Masco Corporation Taylor, Michigan Case Study WORLD LEADER IN HOME IMPROVEMENT AND BUILDING PRODUCTS VALUES SUSTAINABLE INNOVATION Masco Corporation, headquartered in Taylor, Michigan, is one of the worlds largest manufacturers of brand-name consumer products for the home improvement and new construction markets. The corporation manages and social ramifications of actions in addition to the companies in five business segments based on bottom line. The Forum is a learning organization similarities in products and services; cabinets and that meets to discuss pertinent issues and hear related products, plumbing products, installation presentations concerning the practical and strategic and other services, decorative architectural inclusion of sustainability in business practices. products, and other specialty products. Corporate companies include Merrilat Industries, American Environmental Management and Sustainability Shower and Bath, Delta Faucet Company, Masco Corporation recognized the importance of KraftMaid Cabinetry, Milgard Manufacturing environmental sustainability by issuing its first Inc., Behr Process Corporation, Duraflex, corporate sustainability report for 2003/2004, which Damixa, Hansgrohe, Masco Contractor Services, describe Mascos endeavors to design, and Cobra Products, Inc. Masco Corporations manufacture and distribute products in a safe and sheer size and product lines make it an ideal environmentally sound manner. candidate for sustainable innovation. Information contained in this case study was extracted from Masco's 2003/2004 Corporate Masco is committed to conducting business in a Sustainability Report. manner that protects the quality of the environment, as well as the health and safety of employees, by reducing the quantity and toxicity of the waste generated at its plants. Masco does MICHIGAN DEPARTMENT OF this by implementing aggressive policies that ENVIRONMENTAL QUALITY safeguard the health, safety and environments in ENVIRONMENTAL SCIENCE AND SERVICES DIVISION PO BOX 30457 which employees live and work, as well as by LANSING MI 48909-7957 ensuring their responsible use of the worlds www.michigan.gov/deq natural resources. Masco is a founding member Environmental Assistance Center and participates in the Southeast Michigan Sustainable Business Forum, which works to 800-662-9278 RECYCLED promote sustainability by ensuring a better January 2007 #9862 PAPER quality of life by addressing the environmental AUTHORITY: PA 451 OF 1994 TOTAL COPIES: 000 TOTAL COST: $0000 COST PER COPY: $.00 MICHIGAN DEPARTMENT OF ENVIRONMENTAL QUALITY Jennifer M. Granholm, Governor u Steven E. Chester, Director Case Study Mascos dedication is demonstrated by its facilities utilize Six Sigma, a resource efficiency development and implementation of environmental metric and methodology, reducing wood waste management systems (EMS) certified to the ISO by 50%. 14001 Standard. Currently, 31 facilities have an ISO 14001 certified Environmental Management Reuse and Recycling System with several more facilities in the process. Recycling is an essential component of Mascos Mascos environmental management system environmental strategy and manufacturing addresses waste minimization and effective use processes. Masco strives to reuse material or of raw resources, recycling, water conservation, use recycled or recovered materials in its energy efficiency, products and the environment processes where possible, thereby consuming and supplier incentives. fewer raw materials and natural resources. Masco Corporation recycles cardboard, medium Waste Minimization and Raw Resources density fiberboard (MDF), particleboard, pallets, Masco recognizes the importance of forest wood shavings and wood dust, clean vinyl scrap, resource protection and has developed its own glass, plastics, brass scrap chips and other scrap Kitchen Cabinet Global Forest Policy to promote metal. Several Masco companies have also the manufacture of cabinets using lumber from created their own innovative recycling programs. forests that are managed in a sustainable manner For example, Merillat makes use of its wood certified by the Forest Stewardship Council waste from cabinet manufacturing by selling (FSC), the Sustainable Forestry Initiative (SFI) sawdust and shavings for agricultural use, and the Tree Farm Standard. As part of its manufacturing fire logs and incorporating waste environmental strategy, Masco implemented a wood products into composite board and decking. Supplier Relationship Management (SRM) system This program yielded a savings of over 22,000 which helps the company to evaluate raw metric tons of wood at a single facility. material efficiency and minimize waste streams Water Conservation throughout the Total water consumption corporation. Masco at 39 of Masco's largest also encourages its water using facilities companies to take steps dropped by 7.6% to improve the resource between 2001 and 2003. efficiency of facilities. Masco achieved this Masco facilities reduction through its reduced Volatile water usage data Organic Compound collection system. Water (VOC) emissions by usage is monitored and 32% from 1999 to 2003. compiled by Masco Masco facilities facilities, helping Masco achieved this reduction by adopting new to target areas needing technology and streamlining current processes. A improvement. Facilities use the data to identify Merillat facility realized a 94% reduction in VOCs water usage and install devices such as control when it replaced solvent-based stain with water- valves, closed loop systems and other water based stain and installed single-edged grooving reuse systems to reduce and control water use. and coating machines. A Duraflex facility made vinyl saw adjustments that resulted in reduced Energy Efficiency waste and increased productivity. The Merillat Masco closely monitors energy use and efficiency. Throughout the corporation, facilities are encouraged to implement energy saving 2 Case Study processes and technologies that decrease the use such as employees, suppliers, customers, of fossil fuels. Alternatives include the use of shareholders, institutions, governments, renewable energy and energy from waste. organizations, media and surrounding American Shower and Bath in Lapeer Michigan communities. Masco promotes team based realized significant energy savings after installing programs to improve financial, operational and energy-efficient vacuum-forming ovens, on- people performance and eliminate non-value demand vacuum pumps, thermostats and timers added activities from manufacturing and on heating, cooling and air-handling equipment, business process. Outcomes include improved and metal halide lighting. productivity by 20 %, reducing work-in-process inventory by 50 %, reducing material handling Products and the Environment steps by 33 %, and implementing safety and Masco Corporations many product innovations environmental improvements. As a result of the and services reflect the corporations vested success of the team based programs, many interest in sustainability. Milgards energy-saving operating companies have designated full-time glass, Coat-Max low-e, filters solar energy in Continuous Improvement Managers to the summer and reduces heat loss in the winter. coordinate Lean Manufacturing activities. Behr Process produces a line of low-VOC Masco Corporation funds the Masco paints, which has received widespread Corporation Foundation, which was established recognition from a national consumer products in 1952 to provide financial and in-kind support magazine. Damixa developed a number of via partnerships with result-oriented water- and energy-saving devices including Eco- organizations focused primarily on low-income Klik, which is a patented mechanism that housing and arts and cultural initiatives in the reduces water usage at full flow and limits hot southeast Michigan region. Masco has water consumption. Masco Contractor Services contributed time and resources to community developed The Environments for Living® development projects, sponsoring Habitat for Program, which provides builders and Humanity 2003 Detroit's Blitz Build to construct homeowners with guidelines for creating four homes, and awarded grants to a wide sustainable living environments, which are less variety of arts and cultural organizations in costly to heat and cool. southeast Michigan. Supplier Incentives Economics Mascos sustainability efforts extend to its supply Masco Corporation has developed an effective chain of more than 13,000 suppliers in 36 economic strategy for long term growth, which countries in 2003. Masco encourages suppliers to includes enhancing corporate sustainability, act responsibly and developed a recognition building value for shareholders, continuing to program to reward leadership, communication, meet the needs of customers through customer commitment and cooperation, while achieving service initiatives, and improving efficiency and world-class quality, cost reduction, delivery, competitive advantage in the home improvement service and sustainability. The corporation and new construction markets. Masco works to encourages its suppliers to comply with corporate meet these goals while continuing to increase sustainability standards, through programs such inventory, sales and dividends. Between 2001 as the Masco Supplier Team Recognition and 2003, Masco increased its inventory by 12% (MASTAR) program. and sales rose by 37%. In 2003, Masco increased sales by 19.7% from the previous Society year. Shareholders have also benefited