Fostering a Culture of Innovation for Sustainability

In conversation with Prisila,Correspondent,Asia Business Outlook Magazine, Vinay discusses leveraging data and technology for monitoring supply chain sustainability. He also explores how industry leaders keep up with dynamic sustainability regulations to ensure compliance.

Vinay Bansal ,with over 28 years of experience, he has excelled in supply chain management for core sectors like chemicals, steel, cement, and polyester. From handling large-scale procurement at Grasim Industries to managing Greenfield projects, he also founded a successful procurement outsourcing startup. Currently, he led supply chain operations for a prominent Agrochemical manufacturing company in India, focusing on sustainability and global market competitiveness.

Innovative Solutions for a Sustainable Supply Chain: Cultivating a Culture of Innovation in Companies

Sustainability encompasses more than just carbon credits and greenhouse gases. While these factors remain crucial, companies now adopt a comprehensive approach. This approach includes waste reduction, human well-being, hazard mitigation, emergency handling, and future risk readiness, alongside greenhouse gas reduction. Emphasizing this inclusive strategy boosts a company's reputation and fosters a healthy and happy society. Society is increasingly recognizing environmental and social responsibility, shifting from traditional supply chain management to understanding these aspects better. Notably, greenhouse gas emissions have three scopes, with scope three, mainly from road transportation, now being a significant source.

Addressing sustainability involves ensuring driver and family well-being, safe transit routes, and proper training for material handling during emergencies. Partnerships with local authorities enhance awareness and accident response measures. Innovative technologies like blockchain, IoT, AI, and machine learning enable accountability, transparency, risk identification, and environmental mapping. Embracing sustainability as a culture can shape a visionary and successful organization.

Achieving Sustainable Supply Chain Management through Innovative Technologies

In the pursuit of sustainability, companies are redefining their approach to supply chain management from the ground up. By focusing on carbon credits and reducing GHG emissions (scope one and two), organizations are now embracing a holistic view to understand and control their supply chain's sustainability.

Data is the foundation of this transformation. Companies must collect consistent, accurate, and transparent data to map and categorize sources of GHG emissions, waste generation, and potential hazards. Identify hotspots which are  primary targets for immediate improvement.

To achieve seamless data integration, blockchain technology offers solutions like Oracle's Chainlink, VeChain for product traceability, and IBM's Trade Lens for visibility and document management. Pairing this with artificial intelligence enables real-time monitoring and alerts, ensuring inventories stay within targeted limits and optimizing transportation routes.

Machine learning plays a pivotal role in categorizing inventories, enhancing truck loading efficiency, and redesigning packaging for reuse and reduced waste. Implementing tracking devices through the Internet of Things (IoT) optimizes inventory management and increases asset lifecycle.

To further minimize environmental impact, companies can leverage renewable energy sources for transportation, while waste management is linked in a circular process to reduce waste and measure the carbon footprint.

By adopting these strategies and technologies, organizations can solidify their reputation as sustainable leaders in the market, with data-driven insights guiding future targets and continuous improvement.

"Sustainability in companies goes beyond environmental and societal benefits; it also leads to cost reduction."

Industry Leaders Ensure Supply Chain Compliance in a Shifting Landscape

In June, the Ministry of Environment, Forest and Climate Change in India introduced a commendable draft for Green Credit. This visionary program encompasses eight dimensions, including tree plantation, water conservation, sustainable agriculture, waste management, air pollution reduction, and mangrove conservation, eco-mark labelling, and building sustainable structures. A key term in sustainability is "carbon sequester," a process wherein certain plants and trees retain CO2 without releasing it back into the atmosphere. Notably, mangroves are effective in preserving CO2 within their roots.

On 28th June, the Ministry of Power presented another draft for carbon credit trading. The Central Electricity Regulatory Commission and the Controller of India will facilitate transparent trading, and the National Steering Committee and the Bureau of Energy Efficiency will set targets. This will transform the carbon credit landscape, allowing organizations to fulfill long-standing demands for carbon credits.

Companies can prepare for the future market by investing in data mapping and understanding their carbon emissions. Identifying hot spots, such as supply chains, and collaborating with partners to reduce carbon generation will enhance their reputation and market value. In the international market, Europe leads as the largest trader, while India stands as the primary seller of carbon credits.

Looking ahead, there is potential for scope three to be covered in future credit policies, further driving sustainable practices. By adopting a sustainable supply chain approach, companies can effectively adapt to changing global scenarios in the next two to three years. Through these initiatives, India is taking significant strides towards a greener and more sustainable future.

Empowered Employees: The Driving Force behind Sustainable Supply Chains

Companies must identify and target the most critical hotspots for sustainability, which can vary within industries. Engaging employees is crucial, empowering them to understand environmental and human-related issues. Adopting digital transformation, AI, and IoT for a futuristic supply chain, partnering with transporters to reduce GHG emissions, and enhancing data transparency are vital. Increasing CSR budgets and forming public-private partnerships for driver facilities and route safety are key actions. Employees can break down these targets into achievable milestones, receive training, and define their roles to drive organizational sustainability.

Key performance indicators are most relevant for evaluating the success and the impact of the sustainable supply chain strategy.

Sustainability in companies goes beyond environmental and societal benefits; it also leads to cost reduction. Inventory reduction is crucial, as it represents a significant portion of the purchase value. Minimizing inventory disposal, waste from unused inventory, and inventory holding days can optimize supply chain efficiency. Moreover, tracking distance travelled for procurement, sale of scrap, and transit accidents per metric ton can improve resource management and reduce environmental impact. Fuel efficiency per million procurement value and packaging material reuse add value to sustainability efforts. Additionally, minimizing per-employee travel distance can enhance work-life balance and productivity in urban areas. Implementing these key performance indicators (KPIs) helps companies achieve greater sustainability without compromising efficiency.

Message: Sustainability in the supply chain is vital for positive impact on organizations and society. It's not a cost but a cost reduction and happiness enhancer. Let's all contribute to a sustainable future.