Cradle-to-Cradle Design at Herman Miller: Moving Toward Environmental Sustainability

MGT 551 Operations Analysis
October 21, 2013

Cradle-to-Cradle Design at Herman Miller: Moving Toward Environmental Sustainability
Many organizations today claim they are environmentally friendly, their businesses are sustainable, or they work at minimizing their carbon footprint. While stating the claims may be easy, they take commitment of time and resources, a culture or homogeneity of vision, and a great deal of planning to implement. The complicated part is that the change cannot occur in just one facet of the organization, the change must carry across the organization and the entire supply chain.
Drew Schramm finds himself in a difficult position at the Herman Miller organization. His supply chain background is in conflict with the organization’s environmental sustainability position. While he may see easy money to be picked from the savings tree, it has now become forbidden fruit. The Herman Miller organization is committed to their stance of environmental sustainability and Schramm must now take that into serious consideration when making supply chain decisions. Their new chair design, the Mirra Chair, has yet to have a decision made on the construction and materials of its arm pads. They can either use the common polyvinyl chloride (PVC) that violates their cradle to cradle (C2C) protocol standards, thermoplastic urethane (TPU) which meets the C2C standards but is more expensive and unproven with production tooling at higher volumes, or come up with an alternate solution.
When one considers the organization’s mission and culture, the choices narrow down to either the safer TPU material or coming up with another solution completely. A company cannot go against their mission and still maintain their credibility with the consumer, industry, and employee base. The use of TPU is still a viable choice since the product meets their C2C standards which puts them in line with their corporate strategy. However, testing still needs to be completed and the product is twice as expensive as PVC. There is the chance that the green publicity they receive from it will give them a prominent position as one of the few C2C manufacturers of office furniture. This show of commitment may also convince the rest of their suppliers that they are dedicated to this course towards sustainability and the suppliers need to either participate or be left by the wayside.
There is another solution that is more in line with the organization’s environmental vision and reputation for innovation and style. This choice may even be less expensive than the other two and also propel them into a leadership position among the manufacturers. They can completely change the consumer perception of arm rests. People are used to seeing pads on arm rests and no one has really come forward to challenge that perception. There is no mandate that states cushions should always be used. It is more the consumer perception that gives them such importance. Herman Miller can completely do away with the current arm rest cushion design by creating suspended webbing for the arm rest instead of a cushion. This looks at their problem from a different perspective and it may also garner them a patent on the design and a potential first to market with a brand new product that has an innovative design and also meets their strict C2C standards.
This case also brings to surface another issue besides the choice of arm pads. The fact that the product team hedged their bets and proceeded with the tooling for a PVC option from the start is troubling as well. This may highlight a possible lack of unity in vision among some of the teams. Mankins and Steele speak about strictly following seven simple rules to maximize a strategy’s potential. The situation with the product team may have fallen short in discussing resource deployments early, identifying priorities, and continuously monitoring performance by Schramm (2005, P. 1). He will need to refocus his team on what these rules entail and how they affect the organization’s strategy so they can stay on track and be of one vision.
According to William Stevenson, there are four basic sources of variation; the variety of goods or services being offered, structural variation in demand, random variation, and assignable variation (2012. The Herman Miller organization has variation occurring due to the variety of goods being offered and structural variation. Variations can be disruptive to operations and supply chain processes and can cause delays, shortages, poor quality, additional costs, and inefficient work processes. However, disruptive technology does need to take place if the organization is continuously being innovative or pursuing their vision. In this case, Herman Miller’s environmental stance will have them struggle with variation in their supply chain.
Schramm can address a couple of items to further the organization’s strategy. One is to make sure that all teams within the organization understand the importance of their C2C strategy. Product teams cannot be independently making decisions that do not move forward the C2C strategy. Schramm needs to take responsibility in monitoring these types of decisions early in the process so that corrections can be made or the product teams guided towards the right choices. The second item would be for Schramm to convince the product team that recyclable plastic suspension webbing is the future of arm rest design. This falls in line with their C2C strategy and the chair can be marketed as PVC free and a sustainable choice for consumers. It also plays to their strength in being a leader of residential and office furniture and workplace design. They have collections showcased in many high profile museums and it will help change people’s perception of what constitutes a comfortable arm rest. This commitment will also convince their suppliers and vendors that they will need to work on sustainable alternatives that they could offer for future Herman Miller products. Schramm will also need to insure the correct talent is in place to move the organization in the same direction as their strategy. This choice will in effect begin the creation of a virtuous circle where according to Mankins and Steele, “talent begets performance, performance begets rewards, and rewards beget even more talent” (2005, P.10). Herman Miller has already made great strides and they are fortunate that their culture is in line with the direction of their strategy.

References
Gomez-Mejia, Luis R., Balkin, David B. and Cardy, Robert L. (2008) Management: People, Performance, Change, 3e, McGraw-Hill/ Irwin, New York, NY.
Kerin, Roger A. & Peterson, Robert A. (2013) Strategic Marketing Problems: Cases and Comments, 13th Ed. New Jersey: Prentice-Hall. ISBN: 978-0-13-274625-7
Mankins, M. and Steele, R. (2005) Turning Great Strategy into Great Performance, Harvard Business Review, July-August 2005 issue, Harvard Business School Publishing Corporation
William J. Stevenson; (2012) Operations Management, 11th edition, McGraw Hill Publishing ISBN: 978-0-07-352525-9