Supply Chains and Sustainability, A Natural Match

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Though there is still a misconception that supply chain issues only affect manufacturers, third-party logistics firms, and suppliers of raw materials, supply chain issues probably affect your business. If you purchase supplies in the course of your operations, or if you add value to something and pass it downstream, you should probably be aware of your supply chain.

In that vein, here are two articles talking about supply chains. The first is about supply chains and sustainability initiatives, and discusses the reason why companies are greening their supply chains: ROI. The second talks about increasing visibility along the supply chain, which isn’t overtly about sustainability, but if you replace each idea with sustainability, it works.

This article from Environmental Leader is noteworthy, not only because it has a useful chart of the most valuable greening initiatives along a supply chain, but also because of a hidden gem: that the primary reason companies are making their supply chains more sustainable–ahead of ROI, even–is for better customer relations. Customers are starting to expect and demand it.

The other article, from the Global Transportation Management newsletter, talks about how improving visibility and transparency along the supply chain can improve operational efficiency and effectiveness. If you’re not convinced it’s directly transferable, some of the tips are translated more plainly for you below:
1. There is no one-size-fits-all model for sustainability.
2. Have a central hub where sustainability efforts are tracked and measured. This ensures efficiency and continuity.
3. Don’t assume your data are perfect; you could be missing a big part of the picture.
6. Increase transparency and informational linkages as far back to the source as possible.
7. Once you know as much as you can, track your suppliers’ performance on sustainability. If they can’t perform, shop around.
8. Track carbon costs along the chain. This should go without saying. If you know what the impact of your business is along its chain and at each stage, then you can manage and improve it.

Knowledge is power, and managing your supply chain well is one of the easiest ways to reduce your footprint as a business. Moreover, as noted time and again, it’s one of the easiest ways to see dramatic financial benefits.

Stacie Nagy is currently pursuing an MBA at the Jenkins Graduate School of Management at NC State University, with a dual concentration in Supply Chain Management and Consulting & Services Management. She is vice president of her school's chapter of Net Impact. Prior to returning to school, Ms...
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