BPM Forum/E2open Report Identifies Major Green Awareness/Action Gaps in SCM

Are supply chain management (SCM) firms talking the talk but not walking the walk on the environment? A new report by the BPM Forum and E2open, Acceleration of ECO-Operation: Achieving Success & Sustainability in the Supply Chain, shows heightened awareness of the need to be more green and efficient. Yet a lack of leadership and standardized sustainability metrics is hampering efforts.

 

Some 90 percent of supply chain and operations professionals say their management subscribes to enhanced trading partner visibility, flexibility and sustainability across the entire supply and demand chain. Yet nearly two-thirds have marginal or no visibility across all tiers and levels of their value chain.  Even more disconcerting is data showing that 78 percent of companies rate the level of synergy and accountability in their global trading network as suboptimal.

 

The report surveyed more than 125 supply chain, operations, finance, and executive professionals globally across multiple industries to measure and quantify just how companies are managing the complexities of supply chain demands, distribution costs and environmental concerns.  The study looks at progress in achieving ‘ECO-Operation’, or optimal environmental visibility, collaboration, and sustainability throughout the multiple layers of supply and demand chain networks. 

 

“[A]lack of leadership, visibility and standardized sustainability metrics are holding companies back from achieving bottom line benefits,” says the report.

 

Other key findings include:

 

*The top benefits achieved through better ECO-Operation programs include more environmental responsibility, better sustainability compliance, more efficient product manufacturing and better customer responsiveness

 

*More than half of respondents say that their competitors use green or ECO-Operation practices for competitive advantage

*42 percent of companies do not consider their carbon and energy footprints as including their entire extended supply chains, and only 55 percent say their customers would agree

*76 percent said their customers have not yet asked them to reveal their carbon footprints, but two-thirds expect customers to demand this in the next year

 

*An overwhelming 85 percent of respondents say they are actively involved in new programs that drive operational efficiency, CSR (News - Alert) and cost-savings across supply and demand chains
 
“Today’s economic, social and regulatory dynamics are putting real pressures on global companies to be both lean and green in their product sourcing, logistics, distribution and operational practices,” says Donovan Neale-May, executive director of the BPM Forum. 

Unifying and controlling complex, globally-distributed value networks in turbulent, unpredictable times requires real-time operational insights down to the product level, accurate sourcing and sell-through intelligence, and relentless dedication to eliminating waste in all areas of the go-to-market process.”

The report also examines detailed perspectives from more than 20 corporate and faculty leadership committee members. It also includes commentary and content covering best practices and viable solutions in helping companies come to grips with how to begin to insert efficient and environmental practices into strategic supply chain strategies and solutions. These include:

 

*Sustainability is becoming an increasingly important consideration to supply chain management executives

*Most companies are still struggling with obtaining verifiable, consistent data to measure value chain effectiveness and environmental responsibility

*Consumer awareness and increased regulation will put added demands on companies to drive green initiatives and efficiencies in the supply chain

“The Acceleration of ECO-Operation initiative provides comprehensive confirmation supporting our observation that companies with many global suppliers need to do a much better job at seeing and measuring the levels of environmental compliance and efficiencies down to the second and third-tier level of supplier,” says Rich Becks, senior vice president at E2open.  “Supply chain executives understand the benefits of better managing collaboration and sustainability in the value chain. Now they just have to make it happen.”