Last Friday I heard an interesting piece on NPR’s Marketplace on my drive home from work and I think that it’s very relevant to this crowd. It was called “Can Wal-Mart save the world?” and it talked about some of the efforts that the world’s largest retailer is undertaking to promote sustainability. Although this post isn't about my normal topic, RFID, since my last post was about Wal-Mart using their massive retail weight to…ahem…encourage their suppliers to action, I figured readers would find this interesting nevertheless.
In my personal experience, Wal-Mart doesn’t have the word ‘superhero’ painted across its chest; quite the contrary. It’s not abnormal to hear negative public opinion about the vulnerable senior citizen greeters at Wal-Mart’s stores that can’t afford health care or the Mom and Pop shop that had to shutter their doors when Wal-Mart moved to town. So I was pleasantly surprised to learn that they are making efforts to reduce waste and increase sustainability efforts in their sphere of influence. Don’t get too excited, however, their CEO, Lee Scott, was the first to admit that this is not an altruistic endeavor. In fact, one might even suspect that these efforts are specifically designed to start stitching that S into their cape. Regardless of the motivation, however, the results are dramatic and certainly pointed in the right direction.
Scott says that they intend to use, as a company, 30% less energy, through means such as automatic lighting systems that turn on only when needed. Note that this will also dramatically reduce their operational costs, but who can argue with less energy consumption. They are also using their considerable market presence to encourage their 60,000 suppliers to reduce their packaging by 5% each year. They estimate that this will take 213,000 trucks off the road and save 67 million gallons of diesel fuel per year. Wow. Think about that for a second. 67 million gallons of fuel saved. Who can really argue with those kinds of results right now?
SAP has also been committed to these kinds of endeavors. So much so that we started a business unit focused on sustainability. SAP, as one may expect of a German company, has long been an environmentally friendly company and has made many decisions to ensure that our operational activities are as sustainable and as economical as possible. Now, we’ve actually productized some of our experience and show companies how they can actually save money while also saving the environment. SAP offers sustainability management features in our GRC product that enable customers to easily report on economic, social, and environmental KPIs. Through these reports our customers should be able to make the decisions they need to really make an impact, both on the environment and their company performance. To the best of my knowledge, Wal-Mart is not yet a customer of ours in this space, although they did recently select our ERP Financials product. I'll keep my fingers crossed that they see this post. 🙂
The narrator/interviewer for this program, Kai Rysdal, asked Scott some tough questions, including my personal favorite, which I’ll sum up as: “How can you be green and have all of your stores on the edge of town where everyone has to get in their cars and drive to you to shop?” The answer was equally adept (again summarizing): “we do many things upstream with our logistics and our suppliers that a mom and pop shop simply couldn’t.” These kinds of discussions really make one think, and it seems to me that on this point, rational people can disagree.
Where the conversation became particularly interesting, in my mind, however, was when Scott started talking about the green potential of Sam’s Clubs. Sam’s Clubs currently offers gasoline, and because of this they have an infrastructure in place that could serve as an alternative fuel network. My ears certainly perked up at that, and I even wondered if Scott has had the pleasure of meeting former SAPer Shai Agassi yet. If not, it sounds like there’s a potentially mutually beneficial opportunity between Wal-Mart’s stated thinking and Shai’s Project Better Place. I hope, for everyone’s sake, that the two of them can meet and make some of these wonderful and lofty goals a reality.
