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July 29, 2009
Companies Face Challenges in Improving Visibility of Supply Chains
    by Robert Kropp

Respondents to a Business Performance Management Forum survey cite cost savings, environmental compliance, and improved customer service as factors in enforcing sustainability throughout their supply chains.

In a recent online survey of 125 global business professionals, the Business Performance Management (BPM) Forum sought to measure how companies are managing the complexities of supply chain demands, including environmental concerns. Respondents indicated a need for "better standards and key performance indicators for measuring sustainability levels of supply chain partners."

Entitled Acceleration of Eco-Operation: Achieving Success & Sustainability in the Supply Chain, the report found that while nearly 90% of respondents said that management at their companies subscribed to such principles as supply chain visibility and verifiable sustainability, "a vast majority lacks the metrics to enforce sustainability throughout their extended supply chain."

Respondents, 35% of whom reported having more than 1,000 partners in their value chains, identified pressures to be more environmentally responsible and sustainable, as well as cost savings, as key drivers of change in their supply chain operations. Among the challenges most frequently cited to synchronizing supply chain operations are the failure of partners to provide necessary information, and lack of access to second- or third-tier trading partners.

Respondents identified operational cost savings, environmental compliance, and improved customer service as the most likely benefits to their companies of greater visibility in their value chains. Initiatives undertaken to achieve greater visibility include corporate social responsibility (CSR) policies and environmental policies for their value chains, changes in methods of transportation, and procurement standards and policies.

The report found that less than a third of respondents have a goal of carbon neutrality in supplier operations or customer product use. Seventy-one percent of those that do expect to achieve carbon neutrality within four years.

Representatives of 22 industrial sectors responded to the BPM Forum survey. The largest concentrations of respondents were in the manufacturing, electronics, and technology sectors.


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