For the exclusive use of S. Ruiz Del Angel, 2020. NA0579 Recycling Quality Steven B. Kramer, Nova Southeastern University Carolina De Leon, Nova Southeastern University Bruce Wills, Nova Southeastern University Cindy Silva, Nova Southeastern University It was the end of 2015 and John Perry, Manager of Waste Management’s (WM) newest material recovery facility1 (MRF, pronounced “murf”) was concerned about the sustainability of the MRF given changes in demand and competition. WM serviced municipal waste and played a critical role in the recycling supply chain of the reclaimed materials markets. “The municipality’s goal to recycle, was independent of demand. It was not a supply and demand driven market. … the expectation [was] that if we collect it then someone will need it somewhere,” Perry expressed. For a number of years, paper recyclers in China, the MRFs primary customers for fiber (cardboard, newspaper and mixed paper), were rejecting or downgrading container after container due to quality issues. That was the start of many changes in the reclaimed materials markets. MRFs were springing up all over the world and by the end of 2015, world-wide fiber commodities pricing was in decline and fiber represented 50% by weight of Perry’s recycling collections. It was harder and harder to break even, but profitability was only a crude litmus to Perry as an indicator of the viability of the Pembroke Pines, Florida MRF. He was tired of reacting to crises. He was concerned that the processes of collection and sorting were not necessarily aligned to the value proposition of recycling. Perry was hired in 2011 and while Perry had no prior experience in the solid waste management field, he was a six sigma process expert from automotive assembly and manufacturing and he understood the importance of quality. Perry started a sampling initiative at Pembroke Pines in 2012 to characterize the collected materials in the loads from the municipalities but had yet to look at that data closely. He felt it was time to analyze that data to develop an understanding of quality as it related to the various stakeholders. Perry wanted to pinpoint what quality was, for whom and move to implementing a quality management system. He was accountable for the bottom line of his MRF and was in many regards his own small business: expected to be and remain viable by his regional management. He had the autonomy to implement changes as long as they didn’t require unbudgeted corporate resources. That was fine with Perry, he knew the issues here were not strictly a function of capital equipment. Perry knew he was not dealing directly with quality in recycling. Perry had to decide what to do next. ----------------------------Copyright © 2019 by the Case Research Journal and Steven B. Kramer, Carolina De Leon, Bruce Wills and Cindy Silva. Recycling Quality 1 This document is authorized for use only by Suriel Ruiz Del Angel in 620 fall 2020 taught by Mahmood Kotb, University Canada West from Nov 2020 to May 2021. For the exclusive use of S. Ruiz Del Angel, 2020. THE HISTORY OF WM AND WASTE RECYCLING During the 1950’s, the waste industry consisted of many local and regional collection companies. WM was created in 1968 in Chicago when H. Wayne Huizenga merged with Dean Waste Management and Larry Beck’s disposal companies2. The company pursued an aggressive acquisition strategy, expanding beyond Chicago and went public in 1972. In 2015 WM was a multinational corporation with waste collection, landfill, and recycling operations throughout North America. WM’s focus was service operations--their 35,000 employees were mostly collectors and truck drivers. Perry believed that the recycling industry was not born out of a customer need for recycled commodities. Perry called this the “municipality’s pursuit of environmental goodness … they [were] trying to divert things away from landfills and make sure that they [were] used.” Municipalities paid for this service. Depending on the diversion level desires of the municipality (which was specified in collection contracts as minimum requirements), this impacted the costs. If the collector was able to offset their additional collection, as well as the MRF sorting and baling costs by selling some of the collected materials, then the municipality might receive a rebate, effectively lowering the total cost to the municipality for disposing of the entirety of their solid waste. If there was no market for the separated materials and/or the price did not cover the additional processing costs, then the MRF transferred those costs back to the municipality, increasing the net disposal fee for their solid waste. According to Perry, “aside from … the price point of that commodity the [sorting cost] is not tied to a price point. [The municipalities] don't really care how much commodities are worth they still want to divert it.” The industry was concentrated in the hands of a few recyclers up until the mid1990s. “As late as 1995 there were really only five single-stream recyclers in the US. By 2001 there were 70 and there were 160 in 2006 … it was a big change that … really occurred recently,” expressed Perry. WM responded to demands for recycling by building or acquiring “single-stream” and “dual-stream” MRFs. In 2015 WM operated approximately 50 single-stream and 30 dual-stream MRFs. In single-stream recycling, the homeowner deposited all recyclable materials in one container, separated from their household trash. Dualstream recycling placed the onus of categorizing and separating the recyclable materials on the homeowner: typically, glass, plastic, and aluminum were co-mingled and separated from paper products. The business model was “fee for service,” meaning customers specified what and when they wanted service and WM responded. WM’s first automated single-stream plant opened in 1993. Historically, recycling plants processed approximately 15 tons of material per day and this was accomplished by manual sorting. This was a stark contrast when compared to a 2015 normal, large-scale facility such as the one in Pembroke Pines, Florida, which typically processed approximately 450 tons of material per day. There were few viable alternatives to recycling services or landfills for disposing of solid waste and so MRFs became integral parts of the community. Perry believed that WM entered the recycling business “naively” without a full understanding of the complexity of the supply chain. WM was familiar with the collection side, but “there was so much more to it than that,” Perry recounted. According to Perry, WM’s MRFs “evolved” over time. He reflected on the WM evolution. WM created a corporate group in approximately the year 2000 to figure out MRF design and operation. They formed a group called WMRA, … kind of 2 Case Research Journal • Volume 39 • Issue 2 • Spring 2019 This document is authorized for use only by Suriel Ruiz Del Angel in 620 fall 2020 taught by Mahmood Kotb, University Canada West from Nov 2020 to May 2021. For the exclusive use of S. Ruiz Del Angel, 2020. an independent subsidiary … like a little think tank and gave it gave [MRFs] a kind of opportunity to grow. They pushed very hard for single-stream recycling [as opposed to dual-stream]. This group was in place for approximately 10 years. Each MRF manager was responsible for regional customer interaction including negotiating the contracts with the municipalities and managing capacity to the varying level of daily collections. Each local WM business manager was also responsible for both short- and long-term strategies to meet the corporate WM goals. WM’s corporate business unit set WM MRFs’ overarching recycling goals including residue percentage, system effectiveness, and revenue growth (in addition to WM corporate goal of safety) and reviewed them monthly. System effectiveness measures included equipment uptime, tons per labor hour, tons per production hour, and quality composition audit (sampling) data by commodity including residue. Safety (training, incidence, etc.) was deemed to be of primary importance. Each MRF was expected to project monthly performance and account for the previous month’s performance. Corporate management compared site performance and looked for opportunities to leverage best practices from other WM MRFs. COLLECTION PROCESS Each municipality contracted for curbside pickup of single-stream recycling material with a collection company. The “collector” was a collection company, a transfer station, or even a MRF with collection capabilities (See Figure 1). A transfer station was a place that consolidated large amounts of materials - typically both recycling and trash for subsequent transfer to MRFs and landfills. The recycling collector might not be the same as the household garbage collector. The municipality could split their sourcing of recycling collection service within their region, each contracted separately. These collection contracts were not standardized, so each municipality was likely to have a unique style of contract. Pricing was always clearly stated in the contracts: all contracts included some type of rebate agreement as a function of the collected material composition. The contract duration varied from 1 – 10 years and some had auto renewal clauses at the sole discretion of the municipality. The dated contracts typically included a fixed rebate and did not account for recent collection practices or changes in commodity values, nor did they incentivize the municipalities (residents) to improve on material quality. Perry noted that these contracts were born from the “early” days of recycling when demand (and prices) for MRF sorted materials was high, globally, and quality expectations were low. He also knew that the residents were not part of the bid request and evaluation process, these were handled by the administrators in each municipality, so any resident interests (such as ease of collection safety, ease of storage/sort at residence and percent of household waste recyclable ) outside of collection costs and rebates were not considered. Recycling Quality 3 This document is authorized for use only by Suriel Ruiz Del Angel in 620 fall 2020 taught by Mahmood Kotb, University Canada West from Nov 2020 to May 2021. For the exclusive use of S. Ruiz Del Angel, 2020. Figure 1 – Municipality Agreement Source: Author In a similar fashion to the municipalities, the collectors created their own contracts with transfer stations and/or MRFs to receive their collected recyclables from the municipalities (See Figure 2). Transfer stations then contracted with hauler(s) to get their consolidated materials to one or more MRF. Recycling materials sent to MRFs were hauled mostly in 100 cubic yard bulk trucks. Figure 2 – Collector Transfer Process Source: Author Adding to the agreement complexity, collectors could subcontract some or all their collection, transfer stations used their own hauling trucks or subcontracted some or all their hauling, and MRFs used their own trucks for both collection and hauling or chose to subcontract. Perry’s MRF assessed a tipping fee based on a pre-agreed price/ton for each thirdparty delivery to the MRF. The MRF provided load quality feedback to all suppliers 4 Case Research Journal • Volume 39 • Issue 2 • Spring 2019 This document is authorized for use only by Suriel Ruiz Del Angel in 620 fall 2020 taught by Mahmood Kotb, University Canada West from Nov 2020 to May 2021. For the exclusive use of S. Ruiz Del Angel, 2020. of deliveries (based on load quality sampling data) in addition to penalties/rebates as a function of the terms of the contracts. PEMBROKE PINES MRF The Pembroke Pines MRF was originally constructed in the 1990’s for another purpose. It was converted to a MRF in 2008. It was designed expecting 60 to 70 percent newspaper, however in December 2015 newspaper (ONP) was running 20 to 25 percent. The Pembroke Pines MRF processed solid materials such as paper, plastics, and aluminum from many south Florida municipalities’ residential recycling collection points. It was a single-stream recycling facility. Facilities such as the one in Pembroke Pines used various methods (manual and automated) to separate the material into individual commodities. When a truckload of recyclable material arrived at the MRF, the truck dumped its load onto the tipping floor (See Figure 3). Regular garbage trucks carrying singlestream collections drove through and disgorged their load unassisted, while larger trucks required a hydraulic lift to empty their trailers and thus, were “tipped.” As a pre-sort process, the tipping floor operator then mixed the piled material to more uniformly distribute its contents using a very large front-end loader. The operator would then scoop the material onto a conveyor running at just over six miles per hour (about nine feet per second), feeding a stream of one ton per minute to the downstream continuous sorting process. This speed reflected the original design of the Pembroke MRF based on throughput requirements to support customer quality requirements, anticipated local market single-stream market, standard sorting cost-perton metrics and profitability. Operator loading was based on the December 2015 20% by weight residue yielding 0.1 ton or 200 pounds of residue per minute to be removed. This required six people picking at the standard (based on Industrial Engineering work sampling methods) of 35 picks per minute per person. There were several measures of efficiency or effectiveness checkpoints throughout the sort process: in addition to visual assessment of the flow of materials on screens and bottleneck areas, the MRF conducted conveyor audits of glass and residue, paper bale composition, bales per hour and moisture measures on fiber bales. Assessing quality and projecting profitability was difficult. According to Perry, this was linked to the philosophy of each municipality’s desire to recycle. In municipal recycling there was this expectation that if we produced it, somebody was going to need it somewhere. There were no signals from the marketplace to help determine what the quality should have been or what the price point should have been that actually tied back to that municipality. Our revenue came from the commodity we sold so it was really important to know the quality, the composition, and even the average material value of that [collected] material. Although you saw a big pile of what looked like garbage it had a value - like if you had a pocketful of change: you knew the value depended on how many quarters you [had] and pennies in that combination. It was the same thing with the [single-stream] material that came in [to our MRF]. Recycling Quality 5 This document is authorized for use only by Suriel Ruiz Del Angel in 620 fall 2020 taught by Mahmood Kotb, University Canada West from Nov 2020 to May 2021. For the exclusive use of S. Ruiz Del Angel, 2020. Figure 3 - WM’s Single-Stream Processing3 Source: Company website: http://www.wm.com/thinkgreen/how-we-thinkgreen.jsp 6 Case Research Journal • Volume 39 • Issue 2 • Spring 2019 This document is authorized for use only by Suriel Ruiz Del Angel in 620 fall 2020 taught by Mahmood Kotb, University Canada West from Nov 2020 to May 2021. For the exclusive use of S. Ruiz Del Angel, 2020. The most valuable commodity was used beverage cans (UBC) that often topped $700/ton in sales price. UBC only accounted for approximately 1% of each load by weight, but almost 20% of the load’s value. The non-fiber, plastic (valued at $200$300/ton) and metals, were not affected by moisture. The primary customers of plastics and aluminum cans were in the southeast United States. Approximately 40% of revenue for Pembroke’s MRF was derived from the sale of baled fiber commodities (OCC, ONP, MixPpr) which in December of 2015 was valued at $75-$110 per ton. Ninety percent of Pembroke’s sales of baled fiber were to customers in China. In late 2015 their contract specifications were reflecting significant increases in quality levels, specifically reductions in organic and non-organic contaminants, as well as moisture. “Residue” was defined as any material that was not recyclable, therefore, less was better. It was measured by accumulation (weight) after the MRF sort and calculated as a fraction of the original sort weight input. It did not include any loads shunted directly to a landfill rejected prior to sorting as unsuitable for processing. Residue level in December of 2015 was approximately 20% by weight of the received materials. Generally, each individual MRF manager at WM determined the best strategy for his or her MRF to minimize residual. Residents were major contributors to the residual level, putting trash or contaminated recyclables (like a cardboard pizza box with food waste) in the recycling bin. The recyclable fiber materials (newspaper, cardboard and mixed paper), when not contaminated with trash waste, were susceptible to moisture contamination. The MRF paid to haul away the residue to a landfill or a close by waste-to-energy facility. Generally, WM was able to haul the residue to a WM landfill, but it still represented a loading and hauling cost. The WM landfill total capacity (and revenue) was reduced to accommodate this WM-owned residual. The waste-to-energy facilities charged significant tipping fees and in addition their rebates were a function of current energy costs (their source of revenue) making this option on par (regarding cost) with disposal in a landfill. Glass, a material often perceived to be recyclable, was detrimental to the WM MRF profitability in 2015. Glass items broke throughout the separating process, tore up rubber conveyor belts, spilled out through small crevices, and created heavy (typically making up 15% of the incoming stream’s weight), difficult piles to clean up under the equipment. Glass fines (small glass shards) were indistinguishable from dirt and were contaminated with a variety of materials. Likewise, the glass fines became embedded in the fiber materials, contaminating them. The abrasive glass-based dust reduced the life of all mechanical systems and surfaces it encountered including the cement floors and hauling truck beds. The glass was separated into bunkers where trucks arrived daily to pick up loads. The cost of sorting and then hauling the glass to a customer that would use it was only partially offset by that price the customer paid, however was less than the disposal cost in a landfill. The glass “value” was therefore negative at this facility. The time and effort required to clean up glass piles and repair equipment made the glass a challenging commodity to manage. Perry also faced a continually fluctuating price for their processed, baled materials (prices as of the December 2015 are in Table 1). In addition to supply and demand, material integrity significantly impacted prices of the shipped commodity. Thus, Perry’s operation had to keep the commodity bales pure and keep the fiber bales dry to get the best price at the market. Recycled materials from residential collection were generally sold as “low grade” product to their recycling customers. Most commodities were also available to recyclers in higher grades from other sources. For example, retail stores that sorted and baled their own cardboard (OCC), would be able to command a Recycling Quality 7 This document is authorized for use only by Suriel Ruiz Del Angel in 620 fall 2020 taught by Mahmood Kotb, University Canada West from Nov 2020 to May 2021. For the exclusive use of S. Ruiz Del Angel, 2020. higher price because it was generally free of non-cardboard contaminants and protected from moisture. The MRF’s burdened sorting price for received material was steady in 2015 at approximately $60/ton (including the cost of overhead, facilities, etc.). REGULATIONS Municipal waste disposal was heavily regulated including restrictions on handling and disposing of hazardous materials. The MRF operated under these same restrictions. Like municipal waste, hazardous recyclable municipal waste was prohibited from the single-stream collection, but scrutiny was typically in place only at the MRF, and not at other points in the collection stream (e.g., transfer station or curb side). The MRF regularly received a variety of hazardous materials mixed into the collected stream such as syringes, car batteries, and chemicals which added to the challenges of MRF management. MRF employees removed those hazardous materials from the stream in accordance with the federal and state regulations of hazardous waste handling. The MRF was then required to send them to appropriate disposal areas. The MRF mandated employees wear personal protective equipment and be trained in handling hazardous waste. In 2008, the Florida Legislature enacted House Bill 7135 which created Section 403.7032, Florida Statutes. In this bill, the State of Florida listed a goal of recycling 75% of all municipal solid waste material and sending only 25% to the landfills before the end of the year 20204. This legislation mandated municipalities to adopt the state goal but allowed each to set their own county goals on how much material they should be recycling. WM as a recycled material handler became responsible to provide tonnage tickets (receipts) to the municipalities to enable their diversion percentages to be calculated and reported back by the municipalities to the state. Those tickets, however, were only required to list the tonnage amounts received at the MRF, not the fraction of the receipts truly recyclable. In 2015, the Florida municipal recycling rate was listed as 54% according to the Florida Department of Environmental Protection5. While waiting for this loophole to be corrected, Perry’s MRF took it upon itself to provide its receipt tonnage tickets as recyclable materials only. HB 7243 passed in 2010, followed up on HB 7135, amending Subsection (5) of section 403.7049, Florida 276 Statutes applying to county owned MRFs and provided a precedent for commercial MRFs to negotiate contracts based on the received recyclability of materials. It did not just acknowledge residue in terms of recyclability of the commodity, but also the quality of the commodity as in the case of fiber. 8 Case Research Journal • Volume 39 • Issue 2 • Spring 2019 This document is authorized for use only by Suriel Ruiz Del Angel in 620 fall 2020 taught by Mahmood Kotb, University Canada West from Nov 2020 to May 2021. For the exclusive use of S. Ruiz Del Angel, 2020. Table 1 - Material Re-Sale Value per Ton (12/2015) UBC Used Beverage Cans $1300.00 HDPE-N High-Density Polyethylene Natural, Plastic 2 $538.80 PET Polyethylene Terephthalate, Plastic 1 $193.60 ScrpAlu Scrap Aluminum $753.80 HDPE-C High-Density Polyethylene Pigment, Plastic 2 $437.60 BlkyRgd Mixed Rigid Plastic $116.00 OCC Old Cardboard $88.75 MixPpr Mixed Paper $88.13 ONP Old News Paper $79.00 ScrpStl Scrap Steel $76.72 Aseptic Aseptic/Gable top $71.67 Plastic 3-7 PVC, LDPE, Other $30.00 Tin Tin/Steel Cans $22.08 GP-3Mix Three Mix Glass ($12.00) RES Residue ($54.00) Source: Author Recycling Quality 9 This document is authorized for use only by Suriel Ruiz Del Angel in 620 fall 2020 taught by Mahmood Kotb, University Canada West from Nov 2020 to May 2021. For the exclusive use of S. Ruiz Del Angel, 2020. MANAGING MOISTURE IN SOUTH FLORIDA MRFs in South Florida faced unique challenges in the form of wet weather. The wet season, spanning May through October, saw roughly 75 percent of the area’s expected 60 inches of annual rainfall. Much of that came in heavy downpours with high winds. Windy, wet weather increased the likelihood that the material arriving at the MRF was exposed to excessive amounts of water. Wet material (both within the MRFs and at the final customer’s location) clogged processing chutes and required a partial or total system shutdown to clear each obstruction. Fiber also lost much of its physical integrity and tended to disintegrate in the mechanical sort process when it was soaked and reduced it from a sellable commodity to RES (residual). MRF’s customers for fiber (paper – either mixed paper, coded MixPpr, or old newspaper, coded ONP, and old cardboard, coded OCC), included moisture tolerance limits for the material in their contracts. Assuming the material survived the sort, if the material was baled wet, the bale’s weight was exaggerated due to the water content. An even bigger concern was that wet fiber deteriorated quickly into compost. The process of creating compost involves four main components: organic matter, moisture, oxygen, and bacteria. South Florida had plenty of each in its wet fiber and it could take weeks for the baled fiber to reach the customers, primarily Chinese companies. Transport in steel containers also promoted the formation of condensation on the interior of the container which was then absorbed into the interior of the bales, exacerbating the overall moisture level and resulting in moisture level measurements even greater than when shipped. Customers could downgrade the quality of material upon receipt. In the case of fiber, the common moisture tolerance was 12%. When a customer downgraded material received, the price per st (st = short ton, 2000 lbs) was reduced from the original agreed price or the MRF paid a credit for the variance (See Figure 4). During 2014 Pembroke Pines paid back credits of $50-$100K. PERRY’S CHARGE AT PEMBROKE PINES MRF: IN SEARCH OF QUALITY Perry was recruited because WM wanted a manager who understood quality and continuous improvement. The Area Director at the time, wanted to model another MRF located in Twin Cities, Minnesota, one where continuous improvement efforts and methodologies were embedded in processes. Perry came with quality expertise from the automotive and manufacturing industries. 10 Case Research Journal • Volume 39 • Issue 2 • Spring 2019 This document is authorized for use only by Suriel Ruiz Del Angel in 620 fall 2020 taught by Mahmood Kotb, University Canada West from Nov 2020 to May 2021. For the exclusive use of S. Ruiz Del Angel, 2020. Figure 4 - Detail of Downgraded ONP (Old Newspaper) Source: Company documents Within the first month of his hire, Perry visited the Twin Cities MRF. He saw that the manager developed a scientific approach to its sorting process management and designed “composition audits” to understand what materials were in the pre- and postsorted collected material optimize their sorting operations. Perry came back to Pembroke and instituted similar audits. The Pembroke MRF had no quality system in place upon Perry’s arrival. There was no process documentation, there were no quality standards. He recalled, When I was brought here from outside of the industry as a manufacturing person that managed processes, a key measure for me, especially, was how many widgets we made that month and what my necessary labor cost was …, but quality measures were really important. When I worked for a company that was a supplier to the automotive industry the key measure as a manager was your quality record and not so much profit and loss because you were making a component within a larger assembly. … You really were focused on process and gave little thought to the expense side of things. In this environment it was almost the opposite, we were very accounting focused not process focused. I couldn’t look at the end of the month and [use] Recycling Quality 11 This document is authorized for use only by Suriel Ruiz Del Angel in 620 fall 2020 taught by Mahmood Kotb, University Canada West from Nov 2020 to May 2021. For the exclusive use of S. Ruiz Del Angel, 2020. how much money we made [to determine] if we did a good job – that [was] no way to run a business. I was trying to find out how [to] get my hands around this and in digging in I didn’t see any metrics whatsoever except for how many bales we produced every day. I started looking for was how I [could] tell in my paper, for instance, what percent of it was actually paper once I separated a big pile of mess [incoming material]. How [well] did I do in separating paper out of the plastic and plastic out of the paper? Perry started by measuring – We took a bale and broke it apart and then weighed everything. That gave us a measure that we could look at on a daily basis to tell how well our equipment was being adjusted and what impact different material may have had on the sort to be able to adjust a process or repair equipment more promptly. That then naturally led to the next hurdle: what was the specification (from each customer) for each commodity? Perry implemented standard procedures and visual reference signage as well as audits of methods upon arriving at Pembroke Pines. He also instituted “pre-shift huddles” to facilitate communication between workers and shifts. The entire MRF workforce also received quality management training including root cause investigation process training. He instituted an incoming material sampling routine in Fall of 2012 to track both the commodities and the contamination (residual and moisture) levels in the inbound material and to better understand the sources of variability from municipalities and transfer stations. The incoming material sampling process was performed roughly once weekly per incoming municipality or transfer station. Perry concluded it was “a very immature kind of industry market: the normal situation where [a customer] would say, ‘here's our specification, you need to meet this specification’ didn’t exist.” In 2010, at times when demand was strong, prices were high, and the customers accepted high levels of contamination and rarely provided quality specifications and even when they did, they accepted contamination levels higher than specified. In times of excess availability, as it was in 2015, prices dropped, and quality levels were scrutinized in addition to being increased from high demand norms. THE DECISION POINT By the end of 2015, the fiber commodities pricing was in decline due to world-wide competition while their standards for quality were becoming more stringent. The residue levels in the incoming stream were still high. Recycler customers across the commodity market didn’t agree as to what they wanted in the supply of recycled materials and frequently changed their minds. To compound this, “I had municipalities that were not the same [in the overall collection amounts and their commodity compositions] and processes locally and across other regions that were different [like collection], and all those things were on my plate.” Although Perry wasn’t receiving pressure from his management – his MRF numbers of profitability, efficiency and residual levels were as good or better that most other MRFs at WM - Perry felt that he had reached a critical time to act. He didn’t see his current operations, even with his initiatives to date as sufficient to be sustainable, they didn’t seem tuned to the current and future needs of the municipalities, much less to the changing needs of the emerging recycling industry. He wondered if he was measuring the correct things? 12 Case Research Journal • Volume 39 • Issue 2 • Spring 2019 This document is authorized for use only by Suriel Ruiz Del Angel in 620 fall 2020 taught by Mahmood Kotb, University Canada West from Nov 2020 to May 2021. For the exclusive use of S. Ruiz Del Angel, 2020. Perry felt that he needed to better understand the value proposition throughout the recycling process, starting with the municipalities at collection. He realized that it wasn’t just him without a clear vision for recycling, it was also the whole recycling supply chain. Perry felt if he could better understand the MRF stakeholders then he could better incorporate their needs now and into the future. His material audit process looked back at slices of the stream at any one time – what about future trends? He also realized that the MRF plant and its internal operations was not his only point of influence in the supply chain: it was part of his responsibility to develop relationships with the municipalities and his recycler customers. He saw this as a fundamental issue of quality management. He felt he needed a quality management plan for the MRF, and it needed to start by defining quality. He recalled quality definitions from quality gurus of the past such as “zero defects” and “fitness for use” and “conformance to requirements.” Could these help him create a quality management plan in his MRF? And then from his experience he knew that he must operationalize quality through some sort of quality management system. But where should he start deploying his quality management plan: the suppliers (municipalities), the process (MRF), or the customers (recyclers)? Perry had logged quite a bit of sample data from his municipalities. Perhaps he could craft a more enlightened, profitable operating scenario leveraging that data and then communicate that throughout his recycling supply chain. He used statistical analysis successfully in his previous jobs to manage his processes – could they help here? He certainly needed to know if the collected material stream overall and by commodity were predictable. And what about the different municipalities, were they all the same in mix composition? If he understood quality better, could he differentiate “better” and “worse” performing municipalities and why they performed differently? If so, then how might that insight from that analysis support the MRF’s plans for improvements? REFERENCES A MRF was a specialty facility that received collected materials intended for eventual recycling. Instead of hauling them to a landfill, as done with WM’s core business of landfill management, the MRF separated them into their constituent material commodities, compacted each commodity into bales and then shipped them to customers who then recycled the materials into new products. 1 Dean Buntrock was a founding member and former chairman and CEO of Waste Management, Inc. 2 3 http://www.wm.com/thinkgreen/how-we-thinkgreen.jsp 4 http://www.dep.state.fl.us/waste/recyclinggoal75/ 5 http://www.dep.state.fl.us/waste/categories/recycling/ Recycling Quality 13 This document is authorized for use only by Suriel Ruiz Del Angel in 620 fall 2020 taught by Mahmood Kotb, University Canada West from Nov 2020 to May 2021. 
Purchase answer to see full attachment