In addition to environmental responsibility companies are increasingly looking at social issues that impact how they are seen by their customers. Issues include child labor are legal issues particularly in the EU and U.K. along with carbon emissions. And consumers look behind advertising to understand corporate strategies, then make purchasing decisions based on what they understand. Colleague Pam Baker reports on the evolution of supply chain sustainability in her story on TechTarget and how SCM software products either are or need to incorporate sustainability in all its permutations.
Enterprises have generally adopted SCM software to enable them maintain production, delivery, and profitability as the complexity of their supply chain increases and changes. Traditionally SCM systems have focused on the basic issues that get products to market but as software vendors have tried to differentiate themselves they are including other factors. Every company needs to be cognizant of both public opinion and the laws that govern their conduct wherever they do business. And SCM systems seem are logical systems to accumulate, store, and report that information.
Regardless of the software you have in place or even if you haven’t yet deployed a system to track these issues, here are the main points you need to be considering beyond just shipping and on-time delivery:
Which suppliers do or don’t pose potential problems?
You’re already checking them for order compliance but what about their other practices? Have they been reviewed for employment violations of any kind? Have they delivered products containing hazardous materials? Look into their past performance to guide your investigations.
How easily can you audit the events in your supply chain?
International transactions are subject to audits as multiple stages. Is your review process simple or does it require additional work every time you get an audit request? Your SCM software should be expanding to incorporate industry standards like BSCI and SMETA and add new technologies to simplify reporting and follow-up like image capture and even video recording where appropriate.
The carbon economy
Sensitivity to carbon use varies across international boundaries but your products end up as a combination of every carbon expenditure in the process of arriving at your point of sale. Tracking and reporting, then taking corrective action is complex and should become part of your SCM so that as regulatory conditions change you are ready to adapt.
Put it all to work
Regulations and purchasing patterns change all the time. The insights that can be derived from data collected over time by your SCM system can help your enterprise be competitive on a daily basis but adding sustainability considerations to your efforts can put you ahead of the competition.