Resource efficiency gains: what's possible for your company?

Have you ever put off improving your level of fitness because you just didn’t have time – or you didn’t know what was achievable or where to start? The result was probably that you stayed exactly where you were and nothing changed. Guess what? Your company’s resource efficiency journey is exactly the same.

24th Apr 2019

Guess what? Your company’s resource efficiency journey is exactly the same.

Let’s stay with the fitness metaphor for a little longer.

Picture, if you will, all of the time you’ve spent ‘pumping iron’ – also known as lifting weights - at the gym. If you haven’t – pretend! During that time, maybe you focussed on your ‘gains’ – the additional muscle mass and power achieved by eating and training in a certain way. “Gains” - meaning increased strength and improved performance – are the goal.

Now apply this mentality to your business – instead, your gains are not muscle, they are resource efficiency improvements. (Stay with us here.)

Is your company a resource efficiency ostrich?

Just as muscle mass and power ‘gains’ are beneficial for the body, it’s no secret that resource efficiency improvements cut costs, improve performance and reduce the environmental impact of manufacturing. At a time when climate change has never been more dangerous and improved resource productivity can result in a net 12% profit increase for manufacturers, the time for change is now.

But how can manufacturing companies get started? What is an achievable resource efficiency improvement target – and a reasonable rate of improvement?

If you set yourself an arbitrary target of running your first marathon after only two weeks of training, you’re setting yourself up to fail. The target seems too far-fetched and unattainable, so your motivation to train will be low and eventually fizzle out.

The same is true of those resource efficiency ‘gains’. Many companies don’t know what’s possible or reasonable – so simply avoid getting started at all. The necessary shifts seem too big and vague and scary – so they turn into resource efficiency ostriches. They bury their heads in the sand and nothing changes. Is your company one of these ostriches? If you have that feeling in the pit of your stomach right now and you know that it is – you know. And you can’t unknow it.

So, we’re here to help you chase the ostrich away.

Get real: fast facts and figures

Let’s get down to numbers – what’s possible in the world of resource efficiency improvement?

The average Joe: Your average company, operating under ‘business as usual’ conditions, is improving its resource efficiency at a rate of around 1.5% per year.
The rising stars: Some of the highest rates of improvement out there look more like 11-15% - however, if your ostrich is rearing its head at this thought, don’t panic. This is short-term improvement lasting around 2 years, and isn’t generally sustainable. We call these companies the ‘rising stars’ as they either shoot up fast only to burn out just as quickly, or they shoot up and then drop down to level off at a more sustainable rate over time.
The best-in-class: The highest rate of sustained resource efficiency improvement is around 7% per year. These companies are in it for the long-haul, and have the processes and principles in place to prove it. Think Toyota, for example – a world-class example of resource efficiency improvement, who used methodologies and processes such as Lean to help them get there.
The reality check: The majority of companies which set targets and start to work on resource efficiency actively tend to see improvements of 3-5% per year – this is a manageable rate of improvement over time without going all-out and reaching a best-in-class level.

See? Not so scary…

Process before progress

So, that’s what’s possible. But how do you usher your ostrich into another room, close the door and make a start?

1. Make up your mind

We’re back to the fitness analogy… Just as the hardest muscle in the body to control lives between your ears (spoiler – it’s your brain!), perhaps the most important starting point for a shift like resource efficiency prioritisation is making up your mind about the change that needs to happen.

If, earlier in the article, you knew deep down that your company was a resource efficiency ostrich, that’s a great first step! You can’t ignore it any more. You know there is hugely beneficial work to be done, so now you just have to figure out how to do it.

We know that you know that we know, so there’s no going back.

2. Set targets

How can you achieve something if you don’t know what you’re aiming for? Without targets, there can be no tangible improvement. So reach out to relevant members of your business, work out what’s possible around your day to day work, and what it will take to make your resource efficiency goals a reality.

While this might seem like a mammoth task, help is at hand! There are a number of tools available to help companies like yours to set targets and measure their progress against them, such as Manufacture 2030's Bee.

3. Make it stick

It’s one thing being one of the rising stars we mentioned previously and making huge resource efficiency improvements fast, only to fail a year later – and another achieving a sustainable rate of improvement and making it stick.

Everyone is busy, and everyone has multiple conflicting priorities – so make your targets achievable. Not every company has to achieve best-in-class to see visible improvements. It’s better to set manageable targets against which you can actually deliver than to be over-ambitious, and later crash and burn.

Perhaps you roll out a methodology like Lean to ensure that resource efficiency is ingrained into your day-to-day, as we’ve seen in the automotive sector. Keep it real and keep it simple.

4. Start small to unlock your potential

Wishy-washy self-help manual speak though it may seem, your company has far greater potential for positive change than you might think – and you won’t necessarily be aware of just how far you could go until you take the first steps on your resource efficiency journey.

The key? Start small. Begin with the small wins – the low-hanging fruit that eases your business into the resource efficient mindset. Set your targets at the lower end of the spectrum - at around the 3-5% mark - and see what happens.

If a 3-5% rate of resource efficiency improvement is what you achieve, fantastic – but as we saw above, there’s potential across industries for so much more.

Be open to surprising yourself.