2 Printed on paper that contains at least 20 percent postconsume

Going Paperles

With Technolog

Going Paperles

With Technolog
y yg

■ Computerized documents and filing systems—

Several WasteWi$e partners have placed phone directories, human resources documents, and corporate

policy manuals on line to avoid constantly updating

paper versions. Others are using electronic filing systems to reduce the amount of paper copies made in 

the office.

■ Electronic data interchange (EDI)—EDI is the

electronic transfer of business information in a structured

format from one computer to another. It is a high-speed

method of electronically communicating large volumes

of data without the use of paper. For example, rather

than sending paper purchase orders and invoices

through the mail, WasteWi$e partners are investing in EDI to carry out these transactions 

electronically.

■ CD/ROM and other interactive tools—

CD/ROMs have enabled WasteWi$e partners

to store vast quantities of information, much

more than would fit on an ordinary floppy disk,

in an easy-to-use, interactive format.

In addition to reducing paper use, these emerging technologies also improve efficiency, saving time usually needed

to process paper forms. These benefits ultimately mean

increased savings for a company’s bottom line.

This issue highlights WasteWi$e partners’ experiences

implementing electronic technologies that conserve paper.

We look at their successes and the ways in which they’ve

overcome some typical concerns, such as the length of time

needed to implement EDI and costs of purchasing software

and training employees to use the technology. In addition,

some WasteWi$e partners have found that suppliers or customers might also need help adjusting to new technologies.

In this issue, we examine an on-line purchasing catalog

implemented by Silicon Graphics, which the company estimates conserves 500,000 pages of paper per year, and illustrate how Haworth has conserved paper by placing its

product catalogs on a CD/ROM. We also showcase the cos

and paper savings Phillips Petroleum and the Southern

Company have achieved through their use of EDI. In other

articles, we see how BellSouth Telecommunications and

Lockheed Martin achieve the benefits of computerized docu

ment storage.

WasteWi$e congratulates its partners on all the ways

they’ve used technology to conserve paper and increase efficiency. Along with their other benefits, paper-free technologies offer another opportunity to be WasteWi$e.
Q. What is Electronic Data Interchange?

A. EDI is the electronic transfer of business information in a

structured format from one computer to another. EDI is

just one piece of a puzzle known as electronic commerce,

which encompasses such activities as electronic mail, faxing, sharing information via networks and bulletin

boards, bar coding, scanning, and imaging. Companies

typically use EDI for purchase orders and invoices. Other

applications include shipment notification, check

issuance, and electronic transfer of funds; there are literally hundreds of uses for EDI. 

Q. When was EDI first introduced? When did it

start becoming so popular?

A. In 1975 the transportation industry became the first sector to replace paper transactions with EDI. Since 1987

EDI expenditures have grown 20 to 30 percent annually.

EDI is now a $2 billion industry.

Q. Why do companies switch to EDI?

A. EDI systems have proven themselves to be much more

efficient and accurate than paper systems, giving companies a competitive edge. Research indicates that the vast

majority of the companies switching to EDI have no

choice if they want to stay in business—their principal

customer or supplier told them to switch!

Q. What cost savings can I expect from using EDI?

A. Depending on the size of your company, you can expect

to save $1 to $5 per document. Dan Ferguson, president

of The EDI Group, Ltd., a company specializing in electronic commerce education, explains, “These dollar savings are a result of eliminating redundant processing

steps, eliminating paper, and reducing the amount of

labor required to conduct the transaction.”

Q. What other benefits can I expect?

A. According to the 1994 survey, companies switching to

EDI can expect to see a better than 50 percent decrease

in error rates and an average 40 percent or greater

decrease in total transaction time. With all of these bene

fits, you probably also have happier customers.

Q. What are the components of an EDI system?

A. Typical EDI systems consist of three main components

(1) EDI translation software to generate, receive, and

interpret transacted information. (2) Hardware, including computers (mainframe, mid-range, or personal),

modems, printer, and storage device. You may be able to

use existing equipment, with upgrades as necessary. (3)

Access to and continued support from a network

provider that will transport your EDI information.

Q. What are typical EDI start-up costs?

A. Initial start-up costs can be quite high. Ferguson estimates that the cost to set up a typical EDI system averages $10,000 on a personal computer platform; $50,000

on a mid-range platform; and $100,000 on a mainframe

platform. Adding the substantial costs of researching,

pilot testing, and training employees on the new system

can drive costs much higher.

(Continued on page 1
ing more than 2,000 sales-related documents (e.g.,

sales bulletins, price lists, forms, planning guides,

fabric samples, and video clips), salespeople have a

wealth of information at their fingertips. Haworth

estimates that if all of the information contained on

one SourceBook CD were printed, the stack of paper

would be 6 feet tall and weigh 400 pounds. 

costs Haworth more than $1 million annually. Over the ne

few years, Haworth plans to discontinue printing much of

this literature, with the goal of decreasing its annual budget

for reprints by 40 percent by the year 2005.

■ Higher-quality client presentations. Rather than cutting

up glossy catalogs to create presentations, the salespeople

now custom design client presentations on the computer

complete with full-color graphics. This conserves paper

and avoids discarding cut-up catalogs.

■ Greater customer satisfaction. Response time to customers’ questions has decreased since all of the informatio

that salespeople need (e.g., prices) is at their fingertips.

■ New training opportunities. SourceBook serves as a good

training tool for both new employees and customers; it depic

company activities and products. For example, one SourceBoo

video clip explains how Haworth makes wood veneer office

furniture and describes the different types of wood available.
ypp

sion of SourceBook.

Haworth released SourceBook to its 350 independent dealers

in February 1995. The company’s 260 internal market managers were up and running with laptop computers equipped

with SourceBook in November 1995. In early 1996, Haworth

began targeting the first documents for printing reduction.

Haworth currently provides monthly updates of the

SourceBook CD to its dealers and market managers. These

salespeople retain the old CDs as a reference library for historic prices, product lines, and video clips. 

Challenges Take Time to Resolve

As with the introduction of any new technology, Haworth

encountered some challenges during the project. Timing was a

crucial issue. Many of Haworth’s marketing activities are conducted by outside, independent dealers of office furniture as

well as internal Haworth employees, known as market managers. When the company introduced SourceBook in February

1995, both the independent dealers and Haworth’s market

g , ppp

take time to fully adjust to this new technology.”

Haworth’s Electronic Horizon

Haworth is continuously making improvements and

expanding upon its original idea. Currently one-third of the

SourceBook disk space is consumed by video clips, such as an

11-minute interview with G.W. Haworth, the company’s

founder. In April 1996, Haworth expects to have enough vide

for an entire CD/ROM, which will be used for both training

and marketing purposes. The company is also in the process o

electronically scanning fabric and finishing swatches, which

eventually will be contained on a separate CD/ROM.

Each page of a SourceBook document is currently format

ted as if it were a standard piece of paper. Once the need to

print the information decreases, Haworth will be able to

improve SourceBook formatting, making it more compatible

with the electronic medium.

Evans notes, “We continue to learn new things that

SourceBook can be used for. It adds value to the company.”
and enable employees to search for specific information.

To ensure that Lockheed Martin’s corporate policies

and procedures are kept confidential, the network is protected with a firewall. Only Lockheed Martin employees

and authorized guests are able to access the network.

“The Internet has proven to be a cost-effective and

timely way to distribute corporate policies and procedures,” says Nancy Corder, director of corporate policies

and procedures at Lockheed Martin. Using the Internet to

distribute information has helped Lockheed Martin lower

business costs by reducing staff time spent accessing information and the use of paper products. While Lockheed

Martin does not track the number of documents pulled

off the Internet, the company believes the associated

paper savings are tremendous. Mailing just one 100-page

policy manual to each of the 80,000 employees connected

to the network would cost the company more than

$250,000 in postage and paper costs. 

Especially helpful in reducing paper costs is the

Internet’s ability to incorporate and disseminate changes

to documents on-line. Instead of printing and distributing hard copies of revised policies and procedures,

changes to documents can be made without using a 

single sheet of paper. In

addition, the network

can send on-line

memos to employees

alerting them of any

recent revisions

to documents.

A

WasteWi$e partner Phillips Petroleum Company

has saved almost $250,000 in paper, envelopes,

and forms over seven years and conserved 210,00

pounds of paper. The company, headquartered in

Bartlesville, Oklahoma, reaped these rewards by changing the

way it does business with its suppliers. 

In 1989, Phillips began paying a few of its major supplie

electronically (i.e., transferring funds via computers rather

than paper checks). Since then, the company has expanded

its use of electronic fund transfers to make an estimated

615,000 payments, or 35 percent of Phillips’ total payment

annually. Start-up costs were low as Phillips developed the

program through a partnership with its bank. The company

believes that implementation costs, including a $25,000

annual maintenance fee and $80,000 for an EDI translator,

have been offset by the cost savings.

The company is currently expanding its use of technolog

in two ways:

■ Encouraging major customers to replace check payments with electronic fund transfers. Instead of sendin

checks each month, customers can save paper by transfer

ring money to Phillips electronically. Presently, 75 major

customers are making 300 payments each month.

■ Replacing paper purchase order forms with electronically transmitted requests. When ordering paper, for

example, rather than filling out a purchase form and mai

ing it to Phillips’ paper supplier, the company can communicate via computer with the supplier to place an orde

Some 126,000 purchases have been made via computer

order since 1990.

Phillips’ use of these technologies has not only saved mon

and reduced waste, it has also improved efficiency. Transferrin

money and purchase orders electronically reduces the time an

effort formerly spent to process paper checks and forms. 
alone.

Previously, the Southern

Company requested price quotes for

transformers, cable, and other supplies and equipment via paper

forms and received a bid document

in response. Any negotiations over

price, quantity, and availability

required that documents be sent

back and forth between the company and its suppliers. This correspondence lengthened the

time and increased the cost needed to select a supplier. 

Today, the use of standardized EDI transactions cuts

processing time significantly. More than 312 suppliers use

utility-specific standards (known as ASC X12 EDI standards), which enable the company to send and receive

price quotes in a standard format. The ASC X12 standards

have been promoted by the Utilities Industry Group to

both utilities and their suppliers nationwide.

the company developed a conversion factor of $6 per EDI document based on a national survey of

EDI document costs and savings.

The Southern Company multiplied

the 20,000 quotes received last year

by $6 to calculate savings. To

implement the new system, the

Southern Company did incur network charges and technical service

costs. According to Choat, however, “With the cost savings

realized through EDI, the new system more than pays for

itself.”

An important benefit of the Southern Company’s electronic bidding process was the reduction of paper use.

Formerly, each quote averaged three pages, for a total of

60,000 sheets each year. Thanks to the new paperless system, the company now conserves approximately 600

pounds of paper per year. 

it speeds up the payment

process and minimizes the

need for paperwork”

Steve Choat, EDI Coordinator, Georgia Power,

Procurement and Materials, The Southern Company

Setting EDI Standards Industry Wide

The Utilities Industry Group (UIG), a national association of 163 utilities and 98 utility suppliers, was formed in

1987 to investigate the benefits of standardizing EDI transactions in the utility industry. In coordination with the

ANSI Accredited Standards X-12 Committee, UIG developed national guidelines that govern electronic transfer of

information throughout the industry, allowing participating suppliers and utilities to use the same system.

According to Mercedes Johnson, head of a UIG task force on environmental issues, standardization makes electronic

transactions easier for everyone in the industry. “For the utilities involved, the use of standard EDI procedures eliminates

mail and courier charges, improves production cycles, and reduces inventories, clerical workloads, and errors in on-time

data entry,” says Johnson. The suppliers’ process is also facilitated, because suppliers respond to utilities’ requests in a

standard format, rather than having to adapt to hundreds of different formats for processing requests. “The overall

result of EDI standardization has been the improvement of business efficiencies throughout the industry,” adds Johnson.
Now, the companys 11,000 employees can order

products and services electronically without leaving a

costly paper trail.

Breaking the Paper Chain

Early in 1994, WasteWi$e partner

Silicon Graphics, a leading computer

manufacturer, began investigating

opportunities to streamline its purchasing process and cut costs. The

company, based in Mountain View,

California, noticed that in just two

years the number of purchasing

transactions had increased by 90 percent, reaching 19,000

transactions. Ben Gardner, manager of Corporate

Purchasing, realized that he either needed to hire additional

people to handle the growing paperwork or reengineer the

purchasing process to become more efficient. He chose to

research electronic commerce opportunities and put these

technologies to work for the company. Results to date indicate that his instinct was right on target. As a result of the

purchasing system, Silicon Graphics has saved money, paper,

and time. According to Gardner, “In the upcoming year,

Silicon Graphics expects the project’s savings to reach $2.1

million.”

By replacing the multi-part paper forms with electronic

forms, Silicon Graphics conserved approximately 500,000

sheets of paper in just one year (60 to 70 percent of the paper

is unrecyclable carbon paper). This estimate does not include

the paper generated by supplier organizations. 

ees searched through paper catalogs and sent a paper form to

management for approval. The manager then sent each

approved form to the Purchasing Group. After logging in each

form, the Purchasing Group sent another form to the supplie

who sent back invoices and receipts. Finally, the Accounts

Payable Group cut and mailed checks, logging in forms at

every step of the process. Keeping track of an item in the pap

intensive process was time-consuming and frustrating.

Under Silicon Graphics’ new purchasing system, employee

browse supplier catalogs that are electronically linked to the sy

tem and fill out an electronic form. The system sends the form

via e-mail to the appropriate manager for approval. If the man

ager approves the request, the purchase order is transmitted to

the supplier via EDI. In the future, the system will allow digit

signatures to acknowledge receipt of materials, and electronic

invoices and payments. Employees will also be able to track th

status of an order at any point throughout the process. 

“Paperless forms are no longer just the

wave of the future at Silicon Graphics.

They are changing the way we do

business by saving the company

money, time, and paper today.”

Ben Gardner, Manager, Corporate Purchasing, Silicon Graphics
effectively and be compatible with suppliers systems.

Gardner notes that the most rewarding feedback from

users of the new system has been, “Hey you guys really listened to our advice. Thanks.”

Large Start-Up Costs Are Well Worth It

for the Future

Silicon Graphics attributes its ability to please all involved parties to

its long and in-depth review of

what users of the system needed.

The company’s motto throughout

the project was “If the system is not

fast, simple, and pretty, it’s not

going to succeed!” The biggest

obstacle the Purchasing Group faced was getting people to

understand the opportunities that electronic commerce

presents.

Although project start-up costs exceeded $1 million,

Gardner expects to achieve payback within nine months of

initiating the project. In the first year, the project has

already saved an estimated $200,000 for Silicon Graphics

and is expected to save $2.1 million in the second year as

the system is expanded to include additional purchasing

functions. Initial costs were high because they included all

of the efforts to research, design, develop, pilot, and

implement the system, as well as efforts to work with and

educate employees and suppliers. Now that the infrastructure is in place, however, Silicon Graphics can expand its

use of the electronic forms infrastructure into other company groups. 

● Research the current paper-based process from

womb to tomb.

Know the details from start to finish about where a

form is initiated and sent.

● Look at the entire chain of individuals involved with

the process including all customers and suppliers.

Identifying all links is critical to designing a successful system.

● Listen to everyones suggestions and concerns and

incorporate key ideas.

Understanding supplies, customer, and employee

needs helped Silicon Graphics design a system

that works.

● Dont be intimidated by the initial

start-up costs.

Once the infrastructure is in

place, the system can be

expanded to target other

areas where forms are

processed, providing

opportunities for additional savings.

Advice

From Silicon Graphics
WasteWi$e has 40 Endorsers, trade associations and other organizations, that have

pledged to promote WasteWi$e to their

member companies. Endorsers are

using a variety of approaches

to educate their membership on waste

reduction benefits. Consider, for

example, the approach used by the

National Automobile Dealers

Association (NADA), located in McLean

Virginia. In an effort to educate its

20,000 dealership owners about ways

to reduce waste and reap savings,

NADA developed the WasteWi$e

Management Bulletin. The Bulletin,

part of a series of educational guides for dealerships, is

an easy-to-use tool designed to help dealerships understand the waste they generate and develop a strategy to

reduce it. While most of the guides in the series have

focused on new regulations and standards, the

WasteWi$e Management Bulletin is the first to highlight

voluntary initiatives for protecting the environment and

saving money. NADA plans to advertise the availability

of the Bulletin in trade publications such as Automotive

Executive and Automotive News. 

According to Patrick Rowsey of NADA’s Legal and

Regulatory Group, NADA undertook this project because

“we are moving out of the era of command and control

regulations and into the world of voluntary partnership

programs like WasteWi$e that provide the flexibility for

companies to implement cost-effective environmental

management programs.” NADA hopes that by

educating its membership about voluntary programs, it can keep members on

the cutting edge and help them be

proactive about waste reduction. 

NADA researched dealership

wastes by surveying selected dealerships and performing a waste audit

at one dealership. Based on this

information, NADA developed a modified WasteWi$e goals form for use at

automotive dealerships, with sample activities under the waste prevention, recycling, and buying

recycled sections. For each recommended activity, NADA

explains how to implement it and discusses associated

benefits and considerations. 

For other WasteWi$e endorsers, developing similar

guidance might be a useful way to alert your membership to the cost-saving opportunities of waste reduction. 

will be able to join WasteWi$e via on-line registration.

Prospective members will simply enter the requested information on line, and e-mail directly to WasteWi$e.

■ On-line Distribution of Materials. Soon we will put the

WasteWi$e Bulletin and other materials on the home page

WasteWi$e email: ww@cais.net

Endorser Update:

NADA Helps Car

Dealers Be WasteWi$e
research, trends, opinions, and case studies written by

a variety of authors in the electronic commerce industry. For more information on this journal or The EDI

Group, Ltd., including courses and conferences, call

708 848-0135 or send e-mail to

dmferguson@attmail.com.

n Buyer’s Guide to Electronic Commerce.

Describes e-mail, EDI, and electronic commerce products and services; also available electronically. For

more information, call 770 951-2648 or send e-mail

to info@e-com.com.

n Internet links. Start with the home page of Premenos,

an EDI software company (http://www.premenos.com),

which will introduce you to many publications, web

sites, and e-mail addresses.

n Data Interchange Standards Association

(DISA). Located in Alexandria, Virginia, this not-forprofit organization provides education and information on EDI and electronic commerce. DISA also

sponsors one of largest annual EDI conferences and

exhibitions in the country. For more information, call

703 548-7005.

n Electronic Commerce World Institute. Located

in Montreal, Canada, this membership organization

offers a global perspective on EDI and electronic commerce, including current news from around the world.

The Institute’s web site (http://www.ecworld.org) offers

case studies, links to related sites, and other useful

resources. For more information, call 514 288-3555 or

send e-mail to institute@ecworld.org.

er to another. A new player is emergingthe Internet.

Debate still ensues over the strengths and weaknesses of

VANs versus the Internet. Only time and experience will

tell which one will ultimately serve more customers.

Q. What are the benefits of using VANs?

A. VANs offer years of EDI experience and implementation

support for their customers, including trouble-shooting,

communications monitoring, and policing for compliance

with EDI standards. VANs also provide a direct link

between computers, thus ensuring reliability, stability, and

availability.

Q. What are the benefits of using the Internet?

A. Internet accounts usually allow many hours of use at much

lower costs than VANs. The Internet also offers worldwide

access and rapid transport of information. Security and reliability are issues for EDI via the Internet. However, standards such as including encryption and digital signature

techniques are being developed.

Sources for EDI Questions and Answers

1. 1994 survey, conducted by the EDI Group, Ltd., results published in

EDI Forum, The Journal of Electronic Commerce, 1994, “The Real

Facts About EDI in 1994,” Daniel M. Ferguson.

2. Journal of Systems Management, March/April 1995, “EDI: An

Analysis of Adoption, Uses, Benefits and Barriers,” Vairam

Arunachalam, Asst. Professor of Accounting, University of Missouri,

Columbia.

3. EDI Forum, The Journal of Electronic Commerce, 1995, “The Internet:

A Strategic Backbone for EDI?,” Vince Hruska, Vice President, First

Interstate Bank in Los Angeles.

4. EDI Forum, The Journal of Electronic Commerce, 1995, “EDI on the

Internet,” Timothy Szal and Barbara Lloyd, Advantis.

5. Interview with Daniel Ferguson, president of The EDI Group, Ltd.,

Oak Park, IL, March 1996.
dollars, but thats precisely what BellSouth

Telecommunications (BST) has discovered. During 1994

and 1995, the company conserved approximately 16 million sheets of printout paper and saved $3.5 million by

implementing an electronic filing system.

BST’s system of storing reports electronically enables

that their reports are safe and accessible, explains

Poppell. To overcome this challenge, the company has

publicized the advantages of the electronic filing system in

its employee publication. BST also includes a note with

all printed reports that details how much paper an

employee could have saved by not printing the reports. 

1EPA

United States

Environmental Protection Agency

(5306W)

401 M Street, SW.

Washington, DC 20460

Official Business

Penalty for Private Use

$300

WasteWi$e would like to hear about your efforts to achieve a

“paperless office.” In addition, if you are not yet a WasteWi$e

partner and would like to join, please let us know. Benefits of

membership include technical assistance on waste reduction,

publications, a peer match program, workshops, and more.

Contact us at 800 EPA-WISE for more information.

We’d Like to 

Hear

from

You!=