The Role of Software in Environmental Compliance

Scott McCarley, product analytics expert at PTC, answers a few questions about the role of PLM in successfully navigating environmental compliance.

Q: Is environmental compliance a real concern today for manufacturers?

A: Yes, manufacturers simply have no choice but to comply with the ever-expanding number of environmental compliance regulations. An inability or unwillingness to comply with changing rules and regulations can result in fines, brand damage or products that cannot be sold in critical markets.

For example, regulations governing the use of hazardous substances have quickly proliferated including, ELV, REACH, CAPSIA, EU RoHS, China RoHS, and Korea RoHS. Additionally, standards for one region or sector are being adopted around the globe, affecting related countries and industries.

Q: As of today, are some manufacturers going any further than current regulations?

A: Historically, manufacturers polled suppliers for additional data for one purpose, to satisfy current product compliance requirements focused on restricted materials and substances. Today, many manufacturers collect detailed information from suppliers about the components they provide to not only satisfy current compliance requirements, but to prepare for tomorrow’s regulation changes.

As environmental compliance regulations rapidly change, companies with product development processes that are designed to only react to current compliance regulation—rather than anticipate them—are overheating. Even if a manufacturer adequately tracks product development data against current regulations, those regulations can change or be superseded in short order by entirely new ones.

Q: What is their industrial approach? A better training to products analytics tools or use of external providers?

A: Leading manufacturers collect full material data in order to understand detailed information about every material and substance used in products and components. This technique includes asking for the full material and substance breakdown of all purchased components. With this information and the right product analytics system companies can satisfy today and tomorrow’s compliance objectives.

One of the main advantages of full disclosure is that it provides significant flexibility and adaptability as compliance regulations change and as new requirements develop. This protects suppliers from responding to new surveys when regulations change or new standards emerge, and insulates manufacturers from the cost of resurveying suppliers. Additionally, the data can be used to satisfy numerous other product analytic objectives, including lifecycle assessment, material footprint, and commodity price exposure.

Q: According to you, which industrial sectors and which countries are the most advanced on this topic?

A: Different industries and countries are at various levels of maturity when it comes to collecting supplier data. Maturity is primarily driven by the presence and adoption of data collection standards and how regulated the industry and country is.

The automotive and electronics industries have been wrestling with environmental compliance issues longer than most other industries, and over time each has worked to develop data collection standards intended to help manufacturers in their industries collect supplier data more efficiently.

Given the compliance pressures and the presence or standards in these two industries, it’s no surprise that we find the automotive and electronics industries are the most mature industries when it comes to supplier data collection. Additionally, due to numerous European regulations, we see European companies’ excelling at collecting data in order to ensure compliance and improve environmental performance.

Q: Today in manufacturing, the trend is to shorten development time. Considering this new trend, do you think manufacturers have got enough time to use product analytics tools?

A: Today, many argue that the greatest challenge manufacturers face when it comes to compliance is timely and accurate acquisition of supplier data. Manufacturers need to collect and process data from potentially thousands of suppliers in order to assess critical product environmental requirements and ensure compliance with regulations. To avoid overburdening already scarce resources, manufacturers need to automate the supplier data acquisition process.

A product analytics solution must automate supply chain data collection, as well as complement your existing design and supply chain management data management systems. Doing so will enable product performance analytics to become an integral part of your product development process and allow manufactures to analyze compliance in the earliest phases of product development to bring products to market faster.

This interview was originally published in The Manufacturer.

Photo Credit: Aspen Leaf by Wayne Noffsinger, Flickr (CC BY 2.0)


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