Supply Chain Management for Environmental Improvement

Collaborative Partnering with Suppliers and Contractors

Both customers and their supply chains stand to gain by collaborating on environmental and efficiency improvements. Benefits of partnering are:

A few examples of partnering between supplier and customer include:

Who's Doing It?

Andersen Corporation (see page 26) implements P2 with supplier input and environmental products

Applied Materials, a semiconductor manufacturer, needed a solution to copper-bearing waste water; they engaged several suppliers in design and development of a closed-loop, zero-discharge water recycling system

Ben & Jerry's (see page 33) worked with suppliers to develop chlorine-free packaging and reduce berry packaging

In 2000, Bristol-Myers Squibb partnered with suppliers in Egypt, Venezuela, and Greece to eliminate use of methylene chloride

Collins & Aikman (see page 32) work with suppliers to reduce VOCs in carpet products through reformulation of raw materials

Cosmair and suppliers recycle or reuse shipping containers

Eli Lilly and Company (see page 33) and a supplier researched and found an alternative raw material for a lead-bearing catalyst

Levi Strauss & Company works with suppliers worldwide on water quality. More than 35 water treatment systems were built or upgraded at laundry and product finishing facilities. Many recycle the treated water. One launderer in Texas uses the treated water to irrigate an adjacent field. (Reference: Supplier Environmental Management, Businesses for Social Responsibility)

Herman Miller contracts with their supplier of PVC vinyl edging, to take back the PVC scrap for re-extrusion into new edging

Maytag teamed with a supplier on packaging reductions

Nike seeks partnerships with ecologically responsible suppliers. For example, Nike's Air Sole manufacturing plant diverts approximately 5 million pounds of manufacturing scrap from the waste stream, and 92% is sent to Tetra (currently a subsidiary, formerly an independent supplier), to be processed into new film for Nike's use.

Patagonia works closely with suppliers to minimize their environmental impacts; including helping them successfully grow organic cotton

Roche Vitamins and suppliers redesigned their packaging

Royal Crest Dairy changed to a new supplier who agrees to recycle packaging

SC Johnson Wax works with suppliers on VOC reduction and packaging reduction

Xerox Corporation works with suppliers to make "smarter" parts and products for their office equipment, especially to facilitate remanufacture of the Xerox copiers and other equipment at the end of its useful life

Going To the Customer

Ashland Specialty Supply Company (see page 28) works with customers on product reformulation, distribution, waste disposal, and chemical management

NACHI Technology implements packaging reduction for customers and offers shared savings through a reduced priced product for the customer

Additional Resources

From the National Environmental Education and Training Foundation (NEETF) and Greenbiz.com:
  - Standardizing Excellence: Working with Smaller Businesses to Implement Environmental Management Systems; and
  - Environmental Mentoring: Benefits, Challenges & Opportunities

PPRC's Topic Hub on Environmental Mentoring

Servicizing (from PPRC's Product Stewardship resource)

"Optimizing the Chemical Supply Chain: The Trend Toward Chemical Management Services", by Darcy Whaley & Jill Kauffman Johnson, 2000.

Suggestions for Partnering With Suppliers or Contractors

checkbox Involve suppliers early

Why? Long lead times necessitate early sourcing and early supplier involvement in green product development

checkbox Identify opportunities for improvement that suppliers may be able to help resolve

Examples:

  • Gather a cross-functional team of staff to brainstorm on product and process improvements; include office, design, manufacturing, procurement, waste handling, and other staff
  • Evaluate your current products and supplier products for life cycle impacts
  • Evaluate manufacturing, office, maintenance, inventory and other operations against environmental policies, goals, management systems, etc. to determine areas that need improvement
  • Ask all your suppliers for suggestions

checkbox Prioritize the opportunities identified in the previous exercise and determine a set of action items to implement the top opportunities

Example prioritization criteria:

  • Start with the "biggest bang for the buck"
  • Focus on products or processes that generate the most pollution or highest volume waste stream
  • Focus on operations that your staff may not have the sole expertise or time to address, such as chemical inventory management, just-in-time inventory, reusable packaging, process improvements, alternative solvents, energy reduction, scrap recovery, etc.
  • Start up the effort with one or two supplier(s) known to provide quality products and service, exhibit some environmental initiatives and interest, or are have a longstanding business relationship with your company

checkbox Identify existing and new suppliers that go beyond simply providing a product or basic service, and are willing to help their customers meet environmental goals

Examples:

  • When their existing compressed gas supplier refused to take back empty cylinders, Eli Lilly and Company sought out and found a new gas supplier who would take back spent cylinders for recycling
  • Anheuser-Busch Companies, Inc., a beverage producer, worked with aluminum can manufacturers to decrease wall thickness and lid diameter, acheiving a 30% weight reduction in aluminum cans and changing beverage can design industry-wide

checkbox If applicable, establish terms and agreements for the partnership

Examples:

  • Will shared savings be adequate compensation for each party?
  • Will you need to pay for the supplier's additional services or participation?
  • Is the agreement informal or does it need to be an official business document?

checkbox Consider becoming an environmental mentor, or find an environmental mentor to assist you

Examples:

  • General Motors (GM) Lean Implementation Program mentors suppliers on environmental and other key business issues
  • GM’s Supplier Environmental Advisory Team provides feedback from key suppliers to help shape GM’s environmental initiatives

checkbox Influence up and down the supply chain by providing customers with waste saving ideas, proposals, and initiatives

Example: With persistence and cost data, NACHI convinced one of their largest customers to start using a reusable packaging system

 

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