Best Practices

A Lower-Carbon Future Starts with Low-Hanging Fruit

Procurement professionals are in a strong position to initiate positive change on a broad scale because it is relatively easy to achieve significant carbon savings. The trick is to ask suppliers the right questions about their manufacturing and operating practices.

Many companies have made investments in ‘green’, low-carbon or sustainable sourcing and procurement, and for good reason. Environmentally responsible sourcing is good for business: it can bolster customer loyalty, increase brand value, and boost sales and profits.

Not only does low-carbon sourcing allow buyers to do the right thing, it is also a value-adding practice that can raise the status and profile of the procurement profession. Environmentally responsible sourcing can be turned into a marketing tool for senior management to increase sales and profitability.

Low-carbon sourcing might be the procurement profession’s ticket to a seat at management committee.

Start with baby steps: measures procurement can take without spending money or asking permission. Here is a simple example of how to lower a company’s carbon footprint while improving efficiency and savings: courier services.

Environmental Impact as an Award Objective

Tell qualified couriers they stand a better chance of being awarded a contract if they also make an active and committed effort to reduce their environmental footprint. Encourage them to adopt new approaches such as idle-free programs; providing driver training for safety and fuel efficiency; proper tire and vehicle maintenance; measuring and monitoring emissions; introducing biofueled or hybrid vehicles into their fleet; increasing the use of bicycles in downtown traffic corridors or participating in carbon offset programs.

Take Deming’s Advice and Measure

As W. Edwards Deming once said, “You can’t manage what you don’t measure”. A good metric for gauging fuel reduction success is deliveries per gallon. Couriers know the number of deliveries they make across all customers. By monitoring the total volume of fuel consumed, they can easily calculate a period’s deliveries per volume of fuel. This statistic can be used to track the improvement of individual couriers. Once it’s known which factors have impact on deliveries per gallon, these metrics can be used to compare performance between suppliers.

Lower fuel consumption is easy to measure, reduces both emissions and costs, and certainly qualifies as low-hanging fruit.

Setting a Good and Scalable Example

If companies want to use their influence to make a difference to the environment during the bidding process, procurement needs to make sure environmental criteria are widely publicized. The goal is for all invited bidders to understand these new selection factors. In this way, encouraging a reduced carbon footprint can have a multiplier effect by potentially changing the operating practices of many suppliers, even those who do not win the bid.

Procurement professionals are in a strong position to initiate positive change on a broad scale because it is relatively easy to achieve significant carbon savings by asking suppliers to supply answers about their operating and manufacturing practices.

With a little extra effort, procurement can make a surprisingly big difference to the company’s carbon footprint and the air we breathe – and increase the value the supply chain delivers to the company at the same time.

Reducing the cost of a product or service while also reducing the impact on the environment gives procurement an opportunity to start having conversations at increasingly higher levels in the organization. It also has the potential to raise the status and profile of the whole profession.

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