[Editor's note: This is the final part of a four-part series covering the state of sustainable supply chain management in the IT sector. Previous pieces can be found here.]
A previous post, “How the largest IT companies view sustainable supply chain issues,” discussed matters that survey respondents identified as most pertinent in addressing sustainable supply chain management, or SSCM, strategies. Stakeholder interest was identified as an influential driver of social and environmental SSCM issues. This final part of the series will discuss how IT organizations are currently addressing and communicating SSCM issues, with a specific focus on how industry collaboration and supply chain transparency can help companies by driving value creation.
To recap, Malk Sustainability Partners, a specialty management consultancy that guides businesses in developing profitable corporate sustainability strategies, engaged global IT companies and industry experts to investigate the key drivers, important issues and popular strategies behind the sector’s adoption of SSCM. MSP then synthesized this information into a study describing the state of SSCM in IT, available for download here.
So why do businesses choose to pursue SSCM strategies? We found the four main drivers of SSCM to be:
- Stakeholder interest.
- Risk and cost management.
- Regulatory pressure and compliance.
Every supplier or customer within a supply chain will, at some point, be faced with the task of effectively addressing common challenges that arise from each of these four areas of concern. So the big question to answer is:
How can businesses address these issues effectively through SSCM?
Fortunately, information collected in this study provides valuable insight into how emerging SSCM strategies are making it easier for businesses to address these issues and pursue successful SSCM.
Opportunities and Challenges
Can pursuing SSCM strategies help business? Absolutely. Nearly 70 percent of respondents see value from dedicating resources to SSCM. Many of these are consumer electronics brands and OEMs that source from component manufacturers and are exposed to risk from unsustainable supplier operations, such as the recent episode in which one of Apple’s suppliers in China was found to be employing underage workers. While the majority of companies in the industry have adopted SSCM policies, each company defines its level of commitment and engagement differently, depending on the type of challenges faced. This study identified several common challenges in adopting SSCM:
- Supplier transparency.
- Communicating with stakeholders.
- Managing regulatory requirements.
What do these challenges have in common? The need for better communication! Specifically, we found that this communication challenge in terms of supplier engagement to be managed in three primary ways: customer inquiries, compliance audits and industry collaboration. Out of these, industrywide coalitions were explained to be particularly beneficial.
Next page: Collaborating for SSCM