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Broadening the Scope: 6 Lesser-Known Ways Supply Chain Sustainability Contributes to Business Success

6 Lesser-Known Ways Supply Chain Sustainability Contributes to Business Success

* By Mike Ogle *

The word sustainability makes most people think about the environment and green initiatives. Business people may quickly think about costs and regulations. Supply chain sustainability articles often focus on sourcing, energy savings, packaging and reducing physical waste.

All these things ARE part of supply chain sustainability, but a broader definition is needed that includes sustainable business practices that make business continuity a priority. Companies are pursuing sustainability initiatives that not only make them “green-er” by reducing material and resource use, but are also pursuing initiatives that help supply chain partners and entire industries continue to be viable. These consumption and competitive practices affect the bottom line today, but also reduce supply chain risks and volatility for decades and generations to come.

This article goes beyond the “green-er” benefits like energy and waste reduction to highlight some often overlooked benefits of sustainability initiatives such as culture change, recruiting, collaborations and risk reduction.

1. Lean practices align with sustainability

Individual companies can turn many small, incremental reductions in waste into large collective changes by pursuing long-practiced lean process techniques that reduce the eight types of waste. This enables longer-term sustainability by “doing more with less” and opening up additional capital to invest in growth, but lean techniques haven’t been thought of as a “sustainability” practice.

Daniel Adam, global director of fulfillment design and engineering services at MHI member Sealed Air, said, “Operational excellence focuses on being nimble and efficient. Sealed Air is known for inventing Bubble Wrap® packaging, but the company also employs more than 700 Green Belts, trained to look at process wastes and share best resource practices, often recommending less use of our products rather than more.”

Jason Adlam, vice president of new business development at MHI member CHEP USA, said, “Companies have awoken that sustainability has business benefits. Being green has costs, but you can have it both ways—eliminating waste AND being more sustainable—particularly when using a network of partners to scale your efforts of reducing waste.”

Also emphasizing how lean thinking aligns with sustainability, Bart Cera, COO of MHI member Vargo, said, “We integrate fulfillment solutions that meet output requirements, but make them as lean as possible, reducing building footprints, operating at high efficiencies and using less energy.” He explained that clients may not be providing specific sustainability targets, but the focus on lean is part of the standard design process.

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This issue of MHI Solutions focuses on sustainability and its progression in the supply chain. Consumers are becoming more interested in making environmentally friendly decisions when it comes to their buying habits and the brands to which they are loyal. Studies have found anywhere from 80-85% of consumers are more likely to buy from a company with a reputation for sustainability than from a neutral company, if their prices are equal.

Leading firms are tapping into this mindset by building more sustainability, and transparency, into their supply chains. They know that more sustainable operations will drive long-term brand loyalty and competitive advantage while having bottom line impacts on efficiency and profitability.

This issue of MHI Solutions will help provide you with the information and resources you need to address sustainability across your supply chain to improve your overall business performance.

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