Home >> Money Matters >> Greening the Supply Chain through Systems Thinking and Collaboration

Greening the Supply Chain through Systems Thinking and Collaboration

By Julie Urlaub

Sustainability has been described as a continuous improvement process that challenges business to balance organizational needs with the shifting expectations of their stakeholders. This balance can be demonstrated by a consumer rise in eco-friendly business, innovation, technological advancement, or mutually beneficial proactive change. While sometimes seen as an overwhelming landscape of potential improvement, a common thread of ‘collaboration’ can be seen through just about every potential business action.

Exploring this concept, an Industry Week post (1) offers insights related to, how to create value by collaborating inside and outside the organization. The article focuses its attention on the strained supply chain relationships emerging from the global economic recession.

More specifically, the authors examine the sustainability mindset shift and resulting actions required in today’s business environment: “Over the past 20 years, most companies have used strategic sourcing to restructure their supply bases and reduce costs. At times, the approach not only required confrontational relationships with suppliers…Today, reducing costs is no longer enough. Companies want value and they want their chief procurement officers (CPOs) to deliver it. How can CPOs get the job done? By first identifying and then collaborating with their key suppliers.”

Collaboration inherently includes a “systems thinking” approach. As the article A Green Supply Chain Takes a Systems Thinking Approach–And Patience (2) suggests, by viewing the supply chain in a systematic or holistic manner, “organizations can apply that “big-picture thinking” needed to be truly innovative. Doing so can create leverage points that companies never realized they had before with their suppliers.” Applying systems thinking through implementation and keeping with sustainable supply chain best practices, following are areas to be addressed:

Supply Chain Alignment. Evaluating business needs, market conditions, and sustainability value drivers (research/benchmarking) to improve supplier relationships or initiating sourcing.

Procurement Guidelines and Policies. Improving sustainable material selection and supplier manufacturing processes as part of supplier selection criteria.

Supply Performance Tracking. Establishing key supplier performance metrics to ensure continuous alignment with sustainability targets.

Supply Chain Efficiency. Reducing inventory levels on non-critical supply resulting in lower carrying cost, waste and material obsolescence across the entire supply chain.

Sustainable Logistics and Distribution. Refining transportation modes to make significant environmental and social impact reductions.

By adopting a systems thinking approach combined with supplier collaboration, procurement professionals can proactively address supply stability and quality issues from a different perspective. A common characteristic among leading business sustainability-minded companies is a willingness to assess and reassess dated business models and organizational structures. These groundbreakers recognize the speed and quality of their response to business sustainability opportunities and possible risks ultimately affects company profitability. As such, many recognize that social media can play a role in sustainable supply chain management (3) by reducing risk (4). Taking immediate action can get a business on the right track and can be as simple as evaluating the companies with which you partner. In fact, the true ‘business sustainability’ differentiator are those who understand and effectively mitigate the potential thwarters of supply.

No doubt, in the corporate world, most business leaders agree that achieving real bottom line improvements, whether through cost savings or improved revenues, is critical to business sustainability. Forward thinking organizations are harnessing the power of social media to effectively engage the outside world in the process. Through collaborative stakeholder engagement, your business can stimulate interaction, create alignment and ensure the most effective results.

endbug

Screen Shot 2013-11-19 at 6.50.31 PMJulie Urlaub is the Founder and Managing Partner of Taiga Company and the author of The Business Sustainability Handbook. Her popular blog, engaged Twitter following of 37,000+, and her large, loyal following on Facebook, Pinterest, and Google+ has garnered her recognition as one of the top resources and thought leaders in social media engagement for sustainability. Leveraging 15 years of business development and communications expertise in the Energy, Medical, and Information Technology industries, Julie now consults, writes, speaks, and advises clients on purpose driven communications in the social space, and is fast becoming the go-to speaker on social media and sustainability. For more information, visit www.TaigaCompany.com; on contact Julie on Twitter using @TaigaCompany.

 

SOURCES:

1) Industry Week, Time To Tell Your CPOs to Collaborate With Suppliers. http://www. industryweek.com/articles/time_to_tell_your_ cpos_to_collaborate_with_suppliers_25537. aspx?sectionid = 2% 2520guest

2) Valuestreaming, A Green Supply Chain Takes Innovation, Systems Thinking, Collaborative Approach—And Patience. http://valuestream2009.wordpress. com/2010/08/23/a-green-supply-chain-takesa-systems-thinking-approach-and-patience/

3)The Taiga Company, Social Media in Sustainable Supply Chain Management. http:// blog.taigacompany.com/blog/sustainabilitybusiness-life-environment/social-media-insustainable-supply-chain-management

4) The Taiga Company, Stakeholder Engagement Reducing Risk in the Supply Chain. http://blog.taigacompany.com/blog/ sustainability-business-life-environment/ stakeholder-engagement-reducing-risk-in-thesupply-chain