Last month, Velocity focused on green issues facing the electronics supply chain, and as a quick followup, I wanted to focus on a key topic raised in a report I recently came across.
As could be expected, the report — “Greening the Supply Chain: Best Business Practices and Future Trends” from The Initiative for Global Environmental Leadership (IGEL), Knowledge@Wharton, Xerox Foundation, and International Paper Co. — provides some examples of current best green practices. They mostly center on supplier selection and sourcing, with the more run-of-the-mill discussion focused on collaborating on innovation, creating transparency and enforcing compliance of green laws and standards.
Then I saw this:
- Many of the largest and best global corporations are still using spreadsheets to handle environmental data. To make their supply chains truly sustainable, companies need information systems that merge environmental and economic data, and make the results available to all stakeholders within and outside the company.
Companies are still using spreadsheets to handle environmental data? Really? What is this, 1990? I obviously thought, by now, in 2012, spreadsheets would have gone the way of the dinosaur or the Liverpool Pigeon (which is thought to have gone extinct in 2008), especially given the investments so many companies have made in IT and supply chain planning systems.
I sometimes forget that there are still huge gaps between supply chain goals and reality, despite all the talk about creating uniform IT systems that allow supply chain transparency, exception-management capabilities, and any other cross-functional informational sharing. The report points out that “many businesses are still only at the starting line when it comes to analyzing environmental metrics,” and spreadsheets are the common way to track such data.
To be sustainable, environmentally and economically, companies must integrate environmental information with existing financial data, the report notes. Once that information is connected via a more robust IT platform, senior executives can better weigh all the relevant data needed to make long-term decisions and assess potential risks and opportunities for innovation.
Integrated environment-financial information also allows supply chain managers to align decisions to green-related, fiscal goals, and have clearer direction on what data can be shared with supply chain partners, a critical element in making the whole chain more environment-friendly.
Robert Giegengack, a professor emeritus at the University of Pennsylvania's department of earth and environmental science, says something in the report that is both a reminder and a wake-up call for anyone working on green supply chain improvements:
- We are congratulating ourselves that we are becoming more sustainable but we are not. We are becoming less unsustainable. And we'll begin to approach the question of global sustainability when we carry this discussion back to the beginning of the supply chain, because in every case but two [water and oxygen], we are extracting natural resources at rates that far exceed the rate at which they are being replenished.
It seems logical that one of the most important places to start is by getting the data house in order. Without it, how will companies know where to go next?