Could supply chain transparency give your company a competitive edge?
Supply chains have long been the backbone of an organisation, even though traditionally, very much like a covert operation, only intended to be accessible internally. However times have changed and supply chain functions are now being asked to ‘show their hands’. Companies are now being called on to offer complete visibility into their raw materials, labour practices, energy consumption, waste and carbon emissions measurement to name just a few things!
Having a responsible and ethical supply chain focus, plus transparency around those initiatives, is becoming essential to your company’s public image. A large influencing factor, is that of social media which can directly impact a company’s reputation and public image. More and more social media has the power to affect your bottom line.
Transparency can offer a significant competitive advantage. It might be a consumer’s privilege to buy a product blindly, either ignoring or not caring about its supply chain footprint. But transparently offering an ethical, compliant global sourcing strategy becomes a true competitive differentiator that could get you and your products noticed. It could be how your company gains, and retains customer loyalty, not to mention making your company stand out as a desirable employer. High-quality potential candidates are attracted to companies that demonstrate they understand that business is, and should be, more than just about making large profit margins, but that it’s about its’ people and taking care of them, all the way along their supply chain.
Once you’re on board with the reasons you need to offer a transparent supply chain, the next concern is your strategy for getting to that point. Your ability to be transparent is directly related to just how complex your supply chain is and the way you design, implement and support transparency initiatives is directly related to how your company currently plans designs, makes and ships products. You simply can’t offer transparency if you don’t have the right level of visibility of all these things.
Questions that may need answering; what new requirements will you have to implement in your process? How deeply will changes need to go? Where do you need to start? You can look at everything from how and where you source your materials to how and who assembles them and who transports them. Consider reducing emissions in your shipping practices, or ensure you use a logistics partner that does. You could choose to implement a green packaging initiative, and more. Then you need to consider how to track and measure your initiatives as well as how you make them visible to the public.
Nike, for example, has put a Nike Responsibility initiative into place. They developed the Materials Sustainability Index (MSI), a database that, over seven years of research, assembled information on 77,000 materials. Its supply chain team is thoroughly trained to make smart, creative choices regarding material choices when designing and sourcing for their new products. This means that accountability becomes a companywide value.
At ediTRACK, we are also seeing the demand grow for ethical compliance tracking software in the retail fashion industry. We are working together with our clients to harness the technology we have developed to address the challenges faced auditing ethical trade in a global market that often includes multiple tiers of suppliers and factories. We are using lessons learned to investigate how we can configure that technology to track all sorts of CSR initiatives.
In addition, our group logistics company ‘Allport Cargo Services’ have made it their duty to improve and measure ethical compliance when handling our clients’ goods. It’s the only logistics provider who is a member of the retailer-led Ethical Trade Initiative. Allport Cargo Services also has its own Ethical Compliance Programme in addition to using the latest Ethical Trade Management software to underpin the management of the process, to ensure a fully transparent and compliant supply chain.
Supply chain transparency is about harnessing the right combination of innovation and environmental, social, quality and cost best practices. When you operate with full visibility, you’re opening your company up to a new standard of excellence, and redefining what success means. It goes beyond big business, bottom lines and ROI—it’s about operating smartly, ethically and in a sustainable way, now and into the future.
The real reason to make your supply chain transparent is this: It boosts your company’s image, increases customer loyalty, and can make you shine brighter than your competition. Transparency means offering consumers real insight into your environmental and social initiatives, and your efforts to improve the quality and cost of your products. It gives you a whole new standard of excellence and the real question to answer is…
What will the cost to your business be, if you don’t make your supply chain transparent?