Thought Leader -- Reducing the Supply Chain Footprint

June 13, 2009

HP's Christian Verstraete brings a systems engineer's eye for the big picture to managing the supply chain's "ecosystem."

Adrienne Selko

You might think that a person would run out of ideas after being at the same company for 30 years. Not the case with Christian Verstraete, who began his career with Hewlett-Packard as a systems engineer. These days he is pushing the lean frontier to see "how it can be incorporated into the wider view of the complete ecosystem." That view must extend beyond the boundaries of the enterprise and reach across the whole supply chain. For example, he warns, "Today companies must have a handle on risk management and mitigation across the supply chain while simultaneously reducing the variants. Rather than do Six Sigma within the company, do Six Sigma across the supply chain."

Q: How is HP able to continuously improve its supply chain?

A: Once we have identified potential improvements in our supply chain and before we implement the improvements, we develop a model. We inject multiple scenarios and variances and see how the model reacts. Simulation tools are relatively inexpensive and it is money that you can recoup very quickly by avoiding implementing the wrong thing.

Here's an example. In the mid '90s HP moved into the notebook business, and while they took off like rockets, we weren't making any money. We didn't understand why this was the case until we got our supply chain modeling people involved and discovered that there were a number of things that we hadn't taken into account. We revised our supply chain design and are now the largest notebook manufacturer in the world.

Q: HP won Wal-Mart's 2008 Home Entertainment Design Challenge. How did that happen?

Christian Verstraete
Chief Technology Officer / Manufacturing & Distribution
Industries Worldwide, Hewlett-Packard Co.

Responsible for thought leadership and innovation

Spends his time scanning trends and figuring out how to capitalize on them

Is busy figuring out ways to quantify "green" efforts

Proud of HP's efforts to help employees become environmentally conscious in
their own homes

A: It was actually very simple. Wal-Mart asked its top 100 suppliers to reduce the amount of packaging material in an effort to be environmentally responsible. One of our employees was contemplating how to protect the laptop when it was coming from China or Thailand. He found padded bags that were made from recycled material. He designed one package that was able to contain everything that the PC needs. It reduces shipping material by 97%, and it conserves fuel and reduces CO₂ emissions by removing the equivalent of one out of every four trucks previously needed to deliver the notebooks to Wal-Mart stores.

Q: Looking forward, what "green" issues do you see?

A: First of all you need to measure the result of your green efforts. We are among the first companies to calculate the carbon footprint of the supply chain. While it's still in its early stage of development, we hope over the next three to five years we will be able to more closely calculate and express all of the aspects of an environmental footprint. We need to go beyond emission only and look at water and other resources. We are teaming up with research institutes and universities to ensure that we take a holistic approach.

From a manufacturing viewpoint we need to move environmental concerns up to the product development stage so that design takes into consideration the whole life cycle as well as the end use. For example, if we put the paint in the plastic rather than paint the end product, we can ensure proper recycling.

Watching out for the environment is a priority not only for HP but also for Verstraete personally. "A company is a community of human beings," he says. "Everyone is responsible for doing their part at work and at home."

To read what Christian has to say on a variety of topics, visit HP's blog: http://www.communities.hp.com/online/blogs/manufacturing-distribution/default.aspx

About the Author

Adrienne Selko | Senior Editor

Focus: Workforce, Talent

Follow Me on Twitter: @ASelkoIW

Bio: Adrienne Selko has written about many topics over the 17 years she has been with the publication and currently focuses on workforce development strategies. Previously Adrienne was in corporate communications at a medical manufacturing company as well as a large regional bank. She is the author of Do I Have to Wear Garlic Around My Neck? which made the Cleveland Plain Dealer's best sellers list. She is also a senior editor at Material Handling & Logistics and EHS Today.

Editorial mission statement: Manufacturing is the enviable position of creating products, processes and policies that solve the world’s problems. When the industry stepped up to manufacture what was necessary to combat the pandemic, it revealed its true nature. My goal is to showcase the sector’s ability to address a broad range of workforce issues including technology, training, diversity & inclusion, with a goal of enticing future generations to join this amazing sector.

Why I find manufacturing interesting: On my first day working for a company that made medical equipment such as MRIs, I toured the plant floor. On every wall was a photo of a person, mostly children. I asked my supervisor why this was the case and he said that the work we do at this company has saved these people’s lives. “We never forget how important our work is and everyone’s contribution to that.” From that moment on I was hooked on manufacturing.

I have talked with many people in this field who have transformed their own career development to assist others. For example, companies are hiring those with disabilities, those previously incarcerated and other talent pools that have been underutilized. I have talked with leaders who have brought out the best in their workforce, as well as employees doing their best work while doing good for the world.