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Supply Chain Sustainability Management

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Xiaolei Liu

on 14 November 2012

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Transcript of Supply Chain Sustainability Management

Issues relevant to Sustainability supply chain Economic

Promoting profits, reducing costs, anticipating and managing long-time risks, and fostering long-term competitiveness

Conserving energy and resources, consuming more renewable and less-polluting energy, increasing recycling, minimizing packaging and reducing the firm’s “carbon footprint”

Improving labor standards and conditions, enhancing communities, and creating and delivering socially responsible products and services

Develop a sustainable strategy to define the values, principles and guidelines

Retool the organization to support sustainability goals

Manage supplier relations to implement sustainability practices

Measure and enforce the sustainability performance of major suppliers Behavioral Characteristics of Sustainable Supply Chain Assessment of the characteristics of a sustainable supply chain Definition of Supply Chain Sustainability Management Contents

Table 1 – Ethical spending in the UK, £bn (Source: Co-operative Bank, 2011)

Stricter government regulations
Use of technology and social media To balance between increase efficiency of supply chain and concern environmental issues.

To manage and minimize the negative impacts of unmanageable risks.

Collaboration and long term commitment. Issues relevant to Sustainability supply chain Group 2
Members: Bo Xu, 620027615
Nateera Chanjitwithaya 610051990
Nalinee Ngamchaliaw 610052026
Ying Guo 610059154
Xiaolei Liu 620027411 Supply Chain Sustainability Management Increasing the value of
Social, environmental, economic of company toward all stakeholders and society
Several major characteristics that impact on doing sustainability
Advance technology
Cost To sum There are many successful sustainable businesses
Small to large organization
Start little-by-little Objectives
Measure a company’s ‘success’ in term of
It determines the viability as a sustainable organization
For all stakeholders that involved in bringing products and services to market Triple bottom line Definition of Supply Chain Sustainability

Assessment of the characteristics of a
sustainable supply chain

Behavioral Characteristics of Sustainable Supply Chain

Issues relevant to Sustainability supply chain

IKEA’s sustainability Assessment of the characteristics of a sustainable supply chain How to analyze the SSC in a case? Characteristics of Sustainable Supply Chain Behavioral Characteristics of Sustainable Supply Chain Sustainability in Action Customer awareness in ethical product Replacing the challenging materials, such as foam, rubber, and plastic composites, to be recyclable
Palm oil used in IKEA products
Ensuring animal welfare Challenges Social perspective:
IKEA supplier code of conduct IWAY, 67% of suppliers comply with
Working with others
With UNICEF to strengthen children’s rights
SUNNAN lamps to children in developing countries such as Kenya and India
65 meur donation to charity partners by the IKEA Foundation
In 2011, 59/40 share of men/women in management positions, compared with 60/39 in 2010
UNDP project to empower women in India Practices adopted toward Sustainable Supply Chain Economic perspective:
In 2011, Sales increased by 6.9% compared to 2010
Existing stores grew with 2.7%
Lowering the prices to customers with 2.6%, while the quality of products has improved
Saving 6.2 million euro by improving Energy Efficiency
Sourcing Certified Wood to make products Practices adopted toward Sustainable Supply Chain The IKEA Sustainability Direction 2015
Reducing emissions
e.g. 20% of CO2 reduction by 2016, from its operations; its own buildings
Striving for more efficient goods transport
Engaging customers to reduce their carbon footprint and waste
Reducing its water footprint
Taking social responsibility
e.g. IWAY– supplier code of conduct IKEA Goals of Sustainability Environmental perspective
Engaging in Climate-related project,
i.e. working with WWF to promote a more sustainable life at home to customers
Raising awareness of climate change in employees’ and customers’ mind
e.g. Earth Hour campaign taken in 25 countries in 2011
Reducing the carbon footprint
40 IKEA buildings with solar panels installed
60 wind turbines
Total renewable energy produced 152 GWh Practices adopted toward Sustainable Supply Chain (source from IKEA 2011 sustainability report ) Steps toward a Sustainable IKEA Focus on:
Energy efficiency
Renewable energy
IKEA Foundation
Certificated wood
Sustainable cotton IKEA’s Sustainable Supply Chain An international home products enterprise
Founded in Sweden in 1943
Employees: 33,500 in 13 retail countries in 2011
The largest furniture retailer in the world IKEA References Mahler, D., Erhard, A., Callieri, C. (2007) ‘Chain Reaction’, A.T.Kearney [Online], Available: http://www.ism.ws/files/sr/chainreactionsustainabilitystudy.pdf [4th Nov 2012]

The IKEA Group approach to sustainability (2011), Progress on sustainability - 2011 IKEA Sustainability Report, [Online], Available: http://www.ikea.com/ms/en_GB/pdf/sustainability_report/group_approach_sustainability_fy11.pdf [5th Nov 2012]

Sustainability Report 2011 (2011), Progress on sustainability - 2011 IKEA Sustainability Report, [Online], Available: http://www.ikea.com/ms/en_GB/pdf/sustainability_report/sustainability_report_fy11.pdf [5th Nov 2012]

Piotrowicz, W., and Cuthbertson, R., Islei, G. (2007) ‘Sustainable supply chains – a framework for best practice assessment: results of the pilot study’, Proceedings of the 3rd IASME/WSEAS International Conference on Energy, Environment, Ecosystems and Sustainable Development, [Online], Available: http://economics.ouls.ox.ac.uk/13592/1/Piotrowicz%20Cuthbertson%20Islei%20WSEAS%20Conference%20Publication.pdf [5th Nov 2012]

Bruer, D. (2010) A New Breed of Design Thinking, [online], Available: http://www.pddnet.com/articles/2010/11/new-breed-design-thinking [3rd November 2012].

Rowley, M. (2012) What’s Your Personal Triple Bottom Line?, [online], Available: http://incentivize.us/2012/10/08/whats-your-personal-triple-bottom-line/ [3rd November 2012].

United Nations Global Compact. (2010) Introduction, p.7, [online], Available: www.unglobalcompact.org/docs/.../Supply_Chain_Sustainability.pdf [3rd November 2012]. Conclusion Thank you! Managing the use, development, and protection of natural and physical resources in a way, which enables people and communities to provide for their social, economic, and cultural well-being and for their health and safety Definition: Sustainability Definition: Supply Chain The activities of organization manage every process of company to achieve maximize competitive advantage and customer value
The activity includes everything from production process to delivering finished product to customers The management impact of
The encouragement of
Governance practices
Goods and services Definition: Supply Chain Sustainability
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