WA12B Certification, Benchmarking and Environmental Management Systems
C123
8:00 AM - 12:00 PM, Wednesday
() Application of Total Cost of Ownership for More Informed Decision Making.
Heckman, J1, Fava, J2, Steinmetz, D3, 1 Five Winds International, Boulder, CO, USA2 Five Winds International, West Chester, PA, USA3 BASF, Wyandotte, MI, USA
ABSTRACT- A life cycle based decision support approach quantifies direct and hidden costs attributed to acquisition, use and disposal of products and/or materials. The approach estimates a Total Cost of Ownership (TCO) that enables the user to identify and assess costs related to material handling, safety training, etc., as well as traditional costs, such as purchase price. The output can be used to support decisions regarding purchasing, material selection, research and development and marketing. The software tool associated with the approach provides a focal point for discussing decisions among and between 1) purchasing, 2) marketing, 3) research and development, and 4) health, safety and environmental professionals. Costs are grouped into three general categories; labor, management, and process and/or energy. Typical labor related costs include EHS training, auditing / monitoring, waste handling costs, labeling, PPE costs, exposure monitoring, record keeping, dispensing costs, material handling, and lost work days. Typical management related costs include fines / penalties, non-hazardous waste disposal, hazardous waste disposal, registration costs, and wastewater costs. Typical process or energy related costs include process changes, property protection costs, energy costs, and water costs BASF has advanced the tool and approach as part of its regular planning and decision-making processes. This paper will present the TCO approach and will illustrate through examples, how this approach has been used to both improve environmental performance and create business value.
Key words: total cost of ownership, Life cycle management, decision making, sustainability