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Cradle to cradle

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Cradle-to-Cradle Design at Herman Miller: Moving
Toward Environmental Sustainability

We put Herman Miller’s corporate environmental goal quite simply: to become a sustainable business— manufacturing products without reducing the capacity of the environment to provide for future generations.” — Herman Miller website

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Drew Schramm, senior VP of Supply Chain Management, reflected on the irony of his position at Herman Miller. Brought in as a supply-chain specialist to cut costs, he somehow found himself on the steering committee of the Design for Environment (DfE) team, charged with setting the company’s environmental policy and direction.

He agreed with the team when they decided to adopt the cradleto-cradle (C2C) design protocol1 for environmental sustainability,2 on the new mid-level office chair. Herman Miller had been working with an external design house on the conceptual design for the Mirra chair forseveral months and in October 2001, the DfE team became involved to guide the design and development of the product using the C2C design protocol.

The Mirra chair would be the most advanced and complete application of the C2C design protocol among any product manufacturer to date.3 It was challenging to implement a new design process while designing a new product, but everyone agreed that C2C was the way to go.

However, the team now faced a decision that was clearly a development milestone: whether to use polyvinyl chloride (PVC) in the arm pads of the chair. Arm pads were a critical part of the chair in terms of customer perception for comfort and wear (quality), and could contribute up to 10% of the cost of the entire chair. PVC violated the standards of the C2C protocol because of the toxins released during its manufacture and when it was burned.4 However, PVC was a standard material in the office furniture industry (more than 50% of office furniture products contain some PVC part); it was durable, easily formed, and inexpensive. Alternate materials would likely give lower performance or be more expensive. Thinking from the supply-chain

1 The cradle-to-cradle protocol was a set of environmentally friendly product development guidelines created by architect William McDonough and chemist Michael Braungart in order to create closed-loop product life cycles. 2 According to the U.N. Brundtland Commission (1987), sustainable development is defined as “development that meets the

needs of the present without compromising the ability of future generations to meet their own needs.” 3 William McDonough, co-creator of the C2C design protocol.
4 In an article published in the Journal of Industrial Ecology (Fall 2006), “Design for the Next Generation: Incorporating Cradle-

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to-Cradle Design into Herman Miller Products” by Mark Rossi, Scott Charon, Gabe Wing, and James Ewell, the authors explain that “According to [C2C] material protocol, PVC is considered to be an ecologically inappropriate material because of its organochlorine content, its use and generation of
chronic toxicants in manufacturing (including the known carcinogens vinyl chloride monomer and dioxins), and its generation of dioxins and furans when burned (including in incinerators).” ________________________________________________________________________________________________________________ Professor Deishin Lee and Lionel Bony (MBA 2006) prepared this case. HBS cases are developed solely as the basis for class discussion. Cases are not intended to serve as endorsements, sources of primary data, or illustrations of effective or ineffective management. The numbers in this case may be disguised.

Copyright © 2007, 2008 President and Fellows of Harvard College. To order copies or request permission to reproduce materials, call 1-800-5457685, write Harvard Business School Publishing, Boston, MA 02163, or go to http://www.hbsp.harvard.edu. No part of this publication may be reproduced, stored in a retrieval system, used in a spreadsheet, or transmitted in any form or by any means—electronic, mechanical, photocopying, recording, or otherwise—without the permission of Harvard Business School.

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perspective, Schramm knew it was going to be much easier to work with suppliers if Herman Miller continued using PVC: it was a known material that everyone was used to working with. He guessed that development engineers would also be more comfortable sticking with PVC because of product performance. The PVC decision for the Mirra chair could also have implications on future products, especially if the company actively promoted the PVC-free feature in its marketing drive. Would the company take a stand for the environment? In the minds of many on the DfE team, this is where the rubber met the road.

Overview of Herman Miller

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Design and Innovation5

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Herman Miller was founded as the Michigan Star Furniture Company in 1905, but its true father was D.J. De Pree, who purchased and renamed (after his father-in-law) the company in 1923. Over the following 60 years, D.J. De Pree and his two sons, Hugh and Max, grew the company into an internationally acclaimed furniture design house. Through innovations that included the Noguchi Table, the Eames Lounge Chair, the Action Office System, and the Aeron Chair, Herman Miller evolved into a leader of residential and office furniture and workplace design. Collaborations with notable designers resulted in creative excellence that had been showcased in permanent collections in many museums including New York’s Museum of Modern Art, the Whitney Museum, and Washington D.C.’s Smithsonian Institute. (See Exhibit 1 for examples of the company’s products.)

Culture

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D.J. De Pree believed that Herman Miller should not be satisfied with offering innovation and good design. He also strongly believed that his firm served a moral purpose. The mindset of the management and employees was reflected in the “things that matter” at Herman Miller (as described in a company document): Curiosity and Exploration, Design, A Better World, Performance, Relationships, Transparency, Engagement, Inclusiveness, and Foundations.6 Drew Schramm, one of the few seniors managers hired from the outside, noted:

There is a very strong culture at Herman Miller—humility is a big part of it. We respect each other, we care about the environment. Herman Miller is a great company that attracts a lot of talent, and people who want to work here generally hold the same values. If you come in here acting brash and looking out only for yourself, you’re not going to last. We don’t even blow the horn about our environmental actions and record to the outside world as much as we could. Some competitors do a much better job marketing the environment, even when they don’t do as much as Herman Miller does.7

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The company consistently received high marks in internal surveys on questions such as, “Are you proud to work for Herman Miller?” Because of its progressive culture, Herman Miller believed that it was able to attract and retain employees of like mindsets and to be an employer of choice.

5 This section draws on Sandra J. Sucher and Stacy E. McManus, “Herman Miller (A): Innovation by Design,” HBS No. 602-023

(Harvard Business School Publishing, 2002).

6 “Things That Matter: Incomplete Thoughts About Herman Miller,” Herman Miller internal company document. 7 Interview with case authors, April 18, 2006.

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Cradle-to-Cradle Design at Herman Miller: Moving Toward Environmental Sustainability

Economic Performance

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Herman Miller sales grew from $25 million in 1970, when it first became a publicly traded company, to $1.5 billion in 2002 (see Exhibit 2 for financials). Herman Miller benefited from the explosive growth of high tech companies in the late 1990s and early 2000s, but also suffered from their decline starting in 2002 as many of its customers faced cutbacks or completely dissolved. In 2002, as sales fell to the pre-Internet-bubble level, Herman Miller faced layoffs and cutbacks to adjust their workforce and operating level to respond to the post-bubble market correction.

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Herman Miller was one of the top four suppliers in the U.S. office furniture industry. In 2002, Herman Miller, Steelcase, HNI, and Haworth had, respectively, 16%, 29%, 19%, and 13% of the $8.9 billion U.S. office furniture market. Herman Miller’s international presence had grown, representing 14% of sales in 1990, peaking in 1996 at 19%, and stabilizing at 15% in 2002 after a dip in the late 1990s. The company anticipated that the international market would continue to be an important area of future growth for the company. Most of Herman Miller’s customers were S&P 1000 companies, many were multi-location, and multi-national. The company also had a significant presence in healthcare, education, and residential/consumer markets.

Products

Seating: A wide variety of chairs ranging from work chairs to lounge chairs

Systems furniture: Matching furniture collections (including structural elements) for offices or cubicles

Filing and Storage: Filing and storage cabinets

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Herman Miller offered a suite of office furniture, including:

Desks and Tables

Healthcare: Furniture for healthcare facilities

In 2002, the percentage sales in the U.S. office furniture market for seating, systems, filing and storage, and desks and tables were, respectively, 26%, 32%, 20%, and 19%.8

Herman Miller and the Environment

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Herman Miller adopted the triple-bottom-line philosophy of financial, environmental, and social responsibility performance. The company was considered to be an environmental leader in the industry, with competitors following its lead on many environmental initiatives. It stated in its Corporate Values statement, “We contribute to a better world by pursuing sustainability and environmental wisdom. Environmental advocacy is part of our heritage and a responsibility we gladly bear for future generations.”9 In 1989, the company formed the Environmental Quality Action Team (EQAT) to set the company’s environmental direction and priorities, and to measure the results. By 2002, more than 400 employees (out of 8,500) volunteered to be on EQAT teams, meeting monthly or quarterly, often working after hours to generate and implement ideas geared toward

8 Business and Institutional Furniture Manufacturer’s Association, http://bifma.org/statistics/index.html. 9 Herman Miller website, http://www.hermanmiller.com, accessed February, 2007.

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achieving the company’s environmental goals. (See Exhibit 3 for details on EQAT groups.) The company’s environmental efforts culminated in the early 2000s with the “Perfect Vision” initiative, a range of sustainability targets including zero landfill (previously established in 1991), zero hazardous waste generation, zero air and water emissions from manufacturing, company buildings constructed to a minimum LEED10 Silver certification, and the use of 100% green energy (renewable and environmentally preferable) to meet power needs; these targets were to be achieved by the year 2020.

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When Herman Miller adopted the zero landfill goal in 1991, the company realized that the way its products were designed generated waste in the production process that could be minimized or avoided. For example, the packaging employed by suppliers to ship the tiles used for the Ethospace11 product line included plastic fingers glued to cardboard, which made them difficult to recycle because of the heterogeneous materials. Herman Miller worked with the supplier to get rid of the cardboard, and to make the packaging returnable and reusable.

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In 1991, members of the Environmental Health and Safety group, including director Paul Murray, drafted a series of guidelines called “Design for Environment” (DfE) in an effort to formalize the environmental aspects of its design process. As explained in the original document, DfE was “a list of facts and suggestions that can help when making decisions during product design and development. Experience has shown these axioms to be earth friendly.” It offered specific guidelines in the categories of Material Selection, Design for Disassembly, and Manufacturing. For example, the section on Aluminum in the “Material Selection” section stated: “Most aluminum is made from 100% recycled material and is 100% recyclable. Diecasters can use 100% recycled materials, where extruders will have a more difficult time using 100% recycled aluminum.” There were equally detailed suggestions in the other two sections.

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In 1999, a DfE steering committee consisting of senior managers and executives from Supply Chain Management, Product Management, Healthcare Marketing and Project Services, Concept Development, and Environmental Health and Safety was formed to set the company’s environmental policy (see Exhibit 4 for Herman Miller’s organizational chart) and balance its environmental goals with its business decisions. As Schramm put it: “We have to use business common sense. We don’t make decisions that will put us at a disadvantage in the market. It doesn’t do the world any good if we go out of business because we’re nice guys. We want to be in business AND be nice guys.” The company was also betting that global resource constraints were leading to tightening of legislation on the use of materials and energy, and waste disposal. According to Mark Schurman, Herman Miller’s Director of Corporate Communications: “We absolutely believe that more and tighter environmental regulations are the way the world is going. We’re already seeing it in Europe. DfE is going to help us stay ahead of the curve, hopefully setting the industry standard.”12

The Cradle-to-Cradle Design Protocol

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Herman Miller viewed the DfE guidelines as an evolving set of rules that was intended to change as they learned more about their environmental impact. Therefore, when architect William McDonough approached the company in 1997 with an offer to integrate sustainability principles into 10 LEED (Leadership in Energy and Environmental Design) is the green-building rating system established by the U.S. Green Building Council, a coalition of 7,500 companies and organizations that work to set standards for buildings that are healthy, environmentally sound, and profitable (http://www.usgbc.org/). 11 Ethospace is an office system made of individual segments, called “tiles,” that are attached to steel frames. This structure allows the user to benefit from a great variety of designs and functions. 12 Interview with case authors, March 26, 2006.

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the DfE guidelines, they listened. At the time, McDonough had formed the McDonough Braungart Design Chemistry (MBDC) consulting firm with German chemist Michael Braungart, and was working with companies such as BASF, Ciba Geigy, and Nike on defining what would become the cradle-to-cradle (C2C) design protocol. Braungart and McDonough contrasted their vision of design with traditional practice:13

Cradle-to-Cradle Underlying Principles
The C2C protocol was based on two premises:

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The characteristic design approach of the last century was “cradle to grave.” It involved digging up, cutting down, or burning natural resources—releasing toxic material into the environment in the process—to make products that became useless waste at the end of their useful lives. By contrast, [the] cradle-to-cradle approach mirrors nature’s regenerative cycles so that at the end of its useful life, a product and its component materials are used to make equally valuable products. C2C thinking does not just focus on minimizing toxic pollution and reducing natural resources waste. It goes one step further, demanding that companies redesign industrial processes so that they don’t generate pollution and waste in the first place.

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Eco-effectiveness vs. eco-efficiency Eco-efficiency aimed to incrementally improve the modus operandi of the existing industrial system so that it would generate less toxic pollution and decrease the rate at which it depleted natural resources. On the other hand, eco-effectiveness required creating a new industrial system that did not generate pollution or deplete natural resources. Effectiveness was achieved in product cycles when the materials used in the object could be not just recycled, but “upcycled.”14 For example, in the case of a plastic container, it meant that the container could be dissolved back to the polymer level, and the polymers could be reused as materials for high-quality applications, just as virgin plastic would be. McDonough and Braungart explained the difference between efficiency and effectiveness: The marvelous thing about effective systems is that one wants more of them, not less. For example, instead of minimizing the consumption of energy generated from coal, oil, and nuclear plants, why not maximize energy availability using solar and wind sources? . . . Instead of directing intelligence toward regulation compliance and liability reduction, why not design industrial processes and products so safe they do not need regulation, and direct creativity toward maximizing economic, social, and ecological benefits?

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Waste equals food “Eco-effectiveness seeks to design industrial systems that emulate the healthy abundance of nature. The central design principle of eco-effectiveness is waste equals food.”15 Once a product had been designed so that, at the end of its life cycle, it could safely be returned to industry (through recycling) or nature (through biodegradation), pollution and depletion would therefore disappear, resulting in what McDonough called “virtuous closed loops,” in which industrial and natural elements were recycled over and over.

13 William McDonough, “Green Gold, Corporate Leadership for Energy Efficiency,” Harvard Business Review, April 2006. 14 McDonough and Braungart define a material as being “upcycled” when it is utilized over and over for the same high-quality

use in an infinite series of product cycles.

15 William McDonough, “Green Gold, Corporate Leadership for Energy Efficiency,” Harvard Business Review, April 2006.

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Translating C2C Principles into Design
There were four key elements for implementing C2C, according to MBDC:

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Biological and technical nutrients C2C distinguished between biological and technical nutrients and cycles. A biological nutrient was a biodegradable material posing no immediate or eventual hazard to living systems that could safely return to the environment after being used by humans. Examples included natural fibers such as cotton or wool. A technical nutrient was a material that remained in a closed-loop system of manufacture, reuse, and recovery, maintaining its value through many product life cycles.

Examples included raw materials transformed by industry such as metals or petrochemicals. The C2C protocol required that biological and technical nutrients be kept separate in order to avoid the creation of “monstrous hybrids,” defined as products in which biological and technical nutrients were mixed together in a way that made it infeasible to separate them at the end of the product’s life. An example of a monstrous hybrid was a shoe whose leather is treated with a non-biodegradable dye. Because of the dye, the leather could not be turned into compost and had to be landfilled or incinerated.

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The Green-Yellow-Orange-Red list The C2C protocol recommended detailed assessment of all materials that were used to manufacture a product in order to determine the level of danger the chemicals might represent to humans and the environment, in terms of toxicity, cancer, and endocrine disruption.16 After assessment, chemical compounds were categorized as green (little or no risk— chemical is acceptable for use in the desired application), yellow (low to moderate risk—chemical is acceptable for use in the desired application until a green alternative is found), orange (no indication yet that chemical is high risk for the desired application, but a complete assessment is not possible due to lack of information), or red (high risk—chemical should be phased out).17 “Red” chemicals included all known or
suspected carcinogens, endocrine disruptors, mutagens, reproductive toxins, and teratogens.18 In addition, chemicals that did not meet other human health or environmental relevance criteria were “red” chemicals.

Disassembly The product should be easy to disassemble and have its different components clearly marked so that they could be properly recycled.

Recyclability and recycled content The product should use materials that could be recycled so that as little of the product as possible ended up in a landfill19 or an incinerator. In order to minimize its impact on virgin raw materials, the product should use as much recycled material as possible.

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16 According to the EPA, in recent years, some scientists have proposed that chemicals might inadvertently be disrupting the endocrine system of humans and wildlife. A variety of chemicals have been found to disrupt the endocrine systems of animals in laboratory studies, and there is strong evidence of this effect on fish and wildlife in particular locations. The relationship of human diseases of the endocrine system and exposure to environmental contaminants, however, is poorly understood and scientifically controversial. Source: Kavlock et al., “Research Needs for the Risk Assessment of Health and Environmental Effects of Endocrine Disruptors: A Report of the U.S. EPA-sponsored Workshop,” Environmental Health Perspectives, Volume 104, Supplement 4, August 1996, pp. 1–26.

17 “The Cradle-to-Cradle Design Protocol,” MBDC website, http://www.mbdc.com/c2c_mbdp.htm, accessed July 8, 2006.

18 A teratogen was an agent that caused the malformation of a developing fetus; for example, chemicals, viruses, and ionizing radiation.
19 For biodegradable material to decompose in a landfill, it must be exposed to certain bacteria and fungi. The compression of

material in landfills often prevents this, thereby resulting in the preservation of garbage.

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Implementation of C2C at Herman Miller

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In 1997, Herman Miller initiated a project to evaluate a number of environmental protocols that could help the company move toward environmental sustainability. The project was overseen by a senior advisory team that included representatives from Advanced Projects, Engineering, Materials Research, Supply Chain Management, Environmental Health and Safety, Finance, and Marketing. After researching various options over several months, the team converged on the cradle-to-cradle protocol offered by MBDC because they felt that its design focus would fit well with the company’s design and innovation culture. And, as Mark Schurman commented:

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It seemed that Bill McDonough had the drive, vision, and connections to make this protocol a standard across all industries. Also, McDonough was willing to put together resources for the implementation of his vision, therefore ensuring that C2C would be more than just a nice idea on paper. Finally, the “virtuous closed loops” concept that is behind C2C enabled businesses to move beyond the traditional “be less bad” to the “consumption is good” paradigm. C2C is a godsend to business!20

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At that time, although McDonough and Braungart had developed the conceptual framework for C2C, the details of how to implement the protocol did not exist. Over the next three years, Herman Miller product developers, engineers, supply chain managers, and the Environmental Affairs department worked with MBDC to develop the practical elements of the C2C design process. As the details of the process started to take shape, the Project Henry team realized that the implementation of C2C design would require the involvement of several different groups inside the company and the dedication of full-time resources. As Braungart and McDonough explained: “Herman Miller’s engineers were well informed about materials performance, but had very little knowledge about the composition of those materials. Similarly, the company’s purchasing agents were quite skilled at securing materials at target price levels, but had little experience assessing data on the environmental performance of product ingredients.”21

In 2001, the company felt that enough of the C2C process had been defined with MBDC to implement the design protocol on a product from beginning to end.

The Mirra Chair

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The Mirra chair, intended to be a mid-level office chair, retailing for approximately $750,22 would be the first product designed from beginning to end under the C2C protocol. In order to implement C2C, a dedicated DfE team (rather than a volunteer EQAT team) was formed in January 2001 to develop environmental evaluation measures for new products, create a database for suppliers’ materials categorized using the Green-Yellow-Orange-Red list criteria, and establish disassembly guidelines for new products. Herman Miller hired two full-time employees, supply chain manager Scott Charon and chemical engineer Gabe Wing, who were placed in the Supply Chain Management and Engineering departments, respectively. Later the DfE team was placed under the responsibility of Paul Murray, director of Environmental Health and Safety. Charon and Wing worked together to assess the materials used in Herman Miller products using the MBDC material screening process. Charon managed the relationships with the suppliers while Wing, a chemical engineer specializing in

20 Interview with case authors, March 26, 2006.

21Michael Braungart and William McDonough, “The Anatomy of a Transformation, Herman Miller’s Journey ToSustainability with MBDC,” 2002, http://www.mcdonough.com/writings/anatomy_transformation.htm, accessed March 7, 2007. 22 The Mirra chair was positioned approximately 15%–20% below the high-end Aeron chair.

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advanced materials, worked with the suppliers’ technical staff and MBDC on the chemical composition analyses.

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The implementation of the C2C protocol was spearheaded by the DfE team; however, in order to operationalize the protocol, Herman Miller engineers, supply chain managers, manufacturing associates, and design consultants would have to change their processes. Over a period of 6 months, starting in June 2001, Charon and Wing trained over 300 Herman Miller employees on the new design protocol. In a three-hour training session, employees were given an overview of the C2C protocol, a detailed explanation of the DfE process (C2C as specifically implemented at Herman Miller), and a hands-on exercise for disassembling one of Herman Miller’s office chairs.

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Design process The Herman Miller product development process consisted of four phases: Exploration, Development, Launch, and Maintenance. As described by Gabe Wing: “In the Exploration phase, the DfE department gets involved with design early on, so as to enable ‘intelligent design’ that will take into account C2C from the beginning. Therefore, this phase starts with a DfE kickoff meeting where the DfE team presents its guidelines to the design team, and gives them access to the chemical products database. Then we let them go do their magic.”

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In the Exploration phase, designers brainstormed on the basic concept of the product and outlined high-level specifications. They did not yet spend significant effort to develop any specific product features. The DfE kickoff meeting for the Mirra chair was in October 2001. The design consultants from Studio 7.5 and the Herman Miller development team attended the meeting.

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In the Development phase, once the basic design was established, the product was divided into modules, with different teams assigned to each module. As each team developed prototypes of their modules, the DfE team would assess the design, following the C2C protocol, for material chemistry, disassembly, and recyclability and recycled content. A “DfE weight” was calculated for each component of the module, which was a measure of C2C compliance (in percentage terms) of the component. The DfE score for the component was the sum of the three DfE weights. (See Exhibit 5 for how to calculate DfE weights and score.)

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Feedback was given to the development team in the form of a DfE scorecard. There might have been multiple iterations of any given module because of changes to the design for C2C compliance and other issues. The final DfE assessment proportionately aggregated the material chemistry, disassembly, and recyclability and recycled content scores for all modules, and a scorecard for the final product was given to the development team. (See Exhibit 6 for an example.) The results of the measures were entered into Herman Miller’s materials database for future reference. Although each product was evaluated on a case-by-case basis, a final DfE score of at least 50% was typically required for product acceptance.

The 50% score generally implied that materials were “yellow” or better, that for the most part the product could be disassembled into components of homogeneous material, and that a significant portion of the raw materials could be recycled. The score of 50% was not a static threshold. It was initially set as a realistic goal based on the current state of Herman Miller products. As products improved, the threshold would be raised to reflect the next level of desired environmental sustainability. Development engineer Doug Van de Riet commented on the impact of C2C: “Since there are so many materials out there, it’s good to get your choices limited by the C2C database. We now spend less time in material selection. But we now spend more time making do with the available materials.”

For example, the Y-spine of the Mirra chair (the structure that supports the back of the chair) was originally designed as a piece of metal with plastic overmolding, a difficult to recycle “monstrous hybrid.” After several prototyping iterations, a solution was found in the form of a two-piece

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patented design made of recyclable Nylon 6.23 The new part met the requirements of C2C and was also less expensive than the original. Another design change that improved the DfE score was the elimination of foam materials for the seat and back support. Although this design change was motivated by performance criteria (i.e., breathability and comfort), the foam, a “red” material, was replaced by a copolyesther elastomer textile, a recyclable “yellow” material. The PVC material in the arm pad of the chair was classified as a “red” material because of the toxins released during its manufacturing and disposal processes. However, one designer described the risks of replacing PVC:

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PVC is the perfect material for arm pads—it’s extremely durable, scratch resistant, formable, and cheap! That’s why everyone in the industry uses it and suppliers are used to working with it. Arm pads are a very noticeable part of the chair and it’s important that the part performs well. We’re committed to quality so if we want to get rid of PVC, we had better find a material that performs at least as well.

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Early in the Development phase, the manufacturing team was brought on board to create drawings for potential tooling requirements, evaluate the ease of assembly of the product, and eventually design the production line.

In the Launch phase, the development team finalized the product while the factory ramped up. At that point, only a quick DfE assessment would be conducted as a double check, since the majority of issues should have been resolved in the Development phase. Maintenance was affected by C2C insofar as any replacement materials (for cost reduction) would have to be assessed by DfE.

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Manufacturing Toward the end of the Development phase, once the basic design had been determined, the manufacturing team began to design the line to assemble the Mirra chair. The intent was to fashion the line after the production line for the Aeron24 chair. The line would be connected by a conveyor that would transport the product from station to station as manufacturing associates assembled the chair from the base up. Work would be allocated to each station so that the line was balanced. Although the proposed Mirra chair options—ranging from adjustable vs. fixed lumbar to fabric covered vs. all-plastic back, along with multiple colors and finishes—added up to millions of possible combinations, the Mirra chair was easier to assemble than the Aeron chair—“like a tinkertoy,” according to Operations Work team leader Henrietta Carter.

This made the manufacturing line shorter and simpler, thereby allowing employees to rotate through every station, rather than only within zones as on the Aeron line. As a result, Carter thought that “the job should be more interesting, each worker can replace anyone else on the line, building a stronger sense of inclusiveness.” Based on the current factory design, the manufacturing team anticipated that a completed chair would roll off the line every 55–60 seconds. (See Exhibit 7 for a factory process flow diagram.)

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Herman Miller was also in the process of implementing the Herman Miller Production System (HMPS), a manufacturing system based on the Toyota Production System (TPS). Andi Talley, Continuous Improvement team leader, observed that “With its policy of no inventory, no wasted products, and no waste of parts and time, the Toyota Production System is aligned with DfE.” Manufacturing efforts to reduce waste included returnable packaging (to the suppliers), eliminating packaging, and finding useful ways to use non-returnable packaging, thereby eliminating some other form of packaging in the factory.

Supply chain management

materials database.

There was considerable up-front work to populate the DfE
To set up the database, Herman Miller spent approximately $100K on IT

23 Nylon 6 is a polymer also known by the trademark “Perlon.” 24 The Aeron chair was introduced in 1994 as a high-end office chair.

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engineering costs and $300K on materials assessment fees for MBDC. The DfE team, Charon and Wing, worked with each supplier (over 200 suppliers in the first six months alone) to introduce the supplier to the DfE program, and to explain how the materials assessment process fit into the new design protocol. If the supplier agreed to cooperate with the assessment of their materials, then the DfE team would guide the supplier through the assessment process and provide feedback on the results. For nonconforming material, the DfE team worked with the supplier to find substitute inputs or a completely new material. Eventually, the goal was to build a synergistic relationship with suppliers for developing common environmental goals.

However, getting suppliers to initially cooperate with the raw material assessment proved no easy task. As observed by Schramm:

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DfE creates a lot of anxiety with our suppliers. For example, we’re working with a German plastics company who uses a vendor that refuses to share their chemical information with us. Now, our supplier either loses our business, or has to find another vendor who is more cooperative and cultivate that relationship, do its internal certification to qualify the vendor, and set up logistics: it’s a lot of work. Meanwhile, Gabe [Wing] and Scott [Charon] are managing this whole process on our end—meeting with our suppliers and with our suppliers’ suppliers, educating them on DfE, and helping them find alternative materials. If we hit a C2C hurdle, we don’t just give up. We continue to work on it until we find a solution that’s good for our business, our supplier’s business, and the environment.

No
tC

In their negotiations with suppliers, Charon and Wing highlighted the benefits of joining the C2C initiative, including: (i) shorter development cycles thanks to the more thorough up-front selection of materials that would decrease the number of iterations, (ii) assessments of their materials which would help them develop new markets and better anticipate future environmental legislation, and (iii) the public relations exposure that the Mirra chair received, with Herman Miller willingly highlighting the role of its suppliers.

However, the bottom line was that if suppliers wanted to continue to do business with the $1.4 billion company, they would have to comply with the C2C protocol. Schramm gave an example: “When we introduced the database, a plastics supplier for one of our molders told us we were nuts! It’s like asking them for the recipe for Classic Coke. They don’t want to share that information. Only with NDAs, cajoling, and a bit of arm twisting were we able to get them on board.”25

Sales and marketing At the time, there was a fair amount of press about the C2C protocol. William McDonough was a proficient proselytizer of the design protocol, winning numerous environmental awards including the National Design Award26 for exemplary achievement in the field of environmental design. The fact that the Mirra chair was the first highly engineered product to use the C2C protocol was a golden PR opportunity for McDonough, and as a consequence, for Herman Miller. Although product performance and price were still the dominant criteria in the market, there were increasingly more customers who also considered environmental impact as a factor in their purchase decision.

Do

Closing the loop The Mirra team discussed several options for recycling the material from the Mirra chair. One possibility was to lease the chairs in a contract similar to automobile leasing. Customers could return the chairs to Herman Miller once they were finished with their useful life, or if they wanted to upgrade to newer chair models. This would require, at the very least, a different way

25 Interview with case authors, April 18, 2006.
26 The National Design Awards are given by the Smithsonian’s Cooper-Hewitt, National Design Museum to honor the best in

American design.

10

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607-003

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Cradle-to-Cradle Design at Herman Miller: Moving Toward Environmental Sustainability

to price and sell the chair, and logistical support for handling the products coming back to Herman Miller. Another possibility was to tap into the network of the secondary office-furniture market to collect used products. Yet another option was to merely wait for local governments to increase their community recycling abilities. One of the DfE steering committee members commented:

rP

There is a question of how much we want to invest in the front-end of the process by implementing DfE, when its unclear how it will work in the back-end with getting material back into the loop. It’s a classic chicken-and-egg problem. We have to start somewhere, but closing the loop
remains an open issue.

yo

The PVC Decision

In August 2002, the DfE steering committee met to discuss its course of action regarding the use of PVC for the arm-pad skins (the outer layer of the arm pads) on the Mirra chair. (See Exhibit 1 for a picture of the Mirra chair with arm pad indicated.) PVC had gotten a lot of bad press since the death of 87 people, many firefighters, due to toxic fume inhalation in a fire fueled by PVC pipes at the MGM Grand Hotel in Las Vegas in 1980. As a result, some customers had started to ask for PVC-free products. At Herman Miller, there was already a precedent for not using PVC, as explained by Schramm:

No
tC

op

I was brought on board to save money. They asked me to join the DfE steering committee, following the precept that you should keep your enemy close to you. After working with the Value Analysis engineering group, we realized that we could replace steel with PVC in one of our systems products. The change would save the company $2.5 million a year. Then Gabe [Wing] comes and says PVC is bad! He convinced me that it was the right thing to do, so I would have to find the $2.5 million somewhere else. The positive side of my decision was that I became a hero on the steering committee which started to see me as an advocate, not a potential enemy.27

Do

Ironically, making the Mirra chair PVC-free would not significantly impact its DfE score as the contribution per part was determined by weight. (See Exhibit 5 for DfE score calculations.) The development engineers and supply chain group all preferred to stick with PVC—it was an inexpensive material providing the necessary characteristics (durable, scratch resistant, soft). In fact, tooling for the PVC arm pads had already been fabricated. The product launch was scheduled for June 2003 at Neocon, the annual trade fair where many customers came to see the newest industry designs. (See Exhibit 8 for Mirra chair sales forecasts.) Due to the timing of the product launch and the required tooling lead time, the product team hedged their bets and proceeded with the tooling for a PVC part from the start so they would be able to launch the Mirra chair on time.

There was initially some question as to whether another suitable material could be found that would give the same product performance as PVC. Wing eventually identified thermoplastic urethane (TPU) as a possible alternative. Early tests showed that TPU had acceptable quality characteristics and might be even more scratch resistant than PVC; however, testing with production tooling at higher volumes still needed to be done. Moreover, the raw material cost of TPU was twice that of PVC, increasing the cost of the arm pad assembly by approximately 30%. To switch to TPU meant that Herman Miller would have to either pay its supplier to retool (costing over $100K), or try to modify the PVC tool to work with TPU. Although modification of the original tool was feasible, it was unclear whether the part quality of the TPU arm pad skins would be as consistent as the PVC skins.

27 Interview with case authors, April 18, 2006.

11

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Cradle-to-Cradle Design at Herman Miller: Moving Toward Environmental Sustainability

os
t

607-003

rP

Both the development and supply chain management teams preferred to proceed with PVC for the Mirra launch to buy them more time to either find a cheaper alternative to TPU, or work with the supplier to achieve consistent quality with TPU. The DfE team, however, wanted to press forward with TPU. The team thought that once the product had shipped, resources would be drained and the psychological hurdle of revisiting the PVC problem would be too high to overcome.

Schramm also wondered what the implications of a high-visibility PVC-free product would imply about Herman Miller’s future use of PVC:

Do

No
tC

op

yo

The Mirra chair is going to get a lot of “green” publicity. What if we set a precedent with our customers that we can offer PVC-free products with no performance loss and at a reasonable price? Will they start demanding that for everything? Eliminating PVC from future products would already be challenging enough, but what if they start to demand that we take it out of our existing products? Just the engineering effort alone would be staggering, not to mention the potential increase in material cost.

12

Copying or posting is an infringement of copyright. [email protected] or 617-783-7860.

Herman Miller Products

rP

Exhibit 1

607-003

os
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Cradle-to-Cradle Design at Herman Miller: Moving Toward Environmental Sustainability

The Eames Lounge Chair

No
tC

op

yo

The Noguchi Table

The Aeron Chair

The Action Office System

Do

arm pad

Source:

The Mirra Chair

Internal company document.

13

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Cradle-to-Cradle Design at Herman Miller: Moving Toward Environmental Sustainability

Operating Results (in US$ millions)

Exhibit 2

os
t

607-003

2001

2000

1999

1998

1997

1,469

2,236

2,010

1,828

1,773

1,544

Gross Margin

553

848

758

704

664

582

480

418

Selling, General, and Administrative

439

520

446

417

405

389

343

325

Net Sales

Design and Research
Operating Earnings
Earnings Before Income Taxes

35

33

312

286

2

236

235

224

-56

141

140

142

1,325

1,083

29

26

25

31

259

193

136

93

208

145

91

53

128

74

46

4

Standard and Poor’s Compustat® data, accessed June 2006.

Do

No
tC

op

Source:

37
329

1995

yo

Net Earnings

34
115

1996

rP

2002

14

Copying or posting is an infringement of copyright. [email protected] or 617-783-7860.

Exhibit 3

607-003

os
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Cradle-to-Cradle Design at Herman Miller: Moving Toward Environmental Sustainability

EQAT Teams

Environmental Affairs Team: in charge of regulatory compliance as well as coordination and support of companywide environmental initiatives.

Communications Committee: responsible for articulating the company’s environmental actions and results to internal and external audiences.

Indoor Air Quality Team: in charge of reducing off-gassing, the phenomenon by which some materials release toxic gases or particles.

Design for Environment (DfE) Team: tasked with creating environmentally
responsible design standards (currently C2C).

Transportation/Packaging Group: responsible for reducing the amount of packaging used in shipments from suppliers and to distributors and customers.

Green Buildings Team: in charge of ensuring the environmentally soundness of construction and maintenance of the company’s facilities.

Environmental Low Impact Process (ELIP) Steering Team: tasked with finding ways of reducing, reusing, recycling, composting and/or burning waste.

Plant Engineering/Energy Group: responsible for increasing the use of alternative and renewable energy.

ISO 14001 Team: in charge of developing an environmental management system for the company’s facilities.

yo

op

No
tC
Internal company document.

Do

Source:

rP

15

Copying or posting is an infringement of copyright. [email protected] or 617-783-7860.

Cradle-to-Cradle Design at Herman Miller: Moving Toward Environmental Sustainability

Herman Miller Organizational Charta

Source:

No
tC

op

yo

rP

Exhibit 4

os
t

607-003

Internal company document.

Do

aDfE Steering Committee members are shaded.

16

Copying or posting is an infringement of copyright. [email protected] or 617-783-7860.

Exhibit 5

607-003

os
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Cradle-to-Cradle Design at Herman Miller: Moving Toward Environmental Sustainability

Calculation of DfE Weight and DfE Score

Material Chemistry:

rP

DfE Weight = Component Weight [grams] × Weight Credit

Weight Credit: The weight credit is assigned based on the material classification according to the Green-Yellow-Orange-Red list.
Green = 100%
Yellow = 50%
Orange = 25%
Red = 0%

yo




Disassembly:

DfE Weight = Component Weight [grams] × Weight Credit

Weight Credit: The component receives a weight credit of 100% if it satisfies the following four criteria. Otherwise, the weight credit is 0%.
The component can be separated as a homogeneous material, with no other materials attached. Mixed materials have little to no value in recycling programs. The goal is for disassembly to create individual components that may have value when recycled.

2.

The component can be disassembled using common tools: screwdriver, hammer, and a pair of pliers. The goal is for the chairs to be easily disassembled anywhere in the world.

3.

It takes less than 30 seconds for one person to disassemble the component. By disassembling many products, the product development team concluded that any component that takes greater than 30 seconds to remove is too long.

No
tC

4.

op

1.

The material is identifiable and marked. Parts must be marked clearly so disassemblers will know which recycling bin to place them in.

Recyclability and Recycled Content:
DfE Weight

= 75% × Component Weight [grams] × Weight Credit (Recyclability) + 25% × Component Weight [grams] × Weight Credit (Recycled Content)

Weight Credit (Recyclability): There are three levels of recyclability. 1.
2.

The component can be down-recycled (recycled but into a lesser value product) and there exists a commercial recycling infrastructure to collect and recycle it: 50%. There is no recycling potential or infrastructure for the product: 0%.

Do

3.

The Material is a technical or biological nutrient and can be recycled (or composted) within an existing commercial collection and recycling infrastructure: 100%.

Weight Credit (Recycled Content): The weight credit equals the percentage of the component that is made up of recycled content.

17

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Cradle-to-Cradle Design at Herman Miller: Moving Toward Environmental Sustainability

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t

607-003

Component DfE Score: The DfE score of a component is the sum of its material chemistry, disassembly, and recyclability DfE weights divided by the maximum DfE weight possible (which is equivalent to three times the weight of the component).

=

+

DfE weight for
disassembly

+

DfE weight for
recyclability and
recycled content

rP

Component
DfE Score

DfE weight
for material
chemistry

3 × weight of component

× 100%

Company document.

+

DfE weight for
recyclability and
recycled content
× 100%

Do

No
tC

Source:

=

DfE weight
DfE weight for
for material +
disassembly
chemistry
3 × weight of component

op

Component
DfE Score

∑ all
components

yo

Product DfE Score: The DfE score for the overall product is the sum of the three DfE weights for all components divided by the maximum DfE weight possible for the product (which is equivalent to three times the weight of the product).

18

Copying or posting is an infringement of copyright. [email protected] or 617-783-7860.

Exhibit 6

607-003

Final DfE Score Assessment and Scorecard for Fictional Product X

CHA-1234

ECO Chair
Bill of Material

Part #

Qty

rP

Final DfE score assessment

os
t

Cradle-to-Cradle Design at Herman Miller: Moving Toward Environmental Sustainability

DfE Score

Description

Material

Supplier

Wt
(g)

DfE Weight:
Mat. Chem. + Disassembly +
Recyclability (g)

Potential
DfE Wt
(wt of
part * 3)

2,500

5800

7500

77.3%

Final
Score

1

FRAME,
SEAT

16 Ga. 10081010 Steel

Frame
Inc.

123457

1

PAN – SEAT

20% GF
Polypropylene

Molders
Plus

600

525

1800

29.2%

123458

4

FASTENER PU

Sintered
Metal

Fastener
Land

42

117.6

126

93.3%

123459

4

FASTENER ST

Spring Steel

Fastener
Land

1

2.3

3

76.7%

123460

4

BUMPER

Super Rubber

Importers
R’Us

26

32.5

78

41.7%

123461

4

CONNECTOR
CLIP

Nylon 6/6

Molders
Plus

26

32.5

78

41.7%

123462

1

BACK

20% GF
Polypropylene

Molders
Plus

1,000

1875

3000

62.5%

123464

2

ARM ASSY,
RH & LH

380
Aluminum

Importers
R’Us

404

252.5

1212

20.8%

123467

2

ARM LH / RL

Polyrazz 1234

Molders
Plus

188

164.5

564

29.2%

123468

2

O-RING

Silicone
Rubber Fill

Importers
R’Us

1

0

3

0.0%

123469

2

SPRING

Steel

Importers
R’Us

10

8.75

30

29.2%

123470

4

CHAIR FEET

Sintered
Metal

Importers
R’Us

100

137.5

300

45.8%

8,948.15

14,694

60.9%

op

No
tC

4,898

Company document.

Do

Source:

yo

123456BK

19

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Cradle-to-Cradle Design at Herman Miller: Moving Toward Environmental Sustainability

os
t

607-003

Company document.

Do

Source:

No
tC

op

yo

rP

Final DfE scorecard

20

Copying or posting is an infringement of copyright. [email protected] or 617-783-7860.

Exhibit 7

Proposed Mirra Assembly-Line Process Flow

2.

Tilt covers and spines

3.

Limiter controls

4.

RH & LH Arm Assembly and Attach

5.

Seat Assembly

6.

Seat Attach

7.

Lumbar Assembly & Torque

8.

Back Assembly

9.

Back Attach

Internal company document.

No
tC

Source:

Exhibit 8

Year
2003
2004
2005
2006
2007

Mirra Chair Sales Forecasts

Units

23,000
65,000
97,000

128,000
145,000

Internal company document.

Do

Source:

op

10. Inspection
11. Packaging

rP

Base, cylinder, and tilt press

yo

1.

607-003

os
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Cradle-to-Cradle Design at Herman Miller: Moving Toward Environmental Sustainability

21

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Cite this Cradle to cradle

Cradle to cradle. (2016, May 19). Retrieved from https://graduateway.com/cradle-to-cradle/

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