Optimise your outsourcing to achieve green goals - supplychain.com

Written by: Jonathan Tapp, Head of Sustainability Services, Capgemini

What do we mean by ?green outsourcing?? It is such a broad term. On one level outsourcing effectively reduces your energy consumption by transferring your IT processing to a third party. So long as that third party can process the same amount of work more efficiently, perhaps because they have more efficient data centres or can offer economies of scale in the use of their facilities, then the net amount of energy will reduce; your company wins but so does the environment.

But this is little different from shuffling the chairs on the Titanic as the net gains are usually small and to all intents and purposes, it is effectively just a reallocation of energy use.

Three steps to greener pastures

There are, however, other approaches to green outsourcing. First of all, if you are involved in the procurement of an outsourcing contract, ask for a carbon based business case as part of the exercise and ensure that any RFI or ITT includes questions that ensure your prospective partners truly are energy efficient. The business case will ensure that the energy implications of any proposal are properly thought through whilst the qualification questions will ensure your outsourcer really is efficient in everything it does. Ask for the outsourcer?s own published environmental targets and information as to how they are doing in achieving their aims.

Secondly, look at your own use of IT within the procurement function. It is not always practical or commercially possible to simply outsource all or part of your existing IT estate. What may be possible, though, is to use third party systems providing ?Software as a Service? (SaaS) to extend your own capability into the monitoring, analysis and exploitation of the data you hold on your supply chain, thereby generating additional valuable intelligence without increasing your own foot print.

That intelligence can then be used to highlight the green (environmental) business risks that have an impact on your organisation; ?green? in this context applies to many aspects of the business. Your manufacturing might be exposed to constrained resources, such as minerals, as much as energy supply. How many CEOs these days plan a decade ahead but assume security of supply while in fact those rare earth minerals coming out of the Congo may simply not be available by then? Leading companies are now looking to their supply chains to highlight such risks.

Thirdly, remember that green is also not just about energy and resource supply. For example, water is becoming a key focus for many as companies realise too much can be as bad as too little! The business interruption caused by flooding can be every bit as disruptive when factories are shut as the consequences of drought can be on the availability of raw materials.

As a consequence of this change in awareness, many organisations now offer IT programs designed to help with the monitoring and analysis of supply chains that go beyond simple business intelligence. Typically such programs will allow you
Source: Supply Chain Digital

Source: http://www.supplychain.com/?p=27

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