This month I will pen a series of articles for searchManufacturingERP.com around the nature of sustainable supply chains. In the first of a four-part series I have a look at the nature of supply chain pressures facing value chain members as they determine what is material towards TBL compliance.
Today’s sustainability landscape looks more like a sprawling, unplanned metropolis than a well-designed framework of regulations threaded together to provide transparency and visibility to consumers, governments and investors. And it only gets more complex when supply chain sustainability is the goal.
In every case, manufacturers must document the impact on at least one of the “Triple Bottom Line” economic, environmental and social measures to demonstrate that they use sustainable business practices.
everal impacts are immediate from both the manufacturer and supplier point of view.
For brands and manufacturers, the accuracy of the compliance level must be ensured and made auditable when required. To achieve these, the manufacturer might use standardized supplier questionnaires, surveys, or even phone (“desk”) audits to ensure that the proper information is being collected and risks in the supplier base can be assessed. Brands generally pay close attention to the “top 10/bottom 10” percent of suppliers.
In procurement, top-10 suppliers often have privileged status and flexible contract terms. To make sure these suppliers maintain the appropriate status and level of compliance, manufacturers can make clear their willingness to reassign this favored status to an organization that does a better job. Bottom-10 suppliers are often “at-risk” and require intervention and remediation to preserve a key component or hard-to-find material in the manufacturer’s supply chain.
Please visit searchManufacturingERP.com to read the article in its entirety. Please feel free to visit our website for more information on our partnerships around development of a sustainability program.