Sustainability concerns are springing up in countless industries. A growing number of consumers prefer businesses that are dedicated to environmentalism, and companies are striving to address their concerns while improving internal systems.
Failure to embrace a comprehensive approach to the issue can cause companies to fall short in their efforts. The most effective efforts at sustainability originate through a holistic transformation of the supply chain.
Eco-friendly practices affect multiple areas of the business, of which product development is just one. The various stages of production offer supply-chain managers plenty of flexibility in incorporating green methods. Sourcing, packaging and transportation all have tangible effects on the environment, but they don't have to be adverse. Green supply-chain management (GSCM) can resolve many issues surrounding commercial manufacturing techniques.
GSCM encompasses every level of the supply chain, from product concept to distribution. Core strategies include closed-loop manufacturing, reduction of fuel emissions, and ethical sourcing. The effort enables manufacturers to save money on energy-intensive production processes, waste disposal and much more. While the incentives are enough for most to make the switch, some businesses employ GSCM solely for its environmental benefits. A world leeched of its resources won't turn a profit for anyone — nor can it sustain life. Responsible product development protects the earth by reducing ecological strain.
GSCM is adaptable across virtually any industry. There's always a better, greener way to obtain materials, package goods, or ship products to customers. Success, however, hinges on the adoption of sustainable techniques companywide, as well as with all suppliers. Departmental initiatives won't make much of a difference in a company that is on balance unsustainable.
Getting started requires knowledge of the methods and how to execute them. Green trends are catching on within supply-chain management and transforming how the industry operates. Here are a few current strategies, along with how they've worked for various companies.
Ethical sourcing involves a focus on human, animal and environmental wellness. Sustainability centers on social and economic health, as well as environmentalism. For a material to be truly sustainable, suppliers must obtain it by respecting human harvesters and natural resources. Humane sourcing techniques can range from raising farmers' wages and providing paid maternity leave to practicing selective tree harvesting.
The Dr. Pepper Snapple Group promotes ethical sourcing through a code of conduct that extends to all suppliers. They are required to obtain materials legally and safely by meeting DPS’s quality standards. Conflict minerals can't be present in any materials, and suppliers must follow nondiscriminatory guidelines in hiring workers. DPS analyzes each supplier using assessments such as the UN Human Development Index to prevent human rights violations.
Sustainable materials that limit resource depletion lower acquisition costs and minimize carbon emissions. Examples in the construction and textile industries include bamboo, Tencel, linen and cork. All are either renewable or require less power to harvest and create. A material's embodied energy is directly related to how much is needed to create it, from procurement to refinement. Green manufacturing lowers the embodied energy, minimizing environmental impact.
Unsustainable product processing calls for a lot of power, and it can also prove hazardous, depending on the method. Manufacturers use many chemicals to dye fabrics, preserve foods and create building materials, and while not all are safe for consumers or workers to inhale or ingest, they still make it into everyday products. Detoxification is a component of GSCM that diminishes the presence of toxic elements.
The textile industry has often come under fire for contributing to toxic pollution. In response, Greenpeace developed the Detox My Fashion campaign to end the use of chemicals in clothing production. Numerous companies have signed on and cleaned up their supply chains as a result, including Burberry, Nike and Puma.
Reverse logistics systems address how companies handle products once they fulfill their purpose. GSCM encourages recycling and reusing, though products might undergo other disposal methods if recycling isn't possible. Companies refer to this strategy as a closed-loop system, involving materials that go out and come back for repurposing. Customers return defective or recycled products to the manufacturer, and these become either waste or a new item.
The Sierra Nevada Brewing Co. uses a closed-loop system by composting its food waste into nourishment for its on-site gardens. It grows barley and hops on the land. The company claims to have diverted 99.8% of its waste from landfills by implementing this sustainable program and reversing the supply chain.
JIT supply-chain management involves placing materials in the right place at the right time. Manufacturers only bring in as many supplies as they need to avoid excessive inventory. JIT lets companies avoid overspending on materials and overfilling their warehouses. The strategy takes practice to employ, but can streamline production when executed correctly. Data analysis is a major component, given that managers must forecast consumer purchasing trends to meet demand.
Toyota employs this method with vehicle production by following a specified set of guidelines. The company combines JIT with jidoka, a system that efficiently prevents defective vehicles from leaving the facility. As a result, Toyota designs cars in the shortest time possible while maintaining the highest level of quality.
Transporting goods over long distances contributes to greenhouse gas emissions by burning fossil fuels. GSCM calls for the use of alternative fuels and the establishment of localized supplier and manufacturer relationships. To employ the strategy, some companies will need to downsize and procure materials from fewer sources. They must consider how they can adjust their products and packaging to accommodate new suppliers.
Improving modes of transportation can pose several complexities. Most modern means of transportation release emissions to some degree, and green alternatives aren't always widespread or accessible. The Environmental Protection Agency developed its SmartWay initiative to address the issue. It helps manufacturers select sustainable freight carriers, track emissions and employ fuel-saving tech in moving goods.
Certification from LEED, Green Globes, Energy Star and similar initiatives guarantees a company's commitment to sustainability. They require organizations to meet extensive criteria in measuring adherence to green practices. Supply-chain certification ensures that businesses employ eco-conscious methods by gauging and improving their current production methods.
Canon recently received a top rating from the China Environmental United Certification Center for its green supply chain. By detoxifying manufacturing methods and implementing reverse logistics, the company has achieved a 37.7% improvement in greenhouse gas emissions since 2008. It continues to minimize its impact by following the Sustainable Development Goals established by the UN.
Implementing GSCM has made numerous companies active contributors to ecological preservation and conservation. They've increased their bottom lines by dialing back on wasteful practices and funneling those funds into high-quality product management. More businesses can become leaders in sustainability and innovation by adopting GSCM.
Jenna Tsui is a technology blogger at The Byte Beat.