be transported to the marketplace; how it will be used; and how it will be returned and recycled.

Logistical changes also offer an opportunity for savings. Many products are made with materials sourced overseas. They are shipped here and transformed into products, many of which are then shipped back overseas for sale. Sourcing material locally could be a more efficient option. Local materials may have a higher per-unit cost but do not attract a freight charge. Routes and schedules can be re-examined to make them more efficient.

Ultimately, manufacturers and designers must work together to achieve a ‘cradle-to-cradle’ approach that results in products that are designed from the ground up to be efficient to manufacture, use and dispose of.

How to make LCE a reality

Because New Zealand is a free market, the impetus may need to come first from short-term legislation. This will only be a short-term catalyst however and, ultimately, LCE will only be successful if there is sufficient customer demand.

In places like Europe and Japan LCE has gained momentum because there is simply no space for landfill, so products must be designed with their end-of-life disposal in mind. New Zealand does not face the same space issue, so there is less demand for LCE processes. However, the fact that manufacturing organisations can achieve significant cost savings and improved efficiencies means that adopting LCE processes is likely to keep the manufacturing industry alive even as competition from global players increases.

LCE takes an incremental, iterative approach so small changes can be made and benefits can be realised immediately. The process of becoming fully LCE-ready can take as long as necessary to avoid unsustainable disruption in the organisation.

The biggest barrier to unleashing the benefits of LCE is a lack of understanding. While environmental sustainability is a feature of LCE approaches, manufacturing companies stand to achieve cost savings and efficiency gains that can secure the future of the industry and the success of individual organisations.
When manufacturers can look beyond just the four walls of the factory and begin to take small steps towards LCE, the benefits will quickly add up.