ITW’s move in creating the first ‘Tier 1’ packaging supply company points to an emerging trend.
By Bob Lilienfeld, guest columnist and Editor, The ULS ReportAbout a year ago, Illinois Tool Works (ITW) came to me with an idea. (If you don’t know ITW, it’s a $16 billion global company consisting of around 900 fiercely autonomous business units.) What if they could align their 45 packaging businesses to provide customers with sustainable packaging solutions, and do so as a single source provider?
I lived in the Detroit area for over 20 years, so an automotive analogy immediately sprang to mind: ITW wanted to create the first Tier 1 packaging supply company! By doing so, it could help develop cradle-to-grave packaging systems that would efficiently reduce both environmental and economic waste for customers, distributors, retailers, and even consumers. And the customer would only have to work with one project team and would only have to pay one invoice.
I loved the idea and helped them create what’s now known as the ITW Sustainable Packaging Group, or SPG for short (link = www.itw-spg.com). In less than a year, the SPG has caught the attention of the world’s biggest retailers and CPGs. It has many projects in the works, at many links in the value chain.
The food and beverage connection
Interestingly, quite a few of the SPG’s initial projects are in the food and beverage space. Why? Because sustainable packaging systems must do more than simply reduce packaging discards. More importantly, they must reduce food waste as well. So, a balance must be struck between what the package delivers and the resources needed to do the job both effectively and efficiently.
This new approach requires a very holistic view of packaging, not merely a narrow focus on design or production or conversion or filling. The SPG points to a trend based upon goal setting and problem solving from the top down, not merely at the point of friction. This creates the opportunity to coordinate and optimize the overall result, rather than trying to individually maximize a slew of smaller scale efforts.
There is a great moral to this story: Sometimes, the best ideas come from other industries that have similar needs. In this case, the drive for sustainability in the packaging sector has created a need to apply world-class thinking and technology across complete systems, not just at one point in the value chain.
The automotive industry developed this system years ago to solve its own emerging issues regarding the need to provide what customers perceived to be quality vehicles at competitive prices. And over time, quality in Detroit has taken on a new dimension beyond merely reliability and comfort. Thanks to consumer demand and the high price of fuel, it now includes sustainable thinking around material use, recyclability, and energy conservation.
Robert M. Lilienfeld is a Fox TV environmental commentator and Editor of The ULS (Use Less Stuff) Report, a newsletter dedicated to conserving resources and reducing waste. He also founded the Use-less-stuff.com website.
Along with Dr. William J. Rathje, he co-authored the book Use Less Stuff: Environmental Solutions for Who We Really Are and the 1995 landmark New York Times Op-Ed piece entitled, Six Enviro-Myths.