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In his ongoing quest to unite the blogging community, Sourcing Innovation blogmaster Michael Lamourex recently called for supply and spend management blogs to pen a post on socially and environmentally responsible business practices. My response: it’s nice of you to finally hop aboard the sustainability bandwagon.
Michael, SpendMatters Jason Busch, and others chastised me this time last year when I proclaimed 2007 as The Year of Sustainable Supply Practices. They ridiculed my comments that sustainable sourcing and supplier management approaches that were good for the environment were even better for the business. Now, with the economy hinging on stagflation, commodity prices soaring, and the ice caps melting, I’m finally glad to see that these naysayers have finally come round to the reality that environmentally and socially responsible business and supply practices translate into cost savings, competitive advantage, and, ultimately, profits.
Best of all, sustainability doesn’t need to be complicated. Simple steps in the following areas to deliver quick returns to your organization:
- Recycling and Reuse Programs: Wal-Mart and others have saved vast amounts of money merely by shrinking and reducing packaging and reusing crates and pallets. This not only reduces waste but it also cuts shipping bills dramatically. Others like, Hewlett-Packard have used recycling programs to successfully offset rising material costs. And Kellogg’s recycles 80% of its waste, including converting food waste into animal feed.
- Energy conservation: Adobe Systems is saving millions of dollars each year by retrofitting its existing buildings with energy efficient incandescent lights and power-control systems. Sun Microsystems has taken aim at power-sucking IT equipment. “IT on average spends 25% of their budget on power,” said Ken Leinweber, Strategic Sourcing Manager, Procurement and Operations Strategy at Sun. “Innovating products and solutions that use less power is critical to the environment [and our operating budget].”
- Responsible operations and employees: Tech giants like Microsoft, Google, and Salesforce.com incentivize employees to engage in environmentally and socially responsible practices. For example, Microsoft has launched incentive programs to encourage employees to buy energy efficient vehicles, created ‘green buildings’ and is using solar power systems to power offices. By the company’s estimates, 11,000 of its workers commute to its Redmond, Washington headquarters via some ‘green’ method, such as mass transit, bike, or car pool. Like Microsoft, Salesforce.com encourages employees to support local charities and social causes by giving each employee paid time off for volunteer work.
Many companies are now using internal conservation efforts as an example to encourage suppliers to embrace sustainability. Wal-Mart Airbus, HP, and others have begun measuring the socially and environmentally responsible practices
The message to supply managers was best summed up in a BusinessWeek issue last year: Imagine a world in which eco-friendly and socially responsible practices actually help a company’s bottom line. It’s closer than you think.
5 responses so far ↓
1 the doctor // Feb 12, 2008 at 10:15 am
Chastised?? You got the wrong blogger, pal.
“Tim Minahan predicted that all of those crazy sustainable supply strategies that he’s been touting over on Supply Excellence are going to hit the mainstream. Well, I think they will at least hit best-in-class - after all, despite a few fiascos, Walmart is pushing for it - and with that clout, it’s going to happen, even if a few stumbles are made.”
I’ve been blogging about “green” and “sustainability”
2 the doctor // Feb 12, 2008 at 10:15 am
Chastised?? You got the wrong blogger, pal.
“Tim Minahan predicted that all of those crazy sustainable supply strategies that he’s been touting over on Supply Excellence are going to hit the mainstream. Well, I think they will at least hit best-in-class - after all, despite a few fiascos, Walmart is pushing for it - and with that clout, it’s going to happen, even if a few stumbles are made.”
I’ve been blogging about “green” and “sustainability”
3 the doctor // Feb 12, 2008 at 10:26 am
Chastised?? You got the wrong blogger, pal. I may have said that some of them were crazy, but I never said they were bad.
“Tim Minahan predicted that all of those crazy sustainable supply strategies that he’s been touting over on Supply Excellence are going to hit the mainstream. Well, I think they will at least hit best-in-class - after all, despite a few fiascos, Walmart is pushing for it - and with that clout, it’s going to happen, even if a few stumbles are made.”
Furthermore, I’ve been blogging about “green” and “sustainability” since I started blogging back in June of ‘06 - so it should be obvious that I’m a big fan of “green” and “sustainability”, although I do believe that some of the specific strategies you are touting are misguided. Ethanol - for one. When it still takes an average of 7 barrels of oil to produce 8 barrels of ethanol - a lower energy producing fuel - it’s not worth it. Until we improve the process, or find ways to grow more energy efficient sugar cane instead of corn, we should be looking at other alternative energy sources or, better yet, energy reduction. Better appliances, better engines, and better home insulation will save way more oil than biofuels at the present time. (Way more!)
However, to stroke your ego, I will admit that I did chastise you once last year, but that was for one too many posts on the flailing detroit automotive sector, not sustainability.
4 Rolling my eyes // Feb 14, 2008 at 9:41 am
Come on,
Just because you read about sustainability in the business press and put in a blog makes you a visionary? And then you chastise another blogger for not being equally ‘visionary’? You’re what’s known as the ‘momentum analyst’ - wait till it has some legs and jump on it ‘early’. This stuff has been going for years and “The year of XYZ” stuff is equally stupid. Companies march forward across all their initiatives and only bloggers/journalists/analysts seem to trumpet it.
Retract your peacock feathers and write something useful beyond “I told you so”!
5 Tim Minahan // Feb 18, 2008 at 5:48 pm
With due respect, I believe you overlooked the intended humor in my comments. My citations of my fellow bloggers were in sheer jest. They understand that the comment was pure entertainment. I have great respect for Michael and Jason. They (as well as other bloggers like David Bush, Doug Hudgeon, Brian Sommer, Jean-Philippe Massin, and Richard Edwards) do a great service to the supply and spend management community. And I have personally learned a great deal from their posts and insights.
(Consider Michael’s sage comments on the dismal future for ethanol. Yet, cellulosic ethanol should still have a shot…even if it may be years from now in a Waterworld era.)
As for my own commentary on sustainability, it is true that I often make referrals to successful strategies that have been highlighted in the press. That is an element of blogging — making current events relevant to the intended audience. And, despite the fact that I have been writing about sustainability since this blog’s inception, I never claimed that it was a new concept or that I was the very first to spotlight it. Others, like AMR Research and practitioners themselves — such as HP, Microsoft, and Kellogg’s — have all done a yeoman’s work in this field.
This blog is to “…profile supply strategies, best practices, and case studies to help companies of all sizes and industries accelerate results and drive continuous improvements in global supply management performance.” My goal is to spotlight and foster the exchange of best practices and practical purchasing approaches between companies.
Regrets, if my attempts to do so in a humorous manner have offended you.
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