University of Illinois Urbana-Champaign

Efficiency Performance Contracting for Smaller Manufacturers: Progress in the Metalworking Industry

Bierma, Thomas J.

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https://hdl.handle.net/2142/43345

Description

Title
Efficiency Performance Contracting for Smaller Manufacturers: Progress in the Metalworking Industry
Author(s)
Bierma, Thomas J.
Issue Date
2013-03
Keyword(s)
  • Metalworking industry
  • Supply chain management
  • Pollution prevention
Abstract
Efficiency performance contracts (EPCs) for small and medium enterprises (SMEs) are a marketbased approach that rewards suppliers for improving efficiency and reducing waste in SME operations through pollution prevention and energy efficiency innovations. However, prior research has shown that purchases typically covered by EPCs - such as metalworking fluids, chemicals, paint, electricity, or natural gas – are usually too small in SMEs to support traditional EPC programs. This report addresses the possibility of combining two or more of these purchases under one EPC, or linking them to a larger purchase, such as tooling. This project assisted and monitored the progress of six Illinois SMEs in the metalworking industry as they explored the adoption of EPCs and the expansion of these EPCs to include multiple purchase areas. Results indicate that an EPC based on tooling is clearly practical and beneficial for many SMEs. SME managers expressed interest in expanding tooling management EPCs to include metalworking fluids, and developing EPCs based on energy or paint purchases. However, no EPC other than tooling management has yet been adopted by an SME participating in the project. Though the recent economic downturn is likely to focus greater management attention on cost cutting strategies such as EPCs, adoption is likely to be slow without significant assistance to reduce uncertainty and risk.
Publisher
Champaign, IL : Illinois Sustainable Technology Center
Series/Report Name or Number
  • TR Series (Illinois Sustainable Technology Center); TR-050
  • 2009 Sponsored Research Symposium
Type of Resource
text
Language
en
Permalink
  • http://hdl.handle.net/2142/43345
  • https://youtu.be/0ObCnIrLsFo

Owning Collections

TR Series - Illinois Sustainable Technology Center PRIMARY
Illinois Sustainable Technology Center TR Series