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Addressing the Weak Points of Supply Chain Sustainability
14 Jul, 2022
For companies looking to improve their environmental footprint, the supply chain is one of the best places to start. The various parts of a supply chain, including manufacturing, transporting, raw material gathering, and distribution all contribute to an organization’s carbon footprint. Optimizing each step in the supply chain can help reduce that footprint and improve the company’s overall green rating.
Unfortunately, while many organizations set goals for improving supply chain sustainability, many fall short of achieving their plans. Supply chain optimization isn’t easy – supply chain optimization with environmental consciousness in mind is even more challenging.
There are steps that organizations can take to move the needle in the direction of sustainability. These strategies can be tackled independently or all at once to effect the change the organization seeks.
Step 1: Assess Current Partnerships
The suppliers you choose to work with play a major role in your supply chain’s sustainability. The efforts your suppliers take to reduce their carbon footprint will cascade down into your own initiatives.
With that in mind, it is important to assess your suppliers’ environmental profiles and their sustainability policies. If any of your supplier partners lag behind your own environmental initiatives, it may be time to have a difficult conversation.
Step 2: Explore New Partnerships
Adding new suppliers who have demonstrated a solid environmental track record to your supply chain can help drive your own sustainability efforts forward. While this isn’t always easy, shifting your business to more sustainable suppliers can provide a boost toward your goals.
When signing new supplier agreements, consider adding sustainability policies into your supplier contracts and holding any supplier who fails to abide by these policies accountable. Work with your legal team to identify the best strategies for incorporating these policies, and identify KPIs that can be tracked to gauge the supplier’s efforts to adhere to the sustainability contract.
Step 3: Leverage Data and Technology to Improve Your Environmental Efforts
As with any other aspect of your business, data is vital to your supply chain sustainability efforts. Identifying data points to track and analyze over time can help you gauge your progress toward your sustainability goals.
This may be easier said than done, however, as tracking your environmental impact isn’t always as easy as tracking other performance indicators. For instance, tracking your company’s emissions or raw material consumption isn’t as easy as tracking the number of items manufactured or sold. Leveraging technology like IoT sensors can help support the collection of this crucial data.
With these datapoints in hand, you can begin to adjust every aspect of your supply chain, from research and development/design all the way through production and delivery.
Contact us to talk about supply chain sustainability
Supply chain sustainability is a lofty, but attainable goal. Reducing the environmental impact of your supply chain isn’t easy, but it is possible with the proper strategy, data and technology. HSO is here to help support your supply chain sustainability efforts. Contact us to learn more.