adding value to your organization through ems implementation

Environmental Quality Management / DOI 10.1002/tqem / Winter 2006 / 1

The elements that

make for an effec-

tive environmental

management system

(EMS) are not

unique, or even en-

vironment-specific.

Techniques and sys-

tems that help en-

sure environmental compliance and reduce envi-

ronmental impacts can also help improve safety,

product quality, productivity, and overall corpo-

rate culture.

Organizations that are implementing an EMS

should view the process as an opportunity to add

value. As discussed below, the key to capturing

this added value is to expand the organization’s

view of EMS implementation. The process should

not focus narrowly on environmental, health,

and safety (EHS) issues, but should also seek to

improve operations, maintenance, and adminis-

trative functions that parallel or synergize with

EMS tasks and elements.

About This ArticleThis article discusses ways in which effective

EMS implementation can add value to the imple-

menting organization. In the sections that follow,

I discuss (and offer examples of) several ap-

proaches for leveraging EMS implementation in

order to improve the effectiveness and profitabil-

ity of the business or organization that is under-

taking the EMS

project.

This article is

part of an occa-

sional series that

addresses aspects of

EMS design and im-

plementation. It

follows my prior ar-

ticles for this journal entitled “EMS Improvement

Through Effective Delegation of Environmental

Responsibilities” (which appeared in the winter

2004 issue)1 and “Integrating Managers into En-

vironmental Management Systems” (which ap-

peared in the summer 2005 issue).2

Meeting Customer and StakeholderExpectations

To start off, let me offer a few words on the

most obvious way an EMS can add value to your

firm: by meeting the demands of a key customer

or stakeholder.

If an important customer or a regulatory en-

forcement agency demands that you have an

EMS, the payoff for implementing one generally

becomes quite clear. In addition, in some indus-

tries, agreed-upon industrywide standards of care

may necessitate EMS implementation. Most of

the currently active EMSs in use among U.S.-

Franklin Giles

Adding Value to YourOrganization ThroughEMS Implementation

EMS implementation can be

expanded to improve performance

in a wide range of business areas

© 2006 Wiley Periodicals, Inc.Published online in Wiley InterScience (www.interscience.wiley.com).DOI: 10.1002/tqem.20117

Franklin Giles2 / Winter 2006 / Environmental Quality Management / DOI 10.1002/tqem

based companies have in fact been implemented

in response to one of these drivers.

As discussed below, however, EMSs offer

many other potential benefits, even in the ab-

sence of an outside mandate.

Management Review and PerformanceMetrics

Most EMSs currently in use include a man-

agement review element. The specified review

typically includes periodic assessment of the or-

ganization’s environmental performance and

consideration of any changes to its potential en-

vironmental impacts. Another commonly speci-

fied feature is regular

review of the organiza-

tion’s EHS policy.

In my opinion, the

most useful EMS mod-

els focus part of this

periodic management

review on environ-

mental performance

metrics. Ideally, the or-

ganization will develop such metrics for each op-

erating unit, and then aggregate these individual

measures in order to represent the environmental

performance of larger business units.

Effective environmental performance metrics

allow management to assess organizational per-

formance, prioritize issues for corrective action,

and rally staff members to respond to identified

challenges. Such metrics also facilitate communi-

cation with the organization’s owners and stake-

holders.

Adding Value with Performance MetricsThe management review element of an EMS

offers a significant opportunity to add value, es-

pecially in organizations where periodic review of

performance is currently underutilized or is lim-

ited to top executives only. Value can be added at

these organizations by developing or enhancing

the overall performance metric review process, in

tandem with implementation of environmental

performance reviews.

In the most effective EMSs, environmental

metrics are reviewed along with other measures

of business performance. Well-chosen metrics can

drive significant performance improvements. In

addition, presenting environmental metrics

along with metrics on productivity, quality,

safety, and other parameters that are important to

the overall performance of the business reinforces

the message that leading organizations manage

all important aspects of their business well.

Performance metrics can be very effective in

motivating improvement when the metric repre-

sents something that is both clearly measurable

and under the control of the person who is re-

sponsible for the performance of the parameter

that the metric represents.

Example: Flare Reduction Metric at aPetrochemical Facility

One EMS implementation in which I partici-

pated involved establishing a flare reduction met-

ric at a petrochemical facility. In this case, the

EMS implementation team had identified the

noise and light produced by gas flaring as a sig-

nificant concern for the community surrounding

the facility. In addition, combustion of plant off-

gases in the flare was a source of air emissions.

The facility was designed so that pressure con-

trol valves from various processes vented to the

flare header. A treatment system had been in-

stalled to remove gas from the flare header, treat

it, and then route it for use as plant fuel gas.

As part of its EMS, the facility implemented a

new control display that indicated when gas from

the flare header was being burned instead of

being routed to fuel use. The facility adopted a

performance metric based on the percentage of

time that gas was being burned in the flare. Con-

Effective environmental performancemetrics allow management to assessorganizational performance,prioritize issues for correctiveaction, and rally staff members torespond to identified challenges.

Environmental Quality Management / DOI 10.1002/tqem / Winter 2006 / 3Adding Value to Your Organization Through EMS Implementation

Building on Synergies with Other BusinessActivities

Such integration generally is quite feasible

since EHS activities share many key characteris-

tics with other business functions. For example, a

process to identify, investigate, and correct unsafe

conditions and actions is an important part of a

safety program. Similarly, a procedure to identify

and correct off-specification products is necessary

for quality improvement. Likewise, a means to

identify client dissatisfaction and ensure that

client issues are addressed is a cornerstone of cus-

tomer service.

Using an EMS proj-

ect to implement pro-

cedures that identify

and correct exceptions

in all these important

business areas can add

significant value to the

organization overall.

Example: An Integrated Corrective ActionSystem

I recently was part of a team that reviewed en-

vironmental compliance and EMS effectiveness at

a highly regulated facility. Overall, the facility’s

environmental performance was very good. At the

end of the audit, our hosts met with us to confirm

responsibility for entering our observations into

the facility’s online corrective action system.

The facility had implemented the corrective

action system to meet the expectations of its

major regulator. But rather than limiting the sys-

tem’s usefulness to just one business aspect, facil-

ity management had chosen to expand the scope

of the system to include safety, environment, re-

liability, human resources, and every other signif-

icant aspect of their business.

Their practice was to enter all identified im-

provement opportunities into the system, where

the opportunities would then be prioritized, as-

trol room operators were assigned to monitor and

reduce the percentage of flaring time.

Within six months of EMS implementation,

flaring time had been reduced from over 60 per-

cent to below 2 percent. This represented a very

substantial performance improvement and

helped the facility meet an EMS goal of reducing

community environmental impacts and air emis-

sions. It also provided a very positive improve-

ment story that the facility could share with

members of the local community and with other

facility stakeholders.

In addition, since the flare treatment system

fed the facility’s fuel gas supply, natural gas pur-

chases were significantly reduced over the same

time period.

This performance metric—implemented as

part of an EMS—yielded a direct benefit to the fa-

cility’s bottom line. Performance improvements

of this kind can be found in many organizations

and are a powerful way to add value through EMS

implementation.

Implementing an Exception Investigation andResponse Process

An ability to respond constructively to envi-

ronmental incidents (such as oil spills) is a re-

quirement for facilities that handle hazardous

substances. Above and beyond this basic prereq-

uisite, however, any facility that wants to have a

leading-edge EMS should implement a process for

identifying and responding to all environmental

exceptions, from missed reports to adverse in-

spection findings.

A procedure for identifying exceptions and

planning necessary improvements is one of the

key capabilities underlying the Plan–Do–Check–

Act improvement cycle that forms a basis for

many EMSs. Moreover, implementing an excep-

tion tracking and corrective action procedure can

add value to an organization if the process also

incorporates other important business aspects.

Implementing an exception trackingand corrective action procedure

can add value to an organization ifthe process also incorporates other

important business aspects.


signed a due date, and tracked to resolution. The

facility expected all employees to use the system

in order to ensure that exceptions were being ad-

dressed and that each group could find out what

its assignments were. Since upper management at

the facility regularly reviewed the status of action

items in the system, most workers we met were

very familiar with the corrective action system

and with the status of their assigned tasks.

Instead of being a limited application sup-

porting the regulatory function only, this facil-

ity’s corrective action system provided significant

value to the whole organization.

Reducing Loss ofMaterials andEnergy

Pollutant emis-

sions, hazardous waste

generation, environ-

mental releases, and

energy inefficiency

represent a waste of

process materials, fuel,

energy, or product. Environmental management

system improvements—including measures such

as implementation of environmental performance

metrics, and improvements in training, proce-

dures, and incident prevention and response—can

help reduce all these sources of waste.

These improvements can also reduce waste of

product, feedstocks, and fuel, and can help pre-

vent loss or shrinkage of valuable materials. Thus,

the environmental management system elements

that the EMS team implements can have a direct

positive impact on the organization’s bottom line.

Adapting Environmental ComplianceActivities to Reduce Loss and ImprovePerformance

Many activities required for environmental

compliance can be expanded or adapted in ways

that help reduce loss and shrinkage. Some exam-

ples include the following:

• Systems to inventory and track usage of haz-

ardous chemicals for purposes of complying

with the Toxic Release Inventory rules can be

used to monitor inventories of valuable

process materials.

• The daily and weekly inspection rounds re-

quired for monitoring of hazardous waste ac-

cumulations, oil storage tanks, and air pollu-

tion control equipment can be expanded to

include key security points, material storage

areas, and in-plant piping.

• Combustion control improvements intended

to prevent visible emissions and reduce air

emissions can also improve combustion effi-

ciency and reduce fuel usage.

The flare-gas example discussed above illus-

trates this point well. In the course of reducing

noise, light problems, and air emissions, the fa-

cility also saved a significant quantity of fuel gas

and was able to reduce natural gas purchases.

Decreasing Waste and Enhancing ValueReducing generation of expensive-to-manage

hazardous waste is another way to add value

through EMS implementation. In a January 2003

publication entitled WasteWise Update—Environ-

mental Management Systems, the US Environmental

Protection Agency (EPA) highlighted several case

histories of public- and private-sector organizations

that had added value with EMSs by implementing

recycling, reuse, and other waste reduction mea-

sures. This document is available on the EPA Web

site at http://www.epa.gov/wastewise/wrr/ems.htm.

Using EMS Implementation as an Opportunityto Improve Operations

Updating operating procedures and worker

training to incorporate environmental manage-

The environmental managementsystem elements that the EMS teamimplements can have a directpositive impact on theorganization’s bottom line.

Environmental Quality Management / DOI 10.1002/tqem / Winter 2006 / 5Adding Value to Your Organization Through EMS Implementation

processing problems that each operator had per-

sonally experienced.

Because every operator had somewhat differ-

ent preferred settings, process unit operations

changed just a little at the beginning of each

shift. The changes were small but they temporar-

ily affected product quality—sometimes causing

products to fail to meet quality specifications.

As part of the EMS implementation process,

we convened meetings of the four or five shift op-

erators that controlled each major process unit

and facilitated agreements among them on the

best settings to use for their particular unit. From

an EMS perspective, the purpose was to agree on

settings that would

prevent permit excur-

sions and outages, but

the EMS team hoped

to see an improvement

in product quality as

well.

Using the agreed-

upon settings reduced

the number of changes made to process unit con-

trols and led to smoother and more consistent

operations across shifts. Within six months, the

amount of off-specification product at the facility

had been reduced, and total production had in-

creased by small (but significant) amounts.

The reduction in off-specification product

had been expected, and the EMS team was grat-

ified that the predicted improvements were

achieved. The production gains occurred be-

cause the operators—having stopped making

their individual defensive adjustments each

shift—now had more time to optimize produc-

tion and could refine optimization across shifts

in sequence.

The improvements in product quality and

production quantity achieved in the course of

implementing an EMS at this facility added sig-

nificant value to the implementing organization.

ment system requirements often provides an

opportunity for the organization to realize over-

all improvements in productivity and prof-

itability.

In formulating revised procedures and train-

ing schemes, the organization can incorporate

input on operations, maintenance, administra-

tion, and potential quality improvements from

operators, maintenance personnel, and subject-

matter experts.

Utilizing Existing ExpertiseIn my experience, there is at least one person

in each area who understands how to improve re-

liability and quality, or reduce costs. Significant

profitability gains can often be achieved if the

knowledge and experience of key people can be

synthesized into specific, concrete improvements

in administrative, operating, or maintenance

practices.

Example: Improving Operating ConsistencyOne facility where I helped implement an

EMS realized significant production enhance-

ments through improving operating consis-

tency.

This facility included many around-the-clock

processing operations and followed a rotating

shift schedule. The facility operated in 12-hour

shifts and had four different shift teams, plus a

backup operator for each major process unit.

This meant that at least four different indi-

viduals controlled each process unit at different

times. Some of the process units were large and

complicated and had to be continually moni-

tored and adjusted to ensure that their product

met customer specifications.

Over time, each individual operator had de-

veloped specific control tactics and operating set-

tings for their particular process units, based on

their own experience. Typically, the process unit

settings would be adjusted to prevent the worst

Using the agreed-upon settingsreduced the number of changes

made to process unit controls andled to smoother and more

consistent operations across shifts.


Rescuing an Underperforming Business UnitLet me offer a final example of a high-pro-

file—but challenging—way to add value: Imple-

menting an EMS as part of a package of improve-

ments aimed at turning around a business unit

that is not meeting expectations.

The upside potential of this approach is clear.

If the project succeeds and the business unit man-

ages to turn itself around, the EMS implementa-

tion team can create a significant positive effect,

gain a chance for recognition, and enhance op-

portunities for further EMS development.

The downside potential is also clear, of course.

Moreover, the risks involved often are beyond the

control of the EMS implementation team. In all

likelihood, there are concrete reasons for the inad-

equate performance of the subject business unit,

and these will have to be identified and addressed.

The reader is encouraged to review my previ-

ous articles in this journal for descriptions of—

and possible solutions to—some of the challenges

that can arise in attempting to improve the func-

tioning (including the environmental manage-

ment) of underperforming business units.

Concluding ThoughtsEHS professionals understand the value of

environmental management systems and are

broadly supportive of EMS implementation in

their organizations. Most EHS leaders in both

the public and the private sectors acknowledge

that a well-implemented EMS can improve regu-

latory compliance and reduce environmental

impacts.

Increasingly, corporate leaders in operations,

maintenance, and administrative positions are

joining with their EHS colleagues as enthusiastic

supporters of environmental management sys-

tems. They recognize that these systems can yield

significant benefits to business owners and stake-

holders.

EMS implementation creates an opportunity

to add value at the bottom line, especially when

the organization uses the implementation

process to improve other business functions. This

“expanded” approach can add complexity to EMS

implementation, but the added value makes the

effort worth it.

Environmental management system imple-

mentation creates enhanced value when the EMS

team stays on the lookout for opportunities to

help improve the overall business.

Notes1. Environmental Quality Management, 14(2), 29–37.

2. Environmental Quality Management, 14(4), 31–38.

Franklin Giles is a technical manager in the Bloomington, Indiana, office of Environmental Strategies Consulting LLC. Hehas a BS in biochemistry from UCLA and an AM in chemistry from Harvard University. He has worked in environmentalmanagement, auditing, and management systems implementation since 1990.

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