J. Michael Jones, FACHE – Director of Medical

Sustainability

Mike Luvin – Director of National Accounts

Organization - Rubicon Global

Contracting for Waste Minimization –

Optimizing a Purchased Service Opportunity

Learning Objectives

Upon completion of this program, participants will be equipped to:

I. Evaluate and quantify the economic and environmental impact of their waste stream

II. Apply the principles of Environmental Innovation to their Sustainability and Waste programs

III. Reduce the cost, improve the quality, and positively impact the outcomes of their waste stream activity through reduction and recycling initiatives

• Scope of healthcare related waste

• Current state of commercial waste

services

• Environmental Innovation approach

• Initiative for Global Environmental

Leadership (IGEL) program at the

Wharton School of Business

• Methodology for changing the industry

Overview

• Healthcare expenditures will total 20% of the GDP by 2020

• # of U.S. Hospitals – 8,943 total (70% non-profit - 30% for

profit)

• Urban Hospitals – 5,365 - Rural Hospitals – 3,577

• Total # of beds in U.S. Hospitals – 1,183,146 (excludes

VA/208 facilities)

• Total estimated non-acute clinics – 170,000 (clinic, urgent

care centers, surgery centers)

Healthcare Economics

• Estimated 24 lbs. of waste is generated

per patient/day in acute care

• 80-85% of a hospitals waste stream

volume is Municipal Solid Waste &

Recycling – 50% of spend

• Estimated $10 billion in healthcare spend

on waste in 2009

Scope of the Waste Problem

• Traditional waste companies make money

based on frequency and tonnage sent to the

landfill or incinerator

• Landfills and incinerators are these

companies’ most profitable assets

• Environmental Innovation is the key to

shifting this paradigm

Current State of Waste

Industry Transformation Into a

Sustainable Ecosystem

Lower material

costs

Increased

sustainability

Reporting /

Transparency

Long-term revenue

visibility and maximum

asset utilization

Route-level profitability

driven by minimized

windshield time

Processing

In-depth / detailed /

holistic CSR

reporting

Full supply-chain

transparency /

tracking

Generatio

n

Re-useWater

Treatment

Composting

Haz Waste

Handling

Electronics

Handling

Plasma ArcMechanical

bio treatment

Mechanical

heat treatment

BiodryingAnaerobic

Digestion

Low

High

Transport

Buyer

High volume of

reusable or

processed materials

ready for resale

Lower waste-disposal costs /

new revenue opportunities from

production waste

Higher diversion / sustainability

• Environmental Innovation optimizes and manages waste streams with cost savings and sustainably sound solutions

• Environmental Innovation is “Asset Light” and doesnot involve the ownership of trucks, landfills, or incinerators and therefore is not required to utilize those assets to make a profit

• Environmental Innovation is dedicated toimproving economic efficiency and reducing landfilltonnage - zero landfill is the goal

Environmental Innovation

• Rubicon Global is an Atlanta-based privately held

company founded in 2008 with the vision to improve

waste efficiency and reducing landfill tonnage

• Rubicon currently services over 75,000 pickups

monthly from ~30,000 locations in the U.S., Canada

and Puerto Rico with a network of more than 4,300

haulers

• Rubicon currently employs over 150 team members

and was named as a “40 Fastest Growing Companies”

in May 2015 by Market Watch

About Rubicon Global

Nationwide Coverage

Current Locations

• 70% of revenue is generated within the retail

market – most of balance in grocery and

hospitality - moved into healthcare in 2014

• Notable Investors and Advisors include:

Broad Market Strategy

Prior ExperienceRubicon

Tenure

Years in

Industry

Lane Moore Co-founder &

Executive Chairman

7 years 9 years

Nate MorrisCo-founder &

Chief Executive Officer

7 years 7 years

Perry MossPresident

5 years 24 years

Mark ShaughnessyChief Operating Officer

1 year 1 year

Mary TrenchardVP Customer Advocacy

2 years 7 years

Atul NandaVP Customer Solutions

1 year 23 years

Mike LuvinDirector of National Accounts

1 year 15 years

J Michael Jones, FACHEDirector of Medical

Sustainability

1 year 23 years

Industry Experience

Customer Experience

Partners in Sustainability

As a certified B

Corporation, Rubicon

Global joins a league of

corporations that believe

business is the most

powerful way to create

change.

Through Rubicon Global’s

Clinton Global Initiative

(CGI) Commitment to

Action we will help over

4,000 small businesses in

the U.S. reduce the

amount of waste they

send to landfill.

We signed the United

Nations Global

Compact in October

2011. We are

committed to aligning

our operations and

strategies with ten

universally accepted

principals in the areas

of human rights, labor,

environment and anti-

corruption.

Experts at Rubicon

Global work with

customers to earn

maximum credits on

the LEED Rating

System in order to

achieve green building

certification by the U.S.

Green Building

Council (USGBC).

Rubicon Global is a member of

Enactus (formerly SIFE), an

international non-profit seeking to

create a better, more sustainable

world through the positive power of

business.

The Basel Action

Network (BAN) is the

leading global source

of information and

advocacy on toxic

trade and international

hazardous waste

treaties.

We joined the board of the Initiative

for Global Environmental

Leadership (IGEL) program at the

Wharton School of the University of

Pennsylvania to create an academic

partnership focused on market driven

approaches to sustainability.

• University of Pennsylvania Wharton School of Business

houses the Initiative for Global Environmental Leadership

(IGEL) to promote knowledge for business sustainability

• IGEL works with a diverse network to develop and

disseminate innovative research and business practices

• Goal is to use business actions to solve the most pressing

environmental issues facing our planet

• IGEL interfaces with academic, corporate, government, and

non-government organizations on a global scale

Wharton School and IGEL

• 2011 – Rubicon joined IGEL

• 2014 – Wharton special report “Disrupting the World’s Oldest Industry”

• 2015 – Joint poster presentation and booth at CleanMed 2015 conference

IGEL and Rubicon

• Signed and launched multiple small regional

health systems

• In launch phase with large regional IDN in the

southeast US

• In negotiation with largest healthcare GPO’s

• Partnered with Key Green Solutions, an

established healthcare market provider of data

tools and reporting

Healthcare Strategy

• Revise contracts with current vendors or move to new vendors

• Optimize collection services

• Initiate or enhance recycling and organics programs

• Focus on landfill diversion

Four Phases

• Compare healthcare service and cost data to pricing from current retail customers with similar services in same geography

• Estimate potential savings off current haul and disposal rates for phase one

• Validate pricing against typical cost per ton for similar portfolio of business

Pricing the Service

Implementation Timing

Customer Relationship Manager

Customer Operations Manager

Customer Advocate

Customer Advocate

Customer Advocate

Customer Advocate Lead

Dedicated Team for Each Client

• Daily Operational Service Fulfillment

• Inbound Calls / Outbound

Requests

• Service / Issue Resolution

• New Stores Openings/Closings

• Temporary/Emergency Services

• All Service Changes/Adds

• Voice of the Customer

• Client Relationship

• Contract Compliance

• Business Reviews

• Reporting

Service – Quality and Flexibility

Agreed Upon Efficiency and Diversion Targets

Route optimization and efficiency are continuously

monitored

Portal will flag locations where targets are not being met

for action plans creation

Hauler Quality Assurance

Vendor Scorecard

Invoice Audits

Automated through data analytics

Exceptions are researched and resolved within 24 hours

Category Detailed Criteria Weight

Price

Competitiveness

• Pricing is competitive

• Willing to offer fixed price with longer term MSA

Strategic

Partnerships

• Service area meets mutual growth outlooks

• Independent, instead of national, multi-service providers

• Local monopoly/OGIT (Only Game in Town)

• Willing to sign MSA to form long term relationship

• Willing to participate in B2B productivity programs (e.g. automatic confirmation

of services)

• Minority owned (important to some customers, e.g. governments)

• Developed processes for environmental compliance

• Credit history is in good standing per D&B rating

• IVR compliance. Automated service confirmation

Performance

• No missed pick-ups or stop services orders

• Price is consistent and complies with contract/agreement

• Invoice accuracy

• Can offer multi-level services (e.g. equipment, schedule flexibility, etc.)

• Has dedicated contact for Rubicon business

• Can provide after-hour emergency responses

• Payment terms meet Rubicon’s requirements

• Insurance coverage meets Rubicon’s requirement

IT Capabilities

• Can process invoice and payments electronically

• Capable of communicating via emails

• Has basic abilities of processing documents (MS documents, fax, etc.)

Vendor Scorecard

Data Analytics Description Detailed examples

Data

Analytics

• Full-time employees dedicated to

advanced analytics and creating

insights for our Customers,

Operations and Vendors

• Customer portals enable real-time

access to critical data for our

customers

• Group is focused on identifying

improvement opportunities for our

customers, such as rightsizing

• Proactive view of open

hauler invoices to avoid

service interruptions

• Savings over time

compared to historic

benchmark

• On-time customer billing

performance over time

Operations

Excellence

• Full-time employees dedicated on

improving operations of Rubicon

Global

• Focus of operational

improvements on areas with

impact on customers

• Application of formal Lean/six

sigma techniques to eliminate root

causes of challenges vs. curing

the symptoms

• DMAIC on reducing

service interruptions for

our customers

• Structured root cause

analysis for delays in

hauler invoice delivery to

Rubicon Global

• Development of detailed

standard operating

procedures for all

customer-impacting

processes

Insights:

• Rubicon Global

places large

focus on

providing the best

and most data-

driven customer

service in the

Waste &

Recycling

industry

• Our company is

also applying

industry-wide

best practices in

lean/six sigma to

the Waste &

Recycling

industry to

resolve the

largest pain

points for

customers

Data Reporting

• Rubicon manages more than 250,000 tons of cardboard from distribution centers and bale routes.

• Other fiber grades we market including: newspapers, office paper, slip sheets, boxboard cuttings, magazines, corrugated pallets and fiber cores.

• Market many grades of plastics including: film ( grades A,B,C), PET HDPE and mixed plastics.

• Thousands of tons of organic material diverted from landfill by developing and managing organics programs for our customers.

• Rubicon develops and manages programs for pallets, scrap metal, single stream and other challenging items for our customers.

Innovation - OCC and Plastics

• Solution: After thorough research, Rubicon Global’s Solutions Team identified a compost facility that needed the material for their composting process. This company also had open top walking floor trailers available for transportation.

• Results: Rubicon was able to negotiate a rebate for the material, reduce the transportation cost and reduce the trailer rental fee. In addition, the solution substantially decreased the carbon footprint.

• Benefit: 35% cost savings to Rubicon customer

Innovation - Organics Problem: A large door and window manufacturing facility in Virginia generates

approximately 120 tons per month of sanding particulate. This material was expensive to transport and dispose. To manage this material adequately, it is necessary to have four open top walking floor trailers to service the site.

• In June 2014, Rubicon helped to divert 350 plastic insulated seafood vessels (8 truckloads) from the landfill for one of our grocery partners.

• A partner and vendor of Rubicon Global, retrieved the units at no cost and marketed them for alternative reuse per their business model.

• A number of the vessels have been repurposed for use by wild game meat processors.

• Net Benefit: Avoided disposal cost & reuse of carts.

Innovation - Reuse

• Rubicon is testing a variety of technology on front load containers and compactors at our customer sites.

• Rubicon monitors data from the technology on a daily basis to track the amount of waste in each container.

• Collection schedules are modified to maximum efficiency and lower costs for our customers.

Innovation - Collection Technology

Industry Transformation Into a Fully

Sustainable Ecosystem

Lower material

costs

Increased

sustainability

Reporting /

Transparency

Long-term revenue

visibility and maximum

asset utilization

Route-level profitability

driven by minimized

windshield time

Processing

In-depth / detailed /

holistic CSR

reporting

Full supply-chain

transparency /

tracking

Generatio

n

Re-useWater

Treatment

Composting

Haz Waste

Handling

Electronics

Handling

Plasma ArcMechanical

bio treatment

Mechanical

heat treatment

BiodryingAnaerobic

Digestion

Low

High

Transport

Buyer

High volume of

reusable or

processed materials

ready for resale

Lower waste-disposal costs /

new revenue opportunities from

production waste

Higher diversion / sustainability

Rubicon

Process & IT

Platform

Upon completion of this program, you are now equipped to:

I. Evaluate and quantify the economic and environmental impact of your waste stream

II. Apply the principles of Environmental Innovation to your Sustainability program.

III. Reduce the cost (average 20%), improve the quality, and positively impact the outcomes of your waste stream activities through optimization, diversion and recycling initiatives

Review of Objectives

Questions

J. Michael Jones, FACHE

Director of Medical Sustainability

C (615) 232-4197

Michael.Jones@RubiconGlobal.com

Mike Luvin

Director of National Accounts

C (636) 222-3470

Mike.Luvin@RubiconGlobal.com

www.RubiconGlobal.com

Speaker Contact Information

• AHA Sustainability Roadmap website -http://www.sustainabilityroadmap.org/

• Rubicon Global website –http://www.rubiconglobal.com

• Wharton Special Report “Integrating Environmental and Human Health” http://knowledge.wharton.upenn.edu/special-report/integrating-environmental-human-health/

• Wharton Special Report “Disrupting the World’s Oldest Industry” http://knowledge.wharton.upenn.edu/special-report/garbage-disrupting-worlds-oldest-industry/

References