We use cookies to provide you with a better experience. By continuing to browse the site you are agreeing to our use of cookies in accordance with our Cookie Policy.
  • ::COVID-19 COVERAGE::
  • INDUSTRY PRESS ROOM
  • SUBMISSIONS
  • MEDIA FILE
  • Create Account
  • Sign In
  • Sign Out
  • My Account
Free Newsletters
  • MAGAZINE
    • Current Issue
    • Archives
    • Digital Edition
    • Subscribe
    • Newsletters
  • STRATEGY
  • GLOBAL
  • LOGISTICS
  • MANUFACTURING
  • PROCUREMENT
  • VIDEO
    • News & Exclusives
    • Viewer Contributed
    • Upload your video
  • BLOGS & MORE
    • White Papers
    • Webcasts
    • Events
    • Blogs
      • SCQ Forum
      • Reflections
    • Mobile Apps
  • MAGAZINE
    • Current Issue
    • Archives
    • Digital Edition
    • Subscribe
    • Newsletters
  • STRATEGY
  • GLOBAL
  • LOGISTICS
  • MANUFACTURING
  • PROCUREMENT
  • VIDEO
    • News & Exclusives
    • Viewer Contributed
    • Upload your video
  • BLOGS & MORE
    • White Papers
    • Webcasts
    • Events
    • Blogs
      • SCQ Forum
      • Reflections
    • Mobile Apps
Home » Letters to the Editor
Chain Reactions

Letters to the Editor

June 13, 2014
Supply Chain Quarterly Staff
No Comments

Efficiency gains through optimization are inherently, quantifiably "green"

The "Perspective" article titled "'Green' supply chains are still too costly" (Quarter 1/2014) summarized a report that indicates companies are not heavily investing in making their supply chains "greener." On the surface this appears to be true, but there is a fundamental flaw in the framework of how that conclusion was reached.

The Accenture/CDP-funded report discovered that investment in emission-reduction programs has declined and companies are only willing to make such investments when a return on investment (ROI) is relatively immediate. This is correct, but what about waste- and emission-reducing actions that are not explicitly labeled as such? Many companies are making great strides in achieving greener supply chains as a natural by-product of the classic pursuit of efficiency. They just don't label those spends as waste- or emission-reduction investments.

Green and efficient supply chains are not mutually exclusive; in fact, they are mutually dependent.

Consider traditional physical distribution modeling, which is typically viewed as a cost-saving measure. Its goal is improving efficiency, which is achieved by reducing transportation distances, improving fuel mileage, and optimizing freight movements. While this may not immediately result in flagship green initiatives like building carbon-neutral factories or converting fleets to liquefied natural gas (LNG) vehicles, it does lead to a reduction in fuel-intensive and carbon-intrusive operations. Wouldn't it be fair to call that "green"?

Saving on freight costs by "shipping less air" is commonly achieved by reducing packaging. A recent project completed by my company, Chainalytics, removed �?? inch from the packaging of a prepared food item. That resulted in over $600,000 in cost savings, and the project was a financial success. But it also was an environmental success: That small change eliminated 100 tons of CO2 emissions and 146 tons of paper and corrugate, and saved 2,920 trees. And that's each year.

This packaging optimization had sizable green effects, yet it was not accounted for as an emission- or waste-reduction program. If our client had been surveyed for the Accenture/CDP report, it might have indicated that it had made little or no investment in reducing emissions. However, emission reduction was achieved, as a direct result of purposeful supply chain optimization. Significant reductions in emissions and natural resource usage almost always accompany this type of initiative.

Many green activities are taking place as a result of supply chain trends that do not necessarily evoke specific environmental ideals. Nearshoring, reshoring, packaging and shipping optimization, routing, warehouse and manufacturing location—these are all supply chain elements that companies are actively engaged in improving. Though [the impetus for such initiatives] may be cost-saving directives, it would be shortsighted to say that they do not also make the affected supply chains greener.

Companies everywhere are greening their supply chains and reducing carbon footprints. They are doing so as a regular, complementary effect of cost-reduction endeavors achieved through supply chain efficiency gains.

Gene Long
Vice President, Industry Supply Chains
Chainalytics
Atlanta, Georgia, USA

  • Related Articles

    Executive Insight: Letters to the Editor

    Letters to the Editor

    Letters to the editor

Recent Articles by Supply Chain Quarterly Staff

IBM survey says digitalization trends will sweep trucking industry by 2030

Report tracks rise in cargo theft from storage facilities

Policy groups posit plan to support supply chains hit by Covid-19, winter storms

You must login or register in order to post a comment.

Report Abusive Comment

Most Popular Articles

  • The 3PL industry: time to reset

  • Resiliency starts with supplier mapping

  • Freight market growth expected to slow in 2021

  • COVID-19 and the health care supply chain: impacts and lessons learned

  • Retailers designing stores to support inventory and logistics work, not just shopping

Featured Video

6cabd6ef 64df 4460 bb11 e90c2bdea0a5

Identifying Intralogistics Solutions to Fit Your Operation: LinkedIn Live Ep. 4

Viewer Contributed
As technology evolves, the advantages of using semi- and fully automated solutions to increase productivity and address labor shortages are clear. However, before an organization jumps fully into automation, optimization is a key step that must happen first. Intralogistics solutions, such as Raymond’s iWAREHOUSE and...

FEATURED WHITE PAPERS

  • Warehouse Management System Project Toolkit

  • Solving Talent Management Challenges Now and In the Future

  • Shaping Up Last Mile Delivery to Surpass Customer Expectations

  • Finding the Right Transportation Management Partner

View More

Subscribe to Supply Chain Quarterly

Get Your Subscription
  • SUBSCRIBE
  • E-NEWSLETTERS
  • ADVERTISING
  • CUSTOMER CARE
  • CONTACT
  • ABOUT
  • STAFF
  • PRIVACY POLICY

Copyright ©2021. All Rights ReservedDesign, CMS, Hosting & Web Development :: ePublishing