Sustainable Supplier Tracking

Companies that use 'smart' technologies to collect and analyze large amounts of information from across their supplier networks could improve supply chain efficiency by a minimum of 8% to 12% says IBM.

Drawing on its own experience running one of the largest, most complex supply chains in the world, including development of an expansive database covering 30,000 supplier locations in 60 countries to help collect and analyze data on a wide range of sustainability issues, IBM is now offering its knowledge to others.

IBM's Sustainable Supplier Information Management can help companies develop methods to collect, manage and analyze supplier information for energy use, environmental impact, quality, safety, cost, efficiency and labor practices.

"A global supply chain with thousands of partners exposes a company to increased risk, waste, inefficiency, environmental impact and cost," said Eric Riddleberger, IBM's business strategy consulting global leader, who heads up the company's corporate social responsibility consulting efforts. "Being able to set sustainability standards and truly measure performance against them across such a large network is an enormous task, particularly in industries such as consumer products, retail and healthcare."

IBM estimates tha companies who use "smart" technologies and processes that allow them collect and analyze large amounts of information from across their supplier networks could improve supply chain efficiency by a minimum of 8% to 12% or more, with corresponding reductions in cost, environmental impact and risk.

In a 2009 IBM survey of C-level executives on green and sustainability, 29% of the respondents said they aren't collecting any of this data at all from their supply chains. Eight in 10 aren't collecting supplier data for CO2 emissions and water usage, and six in 10 aren't checking supplier data for labor standards. Half the respondents said supply chain partners are requiring that they adopt new standards for carbon management, but only 19% are collecting CO2 emissions data often enough to effectively manage it. And three-quarters said supply chain partners also require they adopt new standards for energy management, waste and ethical labor standards.

Copyright Agence France-Presse, 2009

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