Environmental Process – Operations management & CSR
Aspect It is no longer possible for companies to ignore the environmental impact of their operations as they need to respond to changing shareholder demands in order to remain profitable. Investors are becoming more interested In a company’s environmental performance, “aware that the firms understand and manage their environmental Impacts are best positioned to benefit from strategic opportunities. “l According to research published in the Harvard Business Review in 2009, 75 percent of U. S. Rockford entrants see social responsibility and environmental commitment as important criteria in choosing employers. This adds pressure to operational managers in terms of environmental practices if they want to attract employees Customers are going ‘green’ and companies must meet their requirements or they will have to face the consumer backlash If their standards do not meet their sustainable requirements More often than not it is operations management that is the centre of major environmental disasters causing pollution for example, as many of the cases are and for a range of reasons.
Further on in the environmental scope we will analyze how an operational failure led to a pollution catastrophe causing headlines around the oral. The mall areas of operations management are listed below along with some
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Today there is a growing consensus that major improvements in environmental performance can often be achieved with better technology at nominal Incremental cost and can even yield net cost savings through enhanced resource utilization, process efficiency, and quality. “3 There Is Increasing evidence that providing more efficient processes coupled with a deduction in waste and pollution will reduce operating and material costs as a result. This concept is known as ‘shared value thinking’ and it is ultimately “transforming the value chain”4 and thus the way people are thinking today.
A key example to how operational managers can make a huge difference on the environment by improving their operational processes: Feted environmental Initiatives: Feted, the American global courier delivery services company have incorporated responsible environmental practices into their daily operations with the aim to reduce waste and increase their efficiencies. Despite the global crisis, the company is replacing the old with the new as they Invest In new fleet Boeing 757, as part of Its remarkable 36% while ultimately growing their capacity. 5 This new investment should reduce their annual CA emissions by 350,000 metric tons. Additional aircraft Boeing 777, will further reduce their fuel consumption by 18%. Other initiatives implemented by Feted include a set of 30 soft ware programs that help optimize flight routes, aircraft schedules and the amount of fuel on board. The company’s distribution hubs in LA and Germany have installed 1. -megawatt solar- energy systems, and finally, to be more fuel efficient in relation to its road-vehicles, Feted have replaced some of its vehicles with smaller fleet and it is using hybrid vans to replace conventional trucks, that are ultimately 42% more fuel efficient.
Feted made the above alterations to their operational processes in order to make their performance and delivery fleet more efficient while ensuring their changes integrated environmental practices that would reduce their negative impact. From a ‘shared value perspective’, Feted have improved their operations while reducing environmental impact, thus creating a Win win’ situation. In another key example below, we will show you the severe consequences that a company can face if they do not manage their operations efficiently and the repercussions this can ultimately have on the environment.
Furthermore, how these negative effects can stimulate global coverage ensuring that large companies cannot hide from their mistakes. BP Oil Disaster On April 20th 2010, BP was involved in the “largest accidental marine oil spill in the history of the petroleum industry’. 7 4. 9 million barrels of oil spread across the ocean lour incessant for a period of three months which resulted in the explosion and sinking of the Departed Horizon rig located in the Gulf of Mexico, about 42 miles off the coast of Louisiana. 8 11 men working on the rig at the time were killed in the explosion that led to fires which burned for 36 hours.
BP was convicted of manslaughter and as a result paid a “record $4 billion in criminal penalties for the company’s role in the oil disaster”. 9 The shares of the oil giant plunged after the incident. The blown out Macon well, which wasn’t properly sealed until September 19th 2010, was owned mostly by BP, he company had a lease contract with drilling contractor Transoceanic, who owned the rig. On their website BP have disclosed exactly what happened during the incident: “The accident involved a well integrity failure, followed by a loss of hydrostatic control of the well.
This was followed by a failure to control the flow from the well with the blowout prevent (BOP) equipment, which allowed the release and subsequent ignition of hydrocarbons. Ultimately, the BOP emergency functions failed to seal the well after the initial explosions. “10 It was a combination of negligent ‘cost- he failure. The operator BP, seems to be increasingly likely to be the one “to foot the entire $42 billion cleanup 1 as accountability is directed their way by President Obama who told reporters “BP is responsible for this leak -? BP will be paying the bill. 12 ‘The leak caused a series of long term and immediate affects in what President Obama described as “the worst environmental disaster America has ever faced. ” 13 According to the National Wildlife federation, “More than 8,000 birds, sea turtles, and marine mammals were found injured or dead in the six months after the spill. The long-term damage caused by the oil and nearly 2 million gallons of chemical dispersant used on the spill may not be known for years. 14 The long term impacts remain difficult to measure as effects from the oil slick, which still lines the sea floor, are still appearing and affecting ecosystems and communities alike. The immediate & long term impacts on wildlife and coastal wetlands assessed by wildlife crews, managers, researchers and scientists are described below: 15 In the aftermath of the explosion, the oil continued to pollute coastlines but it also polluted the company’s image entirely as negative coverage surrounding the operations disaster spread across the world the day it broke.