2. Agenda
• What is sustainability?
• What has driven our current supply chains?
• Developing sustainable supply chains in a recession
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3. Carbon and climate warming are big news …..
• In 1 hour 25 articles were published on Google News
• In 1 day 199 articles were published
• In 1 week 1734 …….
• Obama Touts U.S. Participation in Global Talks on Climate Change (US)
• Cricket goes green (ECB – UK)
• High tax to attack binge flying culture (Kuwait)
• London will be hotter than Northern Portugal by 2071 (India)
• Work with us on Carbon Savings – Retailers tell UK Government (UK)
• “Climate change” – 51million hits
• “Global warming” – 32 million hits
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4. But there are more (and bigger?) environmental
issues to worry about than carbon …..
Deforestation
Water shortages
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5. ……and let’s not forget the social issues …..
UK:
5.35 hectares
Bangladesh:
0.53 hectares
Global Average:
2.28 hectares
Source: WWF Living
Planet Report 2002
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6. The sustainability agenda is much wider than the
environment ………
“Development which meets the needs of the present
without compromising the ability of future
generations to meet their own needs”
environmental
UN World Commission on
Environment and Development 1987
healthy efficient
sustainable
economic
social
fair
6 April 2009 Sustainable Supply Chain Management in a Recession -
LCP Consulting 2009
7. Agenda
• What is sustainability?
• What has driven our current supply chains?
• Developing sustainable supply chains in a recession
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8. CEOs have traditionally focused on 5 key business
levers……
+ + + =
$:£:€
Growth Margin Velocity Return Cash
Show me the Find more Increase Maximise Release
growth! margin! responsive- returns! cash!!
ness!
Release
assets!
Adapted from ‘What the CEO Wants You to Know’ by Ram Charan
8 April 2009 Sustainable Supply Chain Management in a Recession -
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9. …. and for many their only thoughts about sustainability
were concerned with the firm’s economic well being…….
environmental
With a focus on
healthy efficient
business efficiency
sustainable
economic
social
fair
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10. Consequently the goal of supply chain management was
balancing operating costs and customer satisfaction…..
Customer Operating
satisfaction costs
How can we improve on both arms of the scales?
Where are the easy wins?
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11. The easy wins used to be in low cost sourcing….
World Trade and GDP
1950=100 1950=100
8000 8000
Forecast
7000 7000
6000 6000
5000 5000
4000 4000
3000 3000
World Trade
Manufactures
2000 2000
1000 1000
World GDP
0 0
1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015
Before the credit crunch growth in world trade was outstripping growth in world GDP
Source: WTO 2006 Statistics
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12. … and in 2006 the value of East-West flows were
nearly double West-East ……
Western Europe to Asia ~$200 billion
Asia to Western Europe ~ $320 billion
Western Europe to North
America ~$300 billion
North America to Asia
North America to Western
~$220 billion
Europe ~ $180 billion
Asia to North America ~
$430 billion
Probably not sustainable!
12 April 2009 Sustainable Supply Chain Management in a Recession -
LCP Consulting 2009
13. Agenda
• What is sustainability?
• What has driven our current supply chains?
• Developing sustainable supply chains in a recession
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14. Situation now - crisis or opportunity?
CRISIS
--------------------------
Danger & Hidden
Opportunity
We prefer opportunity!
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15. LCP’s Supply Chain Maxims to ride the downturn …
… and prosper in the upturn…….
1. BUILD IN
CUSTOMER
SERVICE
EXCELLENCE
5. REDUCE
UNPROFITABLE 2. DESIGN, PLAN &
COMPLEXITY – EXECUTE FOR
CUSTOMERS AND AGILITY
PRODUCTS
4. COLLABORATE 3. SYNCHRONISE /
TO LEVERAGE INTEGRATE TO
PERFORMANCE ELIMINATE WASTE
…….will also deliver more sustainable supply chains
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16. Our experience of what organisations are actually
doing…...getting started!
Transport of
grapes to winery
(7)
(1) (3) (12)
(2) (8) (9) (11)
Transport of (10)
bottled product
to warehouse
(5)
(6)
(4)
(11) (12)
(10)
(9)
(8)
(7)
(6)
(5)
(1) (4)
(2) (3)
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17. What you need to do…..
• Define your sustainable priorities
• economic/social/environmental
• Identify supply chain risks and opportunities
• understand your end-to-end supply chain
• Link the sustainability agenda to the business agenda using the 5
maxims
• collaboration/waste reduction/asset sharing……
• Prioritise actions
• “apply business principles to the environment, not environmental
principles to business”
• Get started – there are plenty of first mover advantages
17 April 2009 Sustainable Supply Chain Management in a Recession -
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18. Unlocking environmental supply chain value
LCP Consulting
The Stables, Ashlyns Hall
Chesham Road, Berkhamsted
HP4 2ST, United Kingdom
www.lcpconsulting.com
jeremy.hammant@lcpconsulting.com
Tel: +44 (0)1442 872298
Mobile: +44 (0) 77 9699 0639
18 April 2009 Sustainable Supply Chain Management in a Recession -
LCP Consulting 2009
