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Defining the CP Index and CP Ratio |
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CP Index
= productivity / environmental impact
CP Ratio
= productivity ratio / environmental ratio |
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CP Indicators
Measuring cleaner production (CP)
is of critical importance for
your business and corporate
image.
As a
business architect, you must use appropriate indicators, which are generally
applicable, yet specifically measurable, and address both the
productivity and
environmental aspects of your
business system in an integrated fashion.
The indicators should enable not
only estimation of the CP of a product or process and its comparison with other
equivalents, but also
continuous improvement of the existing process or product and the
development
of new products.
Example: Canon
The Canon Production System (CPS)
includes: environmental care, quality, cost, and delivery (EQCD) to optimize
production. Cannon's Suggestion System is focused on elimination of
9 wastes.
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"Product manufacturers are
responsible for their own
operations, upstream processes,
and downstream uses and disposal
of the product. Companies are
increasingly considering the
entire life cycle of their
products when seeking to improve
environmental performance, in
part as a consequence of the
concept of "extended producer's
responsibility," write Ik Kim
and Tak Hur in LCA and TCA as
Tools for Measuring Green
Productivity. Therefore, CP
measurement should be based on
life cycle impacts and costs.
CP Index is the ratio of the
productivity of the system to its environmental impact. Productivity is measured
in terms of economic efficiency using Total Cost Assessment (TCA), and the
environmental impact is calculated using standard LCA methodology.
The CP Index can be used to measure
the CP level of a product or process and to compare it with similar products and
processes.
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You typically must chose between
improving existing processes or
products and adopting a new
alternative that may offer
better performance. Therefore,
you must use one more indicator,
the "CP ratio" for internal
decision making. The CP ratio
considers not only costs and
profits over time, but also
environmental impacts from the
perspective of CP.
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Simply making a ratio from the
two CP indices of the existing
and alternative systems would
fail to adequately reflect the
concept of time value of money.
The CP ratio incorporates the
term "present cost" to capture
the change of value of the
investment over time.
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Cleaner
Production (CP)
Strategies
Features |
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Two-Step Process
①
Define the "productivity ratio"
as the ratio of the productivity
elements of the current process
and an alternative process
expressed in economic efficiency
over time.
②
Define the "environmental ratio"
as the ratio of reciprocals of
the environmental impact
elements between the current
process and an alternative
process.
These two ratios are multiplied
together to generate the value
of the CP ratio. If the CP ratio
is higher than 1, it means that
the alternative is better than
the current one from the CP
perspective.
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