Why are companies going Green?

Not only in the EU but also in the USA and others countries the public becomes more and more aware of environmental problems for instance because of global warming. Therefore consumers may ask companies questions about their efforts to improve sustainability, reduce carbon dioxide emissions or reduce waste of their manufacturing processes and supply chain.

However if you regard the results of the Survey Report published by Bearing Point and others: 2008 Supply Chain Monitor “How mature is the Green Supply Chain?” you find some more reasons. When the over 600 professionals were asked about the main drivers for introducing a Green Supply Chain strategy, 22% answered because they wanted to be in compliance with today’s and anticipated future regulations, 19% responded in order to improve the Brand’s image by reacting on consumer expectations, 15% were motivated by the innovation generating effect of the different Green Supply Chain approaches and 13% were pushed by the cost-reducing effects of the resulting process optimisation. As a result we can state that a higher consumer awareness of environmental issues or Greenwashing are only some reasons among others.

Let’s have a look at some impressing results of Going Green:

General Motors reduced disposal costs by $12 million by establishing a reusable container program with their suppliers.

Through its Zero Waste initiative, Wal-Mart has so far saved 478.1 million gallons of water, 20.7 million gallons of diesel fuel and millions of pounds of solid waste. Through its 100% Renewable Energy program, the company expects to reduce energy consumption by 30% at all of its new stores in seven years.

Does your company has already been Going Green?

The Green Supply Chain concept

The concept is founded on the sustainable development approach which comprehends several components for instance that the needs of the present society are to realize without compromising the ability of future generations to meet their own ones.

As the implementation of this approach within a company influences nearly all the company’s functions, it has a major impact on a company’s supply chain. The reason is that SCM encompasses all functions of a corporation as it aims to optimise the management of all flows of material, funds and information between the various companies and departments which make the product or service available to end-consumers.

The Green Supply Chain approach seeks to reduce a product or service’s ecological impact to a minimum. Therefore the concept has to cover the entire life cycle of the product since each phase can influence the environment negatively. As a result we have to consider a cycle model instead of the common linear model of the classical Supply Chain.  However if  a company already uses  an integrated reverse logistics approach, they are on the best way for a Green Supply Chain.  In the centre of the product life cycle we see the Green design. The reason is that the company needs to bear already in mind the environmental impact of the future product during the conception process. At this early stage the company should find compromises between a low negative environmental impact and justifiable costs in each of the company’s functions. The illustrated main functions are Sourcing, Manufacturing, Distribution, Product Recovery (Reverse Logistics) and the overall Logistics Management. Then in each phase efforts have to be undertaken to lower the environmental footprint of the product/service. Taking the example of the manufacturing phase the management could approve measures to reduce energy consumption and waste. Therefore this cyclical approach involves all parties of a supply chain which are suppliers, subcontractors, distributors, buyers and consumers.

Re-evaluation of the supply chain generates clear benefits

When companies re-evaluate their supply chain before adopting a Green Supply Chain strategy from the product design/purchasing to the distribution of finished goods they often identify cost saving possibilities. In my opinion a precondition for the adoption of each action should be that its costs equals at least its benefits. In this case a company will always benefit from implementing green policies and reducing the environmental impact of its products/services. However some supply chain executives still don’t seem aware of the benefits of a Green Supply Chain for instance thanks to lower material costs or a lower waste disposal. Moreover one has to admit that the measuring of costs and also of benefits depends strongly on the company and its environment for instance its consumer’s awareness of the issue and its stakeholders. Another problem is the fact that there is no single standard about how to measure for example carbon dioxide emissions of a company’s activities.

For further reading please have a look at these pages:
2008 Supply Chain Monitor “How mature is the Green Supply Chain?”
An articel from Forbes about the Green Supply Chain
Mr. Murray about the Green Supply Chain

The Idea behind SCM

For several decades more and more companies outsourced non core activities and reduced their intra-organisational division of labour. As a result more differentiated supply chains had to be set up. Except for some exceptions there is nearly no more competition between vertically integrated companies but between deeply structured supply chains. These supply chains are built of exchangeable independently acting companies connected by contracts. Therefore a company’s management need to structure and coordinate the whole chain with respect to their market’s requirements in order to be competitive and successful. These considerations led to the development of supply chain management. The complexity of a company’s supply chain varies with the type, intricacy and amount of products which are sold.

A possible descriptive definition of SCM

The definition given by the Council of Supply Chain Management Professionals is the following one:

Supply chain management encompasses the planning and management of all activities involved in sourcing and procurement, conversion, and all logistics management activities. Importantly, it also includes coordination and collaboration with channel partners, which can be suppliers, intermediaries, third party service providers, and customers. In essence, supply chain management integrates supply and demand management within and across companies. … Supply chain management includes all of the logistics management activities noted above, as well as manufacturing operations, and it drives coordination of processes and activities with and across marketing, sales, product design, finance, and information technology.

Reasons and advantages of SCM

Some of the reasons for which a company sets up a SCM is to increase customer satisfaction for instance by reducing delivery times, to allow faster adaptation to market changes, to avoid out-of-stock situations while aiming to an overall reduction of stocks, to generate cost benefits through the optimization of the supply chain, etc. Overall advantages of the SCM concept are a higher transparency of the flows of goods, funds and information, a continuous controlling of processes, a reduction of process time and costs as you can clearly identify the big cost drivers.

Elements of the Supply Chain

On his site about logistics and supply chain management, Martin Murray states that a company’s supply chain is made up with the following elements especially if the product is manufactured on order by the client. The customer demands a certain product by contacting the sales department. After having combined different orders the planning department establishes a production plan which takes into account the different requirements of the orders for instance the necessary materials and services. The purchasing department manages the buying of the mentioned goods from the suppliers. These raw materials are received, checked and stored by the inventory. Following the production plan finished products are manufactured by the production department and stored in the warehouse. The logistics department organizes the delivery of the goods to the customer.

SCM-Levels

As already mentioned above, a company has to operate on the strategic, tactical and operational level of the SCM in order to operate efficiently, cost effective and to achieve a high customer satisfaction. Decisions on the strategic level are important for the overall design of a company’s supply chain and represent the guidelines for the tactical and the operational level. Examples of strategic SCM decisions are for instance

• in the product portfolio like the development of new products or the re-launching of improved existing products in order to guarantee a steady growth of the company always with the identified customer segments in mind or
  
• in the logistics management which is the backbone of every supply chain decisions concern the design and the operation of the logistic network which encompass among others warehouses, distribution centres and transportations modes. One of the main points concerns which part of the logistics should be managed in-house or by subcontractors.

However decisions on the tactical level aim for the implementation of measures which will create advantages for the company for instance cost reduction. Let’s consider some examples:

• concerning the product development the management has to decide about the specifications of the products, in which country they should be manufactured and sold in,
• in the manufacturing field managers have to find a way to produce the needed qualities in the most cost-effective way and
• even if the overall strategic guidelines stipulate an in-house logistics department managers may have to outsource some activities because a third party logistics provider (3PL) which is a company that offers outsourced / “third party” logistics services to other corporations can do it at lower costs.

Operational decisions are made on an everyday basis about how the development, the selling, the moving and the manufacturing of the company’s products are organized in order to achieve the highest cost benefits possible. Considering for instance

• the supplier relationship where it could be necessary that local managements order from local sub-contractors instead of from the global suppliers because they need components with a higher or lower quality in order to adapt the finished goods to the local requirements or
• the logistics management which may use a global logistics partner (3PL) who is often fully integrated in a company’s supply chain will have a big problem if the company’s 3PL doesn’t operate in one or several regions and so local managers have to use regional logistics provider.

SCM – Technology

A company needs highly performing information and communication technology tools to organize its SCM processes. The reason is the high complexity of today’s often global supply chains with its many subcontractors on each level of the chain. Large companies use Enterprise Resource Planning (ERP) suites for example SAP and Oracle.

What I liked most about Mr. Murray’s site was the fact that his explanations were easily comprehensible. In my opinion this page really helps to get an overview of SCM. However he didn’t mention the role of wholesalers or retailers in his description of the elements. Moreover he hasn’t considered the role of reverse logistic which means the receiving of defective products and even the recycling of used products.

For further information, please have look at these sites:

Mr. Murray’s Page
Council of Supply Chain Management Professionals
American Society of Transportation and Logistics
Supply Chain Council
The Infosys Blog sees SCM from a process and IT oriented point of view
Supply Chain Management Review
MIT Center for Transportation & Logistics

I decided to start Ultimate Frisbee because it’s a limited-contact team sport which is self-officiated by the players following the “Spirit of the Game”. Therefore sportsmanship and respect for each other are a precondition as it is in the players’ responsibility to assure a fair game. Additionally unlike many other sports you train nearly all muscles and the coordination of your body. What I liked most about Ultimate was the strong team spirit, the fun of playing together and the cheering of opponents at the beginning and the end of games for which each team has its special custom.

Basics

Ultimate is played with a 175 gram flying disc and the aim of the teams of seven players is to score points by catching the disc in the opponent’s end zone quite similar to American football. To win one team has to achieve a certain number of points. The length of the playing field is 64m and each end zone measure 18m on a width of 37m. At the beginning of the game and after each point the play begins with a pull. Therefore the players are lined up at the edge of their respective end zones and the defending team throws / pulls the disc as far as possible in direction to the offensive team. The disc may be moved in any direction by passing it to a team mate. The player who catches the disc has to stop as fast as possible, and then he can only move his non-pivot foot. As the possession of the disc by one player is normally limited to 10s counted by his defender / marker, the game becomes quite fast. The offenders sprint to get open and the defenders try to catch up with him. After a point the teams exchange sides and the scoring team begins with a new pull from the edge of the end zone in which they made the point.

Variations

The game came up in the late 1960s in the USA and now it’s an international sport played nearly everywhere with championships on all levels. Moreover there are different types of Ultimate like Indoor Ultimate which is played on smaller fields and with smaller teams indoors, Beach Ultimate is a variant of it as well as Intense Ultimate on a even smaller playing field and quite similar to Streetball.

For more information

For those of you who became interested in Ultimate please look for further information beneath:

The World Flying Disc Federation
The European Flying Disc Federation
Beach Ultimate Lovers Association
Deutscher Frisbeesport-Verband

There are several interesting pages about European Politics on which you can inform yourself about recent developments. If you look for general information about Europe and the European Union you might visit the relevant site of your government for instance the one of the German Bundesregierung or your Foreign department in my case of the Auswärtiges Amt. Of course it might be interesting to have a look at the site of the European Union as well. However for in-depth information on specific issues I would like to present you one site which I think is really informative and easily comprehensible.

The CAP – Germany’s n° 1 think tank

The screen shot shows you the main page of the CAP, the Center for Applied Policy Research. Attached to the University of Munich, the CAP is one of if not the largest policy research institute in Germany and enjoys international reputation. The institute is directed by Prof. Werner Weidenfeld who is internationally known for his work. The think tank tries to give practical political advice to politicians in the form of possible strategies and options. Moreover the institute publishes a large number of reports freely accessible on the Internet. One of its research fields is European integration in which “current projects focus on efficient EU governance, the institutional reform and questions of legitimacy within the EU, as well as “Greater Europe” and its global responsibilities”.

Other Sources

Another equally  informative think tank is the Brussels based European Policy Centre which is also very well-known. The EPC offers a big variety publications on different topics, too. For those of you who don’t want to read in-depth reports on specific problems but wish to keep in touch with recent developments concerning European Policy, I recommend the Economist’s Blog “Certain ideas of Europe”.

There will be a successor of the Bar Project in the near future. Then we are going to interview an English speaking Businessman.

But now I will present my adventure in the bar. Furthermore I will illustrate the vocabulary I noted during the interview.

I had chosen a pub near Kurfürstendamm. After having sneaked about in the pub for some minutes, I started speaking to a young couple which you can see on the photo below. On the left you can see Peter and on the right side is presented his girlfriend Jane. After having presented each other, we spoke about what we do in life and where we come from. They are both from Liverpool. He is 35 years old and works as engineer in the construction branch. While she is 37 years old and is employed in the marketing department of a fashion store. When I explained that I am enrolled in a Franco German Double Diploma Program, they were curious and wanted to know a lot of details. We even spoke same phrases in French as Jane had learnt it for several years. Then I told them of my first trip to London  during this year’s Easter weekend and what I visited. They said that I had seen quite a lot of London. I replied that I absolutely wanted to return there in order to discover the suburbs of London by bike by following the River Thames upstream and downstream.

Peter and Jane

After a while I asked them to tell me some special pub vocabulary. Please find the expressions here after and enjoy the reading. But be careful when and to whom you may use them.

Another word for water is Adam’s ale.

There are several words to express that you are drunken, for instance to be bladdered, to be caned, to be plastered, to be trolleyed, to get trashed or to get wrecked.

The same is for expressions to say that one wants to go to the toilet for example I need to go to the bog, to the loo or to the smallest room in the house.

Men usually use some more informal expressions to pass the message that they want to go the toilet like I need to pee, to siphon the python, to point Percy at the porcelain, to go for a slash or to take a leak.

If a bloke asks you for a fag, a big man wants to have a cigarette.

When you are drunk, you may talk codswallop which means rubbish.

During the evening you may be obliged to talk to several prats, plonkers or people who are thick as two short planks which mean to stupid persons.

After a long day, it could be that you are shattered, shagged or knackered in other words tired.

It’s possible that someone asks you what you have seen recently at the flicks which mean at the cinema.

If you are really up for it or you want to have it large, you are willing to have a good time.

After a drinking spree you may get the munchies which mean a strong feeling of hunger.

Before leaving the Pub you may have one for the road while as the driver of the car is on the wagon and is not allowed to drink.

After two hours of discussions we exchanged our addresses and said good bye to each other.

This was my Bar Projet. I hope you enjoyed it.