Integrating Sustainability
Throughout the Supply Chain
Redefining Sustainability
Moving past
The Catalysts of Change
Internal Catalysts
• Costs pressure
• Stability of Supply
• Risk Reduction
• Achieving Scale
• New...
In China, stakeholder are being catalyzed by different constraints
……..constraints that were far more personal than “carbo...
Projects are:
• Short timeline/ clear definition in nature
• Require significant upfront planning with little long term be...
Examples:
• Moratorium on off shore oil drilling
• Raising deposits on new home sales for 2nd time buyers
• Free plastic b...
Programs/ Platforms
Examples:
• Ban off shore oil drilling / implementing hybrid standard/ car sharing
• Limiting the amou...
Systems
Examples:
• Banning petroleum based energy product/ investing in urban planning & public transport
• Payment of an...
Systemic Wastes
Xerox: Zero to Landfill
Backdrop:
 In early 1990s the Xerox team working on new product development for
“all-in-one” mach...
Some Firms will see new opportunity
 Interface Flooring
 Haworth
 Nike
Going the Long Way
Some Firms will start with a ...
Keys to Systemic Change
Vision
CapacityScale
Awareness
Scale: Creating a system base that grows across the organization
an...
“In the end, environmental, social and economic sustainability cannot be
separated. A sustainable planet must include a su...
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Integrating sustainability across the supply chain

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In this presentation, which I delivered to China's Supply Chain Council's Annual conference, I spoke about how to integrate sustainability across the supply chain.

It was a discussing where we debated "green" vs. "sustainability", and which firms will focus on over the long term

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Transcript of "Integrating sustainability across the supply chain"

  1. 1. Integrating Sustainability Throughout the Supply Chain
  2. 2. Redefining Sustainability Moving past
  3. 3. The Catalysts of Change Internal Catalysts • Costs pressure • Stability of Supply • Risk Reduction • Achieving Scale • New Opportunity External Catalysts • Consumer demands • Investor returns • Government Regulations • Environmental Crisis • NGO/ Media Government MediaNGO Industry Assoc Competitor Community Rating Agency General Public Distributors Investors CustomersEmployees Suppliers Customers Founders Organization Stakeholders
  4. 4. In China, stakeholder are being catalyzed by different constraints ……..constraints that were far more personal than “carbon” Labor Safety Consumer Safety Urban Planning & Urbanization Food & Agriculture Landfills & eWaste Overpackaging Healthcare (Elderly & Family) Resource Management Traffic and Transport Air, Food, and Water Quality Income Gap – Poverty Alleviation Catalyzing the Catalysts
  5. 5. Projects are: • Short timeline/ clear definition in nature • Require significant upfront planning with little long term benefit • Have clear result/ measurable with limited potential impact • Opportunity for “splash” – press, public awareness, education, etc Programs / Platforms are: • Longer term in nature with preparation time/ infrastructure that can be leveraged • Opportunity for “scale” – creation of platform for building out/ up • Requires dedicated vision, planning, and staffing • Deeper level of long term impact possible Systems are: • Longer term in nature with investments in process, equipment, and people • Goal is to “scale” with long term impact KPIs as benchmarks • Requires separate vision, planning, and staffing The Basic Definitions
  6. 6. Examples: • Moratorium on off shore oil drilling • Raising deposits on new home sales for 2nd time buyers • Free plastic bag ban campaign • Factory closures • Law enforcement monitoring of migrant districts Projects Benefits of Projects: • Management responsibility is easy to define • Easy to justify and implement as a pilot program • Can result in, or appear to be, a quick win • Can provide breathing room while a real solution is found • Does not (typically) require a significant investment in infrastructure, talent, or process • Can be killed easily – internal and external visibility is (typically) low
  7. 7. Programs/ Platforms Examples: • Ban off shore oil drilling / implementing hybrid standard/ car sharing • Limiting the amount of apartments 1 family can own • Plastic bag ban campaign • Factory efficiency upgrades • Providing incentives for migrants to return home Benefits of Platforms: • Management awareness, engagement, and ownership across business function and organization • Leveraging the lessons of projects • Able to capture measure of scale • Can be owned by a BU/ department
  8. 8. Systems Examples: • Banning petroleum based energy product/ investing in urban planning & public transport • Payment of annual property tax on properties owned • Plastic bag manufacturing ban with product take back • Economic restructuring and removal of energy consuming industry • Promoting incentives for migrants to stay Benefits of Systems: • Management awareness, engagement, and ownership across business function and organization • Full benefits of scale – financial, infrastructural, organizational, and external • Stability – removal of gaps and inconsistencies in multi- project system • Risk – Reduced risk of external pressures forcing decisions • Profit – top line and bottom line opportunities to improve
  9. 9. Systemic Wastes
  10. 10. Xerox: Zero to Landfill Backdrop:  In early 1990s the Xerox team working on new product development for “all-in-one” machine took a 2 day group outing  On the last day, one half of the group was hiking past a waste dump and decided to see what was there…They found a Xerox copier “It was hard to explain what happened, but after 2 days in the pristine wilderness, the waste of it all became clear” What Happened Next:  The engineers began calculating all the other machines in landfills, and during a discussion they decided to “stop“ - Zero to Landfill was born  6 years later the new product line was launched – 93% remanufacturable and 97% recyclable  800 managers, engineers, and technicians worked on the project  Manufactured waste free plant – no remaining scrap, packaging, or plastic.
  11. 11. Some Firms will see new opportunity  Interface Flooring  Haworth  Nike Going the Long Way Some Firms will start with a single product  Puma  HP  Esquel Low Hanging Fruit Some Firms will be sustainable from day 1  Burt’s Bees  Bambu Home  Shokay Starting from Scratch Others Will Wait Changing Models
  12. 12. Keys to Systemic Change Vision CapacityScale Awareness Scale: Creating a system base that grows across the organization and core processes • Organizational funding, programs, and people are stabilized at current level • Processes are in place to improve efficiency and protect against unexpected shocks Awareness: Understanding the problem and recognizing one’s role • Building management understanding of issues, risks, and opportunities • Identifying a single product/ process as a pilot program Vision: Developing focus and Staying on Track • What is goal that will be accomplished? • What will it take to accomplish goals? • What are the short term/ long term steps to achieving those goals Capacity: Creating an organization / product / process that is bigger than one person, process or business unit • Investing in a process’s need for R&D, equipment, and people • Working with externals (suppliers and customers) to manage variables and expectations
  13. 13. “In the end, environmental, social and economic sustainability cannot be separated. A sustainable planet must include a sustainable human civilization – resilient human systems that respect the complicated relationships among poverty, human rights, economic development, environmental health, and human success” - Institute for the Future, 2008 Richard Brubaker, Founder rich@collectiveresponsibility.org www. collectiveresponsibility.org @chinacsr @greenerchina

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