On Tuesday, we brought industry thought leaders together for a conversation on Sustainability: At the Intersection of Inventory Management and Digital Supply Chain. “Sustainability” has turned into a buzzword in business recently. We gathered experts to help us get down to the details of what it truly means to operate a business sustainably, what’s being done to tackle inventory management and supply chain issues in the retail industry, and how organizations today can take action to be environmentally and socially responsible throughout the product life cycle.
While our expert panels generated a robust conversation with a breadth of valuable insight, here are our three biggest takeaways on achieving business sustainability:
1. Supply chain startups are driving change within inventory management.
According to panelist Natan Reddy, Senior Intelligence Analyst from CB Insights, supply chain startups generated $1B of funding globally back in 2014. This number is projected to increase to $12-13B in 2020, illustrating a massive need in the marketplace for technology to help solve supply chain and inventory management issues. These startups are tackling visibility, connectivity, and automation in different ways. Digital platforms like Celect are being built to help companies better forecast consumer demand, services like Happy Returns are being designed to take the headache out of returning products, and new forms of customized manufacturing are starting to appear across the industry—all in the name of reducing excess inventory and reducing waste.
The value of this technology is evident in terms of enabling both small and large organizations to enact change. For example, Flexport, which was represented at the event by their Northeast GM Kaitlin Glancy, has developed a tool called Carbon Offset, which enables clients to track dollars and tons of CO2 saved by choosing different methods of freight forwarding within the Flexport user portal.
Google’s Head of Retail Analytics & Attribution, Matt Seitz, summed up this conversation by saying, “Tech enablement is much more accessible than it’s ever been.” He continued on by sharing, “Work that used to require years of time, and data scientists or programmers to complete can now be done in much less time with way fewer resources.”
2. Data is powerful when it comes to prioritizing sustainability.
Now that we understand implementing sustainable initiatives doesn’t necessarily require much time or many resources, what is holding organizations back from making changes? According to panelist PC Chandra, Head of Global Operations at Diane Von Furstenberg, “The only thing that takes time is the cultural mindset inside the organization.” Organizational mindset shift around sustainability will come with prioritizing sustainable initiatives and properly incentivizing them. “Sustainability must be as important as your gross margin targets,” said Chandra. “If not, you won’t see the adoption.”
Quantifying the positive impact an organization is making on the environment can further motivate business leaders to drive change. Panelist Camille Tagle, Co-founder of FABSCRAP, a textile recycling non-profit, explained that each of her clients receive individualized data on the total recycled poundage and resulting environmental impact they’ve made. Similarly, Flexport clients receive the equivalent for the total tonnage of CO2 they’ve offset. According to panelist Lisa Gurwitch from Delivering Good, these powerful data points “create a whole new perspective on your work when you’re able to do good in the world through your work.” “Brands are increasingly understanding the concept of doing well by doing good,” said Chandra.
3. Sustainability is a long-term game, not a short-term gain.
A portion of the panel focused on how sustainability impacts profitability, since sustainable initiatives have an expensive reputation in the marketplace. Tagle countered this idea by saying the landfill will always be cheaper, but it leads to an expensive impact on the environment in the form of climate change and other effects. She then challenged the audience to think about what it really means to be sustainable in your organization.
“Disrupting your supply chain and changing your processes will be more expensive upfront because you’re reinventing the system, but it’s an investment,” said Tagle. “It’s proven that from a financial standpoint alone, making a company more sustainable will naturally make the organization more profitable over time.” How? By organizing processes, perfecting systems, and being more accountable for every step in the supply chain will naturally improve a business and lead to profits over time.
There you have it — our top three learnings from our sustainability panel. How can you start implementing sustainability initiatives in your business today?