Case

Strategic Environmental Management (SEM)

NATIONAL POLLUTION PREVENTION CENTER FOR HIGHER EDUCATION

The Deluxe Corporation’s PrintWise System: An Innovative Solution to a Long-Standing Environmental Problem

Written by Alfred Marcus, Professor of Strategic Management and Organization, and Donald Geffen, Research Associate, University of Minnesota.

With a market share of over 50%, Deluxe Corporation was the largest printer of checks and related financial forms in the United States. The lithographic printing process the company had been employing at about 50 facilities in the U.S. resulted in significant volatile organic compound (VOC) emissions regulated by the Clean Air Act. Although conventional inks contained VOCs that contributed to the environmental problem, Deluxe’s main concern was the VOC-rich solvents used to clean the presses. As a check printer, the company received an enormous number of small orders: more than 100 million a year. This resulted in frequent runs, which required frequent replacements of the lithographic plate. After each change, the “blanket” (the roller that takes the image from the plate and transfers it to the paper) had to be cleaned with a volatile solvent. This combination of petroleum based inks and solvents made Deluxe a “major emitter” of VOCs under the Clean Air Act, and complying with its increasingly stringent requirements was projected to result in higher production costs. At the same time, the long-predicted slowing of demand for printed check forms was taking place. Credit cards, debit cards, and ATM machines were replacing a growing percentage of the checks heretofore used by consumers to make purchases and pay bills. Adding to the check printer’s problems was the consolidation taking place in the banking industry. Mergers and acquisitions and lessening banking regulation were creating larger, multi-state banks with enhanced bargaining power with their suppliers. Well aware of these long-term trends, the Deluxe...