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The Importance of Sustainability in Supply Chain Management

Posted by [email protected] on Mar. 17, 2021  /  Subscribe 0

All the upheaval in supply chain management over the last twelve months has brought many important issues and concerns to the forefront of supply chain managers' minds, but none more significant than the importance of sustainability. There are many factors involved in business relationships that create a surprising environmental impact as well. 

Seeking sustainability and achieving it are two very different activities. Moving from one universe into the other takes time and commitment at every stage and for every level of activity. This article looks into the value of focusing on the importance of sustainability in supply chain management as much or more than just the acquisition of raw materials for production from compliant vendors.

How Does Sustainability Affect the Supply Chain? 

At this junction in 21st-century business evolution, social responsibility has become as significant as improvements in efficiency and, in some cases, even profitability. Many organizations and manufacturers are focusing on sustainability efforts, promoting them through various marketing and media channels as much as their products or services. Why? Because announcing sustainability goals to potential customers can bring in sales. It's that simple. 

Today's marketplace is a complex environment where the policies and actions concerning a company’s sustainability at all stages can be just as crucial in making a sale as the features and benefits of the products or services they provide. Unlike hard assets like real estate or capitalized equipment, investing in sustainable practices can become an asset on the balance sheet in other ways. 

How Can a Supply Chain be Sustainable? 

According to the experts at Forbes, there are fifteen steps to follow to achieve sustainability in organizational behavior. Listed below are the most important steps: 

1. Know what sustainability means for your organization

Understanding how sustainability practices will affect the organization takes time, patience, eyes, and thought. Analysis of vendors, materials, resources, and other factors must be included in the sustainability compliance review. 

2. Get feedback

Don't just talk to people inside your organization about sustainability; speak with your vendors, customers, and anyone else who might be interested in the subject. If nothing else, it will tell you if your efforts are on target or missing the mark. 

3. Work with sustainability experts

If you haven't done so in the past, you might be wasting a lot of time, effort, and resources trying to figure out where to start, let alone how to design and implement a complete sustainability overhaul. It is better to get someone who's been there and gone through the process a few times before risking resources on an exercise in futility and fruitlessness.

4. Build infrastructure to support your sustainability goals

Each step in the process should provide a reinforcement point for the sustainability effort. Be sure to incorporate those new actions, awareness, and activities in the operating manual for future inclusion. 

5. Communicate your message

Talk may be cheap, but it certainly helps when it comes to telling the world about your sustainable practices and policies. Talking with customers, vendors, bankers, investors, and anyone else with an ear to hear it makes sense because community perception is what is going to be important going forward. A focus on sustainability might not be the bulk of your messaging and marketing, but it certainly needs to be included in one form or another. 

6. Develop a culture of sustainability

Sustainability is an exercise in time and motion as well as a discipline to adhere to. Each time a decision is made, there should be a sustainability question attached to it to ensure compliance with corporate policy and culture. It's easy to go back to the old ways, and some folks tend to resist change, but once sustainability is on the table, it needs to be incorporated into every discussion and activity. 

Sustainability Bottom Lines 

To discover if your sustainability efforts are paying off or not, you'll need to set some parameters that must be observed and respected. When upper management endorses a policy of sustainability, that decision needs to work its way down into supply chain management processes as much as any other department or discipline within a manufacturing or production environment.

The impact sustainability policies can have on the environment and the company’s brand awareness can be tremendous. Good policies can launch a company into a stratospheric experience. In contrast, bad policies or worse, no policies at all, can mean losing customers, increased costs for materials, and a drop in market share. Organizations must enforce the policy and work diligently to maintain its requirements. 

Sustainable Supply Chain Management Starts at the Top 

The direction an organization takes toward accepting responsibility for practicing sustainable principles and policies begins at the highest levels and permeates downward through each branch of an enterprise. Executives, managers, supervisors, and line workers must all be on the same page regarding sustainability practices if their policies are expected to create any sort of meaningful impact. 

Reluctance or resistance to achieving your company’s sustainability goals only creates roadblocks and interruptions to achieving true corporate success. Leaders must demonstrate their commitment to their policy and philosophy through their actions and efforts, not only in policy letters and memorandums. 

How Can a Supply Chain be Sustainable?

Given all the variables and avenues where sustainability is concerned, understanding the impact responsible sustainability practices can have on their organizations and initiating such programs as quickly as possible is imperative. The social, marketing, and financial results of a focused sustainability campaign can pay big dividends for those invested in making meaningful changes.

Like everything else in life, practicing corporate sustainability is an action that can be taught and learned. Fortunately, there are resources that can help bring an organization into the modern world of sustainable practices and protocols. The Association for Supply Chain Management (ASCM) provides education and guidance on the subject. Classes are available online for students who wish to discover the benefits and values gained by incorporating prudent and responsible sustainability practices into their procedures and processes.

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