The supply chain must develop a competitive strategy to cope with recycling the electronic devices we use at work and at home, which — as we all know — are loaded with toxic material.
These toxins contribute to the contamination of the environment and affect our health. The implications of recycling have global consequences and must be taken seriously.
The already short lifecycle of devices has been reduced even more as electronics manufacturers release more frequent product updates to the market. Government regulations have been passed worldwide requiring manufacturers to provide environmentally sound end-of-life (EOL) solutions. Here's a sampling:
- In the EU, electronics manufacturers must take their used products back from customers (Waste Electrical and Electronic Equipment, 2006);
- In the US, California has passed several laws that place responsibility on manufacturers, retailers, and consumers for the recycling and disposal of electronics products;
- The US Electronic Waste Recycling Act of 2003 prohibits the sale of a covered electronics device if its sale is also prohibited in the EU countries under Directive 2002/95/EC (RoHS Directive, 2005); and
- Japan has passed legislation for mandatory EOL take-back of products, including washers and dryers, television monitors, videocassette recorders, and refrigerators.
The European Commission Environment Directorate-General commissioned the Umweltbundesamt, the Environment Agency in Austria, the List of Restricted Substances under RoHS 2. The Umweltbundesamt provides downloadable documents for thelist of restricted substances under RoHS 2 Directive.
Is recycling a choice?
According to this research paper from the Kelley School of Business at Indiana University, supply chains should consider the implications of the four generic recycling options before deciding which one is more convenient for their particular case, or if a combination of them could be applied. Here's a sample from the abstract:
Until recently, end-of-life product management was the purview of a small number of firms that could make money out of recycling and/or remanufacturing. Now, changing customer expectations and stringent product take-back regulations are forcing many goods producing organizations to confront EOL product management, even in cases in which there is no clear economic incentive for doing so. This article presents a framework that highlights the supply chain implications for firms forced into EOL product management where recycling is the only viable option. Discussed are the various recycling options available to managers, as well as the strategic implications of each of these choices.
The paper identifies a number of options for recycling electronics, including:
- Outsourcing recycling without disassembly (low-cost option);
- Outsourcing recycling with disassembly (a middle way strategy);
- In-house recycling without disassembly (controlling materials and creating markets); and
- In-house recycling with disassembly (creating unique value through closed-loops).
It's quite an interesting read. It examines how supply chains are being forced into the first systematic discussion of a topic that involves everyone, not only the electronics industry.