need sustainability software that interfaces with that of their suppliers. Ideally,
a solution would “plug in” to the systems of supply chain partners. This
would make the entire supply chain more transparent, which is something
stakeholders have come to expect.
Automation means auditability ........................................................
Companies are starting to require that their suppliers adhere to their sustain-
ability requirements. In addition, the U.N. Global Compact and industry codes
of conduct require members to ensure that suppliers are compliant. Currently
this manual process involves a hodge-podge of emails, surveys, on site
audits, and so on. A value chain sustainability application would analyze the
requirements of, for example, regulations, industry groups or customers, and
automate the audit, documentation, and response process. It would provide
key performance indicators on sustainability programs and show what rev-
enue is “at risk” by poor supply sustainability management.
For example, Wal-Mart has unveiled a “Sustainability 360” plan and has set a
goal of one day using only renewable energy and creating no waste — and the
giant retailer has challenged its suppliers, customers, and employees to do
the same.
In 2007, Wal-Mart announced it will ask suppliers to measure and report
greenhouse gas emissions incurred in the making of certain products. The
company will start with a pilot group of about 30 manufacturers of seven
common products, including toothpaste, soap, beer, milk, and DVDs. Wal-
Mart plans to eventually widen the project to include about 68,000 suppliers.
The move is part of an overall strategy that forces manufacturers and suppli-
ers to comply with Wal-Mart standards or risk losing contracts. “This is an
important first step toward reaching our goal of removing nonrenewable
energy from products that Wal-Mart sells,” John Fleming, Wal-Mart’s chief
merchandising officer, said in a statement.
Automation yields analytics and benchmarks ...............................
An IT solution provides a scorecard that can be tailored to many uses. Data
can be customized for specific stakeholders or user groups. Value and units
of measure could be converted from euros to dollars or kilos to pounds.
Reporting units could be customized; an airline could compare plane types
in terms of their environmental impact while a keyboard manufacturer could
compare all its various types of keyboards in terms of the environmental
impact of their component parts.
262 Part IV: Managing the Flow of Information
