August 14, 2008

Green Efforts Hampered by Broken Supply Chains

Broken supply chains and poor communication between different departments and partners are hindering many firms’ effort to reduce carbon emission, according to Dave Food, Oracle’s UK supply chain director, BusinessGreen.com reports.

Food says many firms are missing out on the expected benefits of sustainability initiatives to cut costs and carbon emissions because of a “siloed approach” to supply chain management.

“We are all aware of the idea that you can cut emissions from flights by importing flowers from the Netherlands instead of Africa, for example, but now studies have shown African flowers have a lower overall carbon footprint as they do not require heated glasshouses,” Food told BusinessGreen.com

According to Food, initiatives designed to cut supply chain emissions provide the perfect opportunity for firms to develop a cross-functional approach to supply chain management. But in order to do this, Food says, firms will need to attain a better overview of their supply chains and increase communication between different silos.

According to a recent IDC survey, businesses are adopting more applications that support sustainable supply chain initiatives.

The good news, however, is that 60 percent of supply chain executives are already measuring their emissions from transportation and logistics, according to a report released in July by Green Transportation & Logistics North American. It seems many more suppliers will also have to measure their emissions as retailers are getting strict on green standards. Some companies, like Method Products, are making going green more alluring to suppliers.

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