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A sustainable supply chain is one that fully integrates ethical and environmentally responsible practices into a competitive and successful model. End-to-end supply chain transparency is critical; sustainability initiatives must extend from raw materials sourcing, to last-mile logistics, and even to product returns and recycling processes.Digital transformation and the growing sophistication of digital supply chain technologies are playing a major part in the evolution of supply chain sustainability. Big Data management, advanced analytics, artificial intelligence (AI), and security tools, such as blockchain and RFID sensors, have brought unprecedented visibility and accountability to modern supply chains. Companies now have a much greater ability – and obligation – to demonstrate corporate social responsibility and to share best practices for green supply chains and sustainable logistics. As ethical supply chain practices become a greater and more immediate priority for businesses, compliance goals and sustainability benchmarks are also becoming more standardized. The United Nations Global Compact has laid out 10 criteria for measuring supply chain sustainability. These cover areas of environmental responsibility, labor practices, human rights, and corruption. These principles are built upon the realization that socially responsible practices and products are not only good for people and the planet, but are also good for building positive brand awareness, competitiveness, and long-term profitability. Supply chain sustainability in a changing worldFor many businesses, it took the arrival of COVID-19 to deliver the sharp jolt of realization as to just how outdated and vulnerable their supply chain operations were. However, even before the pandemic was upon us, some fundamental changes to consumer behavior had been causing global supply chain managers to begin reevaluating their operations. One such change has been the huge rise in demand for next-day shipping. This is known as the Amazon Effect, and it has created something of a paradox as it relates to supply chain sustainability. In a 2019 survey of over 1,500 U.S. consumers, delivery speed was ahead of all other factors when it came to choosing a retail channel. Yet, in many other reports, such as this study by the MIT Sloan School of Management, customers indicated a willingness to pay more for products that ensure green logistics practices and transparent supply chains. If companies are to deliver on both speed and sustainability in a meaningful way, it will require the ability to have real-time access to third-party logistics networks and deep, end-to-end visibility into their entire supply chain operation, including the most distant, low-tier suppliers. A recent article in the Economist calls COVID-19 “the new normal” and suggests that we will have to restructure our lifestyles and businesses in the long term. Part of this will mean decreased reliance on overseas suppliers and manufacturers. Added to the uncertainty we’ve seen in the past few years regarding global trade and tariffs, we will be looking at increased reliance upon modern supply chain and manufacturing technologies to help us bring our supply bases closer to home. But, realistically, ours is a global economy and we will always have to rely on some international sources for certain raw materials and manufacturing capabilities. The sustainability paradox Learn how to balance sustainability and growth in a rapidly changing world. Three components of sustainable supply chainsTwenty years ago, the word sustainability was almost completely synonymous with eco-friendliness. Today, it is a much more holistic term. Green, transparent, and circular supply chains are all components of a modern sustainable supply chain. Components of sustainable supply chain (green, transparent, circular)
How do sustainable supply chains work?
Colgate-Palmolive webinar Learn how Colgate-Palmolive is achieving its green goals with the help of data. Top three benefits of a sustainable supply chainFor companies that invest in more sustainable and transparent supply chains, there are potential benefits across the entire business, including:
Technology components of a sustainable supply chainDigital transformation in the supply chain allows companies to meet and exceed sustainability benchmarks while also innovating and growing their businesses.
Sustainable supply chains in actionBy combining innovation, creativity, and modern supply chain technologies, these companies have developed sustainable solutions to keep their supply chains green, transparent, and more competitive than ever.
Explore SAP green supply chain solutions Sustainable supply chains enhance agility, profitability while reducing waste. SAP Insights NewsletterFurther readingWhich of the following is most likely to contribute to a positive work environment?A positive work environment is built largely on healthy, productive interactions between employees and teams, as well as positive reinforcement. You can help play a major role and set an example by providing positive feedback, heartfelt gratitude, and recognition to both colleagues and managers for their contributions.
Which of the following is a characteristic of the organic organizational business structure?In contrast, an organic organization is characterized by a relatively low degree of job specialization, loose departmentalization, few levels of management, wide spans of control, decentralized decision-making, and a short chain of command.
Which of the following is most likely to be the first step that the members of an employee involvement team should take?Which of the following is most likely to be the first step that the members of an employee involvement team should take? They should identify quality problems related to the employees' areas of responsibility.
What is the next step after defining the objectives in the organizing process?Use your objectives to define your organization's strategies
Finally, once you have your objectives, you are ready for the next step: developing the strategies that will make them possible.
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