For Telecom Industry, Energy Efficiency is Only Half of the Equation

by | Nov 8, 2010

Whichever phrase you chose – sustainability, ecology management, environmental stewardship, or simply green – it’s clear that the telecom industry is fully embracing the issue’s growing economic and social prominence. Take a quick look around and you’ll find progress emanating from nearly every aspect of equipment design and manufacturing, service delivery and logistics. Solar- and wind-powered mobile base stations, reusable packaging for network equipment and eco ratings for handsets are just a few of the initiatives we’re seen emerge this year.

But while programs such as these and the creation of collaborative, cross-industry consortiums are both exciting and long overdue, it’s clear that, as an industry, our attention and success on front-end product development and manufacturing processes overshadows the need for more comprehensive, end-to-end strategies for sustainability. In the long-term, only this approach will offer the financial and environmental ROI that business leaders – and regulatory bodies – seek.

In order to develop a more end-to-end approach, we need to start looking at the back half of the equation and consider how to best address a single question: What happens when a piece of equipment – energy efficient or not for that matter – reaches the end of its useful life?

For many telecom companies, the reality of the service and supply chain is a reverse logistics process in which excess or decommissioned assets are frequently abandoned in enormous warehouses consuming energy, moved from one location to the next haphazardly, melted down or worse. Unfortunately, today’s service and supply chains simply aren’t sophisticated enough to differentiate equipment based on its capacity for profitable reuse within an organization.

If not managed properly, this scenario has the very real potential to undo a lot of the great work being done in product development and manufacturing to address environmental concerns. From my perspective, the key to turning the reverse logistics process around, and bringing the service and supply chain in-line with sustainable development and manufacturing processes, is visibility.

While the reasons may vary – siloed organizations, outdated processes or complex systems – it’s not a stretch to say that many telecom companies have difficulty tracking network assets once they’ve come out of service. And given the rate with which networks are being upgraded these days, the challenge is increasingly more difficult to get in front of. Turnover is so fast, in fact, that many assets haven’t even fully depreciated in value. Knowing what you have, where it’s located, what condition it’s in and its value (either for reuse or resale), therefore, becomes  a critical component for advancing sustainability commitments and improving cash flow through reuse initiatives.

If we knew more about the location, condition and value of equipment after it’s removed from the active network, the industry could drive environmental and business gains by:

–Dictating transportation events to ensure equipment always travels the shortest distance from point of storage to point of need, thereby dramatically reducing CO? emissions and logistics costs;

–Identifying immediate need for surplus equipment in other regions or countries to reduce storage and other physical and plant costs;

–Reducing waste streams and optimizing investment recovery by choosing to resell excess equipment on the open market as opposed to automatically sending material to a recycler as scrap; and

–Establishing cradle-to-grave accountability for equipment disposal to guarantee compliance with existing corporate and government mandates and regulations (i.e. WEEE in Europe).

I’m encouraged by the progress we’ve seen across the industry over the course of the last year. As an industry, we’re moving in the right direction. But it’s important to remember that sustainability is a complex objective, and as various initiatives and programs progress, we need to be conscious of pitfalls that could prevent us from really maximizing those environmental benefits. A well thought-out reuse strategy can build upon the gains of developing energy-efficient equipment and help ensure those assets are put to their highest potential throughout their useful life, and when necessary, disposed of in an environmentally friendly manner and in full compliance with government mandates.

Trade Wings’ Chief Executive Officer and Founder Todd Adelman is passionate about driving business model innovation within the Telecom industry. With more than 20 years of supply chain and asset management experience, Todd leads a number of strategic initiatives designed to establish Trade Wings as a trusted authority on the development and implementation of reuse optimization strategies for network assets.

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