Executive Briefings

Embedding Sustainability in a Supply Chain Organization

Sustainable business is about driving better business value at the same time as you're driving improvements for the planet, says Cynthia Wilkinson, director, supply chain sustainability, Staples Inc.  That means energy efficiency and reduced packaging, among other things. But none of that will happen unless the culture of your business is aligned with the "green" vision.

Sustainability initiatives save money, Wilkinson says, but that alone won't such programs a success. She says it's important to make things easy, for the customer and for the company. "For example, we have ways on our web site for customers to easily identify sustainable products. Our customers want to understand what's important and relevant for them."

Additionally, companies collaborate both internally and externally, and it's important for all employees to recognize and be supportive of green goals. It's equally important for suppliers to know what's expected of them from an environmental standpoint.

Nevertheless, things are always fluid, Wilkinson says, because new information seems to come out daily. "We want to understand that and know how to make that work for us."

Staples has been quite successful in its goals, she says. "I think we've done a great job, particularly within the supply chain, on energy. We've had significant reductions in our energy intensity per square foot. We've saved lots of money in that way. We also have done a lot with recycling. So in our own operations, we're looking to move to zero waste.

"We recycle pallets and stretch wrap, corrugate and other materials, and we're continuing to drive that even further. Also, we have done tremendous work on our fleet, and our fuel efficiency has improved over 30 percent."

But what are the hurdles? "The first thing is economics, making it financially a win as well as a sustainability win. That's a large challenge. When you ask people if they think green is more expensive, a lot of people think so, but it doesn't need to be.

"We have not changed our hurdle rate for our financial decisions. We make these projects fit our hurdle rate. You can definitely drive the economic benefits with the sustainable benefits."

Wishing doesn't make it so. A solid strategy needs to be in place, especially once the low-hanging fruit has been accounted for, Wilkinson says. Staples wanted to save on energy, and it did. But that was an easily achievable goal. "It gets harder when you dig in deeper, so that's when you want to probably establish a strategy for your company in terms of how to drive sustainability within the organization."

Be creative and look at things on a portfolio basis. Initiatives that work in one area should be applied across the board and throughout the company network.

Analysis can reveal some surprising things, Wilkinson says. "As we looked deeper, we recognized that we'd been spending a lot of effort on our own operations - on energy, fleet efficiency, etc. - and what we found is that the largest share of our greenhouse gas was coming from products that we sell. So we've shifted focus a little bit.  We're still making energy improvements and recycling,but we're also looking to drive improvements in our packaging and in our products because that's where the impact is."

Moreover, you need to make customers understand the impact of the products they buy.

To view video in its entirety, click here

 

Sustainable business is about driving better business value at the same time as you're driving improvements for the planet, says Cynthia Wilkinson, director, supply chain sustainability, Staples Inc.  That means energy efficiency and reduced packaging, among other things. But none of that will happen unless the culture of your business is aligned with the "green" vision.

Sustainability initiatives save money, Wilkinson says, but that alone won't such programs a success. She says it's important to make things easy, for the customer and for the company. "For example, we have ways on our web site for customers to easily identify sustainable products. Our customers want to understand what's important and relevant for them."

Additionally, companies collaborate both internally and externally, and it's important for all employees to recognize and be supportive of green goals. It's equally important for suppliers to know what's expected of them from an environmental standpoint.

Nevertheless, things are always fluid, Wilkinson says, because new information seems to come out daily. "We want to understand that and know how to make that work for us."

Staples has been quite successful in its goals, she says. "I think we've done a great job, particularly within the supply chain, on energy. We've had significant reductions in our energy intensity per square foot. We've saved lots of money in that way. We also have done a lot with recycling. So in our own operations, we're looking to move to zero waste.

"We recycle pallets and stretch wrap, corrugate and other materials, and we're continuing to drive that even further. Also, we have done tremendous work on our fleet, and our fuel efficiency has improved over 30 percent."

But what are the hurdles? "The first thing is economics, making it financially a win as well as a sustainability win. That's a large challenge. When you ask people if they think green is more expensive, a lot of people think so, but it doesn't need to be.

"We have not changed our hurdle rate for our financial decisions. We make these projects fit our hurdle rate. You can definitely drive the economic benefits with the sustainable benefits."

Wishing doesn't make it so. A solid strategy needs to be in place, especially once the low-hanging fruit has been accounted for, Wilkinson says. Staples wanted to save on energy, and it did. But that was an easily achievable goal. "It gets harder when you dig in deeper, so that's when you want to probably establish a strategy for your company in terms of how to drive sustainability within the organization."

Be creative and look at things on a portfolio basis. Initiatives that work in one area should be applied across the board and throughout the company network.

Analysis can reveal some surprising things, Wilkinson says. "As we looked deeper, we recognized that we'd been spending a lot of effort on our own operations - on energy, fleet efficiency, etc. - and what we found is that the largest share of our greenhouse gas was coming from products that we sell. So we've shifted focus a little bit.  We're still making energy improvements and recycling,but we're also looking to drive improvements in our packaging and in our products because that's where the impact is."

Moreover, you need to make customers understand the impact of the products they buy.

To view video in its entirety, click here