Plenty of today's supply chain principles and logistics solutions were developed in an era when sustainability, safety, and security were not top priorities. We discovered that the space of feasible supply chain design, planning, control, and execution solutions are spanned by resource scarcity, demographic trends, safety concerns, and security threats at the global, regional, and local levels. One important goal is to reconcile economic sustainability with environmental and social requirements.
Dematerialization, 3D printing, postponing final product assembly, reshoring, and local sourcing can all help to reduce transportation costs. Aside from pure sustainability concerns, reducing transportation may also help to improve security and safety; after all, "cargo in transport = cargo at risk," whereas "less transport = fewer accidents." Where these concepts contribute to the maintenance of the corresponding value chains, the adoption, and deployment of these transportation reduction concepts should be accelerated. In any case, we should strive for long-term, safe, and secure supply chains that include all modes of transportation.
An important notion is that the design of sustainable logistic systems is dependent not only on transport and logistics but also on decisions made by shippers and manufacturers, besides on authorities' and governmental regulations. The same is available for supply chain security. Supply chain risk management can benefit from collaborative chain controls, which contribute to lean, agile, and resilient supply chains, while border agencies can develop new supervision models that recognize this, reducing interventions and burdens for these trusted supply chains.
Furthermore, increasing societal awareness (i.e., the final consumer) of the wide range of activities and operations behind products and services can lead consumers to make more responsible and sustainable choices, with significant impacts and effects on the overall supply chain's sustainability.
Risk reduction and avoidance
Upstream processes, from resource cultivation to individual processing steps to transportation, acts as a value to drivers. This way, careful resource selection, and processing into precursor products improve product quality. Inhumane working conditions and negligent, significant environmental damage caused by upstream processes, on the other hand, indicate an untrustworthy, risky supplier and a lack of quality.
Companies are increasingly being held liable for the social consequences of their downstream processes. Public scandals and the resulting loss of reputation can thus undermine business success.
Creating efficient business processes and increasing innovation capacity
Supply chain management enables the systematic compilation of resource, energy, and transportation costs. These costs can be reduced indefinitely if businesses design their processes (for example, logistics) more efficiently or assist their suppliers in establishing or improving management processes. Furthermore, more efficient processes and systems reduce material demand and as a consequence, reduce manufacturing costs. Responsible occupational health and safety practices can also result in cost savings by increasing productivity and reducing accidents. Integrating sustainability principles into product development can boost innovation capacity.
Working with suppliers on these issues can lead to innovative results for improving manufacturing processes and transportation.
Improving transparency and meeting higher standards in the business environment
Consumers and civil society can now more easily trace products back to their origins thanks to networking and digitization. Furthermore, communication technology, such as apps, allows quick access to this information. Consumers would be able to view the origin and production conditions of a product. By implementing sustainable supply chain management, the company can demonstrate to consumers, the public, and policymakers that it is aware of its responsibilities, willing to address sustainability impacts and risks, and prepared to mitigate them to the greatest extent possible.