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Hewlett Packard

Leading international electronics firm Hewlett-Packard (HP) constantly seeks ways to reduce packaging and use more-efficient transportation options and contracting with suppliers and service providers who abide by GSEs (General Specification for the Environment), allowing HP to reduce the environmental footprint of its transportation activities.

Company Background

Hewlett-Packard Company (commonly referred to as HP) is an enterprise and consumer electronics corporation headquartered in Palo Alto, California, USA. HP is the world's largest technology company and operates in nearly every country. HP specializes in developing and manufacturing computing, storage, and networking hardware, software and services. HP’s shipping activity is enormous, with about 100 million units (printers and computers) shipped annually.

This story reports on efforts HP makes to reduce its environmental footprint in moving its products to market, but its environmental efforts are broad in scope. HP was the first major IT company to report greenhous gas (GHG) emissions associated with its supply chain. Its website has an energy calculator that allows a comparison of HP products to competitor’s models in terms of energy usage. HP was ranked first in Newseek’s 2009 Green Ranking of America’s 500 Largest Corporations, due in large part to its GHG emission reduction programs. Furthermore, HP has made efforts to remove toxic substance from its products.

HP has had a recycling program in effect for over 20 years. It is active in over 40 countries, regions or territories were HP operates. In addition to having met past recycling objectives¹ HP has set a new goal of recycling an additional 2 billion pounds of hardware by the end of 2010².

Driving Forces

Consumer electronics is a highly competitive industry where quality and cost competitiveness are essential to long term success. HP notes the direct correlation between cost and environmental footprint. This means that shipping modes with high costs also tend to have high fuel rates of fuel consumption and emissions of greenhouse gases.

HP has been a leader in environmental responsibility for decades. Its global environmental strategy is based on designing for the environment, which includes product design, as well as the management of HP’s own operations and supply chain. HP is committed to:

• Making it practical and easy for customers to be environmentally responsible – from desktops to data centers, individuals to enterprises;
• Investing in research, product development and materials innovation to further manage the environmental impacts of HP’s products;
• Working with the company’s partners and supply chain and engaging with regulators to make an industry-wide impact; and,
• Driving significant reductions in HP’s own environmental footprint, from the individual employee to global operations.

Actions to Reduce Shipping Footprint

1. Supply chain optimization and logistics
HP manufactures its products in Asia-Pacific and ships them either directly to customers, or to main distribution hubs in Asia, Europe and the Americas (Figure 1).

Figure 1

HP strives to use the transportation mode having the least environmental impact. In order to achieve this HP:

• - Uses marine transportation between continents (when shipping less-than container load HP, shipping agents will locate another partial shipment to make a full container load)
• - Employs rail transportation over land when possible
• - Uses trucking companies that have environmental programs to reduce fuel consumption and GHGs for regional deliveries.

2. Packaging Reduction
Reducing packaging has also been a focus of HP. Its packaging professionals understand that package design can impact the logistics footprint on the environment and that packaging decisions made without that understanding can result in a net loss rather than a net gain. An example of what can be achieved can be drawn from HP’s participation in Wal-Mart’s Home Entertainment Design Challenge, which challenged Wal-Mart product suppliers to reduce packaging³. HP won this challenge by reducing packaging of expanded polyethylene and corrugated box material for its laptops sold in Wal-Mart stores by 97% (Figure 2).

In addition to winning the challenge, this allowed HP to double the number of units shipped in a given container or truck box. This increased density reduced greenhouse gas emissions, did not increase shipping damage, and using the tote bag as packaging became a selling feature.

Figure 2

3. Tracking Results

Every year, HP produces its annual Global Citizenship Report². These annual reports have made their supply chain transparent in order to boost responsibility for the company, its suppliers, and to set benchmarks for the IT industry in general.

The aggregated GHG emissions (CO₂e¹) from more than 86% of HP’s first-tier manufacturing, component, and material supply chain was 4.1 million metric tons. HP works with suppliers to report energy use, carbon emissions and to set energy efficiency and carbon emissions reduction targets. Such year over year reporting provides transparency and progress against targets. For those suppliers who need training, HP sponsors and supports activities to build this kind of capability, as HP has done with other social and environmental topics. HP also requires its suppliers to comply with the Electronic Industry Code of Conduct⁶ (EICC) and HP’s General Specification for the Environment⁷.

4. Technologies
In North America, HP contracts only with trucking companies that are US EPA SmartWay⁵ Partners, recommending that carriers that use leading-edge technologies such as:

• idle reduction
• improved aerodynamics
• improved freight logistics
• automatic tire inflation systems
• wide-base tires
• driver training
• low-viscosity lubricants
• weight reduction
• intermodal shipping
• hybrid powertrain technology
• use of SmartWay Truck Stop/Plaza Partners^8,9 that encourage the reduction of idling and may provide plug-in power to reduce idling

As a result, in October 2008 HP was honoured as a recipient of a SmartWay Excellence Award. The award is the EPA's means of recognizing members that have made significant contributions to more sustainable goods movement through their participation in the SmartWay Transport Partnership. HP was also the first company to receive approval from the U.S. EPA to have the agency’s SmartWay logo displayed on a selection of its consumer product packaging for the compliance of its surface transportation network.

Best Practices

In order to ensure environmental compliance from its suppliers and service providers, HP maintains a General Specification for the Environment (GSE) tool that provides global product content specification for restricting or prohibiting certain chemical compounds or materials in HP products or manufacturing processes. In addition, HP includes environmental criteria in RFQ’s (Request for Quotations) and continues to decrease the amount of paper in our operations (electronic freight bills and invoices). HP has also implemented no idling and energy efficient lighting with motion sensors at many of our warehouses around the world.

Next Steps

HP uses its annual environmental reports as the benchmark for measuring improvements. The reports are available on the HP website.² The next Global Citizenship Report is due to be released in April 2010. Based on a goal of continual improvement, HP intends to monitor its shipping activities and continue to lower the environmental footprint for shipping.

HP is following closely efforts in Europe and Asia to adopt standardized best practices for shipping the way SmartWay does in North America for trucking.

Conclusion

While HP has grown from an owner-operated company to a multi-national, publicly traded company, it retains the founding philosophy of striving to do things well. Known as the HP Way⁴, the philosophy is a list of corporate values and objectives that guide all business activities. For example, one objective, Global Citizenship, states “We fulfill our responsibility to society by being an economic, intellectual and social asset to each country and community where we do business.” This indicated that the pursuit of lowered environmental impact is part of the company way of doing business.

Endnote

1. Hp has defined the aggregated CO₂e as the sum of HP-allocated suppliers' emmissions, calculated by factoring the total supplier emissions by the percentage of Hp dollar volume to the suppliers' total revenue.

Additional information

1. Hewlett Packard Company
2. Global Citizenship Report (2009)
3. HP packaging
4. The HP Way
5. SmartWay
6. Electronic Industry Code of Conduct (EICC)
7. HP’s General Specification for the Environment
8. SmartWay Truck Stops, Truck Plazas and Rest Areas
9. Location of SmartWay amenities

Date modified:

2012-02-17

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