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Sustainable Supply Chain

Firstly, a shout out to all the supply chain professionals. I would argue that Supply Chain Management (SCM) as a profession has done some of the most important behind-the-scenes work to grow the world economy and bring millions of people out of poverty across the world. Efficient supply chains have allowed people, organizations, regions and  countries to specialize in what they do best and reach customers all over the world with ease. Now that supply chains have essentially enabled frictionless commerce across the world, a bigger challenge awaits them. It is to make supply chains sustainable. This challenge may be greater and more intricate than that of keeping supply chains agile and efficient.

The immediate question that comes to mind is why should supply chain management professionals be concerned about Sustainability of their supply chains. There are many reasons, but the most important one is the fact that customers and consumers expect organizations and supply chains to be sustainable. The second most important is the fact that it is the right thing to do, even when it is difficult. It is the reason why Starbucks supports farming communities to be sustainable, Apple works to ensure that it has a responsible supply chain and Ikea is involved in forestry.

Supply chains are not always naturally sustainable. It requires concerted effort, collaboration and transparency among all the participants of the supply chain. It is especially the responsibility of leading brands to ensure that their supply chains are sustainable and responsible. For supply chains that are far and deep, industry level collaboration and on-the-ground support of regional government and non-governmental organizations may be needed. Business processes and systems related to supply chain management (SCM), product lifecycle management (PLM) and procurement need to be augmented with analysis, performance management, collaboration and verification systems that improve traceability, transparency and accountability in the supply chain.

As the leading provider of Technology, Supply Chain Management and Sustainability solutions it is our mission at SAP to help the world run better. That not only includes helping supply chains become agile and efficient, but also more sustainable. Our Transportation Management solutions allow supply chains to not only select the fastest or the most cost-effective transportation option, but also the most environmentally efficient transportation option. Our Product Traceability and Supply Chain Integrity solutions improve transparency throughout the supply chain. Our innovative Product Stewardship Network solution is designed to help organizations in many industries collaborate with their suppliers to improve transparency related to hazardous materials, conflict minerals, environmental standards, labor practices and product sustainability. Our view is that Sustainability is best improved by integrating Sustainability aspects deeply into day-to-day business processes and activities. It is the most effective way to make Sustainability a natural outcome of strategy and action.

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