World Trade - December 2008 - (Page 44)

SUPPLY CHAIN SUSTAINABILITY Now that the logistics industry has accepted the permanency of green business practices, the emerging question is, ‘How do I get there?’ BY LARA L. SOWINSKI f you asked any number of shippers or logistics prov viders a year or so ago what they thought about green b business practices, they generally agreed that it was a ‘g ‘good idea’ driven mostly by consumers and marketers, b but many were doubtful about the actual ROI and even less certain about when and where they would embark on any meaningful initiative to green their own operations. However, the events of the last year, namely the astronomic rise in fuel prices coupled with a downward spiraling economy, have kicked green initiatives into high gear. And let’s face it, while most businesses truly care about the environment, they are ﬁrst and foremost in business to make money and beat out the competition. Fortunately, they’re quickly discovering that green is a great way to get there. Where we are today The latest logistics study from Capgemini, Georgia Institute of Technology, Oracle, and DHL—the 2008 13th Annual Third-Party Logistics Study—found that 86 percent of the executives polled agreed that a green supply chain is somewhat or very important today and are almost unanimous (98 percent) in their belief that green supply chain initiatives are somewhat or very important to their companies’ futures. Yet, when asked about ROI, using green as a factor in selecting 3PLs, and changing transportation modes, the opinions were mixed: about one-half of 3PL users are optimistic about taking action and reaping beneﬁts from green initiatives, while the other half are either unsure or even pessimistic. “Clearly, there is widespread uncertainty about how to move forward with green supply chain initiatives,” concluded the study’s authors. Obviously, you have to know where you are ﬁrst before you can begin to move forward. The Results Group 44 WORLD TRADE DECEMBER 2008 (www.resultsgroup.com), a California-based consulting ﬁrm, has developed a Green Enterprise Maturity model to help companies with that task. It categorizes companies in one of four groups: Complier. Green initiatives in the company’s supply chain and operations are accidental by-products of ‘business as usual’ efforts and there are no metrics for measuring results. Dabbler. The company has made isolated attempts to improve supply chain and customer support operations, and ‘point measurement’ of green is present in metrics, but is not full spectrum. Consistent Improver. Consistent efforts are made across the supply chain and customer support with demonstrated trends in results. Environmental performance is also a factor for supplier selection. As for metrics, green coverage is good but not integrated with business metrics. Enterprise Optimizer. Supply chain and customer support function as integrated entities in optimizing resource usage; green is becoming a key component of the company’s operational strategy for long-term structural advantage; and collaboration is found with suppliers/partners to develop innovative ideas beneﬁting both companies. Furthermore, green is integrated with business metrics (such as carbon released per dollar of revenue). According to Emily Rodriguez, a senior consultant with The Results Group, most companies today are still amongst the Dabblers. “We’re not so sure you’d even ﬁnd many Fortune 500 in the Consistent Improver category, and certainly there are few Enterprise Optimizers,” she says. Although many companies have cited costs as an obstacle to going green, Rodriguez believes that’s less of an issue today than simply being overwhelmed. But, like most challenges, you begin by breaking it down into manageable parts, she advises. http://www.resultsgroup.com

Table of Contents Feed for the Digital Edition of World Trade - December 2008

World Trade - December 2008 Contents The Promise of Peril The Current Reality with IP in China Supply Chain Watch Tradewinds Performance Partners: Awards of Excellence Managing With Mobility What 2009 Bodes for the Supply Chain Small Business Takes to Export Green is Here for Good Fast Fashion

World Trade - December 2008

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