Recent research has shown that Supply Chain executives think their biggest challenge when going green is that they 'don't know where to start'. However, there are a number of well proven steps that form the basis of most successful Green Supply Chain initiatives. Following best practice can minimise project risk while increasing the potential benefit level.

Take a lifecycle approach

Any supply chain will have a number of different business operations – especially when taking the holistic approach dictated by carbon accounting methods that must include all costs from raw material extraction to final disposal of materials. It is important to ensure full visibility across your entire supply chain and understand the end-to-end impact of your Green Supply Chain programme. In this way, it becomes easier to identify opportunities for the programme to deliver business value such as lower costs or improved competitive advantage.

Deploy demand-driven strategies

Within almost every supply chain there is an unacceptable level of waste. Many waste reduction initiatives focus on reducing waste at source or identifying where waste can be recycled or re-deployed into innovative product solutions. While it is important to fully exploit these areas, waste can be effectively driven from the system by using technology to more closely align production to customer need. Demand-driven strategies are designed to ensure that no more is produced than is consumed. This means that all resources are far more efficiently utilised. 

Automate, automate, automate

The Aberdeen Group suggests that the leaders in Green Supply Chain Management are those that 'move more aggressively to embrace technology enablers'. Being green means intelligently deploying an increased automation where possible to deliver lower operating costs, reduced errors, improved cost to serve, and even to increased revenues. It should allow you drive inefficiencies from your supply chain processes, increase the depth and timeliness of communication with your upstream and downstream trading partners, and provide visibility across the supply chain to ensure continuous improvement in all your supply chain operations.

Working in partnership with experts

Even if you had an unlimited budget, re-inventing the wheel would simply make no sense. Minimise risk by sensibly selecting the skills and technology that you do not have internally. Especially in terms of business systems, developing your own trading network that provides you with the features you need while enabling your trading partners to connect to you without imposing a daunting overhead – both in terms of cost and process change – seems a poorly conceived undertaking. A better approach is to consider a Managed Service from a trusted partner with global reach.

Align green goals with business goals

Never forget the bottom line. The more closely a Green Supply Chain initiative mirrors the strategic direction of the business, the more likely that it will make the transition from business plan to live project and the much more likely it is to succeed. When an initiative that would previously have been seen as a cost centre is seen as a means to drive innovation and customer satisfaction, it becomes perceived in terms of its strategic value rather than its tactical burdens.

Think strategically but don't forget quick wins

We are looking across the entire supply chain lifecycle and the greatest results are achieved where lifecycle changes become embedded. But, that is not going to happen overnight. Instead, it is important, as with any change programme, to deliver tangible benefits early and often. Time should be taken to identify where high value results can be delivered quickly and cost-effectively.

Employ a decision making framework

With many supply chain executives admitting that they are not sure how to commence a Green Supply Chain programme, some form of structured planning tool will provide an easy-use tool to begin developing a green strategy to improve supply chain and business performance. The US Environmental Protection Agency has developed a four-step Decision-Making Framework that covers:

Identify costs
Determine opportunities
Calculate benefits
Decide, implement and monitor

Full details of the framework can be found here.

Analysis, measure, improve

To look at the full lifecycle of your supply chain means taking a different approach to ensure that all costs are captured and made visible. Put simply, if you can't measure it, you can't improve it. The latest advances in social and carbon accounting – such as the triple bottom line, the Greenhouse Gas Protocol and the Carbon Disclosure Project – are a good place to start. From here you can establish clear metrics that will let you measure the performance of your Green Supply Chain initiative. Green performance tracking relies on your ability to gather the appropriate data and make it visible to all the people who need it. Now in version 9.0, the SCOR model from the Supply Chain Council includes an environmental element  - called GreenSCOR - that adds green processes, metrics and best practices to this proven method.

Gain senior management buy-in

A green programme is no different from any other major business investment. If it does not command senior management commitment it is going to fail. Developing a board level champion is one of your first priorities. However, green initiatives are likely to need more than arm's length support. With more cross-functional elements than most business change projects, Green Supply Chain programme need executive sponsors to provide cross-functional vision and co-ordination.

Look beyond the organisation

It's time to ask your trading partners and customers about their commitment to sustainability. How can they help you meet your green goals directly through paper reduction and IT optimisation, and indirectly through reductions in freight expediting, optimisations in production, or lower safety stock. But, real success means going further. It means complete integration, transparency and collaboration. For example, some organisations are already allowing their suppliers to automatically replenish inventory when required. This blurring of divisions requires careful management and systems that ensure outstanding data quality and security.