1. GREEN SUPPLY CHAIN MANAGEMENT
RICK EDGEMAN
Shingo Institute Research Director – Utah State University – USA
Professor of Management – Jon M. Huntsman School of Business – Utah State University – USA
Guest Professor of Quality Management – Uppsala University – Sweden
Guest Professor of Sustainability & Enterprise Performance – Aarhus University – Denmark
Six Sigma Black Belt

2. GREEN SUPPLY CHAIN MANAGEMENT
GLOBAL ENVIRONMENTAL LEADERSHIP EXAMPLES

3. GREEN SUPPLY CHAIN MANAGEMENT
Company
Operating principle
Explanation
Neil Kelly
Conserve the embodied energy
A house is a living system. Designers and workers need to consider the environmental impact of (re)building and living in a house. Conserve energy through better layout and design, material/equipment choice, reuse and recycling etc.
Coastwide Lab
Phase out toxic chemicals
Long term goal is to replace traditional cleaning products with ones that are not toxic to people or the planet. Creating a green brand has expanded the meaning of this beyond product development and into all aspects of the supply chain. The same principle that initially led to product development and redesign led to service offerings such as training and vendor-managed inventory to reduce total chemical usage by customers.
Colins Pine
Never log more than annual growth of the forest
Limiting logging is an essential part of holistic forest land management; bio-diversity, forest thinning, and riparian protection are all part of the operations. This informs a general conservation mindset in all operations.
Hotlip Pizza
Use local foods; minimize energy use
Attempt to source only foods grown within 100 miles of restaurant as part of larger efforts to reduce energy use. Local sourcing has multiple implications including food-mile/energy conservation, environmental protection and protection of local communities.
Kettle Chips
All natural ingredients
Products must be all natural and contain what the label says they contain– no fine print. All natural ingredients philosophy predicates farming and sourcing practices. This philosophy, which originated from pollution concerns, also informs pollution reduction effort in the organization’s operations.
Rejuvenation
Being thoughtful and tread lightly
Be aware of environmental and social consequences of decisions. Minimize negative impacts – try and have positive impacts.
Starbucks
Sustainable agriculture
Provide the best quality products without sacrificing the environment; protect the supply -- and the suppliers, who are generally farmers in developing countries.
ENVIRONMENTAL DECISION MAKING

4. BRAZILIAN COFFEE SUPPLY CHAIN
NESTLE & JACOBS
BRAZILIAN COFFEE SUPPLY CHAIN

5. ETHICAL COFFEE BEAN SUPPLY CHAIN
ETHICAL COFFEE CHAIN
ETHICAL COFFEE BEAN SUPPLY CHAIN

6. SLAVERY IN THE SUPPLY CHAIN
COTTON SUPPLY CHAIN
SLAVERY IN THE SUPPLY CHAIN

14. GREEN SUPPLY CHAIN MANAGEMENT
Apple
Nokia
Dell
P&G
IBM
Wal-Mart
Toyota
Cisco Systems
Samsung Electronics
Anheuser-Busch
Apple: Digital SC – Sensing demand and changing their SC
The end of mass customisation? – Dell’s model. Truncating BTO and shifting to MTS and contract manufacturing (Back to the future)
Toyota: lean system, waste minimisation, TPS
Wal-Mart turning back from RFID, instead focusing on greening their SC
Sources: AMR Research Supply Chain Top 25, 2008
TOP 10 SUPPLY CHAIN LEADERS

15. GREEN SUPPLY CHAIN MANAGEMENT
The 7 R’s of Sustainable Packaging
Remove
Reduce
Reuse
Renew
Recycle
Revenue
Read
Sustainable Supply Chains at WalMart

16. GREEN SUPPLY CHAIN MANAGEMENT
November 1, 2006 WalMart introduced its Sustainable Packaging Scorecard
Goal: Reduce packaging in supply chain by 5% by 2013
Predicted Results (Walmart U.S. only):
667,000 metric tons of CO2 not emitted
213,000 trucks off the road annually
66.7 million gallons of diesel fuel saved
Sustainable Supply Chains at WalMart

17. GREEN SUPPLY CHAIN MANAGEMENT
When Wal-Mart tells a supplier that it wants a change in packaging, that supplier will change all its packaging…Wal-Mart has the potential to have a tremendous impact on America’s environmental footprint.
David Willett, spokesman for The Sierra Club
Sustainable Supply Chains at WalMart

18. GREEN SUPPLY CHAIN MANAGEMENT
July 16, 2009: WalMart announced it would develop a Sustainability Index. Step 1: Supplier Assessment Step 2: Life cycle Analysis Database Step 3: Tool for Consumer
Sustainable Supply Chains at WalMart

19. GREEN SUPPLY CHAIN MANAGEMENT
February 25, 2010: WalMart announced plans to eliminate 20 million metric tons of greenhouse gas emissions from the global supply chain by the end of Goal: Reduce energy use and cost for suppliers, WalMart, and customers.
Sustainable Supply Chains at WalMart

20. PATAGONIA: QUALITY IN OUR TIME
WHAT IS QUALITY IN OUR TIME?
RESPONSIBLE BUSINESS AND THE PATAGONIA SUPPLY CHAIN
(14 Minutes)

21. GREEN SUPPLY CHAIN MANAGEMENT
KEUKENHOF: AMSTERDAM, HOLLAND

22. GREEN SUPPLY CHAIN MANAGEMENT
Netherlands produces 65% of the worlds cut flowers, yet has limited land.
Mass cultivation in a confined area resulted in fertilizer, herbicide, and pesticide contamination.
To correct the problem, growing was shifted to rock wool and water vs. soil.
Fertilizer in the water is recycled through the system to reduce waste.
Water based growth also reduces the risk of infestation by weeds and pests, reducing the need for chemical treatments.
The new system also greatly reduced variations in growth conditions, greatly improving the predictability of output.
Producers were able to increase output per space and further innovate to reduce costs (e.g., new harvesting methods).
The Dutch Flower Industry Greened Its Production to Increase Throughput

23. XEROX COPIER TAKE-BACK PROGRAM
70-90% (by weight) of machines reused
144 million pounds diverted from landfills (2003)
In early 1990s Xerox launched a new initiative to take back used copiers as a source of material for new machines.
Customers like the program because they no longer worry about machine disposal.
Xerox estimates “several hundred million” dollar savings annually.
Source: Bringing the Environment Down to Earth, Reinhardt, HBR, July-August 1999 Environment, Health, and Safety Progress Report: 2004, Xerox Corporation
XEROX IMPLEMENTED A TAKE-BACK PROGRAM THAT REDEFINED CUSTOMER EXPECTATIONS

24. Green Supply Chain > Carbon Labeling
GREEN SUPPLY CHAIN MANAGEMENT
Jan. 23, 2007 Tesco, the largest supermarket chain in Britain announced that it would begin labeling all 70,000 products on its shelves with the amount of carbon generated from the production, transport and consumption of those items.
Green Supply Chain > Carbon Labeling

25. GREEN SUPPLY CHAIN MANAGEMENT
FUTURE SUPPLY CHAINS: SIEMENS

26. GREEN SUPPLY CHAIN MANAGEMENT
Triple bottom line
Social policy
dialogue
Social responsibility
Products
Environmental Product Declarations, Life Cycle Assessments
Environmental
management
“Baseline management”
Sites
Implementation of ISO 14001
ABB’s organizational
structure
Local Regional Global
Customer centric
ABB’s first triple bottom line Sustainability Report
ABB’s first
Environmental
Report
ABB’s first
Sustainability
Report
Transforming Sustainability into Customer Value

27. SUPPLY CHAIN SUSTAINABILITY
CRANFIELD SCHOOL OF MANAGEMENT:
SUPPLY CHAIN, SUSTAINABILITY & TRANSFORMATION
(9 Minutes)

28. SOCIAL RESPONSIBILITY AND THE PATAGONIA SUPPLY CHAIN
SOCIAL RESPONSIBILITY & THE SUPPLY CHAIN
WHAT’S DONE IN OUR NAME?
SOCIAL RESPONSIBILITY AND THE PATAGONIA SUPPLY CHAIN
(16 Minutes)

29. COLUMBIA BUSINESS SCHOOL – COLUMBIA UNIVERSITY:
IMPLEMENTATING A SUSTAINABLE SUPPLY CHAIN THAT BUILDS COMMUNITY
(1 Hour 4 Minutes)

30. GREEN SUPPLY CHAIN MANAGEMENT
Sustainability is an integral part of BMW business principles and practices, which has led to a confirmation of its leadership position in the automotive industry. The company has been able to surpass its peers by exhibiting unparallel commitment to environmental issues.
BMW strives to conserve environmental resources throughout its value chain from production systems to materials used in-bound and out-bound logistics, and recycling and disposal of used vehicles.
The company has implemented efficient environmental management systems, and undertakes regular external and internal audits for its operations as well as for its suppliers.
BMW has also included a package of multiple emission reduction measures in large parts of the car fleet (called Efficient Dynamics) in order to meet the challenges of global warming and fossil fuel reserves, which is illustrated by 25 percent decline in car fleet emissions in 2008 as compared with 1995 levels.
Along with various initiatives undertaken to achieve environmental efficiency, the company also takes measures, such as 360 degree feedback and benchmarking of brands against that of peers, to strengthen its brand image and gain competitive advantage.
Source: DJSI World
Bayerische Motoren Werke, AG

31. GREEN SUPPLY CHAIN MANAGEMENT
GENERAL ELECTRIC

32. GREEN SUPPLY CHAIN MANAGEMENT
Kingfisher Plc is a London-based international home improvement retailer. The company's main retail brands run on the do-it-yourself (DIY) concept and include products such as complete kitchens, bathrooms and bedrooms.
The company sets sustainability targets and regularly measures its progress through a social and environmental management system called 'STEPS'.
Its "Future Homes" strategy for instance is designed to integrate sustainability into commercial operations, bringing innovative products to the market to help its customers adopt more sustainable lifestyles.
In Kingfisher's specialized DIY home improvements stores (e.g. B&Q in the UK and Castorama in France) customers are increasingly enticed to choose from a wide range of green products.
In 2008 this accounted for 7% of total sales.
Source: DJSI World
Kingfisher

33. GREEN SUPPLY CHAIN MANAGEMENT
Panasonic ‘s concentrated efforts to develop environment-friendly operations has resulted in operational excellence, which is evident from a sharp decline in greenhouse gas and dust emissions; and reduced electricity, water and waste consumption.
The concept of restoring bio-diversity is also adopted at a strategic level in the company; e.g., the company constructed a 'Prosperous Park' including biotope in a building premise in Osaka in March 2009.
In the social dimension, the promotion of labor practices within the organisation differentiates it from other companies. The company has established 'Diversity Promotion Office', and has been awarded Diversity Award Semi Grand prize.
Source: DJSI World
Panasonic Electric Works

34. GREEN SUPPLY CHAIN MANAGEMENT
In 2004, with support from CH2M HILL, Starbucks voluntarily conducted an inventory of its greenhouse gas emissions in an effort to understand and evaluate its contribution to climate change. Using the WRI Greenhouse Gas Protocol, Starbucks limited the inventory to areas with the biggest environmental impact: retail, coffee roasting, administration operations and its distribution network. Based on the results, Starbucks committed to reducing emissions by: • Purchasing renewable energy—annually, five percent of the energy needed by its North America retail stores, generated by 11 large-scale windmills, and estimated to reduce CO2 emissions by two percent; • Addressing the impact of its transportation operations—working with Business for Social Responsibility’s (BSR) Clean Cargo Group on ocean transportation and using the Clean Cargo tool to engage freight vendors; • Monitoring roasting plant operations— an environmental team at each of the company’s four roasting plants are creating measures for reducing emissions and conserving energy; • Taking leadership and raising awareness—by encouraging others to take action. • Setting a reduction target—in fiscal 2005, the company established a gas emissions reduction target.
Sources: Starbucks
Starbucks

35. GREEN SUPPLY CHAIN MANAGEMENT
Unilever is one of the world's leading food producers, and household and personal care product manufacturer. The company owns 270 manufacturing plants across six continents. It employs around 174,000 people in more than 100 countries worldwide.
The company has out-performed others in the environmental and economic dimensions by strategically focusing on achieving a long-term sustainable business model. This is reflected through a decline in the ecological footprint of the company.
The company has initiated the Sustainable Agricultural Initiative (SAI) and the Lead Agricultural Program to promote the adoption of a responsible approach towards farming practices and has also published guidelines for sustainable farming practices.
Unilever has developed the 'Greenhouse Gas Profiling Tool' in order to assess the environmental impact of its new products. It also creates nutritional awareness among consumers by labeling the nutritional value of ingredients on packets.
Source: DJSI World
The Unilever Group

36. SUSTAINABILITY AT UNILEVER: THE VALUE CHAIN (3 Minutes)

37. UNILEVER SUSTAINABLE LIVING PLAN 2014: SCALING FOR IMPACT (38 Minutes)

38. Examples of “Profitable Sustainability” Wal-Mart
GREEN SUPPLY CHAIN MANAGEMENT
Examples of “Profitable Sustainability” Wal-Mart

39. LCA-ORIENTED REPORTING INITIATIVES
GREEN SUPPLY CHAIN MANAGEMENT
1. Walmart Sustainability Index
Step 1: Supplier Sustainability Assessment
Step 2: Lifecycle Analysis Database
Step 3: A Simple Tool for Customers
2. Outdoor Industry Association Eco-index
Criteria on facility, material, packaging, product guidelines.
Step 1: Supplier Sustainability Assessment
Step 2: Lifecycle Analysis Database
Step 3: A Simple Tool for Customers
LCA-ORIENTED REPORTING INITIATIVES

40. GREEN SUPPLY CHAIN MANAGEMENT
Utilizes materials found primarily within 320 km of the Nike factory
Manufacturing process reduces solvent use by more than 80% compared with Nike’s typical products.
The leather comes from a tannery that recycles wastewater
It is colored using vegetable-based dyes.
Hemp and polyester are used to make the shoe's woven upper and shoelaces.
The mid-sole is cut to lock into the outer sole, reducing the need for toxic adhesives.
The shoe's outer sole includes rubber made from recycled factory rubber waste
EXAMPLE
SMALL SUPPLY CHAIN FOOTPRINT AND
ECO-FRIENDLY MATERIALS

41. GREEN SUPPLY CHAIN MANAGEMENT
NIKE’s Triple Bottom Line Innovation
10 Minutes 20 Seconds
NIKE’s Triple Bottom Line Innovation

42. GREEN SUPPLY CHAIN MANAGEMENT
EXAMPLE
Adidas AG to reduce its environmental footprint by 15 percent by 2015.
The main textile on the Adidas Supernova Glide 3 includes 50 percent recycled polyester.
The laces are 100 percent recycled polyester. It also features renewable foam and a Formotion heel technology that reduces waste by 50 percent.
SMALL SUPPLY CHAIN FOOTPRINT AND
ECO-FRIENDLY MATERIALS

43. The Sustainable Apparel Coalition
GREEN SUPPLY CHAIN MANAGEMENT
Members
Adidas, Arvind Mills, C&A, Duke University, Environmental Defense Fund, Esprit, Esquel, Gap Inc., H&M, HanesBrands, Intradeco, JC Penney, Lenzing, Levi Strauss & Co., Li & Fung, Marks & Spencer, Mountain Equipment Co-op, New Balance, Nike, Nordstrom, Otto Group, Outdoor Industry Association, Patagonia, Pentland Brands, REI, TAL Apparel, Target, Timberland, U.S. Environmental Protection Agency, Verité, VF Corp, and Walmart.
Sustainable Apparel Index V1.0
The Sustainable Apparel Coalition

44. GREEN SUPPLY CHAIN MANAGEMENT
The Sustainable Apparel Coalition

45. GREEN SUPPLY CHAIN MANAGEMENT
Mini-Case Analysis : Fish Products Choice at Fairmont Hotel Restaurant in China

46. GREEN SUPPLY CHAIN MANAGEMENT
Mini-Case Analysis : Fish Products Choice at Fairmont Hotel Restaurant in China

47. Yangcheng Lake, Shanghai
GREEN SUPPLY CHAIN MANAGEMENT
Yangcheng Lake, Shanghai
Mini-Case Analysis : Fish Products Choice at Fairmont Hotel Restaurant in China

48. GREEN SUPPLY CHAIN MANAGEMENT
Beijing
Mini-Case Analysis : Fish Products Choice at Fairmont Hotel Restaurant in China

49. GREEN SUPPLY CHAIN MANAGEMENT
Vegetable and produce sources
- Beijing site: locally sourced from two farms employing mentally challenged youths
- Shanghai site: from the township who is also the partner of the hotel.
- No coherent organic certification
Protein
- Beef/Lamb/Pork, US - Australia, Inner Mongolia (China)
Chicken – local farm
Seafood
- Oyster from Canada through an importer, food poisoning, falsified Canadian export documents and packaging
Farmed fish in China, mostly local
Background
Mini-Case Analysis : Fish Products Choice at Fairmont Hotel Restaurant in China

50. Broader Context on Seafood
GREEN SUPPLY CHAIN MANAGEMENT
Standards:
Marine Fish Council
Walmart: 73% total fish are MFC-certified (wild-caught) and Aquaculture Certification Council (ACC)-certified (farm-raised), WholeFoods
The Monterey Bay Aquarium Seafood Watch: pocket book guidelines on “Best Choices," "Good Alternatives," and "Avoid.” New Seasons Market in Portland, Oregon uses it together with “Home Grown” strategy.
Food safety concerns in China
Broader Context on Seafood

51. GREEN SUPPLY CHAIN MANAGEMENT
If you are an executive chef making sourcing decisions, how would you source seafood for the three hotels in Beijing and Shanghai ?
Sustainability and stakeholder issues
Safety, traceability; Local vs. overseas? Farmed vs. Wide-caught?
Certification needs? Local menu preferences
Markets: Customer demographics, luxury, eco-conscious
Centralized purchasing.
Questions

52. GREEN SUPPLY CHAIN MANAGEMENT
END OF EXAMPLES
GLOBAL ENVIRONMENTAL LEADERSHIP EXAMPLES