More and more, consumers, investors and other stakeholders are looking to companies big and small to do what’s right for people and our planet. To meet the demands of these stakeholders, transparency is key. In fact, an Innova Consumer Survey in 2020 declared “Transparency Triumphs” revealing that six in ten global consumers are interested in learning about where their food comes from and its impact including human/animal welfare, supply chain transparency, plant-powered nutrition and sustainable sourcing. The Environmental and Social Governance (ESG) movement has given companies a platform, a common language and key metrics to articulate their strategies and their progress, making it easier for stakeholders to make purchase and investment decisions.
What’s really exciting is how this is fundamentally changing the way companies think about and operate throughout the supply chain. It is now incumbent on Research & Development, Sourcing, Manufacturing, Planning, Distribution, and other functions to consider factors that impact ESG in key investment decisions and day-to-day operations. By doing so, we are seeing increased innovation, attracting new talent with fresh ideas, improving collaboration with our supply chain partners and reducing risk. It’s driving a real, meaningful change in the way we think. But it’s not your typical mantra to “think outside the box.” It’s a completely different box, and there are different people in the box. Is it any wonder this is an exciting time for operations?
THE DIGITAL SUPPLY CHAIN
To achieve transparency, it’s critical to build a digital supply chain and transform how business is done; and that transformation must be authentic. There needs to be a bridge between people and ESG goals throughout the process. Moving to a completely digital supply chain creates a world where information can be shared in real time with people around the globe. It introduces the ability to gather and bring together new sources of information including video, market insights, point-of-sale data, customer data, machine data and the “internet of things.”
For all of these reasons, we are now evolving our operations to be more digital at Herbalife Nutrition. It truly brings new meaning to what we call our “seed to feed” strategy – a strategy where we work with farmers, vendors, distributors, customers and others every step of the way as we develop and manufacture our products. As we implement new digital technology, we’ll be able to share the entire supply chain process for a specific product via a scannable code on our labels. That scan will lead to a site where information about where a product ingredient came from, the science behind the product health claims, and all the ESG considerations that were made along the way. This is important as the same Innova survey mentioned earlier found that 64 percent of global consumers have found more ways to tailor their life and products to their individual style, beliefs and needs.
WHICH LEADS TO TRUST
What better way is there to instill trust than through complete transparency? It keeps everyone along the supply chain honest and accountable and reassures consumers of the product quality and environmental responsibility considerations made throughout the process. This is especially important when trust is at the forefront of consumers’ minds. Numerous studies show more and more consumers are making purchase decisions based on a brand’s commitment to doing what’s right, including an ethical supply chain, societal impact and environmental sustainability. This is especially true in a post-pandemic world where people are reevaluating what’s important to them.
Which means all of this is not only good for people and the planet, it’s good for business. In addition to driving innovation, improving collaboration and reducing risk, it provides each function with better insights into the complete lifecycle of product development, manufacturing and distribution which results in efficiencies and cost savings along the way. It also provides better insights into the customer’s buying habits, helping companies create better customer experiences and predict future needs.
THE WELCOME CHALLENGE TO DO BETTER
For many companies, this is a new way of doing business. It’s going to require the cooperation and commitment of everyone involved. But it’s also going to bring about a welcome challenge to do better every day. It requires all of us to work together – companies and consumers -- to make clear our expectations for taking care of people and our planet for a more sustainable future.