Life Cycle Design approach in SMEs

This paper is guided by two premises. First, effective pollution prevention requires the demonstrated ability to decrease adverse environmental impacts at every stage of the life cycle of any given product. Firms that take full responsibility for the impacts of their products from cradle to grave experience high levels of organizational learning. A five-stage learning curve is proposed which stems mostly from the actions undertaken within a large firm or multinational context. The second premise is centered on the critical importance for small and medium-sized enterprises (SMEs) to ‘green’ their products. Based on a sample of 368 environmentally responsive SMEs, it is shown that they are making some progress towards dealing with the environmental impacts of their products, despite the fact that their product life cycle initiatives seem to be partial and limited in scope. They will, however, have to move faster along the proposed learning curve, since more advanced, stronger environmental performance will increasingly constitute an asset for selling their products on the international scene or for qualifying as a subcontractor or supplier. Furthermore, empirical evidence demonstrates that improved environmental performance encourages process innovations and enhances corporate image and liability management, but tangible economic returns such as cost containment and revenue generation seem to be harder to achieve.