The Rise of Green Supply Chains in Response to Mega Trends

Explore the Rise of Green Supply Chains in Response to Mega Trends

PurchTips Edition #422

Supply Chains are the Ultimate Delivery Mechanisms of the products and services of the Global Marketplace. Modern Customer Requirements make the mandate of modern supply chains quite clear; Deliver Products and Services that are Sustainable, High Quality, Low Cost, with profound Social Responsibility.

It is from this this backdrop, that several Mega Trends have emerged and have placed unprecedented demands on Modern Supply Chains to be Greener and Leaner.

The modern Mega Trends are:

  1. Urbanization
  2. Population Growth, with 35% increase in demand for food, 40% increase in demand for water and 50% increase in demand for energy
  3. Climate Change and Ecological Impacts
  4. Technological Disruption, including Big Data Analytics, Robotics, Blockchain, Artificial Intelligence and Machine Learning
  5. Political Disruption, including evolving Trade Wars

Many companies are responding to the above Mega Trends in robust and innovative ways. Also, today’s consumer is becoming more and more Eco-Conscious.

The focus of this article is a response to Mega trend #2. In response to Population Growth and increase in demand for food, we see the steady rise of Vertical Green Farming. This awesome innovation in farming, is also called indoor farming, where vegetables are grown in vertical columns, stacked one on top the other. This is far different from the traditional method of growing produce in fields. This concept dramatically reduces the travel distance and fuel consumption of traditional farming. Physical work environments for employees are being controlled to enhance the Social Responsibility companies.

Many of these farms are equipped with advanced hydration systems to reduce water and energy wastage.

The following are the primary benefits of Vertical Green Farming:

  • The Ability to garden in a wide range of locations and environments
  • Near immunity to pests and reduced need for pesticides. A dramatic reduction in the carbon footprint for pesticides
  • Dramatic reduction in pathogens and consumer health risk
  • Increased workforce retention and Job Satisfaction
  • Utilization of renewable energy as the power source for Vertical Green Farms
  • Dramatic reduction in water and soil requirement
  • Higher Quality
  • Reduction in Logistical Movement and Transportation as Vertical Green Farms can be set up close to their consumer bases. This creates a reduction in energy requirements.

The above example of the Greening of Supply Chains demonstrates tremendous benefit to society. Many companies are actively greening their supply chains to realize astonishing financial, brand image, and other benefits.

Robots are also being leveraged to provide greater efficiencies in farming. Robots are now being used to pick fruit and vegetables with astonishing improvements in productivity and crop yields.

Some of the benefits to Companies of Green Supply Chains are:

  1. Reduction in Transportation and Movement of people and materials
  2. Reduced Carbon Footprint
  3. Reduced Cost provided by paperless transactions
  4. Increased Public Image
  5. Increased Revenues
  6. Reduced Operating Cost
  7. Increased Profitability

Caveat: The key for companies to accomplish Greener more Sustainable Supply Chains is the Leverage of Collaboration, Information Sharing and Integration, Innovative Technology (Including Robotics, Artificial Intelligence), and Data Analytics (Including Autonomous and Adaptive Machine Learning).

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Copyright 2018. This article is the property of the Next Level Purchasing Association and may not be copied or republished in any form without the express written consent of the Next Level Purchasing Association. Click here to request republishing permission.

By David Millington, SPSM, SPSM2, SPSM3 - Director of Education (Next Level Purchasing Association)

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