Sustaining an Ethical Supply Chain in 2023

Globally, businesses and commerce-driven organisations at large are facing pressure from many sides to adhere to increasingly stringent policies concerning cost-savings, time-savings, quality specifications and ESG standards. As market regulations grow tighter, so too must the organisations which operate within them. So, how does one sustain a supply chain which is both ethically sound and generates continual growth?

The myth of a perfect, one-size-fits-all solution must be laid to rest. The list of needs and requirements for most modern organisations when it comes to their supply chains has grown exponentially long and complex. In the wake of a sourcing crisis during COVID-19, a cost-of-living crisis in the UK, and the climate emergency requiring ever more pressing levels of attention and consideration, it is apparent that change is inevitable.

Jeffrey Rajamani, a Senior Analyst at Forrester Research, writes in the report The Public Cloud Development And Infrastructure Platform Landscape In Europe, Q3 2022: “Sustainability is a trillion-dollar market opportunity. Cloud platforms with the latest technology can help reduce carbon footprints in meaningful ways. Enterprises looking to modernize business operations for efficiency can lean on cloud platforms to help manage these processes and applications.”

Sustainability has been part of the conversation for a while now, but it seems only recently that more professionals have been speaking up about its potential lucrativeness. Technology, also, has come on leaps and bounds in the last decade, with some of the most exciting innovations to date taking place within the world of software development through Artificial Intelligence. Modernisation has become synonymous with digitisation, as stakeholders come to understand that the next logical step when developing and levelling-up their businesses is towards embracing the latest technological updates.

Depending on how ‘modern’ you consider your business, this can range from adopting a software solution to move away from manual, paper-based processes, or abandoning a legacy platform which cannot keep up with your growth potential.

The market for SaaS platforms is bursting with innovative and continually evolving solutions for every aspect of the sourcing process, right through from supplier-onboarding to contract management and every step in between. What drives these solutions apart is how much of the process a singular provider can cover, as well as factors such as their ability to address ESG concerns within your business. As the tide continues to turn against the fast and cheap in favour of the green and ethical, organisations must adapt or be left behind.

Further in the aforementioned report, Rajamani continues: “Cloud platforms are the foundation of innovation at scale; today, public cloud platforms offer unmatched capabilities and potential for innovation, collaboration, and agility.”

The potential of technology truly is ‘unmatched’, I am inclined to agree. The impact on supplier-buyer relationships is particularly noteworthy. Any half-decent software provider offers you previously unheard-of amounts of information regarding your suppliers, your business, and your overall drivers and targets. This information, filtered through reports and used to identify the strongest and weakest links in your supply chain, sees the fittest and most stable suppliers rewarded with consistent business, and gives suppliers who are struggling to comply incentive to reach the baseline you have set for them. What blossoms is a cycle of continuous growth and development.

A cycle which, if nurtured sufficiently, yields results such as increased efficiency, improved collaboration, lower costs, and emerging needs such as ethical and environmental standards met at the very first hurdle. Imagine having access to years’ worth of data about your suppliers, helping to assess which are inspiring confidence in your business with their consistency, being able to track and encourage the suppliers working hard to reliably improve and keep up with tightening standards.  Imagine being able to visualise and present this data to key stakeholders within your business, allowing them to appraise the hard work it has taken to position the business in a situation of strength. It is an encouragingly sustainable model, and a historically proven model – not a perfect one.

On the 13th of July at 2pm BST, I hosted a webinar featuring Jeffrey Rajamani as a guest speaker entitled ‘How can you Source a Sustainable and Ethical Supply Chain?’. I touched on points not mentioned in this article, so it is definitely worth watching the replay if any of what I have said resonates with you, or even just vaguely interests you.