Ford Motor Company has more than 100,000 personal computers (PCs) in use every day across our global operations. PCs are typically replaced on a rolling basis, to keep pace with technology advancements.
In 2010, the IT “PC renewal” planning team was in the initial stage of creating a Request for Quote (RFQ) for the next wave of PC purchases, and was interested in incorporating sustainability criteria into the RFQ process. At the same time, another group of IT employees – who, in addition to their regular roles, devote one to two hours a week to sustainability-related efforts – were looking for a project that would have a long-term, tangible impact on sustainability within IT. The two teams, along with additional employees in IT Purchasing, were brought together by individuals in the IT Supplier Relationship Management department.
The challenge they set out to meet was: Could a sustainability-focused PC purchase decision reduce Ford’s environmental footprint and costs, while still meeting all other computing requirements?
In the past, Ford’s RFQs for PCs have focused on functionality, service, quality and price. The team’s main task was thus to research and understand what makes a PC “green” and then translate their findings into a set of specific, quantifiable requirements and questions for RFQ responders. The team would then have a consistent way to evaluate and compare suppliers’ responses. “‘Green’ can mean a lot of different things,” explained Eric Wingfield, a member of the team, “so we needed to ensure that we looked for broadly accepted industry standards upon which to build a credible set of questions that could allow the team to fairly compare suppliers’ green offerings.”
The team began by understanding Ford’s current expectations of suppliers relating to sustainability and then benchmarking other organizations’ methods of incorporating environmental criteria into the PC purchasing process. They looked at the approaches of groups as varied as non-automotive OEMs, health care organizations, standards bodies and government agencies around the globe. The U.S. Environmental Protection Agency (EPA), which runs the Energy Star Program, turned out to be an excellent resource for data on various standards globally.
Via the EPA the team found the Energy Performance and Environmental Assessment Tool, or EPEAT – a set of global standards and an accompanying certification process that provides a comprehensive list of sustainability criteria as well as levels of certification that are easily understood by both consumers and suppliers. EPEAT was developed using an EPA grant and is managed by the nonprofit Green Electronics Council. According to the Council, in their report Environmental Benefits of 2009 EPEAT Purchasing, “Combined unit sales of EPEAT-registered notebooks and desktops (including integrated systems) constituted close to 17% of sales of notebooks and desktops worldwide, and 42% of combined product sales in the U.S.”
EPEAT became the foundation upon which Ford built its own requirements. It also provided a credible certification system for assessing PC suppliers’ compliance with sustainability criteria. Certified EPEAT manufacturers are independently verified by the Green Electronics Council to ensure they are actually meeting the standard. “We liked EPEAT standards because they are comprehensive,” said Rob Thies, a member of the Ford team. “The standard requires environmental responsibility throughout the supply chain, including designs that manage the end-of-life concerns, reuse or recycling, where there is a great impact on the environment. We verified that the standards were recognized and used by both government and corporations, which is more cost effective for suppliers as they don’t have to coordinate multiple customer requirements.”
Nikola Ristivojevich, another member of the team, said: “Another benefit was that EPEAT requirements for PCs were completely aligned with Ford’s own environmental standards for our vehicles and operations. Ford is working on sustainable materials, end-of-life issues, energy use reductions, and reducing packaging and waste, so we know firsthand how important these things are and how much effort it takes to accomplish these goals.”
EPEAT was also desirable because it is an international standard recognized in 49 countries. And according to the rules, a manufacturer cannot sell the certified model in one country and then sell an uncertified version of the same model in countries with lower regulatory standards. For the team, this provided assurance that the same level of compliance would be attained no matter where the product was delivered globally.
In the second quarter of 2010, the RFQs were sent to potential global PC suppliers. The providers were asked to specify the level of EPEAT certification their products had attained, along with other sustainability, technical and commercial questions important to Ford. The suppliers’ responses were encouraging, showing that nearly all of the PCs in the suppliers’ quoted offerings would meet the EPEAT Gold standard. Any one of the potential suppliers could therefore meet the sustainability requirement of EPEAT Gold identified by the team and ensure that Ford PCs provide energy savings. The team then looked to the remaining sustainability, technical and commercial questions to determine a choice.
Due to the high performance of all of the potential suppliers, sustainability-related responses were not a differentiator in decision-making. The responses did prove to be a valuable benchmark of potential suppliers’ capabilities and products, and provided important data for comparing energy savings between suppliers, and new vs. prior technology offerings. In addition, the Company was able to send a message to potential suppliers that sustainability is of importance to Ford. The next step was to create contract language that would require continued compliance with the EPEAT standard. The team worked closely with IT Contracts, the Office of General Counsel and Purchasing to develop contract language that requires the chosen PC provider to show how they will continue to meet EPEAT standards and all of Ford’s other requirements throughout the contract. The addition of EPEAT standards to already-robust contract terms that address human rights and working conditions, as well as environmental responsibility, created requirements appropriate to the IT buy.
The purchase of these PCs has resulted in a wide range of concrete benefits. For example, the PCs use significantly less energy than the previous models and will be responsible for fewer greenhouse gas emissions during their use at Ford. They also will be safer for Ford employees to operate, because they are low in volatile organic compounds (VOCs) and thus produce less “offgassing” during use. The more eco-friendly composition of the PCs and a responsible end-of-life disposal process will reduce the likelihood that materials of concern will get into the environment when the PCs have completed their useful lives at Ford. For example, the EPEAT standard ensures that the computers are lead-free, an important end-of-life environmental consideration.
To read the rest of the case study, please download this PDF of Ford’s webpage.
Original publication date: 2010-11