Personal Introduction (this is not part of the following report)
The future success of global commerce and supply chains lies in maximizing honest, creative and altruistic partnerships among organizations and individuals. The more we are devoted to doing what is good for the world (people, animals and the environment), the less we will have to worry about maximizing profits. Supply chain collaboration and stakeholder partnerships have incredible potential to unleash new solutions to our complex problems. This report, and particularly this chapter, hit on a few key points that can get the conversation going in the right direction.
7. Industry
Collaboration & Multi-Stakeholder Partnerships
The objective of supply chain sustainability is to create,
protect and grow long-term
environmental, social and
economic value for all stakeholders involved in bringing products and services
to market. [from the Executive Summary]
Pursuing supply chain
sustainability is an investment for any business and a return on that
investment should be expected. In addition to the financial benefits
generated from incorporating sustainable initiatives into the supply chain,
businesses should expect to see economic, social and environmental benefits as
well. Most companies integrate sustainable practices into their supply chain to
comply with laws and regulations, abide by international principles for
sustainable business conduct or because society expects them to.
The Context for Industry Collaboration
Great potential to solve complex supply chain challenges
lies in industry collaboration and partnerships. Just as any business challenge is best solved by incorporating a
diversity of perspectives and skills, so too are supply chain complexities best
approached with input from diverse enterprises at all levels in the supply
chain. Primary benefits of collaboration include extending a businesses
reach, pooling resources, reducing duplication and avoiding conflicting
messages.
Industry collaboration has taken two primary forms:
1 - Best Practice Sharing:
Companies focus on sharing knowledge and tools that they
have found to be successful in their supply chain progams. Although sharing of resources
with all industry stakeholders is not required, an open-source format greatly increases efficiency across an industry
and allows for enhanced development and faster evolution of industry practices.
2 - Joint Standards and Implementation:
Aims to create consistency among companies’ expectations and
supply chain programs. A shared code of conduct may be adopted to engage
suppliers through joint assessments and auditing. In some groups adoption of
shared codes of conduct may or may not be required. Additionally, these groups
may conduct join capability building for suppliers.
Opportunities and Risks for Industry Collaboration
The opportunities associated with industry collaboration
also come with risks. To determine the true value of any collaboration, a
company must first decide on which elements of their program to collaborate
with other companies.
Opportunities
Leverage with Suppliers.
By collaborating with peers on supply chain sustainability,
companies are sending a loud message to both direct suppliers and sub-tier
suppliers. This group influence can align expectations and engagement approaches
and improve general internal and external
communications.
Credibility with Stakeholders.
Indsutry collaboration demonstrates a company’s vigilance of
challenges in the supply chain and improves credibility with external
stakeholders. A forum in which to discuss controversial topics is also created
through industry collaboration.
Risks (with mitigating factors*)
Internal Commitment.
Commitment to collaborating with potential competitors can
stir up controversey within a company and defeat the purpose of industry
collaboration around supply chain sustainability. *Ensuring internal stakeholders have a complete understanding and buy
into the plan as to which companies will be partnered with is essential to
successful collaboration. Setting expectations as well as required time and
resources early in the process will also garner internal commitment.
Resource Draining.
Just as resources can be shared and cost and time
efficiencies created during collaboration, a potential resource sink also
exists. Initiating shared action can be time intensive and requires an
investment from all partners, but may not always produce results. *Clear planning and transparent goals and
expectations can reduce undesired results and amount of time for a project to
reach maturity and create substantial impact.
Multi-Stakeholder Partnerships
Whereas industry collaboration can leverage industry
specific best practices, multi-stakeholder partnerships focuses on creating
opportunities among companies and a broad range of stakeholders. These could
include national and local governments, workers’ and employers’
organizations, nongovernmental organizations, advocacy and activist
organizations, academic and issue experts and community groups. In more recent
years, a higher number of stakeholder groups have demonstrated willingness to
partner with companies. Many of these groups bring untapped knowledge about
sustainability issues to companies and develop creative solutions to complex
supply chain challenges. Beyond addressing the context for understanding
sustainability challenges, stakeholder groups help design effective responses
and act as local implementing partners. Stakeholder groups can add a layer of additional
resources and legitimacy around sustainability efforts that are vital to creating community support, a fundamental piece to a
sustainable supply chain.
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