Happy Supply Chain New Year

Now, that the x-mas shipping haze is even for the majority of my former Amazon colleagues is over, it’s a good time to think, as we all do with our New Year’s resolutions, about 2020. I think we, as Supply Chain managers, do have a huge amount of responsibility. Not just for the companies we work for but also for “our” customers, supply chains and, with increasing awareness, the planet we all live on. This isn’t appreciated everywhere.

So, to end the year, some thoughts on Supply Chain Sustainability. Which is, for me, much more than the CO2 foot print of our means of transportation. Not to say that we shouldn’t push for the most environmental friendly delivery solutions we can find. Electric delivery trucks should become the norm for the last mile sooner rather than later, and should also be the cheapest last mile solution. And where they are not, I totally favor subsidies until they are.

But Supply Chain Sustainability is so much more. And it is also what we Supply Chain managers already do anyway. We constantly try to figure out ways to reduce lead times and thus directly reduce working capital. We constantly optimize inventory levels. And every single unit not put into inventory is a unit not produced, a unit not shipped and a unit not stored. We don’t need raw materials for these units. We don’t need production resources, energy and storage space. We don’t need shipping capacity. In short, our logistical foot print becomes smaller and our Supply Chain more sustainable with every little step we take.

Unfortunately, we have a tendency to see these benefits purely from a financial and service level perspective. Luckily, this means we are already working on sustainability every day. What we should do so, is to look at our routine work from the sustainability perspective, too. Maybe we can optimize our outbound capacity planning even more by better forecasting and reduce the numbers of trucks we need. Maybe we can decrease inventories by improving transparency. Maybe we can decrease buffer stocks by better collaborating with suppliers and customers. Maybe we don’t need that new storage facility.

The good thing about all this is, so, that with the increased public interest Supply Chain aspects have the potential to become more than just a cost center. It is up to us to seize that attention and guide upper management to leverage efficient, cost-effective, sustainable and customer focused Supply Chains in the best possible way. And give Supply Chain management the freedom and resources to pursue all the improvement ideas, small and large.

Sounds like a good New Year’s resolution, doesn’t it?

Marry Christmas and a happy new Year!

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