Supply Chain with Sustainability

Efficiently Managing a Supply Chain with Sustainability in Mind

Supply chain efficiencies can save companies big; they save time, money, and other resources. Managing a supply chain effectively and efficiently can lead to more sustainable operations, as well.

Why is Sustainability Desirable in Managing a Supply Chain?

The benefits of a sustainable supply chain are trifold. First, a more sustainable supply chain may be able to reduce man hours. Second (and in combination with the first point), sustainability may mean cutting costs. Third, sustainability is, well, sustainable. More effective supply chains save resources, reduce waste, and pander to their customer base with their eco-friendly ways.

Practices that drive sustainability can mean improving the bottom line while reducing your supply chain’s carbon footprint. Who can argue with that?

Certainly not consumers. In the past decade, consumers have become more conscious of where their ‘stuff’ comes from and how it got there. Companies with a track record for environmentally responsible practices appeal to this consumer class.

Here are some steps you can take to create a more sustainable supply chain.

Assess Your Culture

Sustainability isn’t something that can be enacted only on the stakeholder or managerial level. In order to work smarter and improve overall production, everyone needs to be working toward a more sustainable supply chain. Start by mapping your supply chain so you can see where sustainability efforts will be most effective, then promote those efforts across every department and at every level.

Get Your Suppliers on Board

Taking steps in-house is important, but a truly sustainable supply chain isn’t feasible without supplier compliance. Let your suppliers know your goals and work with them on how they can help you achieve them. Share expectations for packaging, more intuitive order filling, and more sustainable transportation. Select suppliers based on their sustainability efforts and compliance with your expectations.

This type of collaboration is beneficial upstream and downstream; sharing your sustainability practices can have a ripple effect, leading to more eco-friendly supply chains everywhere.

Use Tech for Managing a Supply Chain Sustainably

There are countless tech solutions, from AI to IoT and beyond, to help your supply chain use less and function more efficiently. The collection and analyzation of data has never been more efficient and effective. Utilizing smarter warehouse management systems, transportation management systems, and superior routing software can mean huge potential savings.

Keep Aiming Higher

There’s no such thing as ‘too sustainable’, and there’s always room for improvement. Track your sustainability efforts and continue to set new goals as your operations improve. Managing a supply chain isn’t a stagnant endeavor, it’s an exercise in constant improvement.

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Independent research shows that improved supply chain management can yield:

  • 25 – 50% reduction in total supply chain costs
  • 25 – 60% reduction in inventory holding
  • 25 – 80% increase in forecast accuracy
  • 30 – 50% improvement in order-fulfillment cycle time
  • 20% increase in after-tax free cash flows
  • Supply Chain Mapping

  • Review Market Conditions

  • Determine Operational Inefficiencies

  • Outline Opportunities

  • Implement Changes

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