Growing a Green Supply Chain
Green is the new black in supply chains. Whether it's a conscious effort or the byproduct of streamlining your operations, going green can pay off.
1. Walk through your supply chain operations from beginning to end. At each step, stop and ask why. Now, ask the same question four more times. The "Five Whys" technique is an effective tool to expose weaknesses and redundancies in your green supply chain operations.
2. Establish a baseline. Tap an experienced third-party logistics (3PL) provider to model your current systems, including variables such as labor, inventory, and transportation costs, while also considering future needs. Modeling validates current processes, highlights improvement areas, and suggests hybridized solutions.
3. Find the low-hanging fruit. Typically, inventory levels and placement are easy pickings. More product means more space, labor, equipment, waste, and energy consumption. Consider investing in a good warehouse management system if your organization has the in-house expertise to implement it. Otherwise, partner with a 3PL.
4. Go for no-brainers. Simple and inexpensive changes can impact energy and cost savings. For example, consider switching to LED lights, which last five times longer than fluorescent lights and use at least 75% less energy than incandescent lighting. The return on investment can be as quick as a year or two, and the result is a net-green positive on your supply chain.
5. Get lean and mean. Implementing lean operations is the most strategic way to green your supply chain. From the CEO to the assembly line, every member of a lean organization relentlessly seeks out waste and eliminates it. If a system or process does not add value, lose it.
6. Think outside the box. One large office equipment manufacturer with a closed-loop distribution network was already recycling 100% of cardboard packaging, but wanted to do more. The company replaced cardboard packaging with collapsible, returnable plastic totes, diverting 300,000 large cardboard boxes from landfills annually.
7. Waste not, want not. When a cable internet company—which sees 3.1 million pieces of inbound equipment annually—aimed to reduce its carbon intensity, it implemented a solution that included a hands-free, data-capture receiving process that enables quick and easy component harvesting for reclaimed accessories. The tested, repaired, and refurbished products provide customers with like-new equipment and saves more than 3.4 million pounds of waste from landfills annually.
8. Electrify your operations. Many service providers are paving the way for the adoption of alternative fuel vehicles and electric vehicles by providing lease and maintenance options, as well as equipping facilities with charging requirements. Consider electrifying your fleet through a lease program to minimize risk and maximize efficiency.
9. Do what's right. When it's a toss-up, go green. Your customers will thank you.
10. Choose your partners wisely. Look for a reputable 3PL with a strong track record in optimizing green supply chains. Choose a company that considers continuous improvement core to its business and that will continually challenge your processes.
SOURCE: Tom Regan, Group Director of Customer Logistics, Ryder