Justifying the LED light bulb

An article in the Wall Street Journal (Nov 30, 2011) describes the calculation being done by companies like WalMart as they switch to light bulbs made from light emitting diodes (LEDs), which last potentially 10 times longer than regular light bulbs but cost up to 20 times more.  One important component, the reduced maintenance costs associated with changing bulbs, estimated as $ 50 per bulb replacement at the Intercontinental Hotel in San Francisco.  While the prices of LED bulbs are expected to drop, the article suggests that inclusion of the savings in maintenance can justify installing LEDs bulbs immediately.  Should similar savings in operating costs be an essential part of justifying sustainable technologies ? Will the benefit from proactive companies that use such a “supply chain view” justify the cost reductions necessary for widespread adoption ? How should firms be incented to broaden their perspective to justify adoption ?

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About aviyer2010

Professor
This entry was posted in Operations Management, Supply Chain Issues, Sustainability and tagged , , , , . Bookmark the permalink.

One Response to Justifying the LED light bulb

  1. ensustain says:

    Definitely, one of the keys to sustainability is cost savings.

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