Developing Ideas Digest May/June 1998
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Delivering Sustainable Benefits

If the word 'de-materialize' makes you think of something Houdini might have done inside a wooden box, it's time to update your definition. Today, advocates of 'sd' want companies to 'de-materialize' -- to replace the 'stuff' in products with less tangible service components -- as a way of creating a more sustainable economy offering profit for business, value to consumers, and greater employment, without needless plunder of the environment.

Since the industrial revolution, the main engine of economic growth has been business' ability to sell goods to consumers, who accumulate more and more. Yet the rise of a more vigorous service economy provides an opportunity to re-think the paradigm. What if consumers could purchase the service they want, without buying the thing that produces it? Some examples of this are long established. Bus and train companies, as well as the bicycle rental establishments that are common in Europe, provide transportation on an as-needed basis, without saddling consumers with the capital costs, and providing added benefits such as reading time or exercise. These enterprises create employment and profit, even though the shared use of the durable goods (the trains, busses or bikes) means less damage to the environment. Other means of economic 'de-materialization' are more recent innovations. Interface Inc. has introduced the Evergreen carpet leasing program which attempts to contain the material components of its business in a closed loop: the company takes back the packaging when it installs carpeting, then retrieves and recycles the carpet at the end of its life span. Despite the benefits to the consumer - for a small premium, the carpet is maintained during its life and replaced when a better product is available - Evergreen has been a tough sell. Interface Research Corporation President Dr. Michael Bertolucci told DI that "the green lease is not a concept that the financial markets can understand... People need to buy it to appreciate it, and then throw it away - that's the model we're used to."

Indeed, how readily 'selling benefits and not products' is accepted may depend on where you live. Some believe that in affluent northern nations, the real challenge is to convince people to use less, period. In the South, meanwhile, relying on re-use and human ingenuity rather than new products is a living tradition. According to Javier Ramirez of the Colombian furniture company Famoc Depanel A, service components may be key to southern companies' survival in the global market, since fallen barriers to technological imports have virtually guaranteed the multinationals' dominance in the market for goods. He argues that service-oriented enterprise, some of it geared to environmental protection, may give southern-based firms their competitive edge, while meeting the interconnected goals of 'sd': ecological protection, increased employment, economic growth and increased living standards. [increasing profits and employment while consuming less]

take-back schemes n. a way of supplying products to customers whereby the producer takes back the product for re-use after the purchaser is finished with, usually at the end of the product's life cycle.

Elsen, Anne. Sustainable Service Design: What It Is and Where It's Going - a Survey. Amsterdam, Netherlands: UNEP-WG-SPD International Centre, 1997. 45 p.

Virtual Ideas

United Nation's Environment Programme Working Group on Sustainable Product Development http://unep.frw.uva.nl/