Planned Obsolescence - Corporate Social Responsibility

CORPORATESOCIALRESPONSIBILITY

DAVOISEFlorianETOURNEAUClementFLACHERMatthiasGAUTHIERMarieGONGLuyaoHOURYWalidJOLYAugustinKADDOURIMarouaneLEGARFFFrédéric

PLANNED OBSOLESCENCE

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1. What is planned obsolescence?2. Different typesofobsolescence3. Origins ofthis mechanism4. Impactonsociety5. Legislation6. Solutions

Sum up

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https://www.youtube.com/watch?v=lW17rr20tGY

Introduction

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What is planned obsolescence ?

It’s aBusinessstrategy inwhich theobsolescence(theprocess ofbecoming obsolete—that is,unfashionableornolongerusable)ofaproduct is planned andbuilt into it from its conception.“TheEconomist”

Mightbeprofitableforthecompany Harmreputationandimage Customersmaydecidetopurchaseforcompetitors

Pushcustomers topurchase newproducts ofacompany toreplacetheold ones !(Thatadded valueforthecompany is tocommercialize its newproducts even ifthere is nodifferences orfewdifferences

compared totheold products)

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BrooksStevensintroduced theconceptoffashionforeveryday items

What is planned obsolescence ?

While models ofphonesandTVs succeed,wasteaccumulates andnatural resources aredwindling

Context

1950BernardLondonsaid legally binding obsolescenceaway toresolve theeconomic crisis atthetime

1932

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What is planned obsolescence ?

Themechanisms involved :• Technical• Psychological

Planned obsolescencealso weighs on thepurchasing powerandcontributes totheimpoverishment ofhouseholds

Environmental organizations challengethecompanies tofind newissues

Observation

INNOVATION

Makesproductsstronger

Moreefficientbutlessresistent

Morerapidlyrenewed

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6Types of obsolescence

Obsolescenceoffunction Obsolescenceofquality Obsolescenceofdesirability

Ecological obsolescence Economic obsolescence Obsolescencebyexpiration

Thenewproduct makes theoldoneinferior (newcharacteristics

forexample).Defects,incompatibility

It’s when theproduct is nolongerworking.Mostupsetting typefor

consumers

Productbecomes old-fashionedduetothelaunch ofanother one,more“in”.Also called “Esthetic”

obsolescence

Norms andlaws areforcingobsolescence

Reduction invalueduetoexternalfactors

Eat-by-date,Sell-by-date. Usuallyforpublichealth

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Origins of this mechanism

1924

Americannationalautomobilemarket is reaching saturationAlfredSloan jr,head ofGM,suggested a« Annualmodelyeardesign »changes« Dynamic obsolescence ».Smallplayers could notmaintain thepaceandexpense ofyearly re-styling.HenryFord’s strategy :based onsimplicity,economies ofscale anddesignintegrity.

GMsurpassesFord’s salesin1931.Ending theDepression Through PlannedObsolescence,BernardLondon,1932.

London’s planwould havethegovernmentimposealegal obsolescenceonconsumerarticles,tostimulate andperpetuateconsumption.19

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Brooksstevens (anamerican industrial designer)used theterm « planned obsolescence »asatitle forhis talkatanadvertising conference inMinneapolis.

« Instilling inthebuyer thedesire toown something alittle newer,alittle better,alittlesooner than is necessary ».

Inlate 1950s,commonly used term forproducts designed tobreakeasily ortoquickly gooutofstyle.

VancePackard,TheWasteMakers,1960.Defined 2sub-categories ofplanned obsolescence(durability&function)

Origins of this mechanism

1950

-19

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Impact on society

Primary resources Production Distribution Consumption Recycling

Load, cadnium, mercury,water, cooper, plastics,

silicon, glass, …

Foxcom Apple,Sony, Nokia Consumers China,Nigeria,India,Ghana

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Impact on society

PrimaryRessources

• Theuseofraw materials hasincreased almost by50%inthepast 30years

• Richestcountriesconsumeuntil10timesmoreresourcesthandevelopingcountries

• Resourceextractiontakesitstollontheenvironment

• Electronicscontainalotofrareandpreciousmetalsthataremoreeconomictorecapturethantoextractfromtheirextremelylimitedvirgin sources

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Impact on society

PrimaryRessources

• Cell Phonescontain lead,cadmium,andmercury whichareterriblefortheenvironment

• Theflame retardantprocess through which that plasticinthephones is putthrough can causecancerwhich notonly affectstheenvironment butthose inhabiting it

• Highconsumption ofwatertoproduce Copper, theprocess oftransformation results intoxic components

• Depletion ofNaturalResources

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Impact on society

Production

• 56H/Week

• Low Income

• 11Executive days

• Children aredroppingofffrom schools inorder towork

• 14suicidesin2010

1.2MillionemployeesHeadquarters :TaiwanSlogan:TheArtofMore

2010/2011:FoxconnGate

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Impact on society

WorldConsumption

Reasons ofworldconsumption’s growth :

Productlessexpensive HouseholdincreaseofequipmentrateShorterlifetimeMiddleclassincreasing

Between 2007and2020,domestic television e-wastewill double,computere-wastewill increase fivetimes,andcell phoneseighteentimes

Theuseofraw materials hasincreased almost by50%inthepast 30years (50BTRM)

Increases theshare ofelectricity consumption attributable toelectronics andhousehold appliances continues torise

Shorter lifetime andless expensive products 14

Impact on society

Electronic&E-waste

• Guiyu, is known asthebiggest e-waste recycling siteintheworld

• 80%ofGuiyu's children exhibit respiratory ailments,andareparticularly atrisk ofleadpoisoning (many heavy metals andtoxic plastics)

• 70%ofour e-waste is senttoChinaandIndia

• Newcountriesaffected :GhanaandNigeria

Consequences :- Lack ofKnowledge- Dismantling- Diseases- Pollution

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Impact on society

ENVIRONMENTAL ISSUES SOCIAL ISSUES

ResourcesDiminution Waste

Pollution

ChildLabour

Social&politicalConflicts

Legallabour

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Legislation

→March2015:adecree cameinto forceonly inFrance,which aims tofight this practice.

Only applicableinFrance:manufacturers havetoinform their consumershowlong their productsareintended tolast.Then,vendors arerequired totellthefinalbuyers.Failure todoso results ina15.000eurosfine.

Other aspect:manufacturers arerequired torepair,replaceany defective productwithin thetwoyears from thepurchase date,freeofcharge.Thisleadstothecreation ofamandatory two-yearwarranty.

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Legislation

• European Economic andSocialCommittee (EESC)renewed its callforactiononPlanned ObsolescencefortheEuropean roadmapfor2016.

• Belgium, theNetherlands,SpainandFinland allhavedrafted laws inthefighttoeliminate Planned Obsolescence.

• TheConsumerProductSafety CommissionofUnitedStatesdoes havethepowertoissuedurability standardsifit chooses toexercise it.

• TheItalian government guarantees two years ofserviceforany newcomputer.

• TheSwedish government is introducing tax breaksonrepairs toeverythingfrom bicyclestowashing machines.

Alternativelaws

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Solutions GOVERNMENTS

TAKE A LEADERSHIP ROLE

Ensure product repairs areaffordable

Provide education toconsumers

Establish laws againstplanned obsolescence

Create andmonitorstandardsforproductdurability andlongevity

Increase product waranty Governmental TVandradiospots

SocialMedia

School prevention

Ensure transparency

Better access toproductinformations

ImproveEco-participationtax 19

Solutions CONSUMERS

Thinkcriticallyaboutpurchase

Consumeless

Recyclemore

Notparticipateinfashioncycle

Re-use

Buyandusesecond-hand

BuyRepaireditems

CHANGE YOUR CONSUMER HABITS

1. Here,whoisstillusingthefirstcellphoneheeverhadinhislife?

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Solutions

UsedProducts

Adviceson/off-line

tofix

Re-use product

Recyclingproduct

Donationsaresales

CONSUMERS

UseCollaborativeEconomyFindinformationChoosewhenpurchasing

WHAT YOU CAN DO NOW!

Follow onlinecomunities aboutreusingandrepairing products

Useonlineandphysicalstructurestofixandpurchase

Beaware aboutenvironmentals labelsandlifetime certifications

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Solutions INDUSTRIES

ConsiderEnvironment Recognizeproductlifetimeamong

businesspractices

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Hireengineersanddesignerswhowillcreateproductswithanenvironmentalstateofmind

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Practiceandpromotesustainability

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“Papercanusuallyberecycled6timesbeforeexhaustingitsfibrousquality”

COMPANIES WILL NEED TO ADAPT

1. Asanengineer,howwouldyoureactifyouweretoldtolowerthequalityoftheproductyouwereworkingon?

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Solutions

CircularEconomy

Sincetheindustrial revolution, theeconomicmodel isbasedonplentifulnaturalresources

andalinearmodel :

Extractedrawmaterials

Production

Consumption

Wastes

TIMETOCHANGE! REPAIRFIRST,THENRE-USEANDFINALLYRECYCLE!

INDUSTRIES

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Case Study

Investinconfectiononfixablesproducts

20engineers :conceptionofnewproducts lines

Stockof6millions sparepartsinlocalarea(Franche-Compté)

Fairpricetobeaccessibleforconsumers

Investinfive3Dprinters

8% Purchasingintentions

STRATEGY OBJECTIVES RESULTS

300newfixables productseachyears

Fix97%ofproductsforthe10nextyears

Plantofix500000productsin2016

6500repaircenters

GROUPESEB

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DON’t FORGET, You’RE THE MOST IMPORTANT !

Thanks for watching, Any questions ? Don’t hesitate !

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