Sustainability and going green are buzzwords in plenty of business sectors nowadays. So is it any surprise that the concept has found its way to the supply chain management sector? When a traditional supply chain system is infused with sustainable and environmentally-friendly processes, it is called Green Supply Chain Management (GSCM). Any part of the process can be eco-friendly - from material sourcing to product design, from production to end-of-life management.
There are two ways of creating a GSCM - you can either reduce the environmental impact of a supply chain, or you can try to stop the impact. Of the two the former is far more realistically feasible. The latter requires coordination and resources on an unprecedented scale and is something that might not be realistic, given current regulations and policies.
Overall, the biggest benefactors of a GSCM are the economy. With the world at large looking for sustainability-based solutions in all aspects of an economy, it is pushing every sector towards a more environmentally sound approach. GSCM can reduce the carbon footprint of its operations massively with tweaks to its established systems. This, in turn, will increase efficiency within the supply chain, and that will have the domino effect of less wastage during production.
Lowered waste will, in turn, lead to lower production costs and higher profit margins. So, the entire system comes full circle when the transitory first step is taken. Not only this, but a GSCM also acts as its own unique advertiser, and it gives the value add that clients are always on the lookout for. An essential part of the success of a GSCM is the way each side of the business caters to its partners on both, the upstream and downstream of the supply chain. The key operating word here is transparency. Transparency will ensure any collaboration’s successful integration in the supply chain process.
Quick facts:
Going green is good for business - With growing government policies that focus on green sustainability initiatives to dole out contracts, it is becoming a more attractive proposition. Even conscious clients are making the jump to partner with businesses that are more carbon-footprint friendly.
It can reduce inefficiency - Making the necessary changes in areas that are inefficient can have a positive upswing impact on business. Only when we take stock of things like unnecessary fuel consumption, inefficient use of warehouse space, and less-than-optimal freight and container utilization, do we get a clearer picture of the wastages. By mapping these wastages out, we’re not only identifying areas that can lower carbon consumption, but we also uncover areas where the entire transport operations themselves are inefficient.
It is actually on-par for the course in the industry - Creating optimized container usage and transport routes requires a highly effective degree of insight into the nitty-gritty of operations. In this way, Industry 4.0 systems are especially well-suited to promoting sustainability.
Future is here, and it is green - Remember, the transition to sustainability is inevitable. One way or another, climate concerns will have a huge impact on the supply chain system in the very near and inevitable future.
There may be an initial reluctance toward adopting sustainable methods, but in the long run, these changes will become the norm. Businesses can no longer turn a blind eye towards the green revolution, dismissing it as a passing trend. The value derived out of early adoption, and the long-term financial gains make it a very feasible mode of operation in the immediate future and also in the long run. While a cautious approach may be most effective, the entire industry will be looking towards trendsetters for cues on implementing methods that will create new green standards for the entire supply chain and logistics sector.