CaridianBCT: a sustainability success story
Innovation, competitive edge and jobs -- it's got it allBy Graham Russell
CaridianBCT is a leading global supplier of blood-related products, technologies and services to hospitals, clinics and other medical service providers. Owned for many years by Gambro, a Swedish medical company, CaridianBCT is now privately owned and headquartered in Lakewood, Colorado. It serves the medical industry in 90 countries around the world with about 2,300 employees, 1,700 of whom work at the Lakewood HQ, many in the huge clean room where most of the company’s blood products are produced under stringent environmental controls.
CaridianBCT has a longstanding commitment to corporate social responsibility and has a small CSR team, each member of which is responsible for one or more of the company’s sustainability initiatives. Debbie Nunnelee is responsible for CaridianBCT’s waste management program and has increased the company’s landfill diversion rate from about 25 percent in 2007, when she assumed this role, to around 85 percent as we approach the end of 2010.
In 2007, a small local recycling company, the owner of which would prefer that this story not disclose its identity, had for some years been recycling a large volume of vinyl waste material from the company’s blood bag production process. We’ll call the company Local Recycling Entrepreneur (LRE). LRE had found several markets for this material, including companies in Mexico that remanufactured it into garden hose and heels for ladies’ shoes, and others in California and elsewhere that remanufactured it into replacement window frames and makes plastic. Back then, CaridianBCT paid a nationally known recycling corporation to haul off the remaining 75 percent of its waste material, including – notably – mixed containers and paper, both of which are materials for which recyclers had actually paid companies money for many years.
LRE was able to find viable markets for the plastic cores on which the vinyl material arrived at CaridianBCT’s campus. These are made of HDPE, the same material from which plastic milk jugs are made. This was followed by a successful search for a market for the plastic trays in which many of CairdianBCT’s other clean room products are packaged.
Eventually, Nunnelee asked LRE if it would review the entire waste stream generated on the CaridianBCT Lakewood campus and determine what else could be recycled. This resulted in the establishment of a contract between CaridianBCT and LRE in 2008under which LRE has taken over the operation of CaridianBCT’s entire waste management activities. Additional waste materials are now collected and recycled, including large volumes of kitchen waste as well as additional packaging materials.
Under the contract, LRE has:
- Committed over $65,000 of capital to provide baling machinery, tubs, gaylords and other containers, all of which are located onsite at CaridianBCT and fully dedicated to the operation. It also stations two 40 ft trailers (sometimes three) at the site 7 days a week at its own expense.
- Eleven full time employees fully dedicated to the CaridianBCT’s operation. A full time person is stationed 24/7 on site (i.e. three FTEs) to remove waste material from the clean room and elsewhere on the campus, sort it into the various tubs, gaylords and other containers, and load it into the trailers for removal daily. Eight additional people at LRE’s site in Denver are employed in the process of further sorting the various CaridianBCT plastic and other wastes into “clean” streams and packaging them up for shipment.
Under the contract, LRE receives no payment for these services. On the other hand, it does not pay CaridianBCT anything for the various waste materials, which it sells in the global materials markets. LRE tries to maintain long term relationships with buyers in US markets, which is where most of the materials end up. However, some of them find their way to China and elsewhere if market prices are more favorable there for extended time periods. Although commodity prices tanked in late 2008 and early 2009, they have recovered such that, since the start of the contract, LRE has earned an acceptable return on its investment in the operation.
For CaridianBCT, the benefits are also significant. First, the company will save about $30,000 in 2010 in waste hauling costs compared with 2007. In addition, it no longer has to provide labor to remove waste materials from the clean room to dumpsters outside the building, all of which is now handled by LRE. This is significant because the company previously had a technician in the clean room handling this chore, which involved unsuiting each time he left the clean room on a waste removal trip and suiting up again to reenter. CaridianBCT estimates this saving at about 1.25 FTEs per year or $44,000 (plus fringe benefit costs).
In addition, CaridianBCT has enhanced its claim to be an environmentally and socially responsible company and is helping its employees understand the benefits of recycling. To make sure the waste from the site cafeteria is properly disposed of, Nunnelee has devised comprehensive poster boards which leave little room for doubt about what is recyclable.
Of the 15 percent of waste generated by CaridianBCT that is NOT currently recycled by LRE, about 75 percent is organic material from the kitchens and grass clippings from the campus. LRE believes it will be able to establish a viable composting option to deal with this material in 2011, leaving only toxic waste (which LRE is not licensed to handle) and items that are practically impossible to recycle such as wooden furniture, a total of less than 5 percent of CaridianBCT’s waste stream.
LRE is committed to provide whatever CaridianBCT needs to reduce its waste, while CaridianBCT is fully supportive of whatever LRE needs to fulfill its mission. These are important ingredients of the kind of partnerships that will be essential to drive innovative new business models and technologies under the banner of sustainability. Even though CaridianBCT’s sustainability-based thinking was the original driver of the arrangement, the benefits have been significant for both parties.
CaridianBCT’s experience is a compelling illustration of how thinking sustainably can save money, improve resource utilization efficiency, reduce negative environmental footprint, drive innovation (in this case process improvement rather than technology) and….YES… create additional jobs! There’s a lot of noise currently about “green jobs”. Are the new jobs at LRE green jobs? In the end, it doesn’t really matter: they are real, solid jobs. Isn’t this what the “new, green economy” is all about?
It’s worth pointing out too at a time when government subsidies and handouts to thousands of cleantech companies and technologies are adding to what is already a frightening level of national debt, all of this has been achieved without a nickel of government funding. Now THAT is something to think about.
About Graham Russell
Graham Russell is Founder & Principal at Trupoint Advisors, which helps companies achieve strategic success through sustainable business initiatives. www.trupointadvisors.com. Russell writes and speaks on the subject of sustainable business and teaches sustainability in the University of Colorado Denver MBA program.