More on Sustainable Supply Chain Practices – IDC/UPS Survey Results

On November 16, The New York Technology Council hosted an event on high-tech supply chain management and logistics optimization. Charlie Covert, VP of Customer Solutions for High Tech and Manufacturing at UPS presented findings from a UPS sponsored IDC survey entitled “2010 Change in the (Supply) Chain” for which IDC interviewed senior-level decision makers at 125 high-tech companies across the U.S. IDC also conducted approximately 25 in-depth interviews with companies that are located in Los Angeles, San Jose/San Francisco, Dallas/Fort Worth, Miami and New York City.

While Mr. Covert was more focused on covering general supply chain trends, including customer service and the role of reverse logistics, the study had one section about sustainability.

Here are the key facts based on the IDC White Paper:

• Sustainability ranked lower as a current priority for high-tech companies than in the previous years, with only 19% of companies ranking it as a top issue driving changes in their supply chain over the next 3-5 years.
• When asked how often they factor environmental or social sustainability into supply chain decisions 47% of the companies said “always”;
• Only 26% of the companies said sustainability was an important value driver
• Another 21% reported this as a company or industry mandate
• About 33% of the companies categorized sustainability as a “nice to do” but not imperative
• Only 3% of companies never factor sustainability into supply chain decisions

In terms of drivers to adopt sustainability, 36% say their customers will demand it, and 26% believe that legislation will require it. Only 11% saw sustainability as a key to their competitiveness in the future.

Overall top priorities and drivers for supply chain executives were reducing costs and better responding to changing customer demands (customer service).

While sustainability and innovation ranked low on the overall market driver list, improving supply chain visibility remained the top three driver with 73%.

Considering that sustainability strategies demand increased supply chain visibility, one could argue that the sustainability topic is a driver of change in the supply chain; It’s a matter of how you label it.