Date: 2024-06-30 Page is: DBtxt003.php L0700-SS-PRODUCTS
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STREAMS / STRANDS / STRINGS
PRODUCTS THE MAIN LINK BETWEEN PEOPLE, NATURE AND ECONOMIC ACTORS |
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PRODUCTS ARE IMPORTANT
They determine QUALITY OF LIFE to a great extent |
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OVERVIEW OF PRODUCT
Probably more than anything else, it is PRODUCT ... goods and services ... that enables quality of life. For most of history, product was scarce because knowledge and productivity was low, but in the past 300 years, there has been amazing technological progress and in the 21st century there is the capacity to make a huge amount of product which in turn can support a good quality of life for everyone. The downside of this is that the manufacturing processes do damage to the environment, and most management of organizations focus on products that are profitable for the organization much more than those that are best for consumers and the environment. In the end it is through product choices ... what to buy or not ... that people are going to have the most impact on the decisions of organizations and in turn on the overall socio-enviro-economic system. When people change their behavior with respect to product, then everything else will change. The main metric for decision making (buy or not to buy) is price and quality. There is little or no information about the impact that manufacturing the product has had on society and the environment during its flow through the supply chain. There is little or no information about the impact of the product during its use, and what happens to the product in its post-use waste cycle. MULTIPLE IMPACTS DURING PRODUCT LIFE CYCLE Every products has multiple impacts as the product flows through its life cycle. The details are different but the basic flows are somewhat similar. There are virgin materials that flow through a supply chain with different processes being used to create the eventual product that is bought and consumed by a user, and then dicarded into a post use waste chain. At every stage other products (materials) are added in, and payroll paid for labor, and profits made, and pollution created in order to create the product that is then passed on to the next stage. |
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ENVIRONMENTAL PERFORMANCE OF A PRODUCT
PRODUCTS doing big damage to the environment should not be produced |
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ENVIRONMENTAL PERFORMANCE OF THE PRODUCT
Almost every product has a negative impact on the environment with some far worse than than others. Accordongly more production and more consumption or use of products is going to almost always have a negative impact on the environment. The case of coal illustrates the issue. It was coal and steam power that was the key driver of the industrial revolution and the massive increase in availability of material goods over a period of more than a century This was good, and many people saw a significant improvement in their standard of living and quality of life At the same time their was serious parriculate pollution that everyone knew about and massive carbon dioxide and other gasious emissions that were less visible and ignored. Eventually the scientists were able to explain that these were having an impact on the atmosphere and were enabling potentially catastrophic climate change. The USA, Europe and China have been responsible for the majority of the GHG emissions, yet it is the rest of the world that is going to have the most negative impact from the climate change that is already in progress. This is unfair ... yet the rich countries seem to be doing the least that is possible to address the problem. |
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SOCIAL PERFORMANCE OF A PRODUCT
The PURPOSE of a PRODUCT is to be of value for PEOPLE who use the product |
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SOCIAL PERFORMANCE OF THE PRODUCT
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SOCIAL PERFORMANCE OF THE PRODUCT
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PROFIT PERFORMANCE OF THE PRODUCT
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ECONOMIC PERFORMANCE OF A PRODUCT
If the PRODUCT is not profitable, it will not get produced |
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PROFIT PERFORMANCE OF THE PRODUCT
As long as the modern economy is driven by profit performance for the economic actors, and only profit, then the only products that are produced are those that earn profit or have profit potential in the near future. Essentially everything else is going to be ignored. There are many ways to improve the profit performance of a product: (a)... reduce the quality and reduce the quality without reducing the price; (b)... reduce the labor cost by moving production to a lower wage location; (c)... lower costs by lowering standards of pollution control and waste disposal; (d)... game the market so that there is an effective monopoly or cartel. This is routine ... and has been the normal operating procedure for most companies since the early 1980s SUPPLY CHAIN PROFIT PERFORMANCE Every step in the supply chain has to be profitable in order for the product to move. As soon as any one stage in the supply chain s not profitable, the whole of the supply chain will not function. Up to now, the issues of environmental and social impact have been allowed to be ignored by business decision makers ... and lesdership to change this has been weak and ineffective. Arguably the absence of effective management metrics about products has been a factor in this failure. |
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PRODUCT ACCOUNTABILITY
The data system needs to differentiate between PRODUCTS |
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USING TVM FOR PRODUCT ACCOUNTABILITY
Companies keep track of each and every product within their inventory and logistics systems, for cost accounting and tracking the money from sales. Every product has an identity. With TVM this identity is linked to a TVM Standard Value Profile which provides a simplified by relevant profile of the multiple impacts that are embedded in the product, and the anticipated impacts during the rest of the product life cycle. The TVM Standard Value Profile (SVP) has a structure that is somewhat similar to a 'balance'sheet' which shows the current state of a company. The SVP shows the current state of a product. In summary, the SVP shows separately the totals for social impact and environmental impact based on TVM standards while not addressing the economic profits of the businesses which remain confidential. |
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