The View from the C-Suite: Waste Management CEO David Steiner

View from the C-Suite

The View from the C-Suite: Waste Management CEO David Steiner

Waste Management is well known as one of the biggest garbage companies in the country. The company serves nearly 20 million municipal, commercial, industrial, and residential customers through a network of 367 collection operations, 273 landfills, and 134 recycling plants.

Less than three years ago, Waste Management announced an ambitious plan to increase the value of the company's services while benefiting the environment. Their new tag line: "Think Green: Think Waste Management."

GreenBiz.com's Heather King talks with CEO David Steiner about reinventing business models, biofuels, Barbie dolls, and why Waste Management supports a zero waste future.


Heather King: Several years ago your executive team faced a paradox -- your company was in the business of collecting and disposing waste, yet your customers were asking for a zero-waste world. Tell us about your decision to "Think Green."
David Steiner, Waste Management CEO
David Steiner: Our larger industrial customers have been driving the change. They are motivated for environmental and for business reasons. Walmart was one of the first. They put out 450,000 pounds of trash a day. They are looking for innovative ways to reduce costs and recognized the potential value in their waste.

In contrast, the average household puts out 4 1/2 pounds of trash a day. Everything got started with the home customers 25 years ago. Communities told their politicians, "We want a recycling program." Now, companies are driving the market.

So we said, "The interest in getting value from waste is not going be isolated to Walmart; it's going to spread to all of our large customers and beyond. It's going to be big and we need to figure out how we can make money on it." We are doing just that.

HK: Historically the waste business has been about operational efficiency. Now it is about extracting value from waste. How is this changing your business model?

DS: It used to be that waste was a straight chain, from customer to us to landfill. Going forward, it will be a circular, closed-loop chain. Some waste may go to landfill, but much is going to come back as products.

HK: Does this require you to significantly alter your corporate culture or the skill set of your employee base?

DS: We are an environmental services company, not a research and development company. We are trying to find ways to convert waste into higher value. We've started to team up with smart people -- like the investors at Kleiner Perkins -- who also see opportunity in rematerializing waste. In a sense, we are a venture capital firm making investments in new technologies. Kleiner just started a waste and water segment. We co-invested in a company that can take organics and convert the organics to energy.

HK: So you are getting the talent and the resources you need through strategic partnerships and investments. What, then, is your greatest challenge?

DS: Frankly, we had buy-in throughout the company before the leadership team really "got it." Our employees interface with customers daily and were well aware of the market shift.

Our challenge is in scaling the recycling collection effort across the U.S. and Canada. We don't have recycling -- especially for organics -- in all of our markets. Organics is very fragmented; nobody has a national network of organics processing facilities.

HK: Does this mean you see a big opportunity in organics?

{related_content}DS: This is where it gets exciting from a business point of view. When you look at organics today, we are simply composting and reusing. It's a low-tech treatment and we extract marginal value.

It is our view that today's organics business is where gasoline was in the 1880's. Back then, gasoline replaced whale fat as lamp oil. It was an inefficient way to use oil and it created a lot of waste. Over time, more value was extracted from gasoline through different technologies and applications.

Organics has similar potential. We believe that when we break organics into its constituent parts, and extract 100 percent of its energy content, it will be extremely valuable. We want to own that waste stream.

HK: Looking forward, you have set specific goals, such as tripling the amount of recyclable material by 2020. What will Waste Management's business look like ten years from now and how will you measure your success?

DS: I see us as an environmental solutions provider. Today, there is one company for solid waste, another for recycling, and another to deliver reuse. We want to be the one place that you come to for these environmental solutions.

I also see us moving from waste management to materials management.

We are working with our customers to redesign whole product lines for recycle-ability. For example, Mattel makes the very iconic Barbie doll. They came to us for help: "We want our Barbie doll to be environmentally friendly, but we just don't know how to do it."

We are helping our customers at the front end of their process, so that we can have a closed loop chain at the back end. We are making money in a number of links in the chain. And the beauty of it is that, at the same time, we're helping to save the planet.

Heather King is a producer, writer, strategist and executive-in-residence. Her primary focus is on clean technology, corporate sustainability, and new media. She writes the "View from the C-Suite" column for GreenBiz.com.