Friday 21st Oct 2016 - Logistics Manager

Collaboration is key to sustainability


One third of UK businesses will focus on sustainability above all else over the next year, according to a study by Oracle.

Over the past five years things have changed dramatically. While cost, value and speed were once high on the agenda, companies are now much more concerned with environmental issues.

The research, which was conducted by The Future Laboratory, involved a survey of 56 purchasing and supply directors from major businesses in the UK. Of those, 36 per cent thought the best way to achieve sustainability would be through collaboration, whether that be combining loads for distribution, bringing companies together via a supply chain orchestrator or sharing knowledge.

However, only seven per cent said they would seriously consider such measures as they feared they would lose control and reliability working closely with a potential competitor.

Dave Food, business development director at Oracle, said: “The study shows that as regulatory and customer pressure continues to mount, supply managers will be forced to rethink their traditional business models and embrace newer collaborative ways of working.

“But we also cannot underestimate how much of a cultural challenge this will be for companies, such as supermarkets, who have built their business around the competitive advantage of their supply chain.”

In addition, 32 per cent said legislation was vital in ensuring a sustainable supply chain, 13 per cent cited technology, 11 per cent suggested pressure from investors was going to be key, while four per cent said they would be most influenced by consumers.

As well as collaboration the study showed that use of the UK’s canal and rail networks, and coastal shipping routes, which it refers to as ‘slowgistics’, is set to increase as supply chain professionals push sustainability ahead of speed when making decisions.

In a quest to lower carbon emissions companies are also expected to return to local factories as manufacturing costs come down and fuel prices continue to rise. Oracle also suggested that distribution networks of the future will be designed from the customer backwards, rather than outwards from the factory in order to become more efficient.

Barbara Morton, director of procurement at Action Sustainability said companies would be “going backwards” if they only focused on lowering their carbon footprint though.

She added that no organisation is able to change everything at once, but in order to start in the right place they need to prioritise.

Oracle said the challenge can be spilt into three stages, offering companies a simplified framework to operate from:

The first step is to introduce simple practices such as recycling, turning off unnecessary lights and travelling less; the next level sees companies beginning to assess their impact across a broad range of operations and adjust their habits accordingly; while the third stage is the emergence of regulations and consistent standards to help provide a global structure for sustainable supply chain operations.

Lastly, in order to better assess the sustainability of their supply chain operations 48 per cent of respondents said they would like predictive software to calculate the impact of their decision and those of their suppliers and 41 per cent said they would be interested in smart containers or RFID technology with the ability to provide information about the movement of products or energy usage.