Supply chain systems feel the 'green' effect

The increasing globalisation of supply chain systems is causing mounting concern about their effect on the environment, according to the latest survey of this market from PMP Research. The research has been commissioned by the Evaluation Centre.

The impact of any business on the environment is now of paramount interest and over half the respondents state that environmental issues are a 'very important' (23%) or 'important' (32%) concern for their organisation. In addition, 67% are having environmental demands placed upon them by their customers and partners.

Businesses are still at an early stage in defining their environmental approach. The most prevalent measure is to review their transport use both locally and on a global scale, resulting in optimising delivery schedules, use of hybrid vehicles, purchasing new vehicles and generally cutting down on transport movements. In addition, re-usable packaging has been introduced to reduce landfill, along with actively monitoring energy usage.

The drive for supply chain efficiency is never ceasing and the majority of organisations, 52%, have made significant improvements in their operations within the past year and 26% within the last one to two years. This pace of change is set to continue with 45% planning significant improvements within the next year and 36% in the next one to two years. This is driven by the desire to improve service levels (68%), coupled with the ever present pressure to reduce costs, mentioned by 68%.

Managing the supply chain is no longer contained within the walls of a single organisation and the extended supply chain has become the normal way of operation. Just over a quarter of companies (26%) have established this extended relationship with all their partners, while the majority (61%) have done so with their key suppliers. Only 10% of companies have yet to move in this direction.

Radio Frequency Identification (RFID) is still trying to gain widespread adoption with only 3% of companies using it extensively while 19% are deploying it in some areas. However, the largest proportion of companies has no immediate investment plans (26%) and at best 26% might adopt it in the next two years.

The main disadvantage of RFID technology is still seen as its cost, cited by 42% of respondents, while a lack of technology standards is mentioned by 32% and a lack of consumer understanding or distrust by 23%.

Survey Statistics:

We surveyed a broad range of 100 organisations, including companies from the manufacturing sector (32%) and the retail industry (17%) where supply chain issues are particularly important. In addition companies responded from distribution & logistics (13%), energy & utilities (10%) and IT & telecoms (6%).

The respondents represented a spread of different sized companies with 16% having in excess of 5 billion turnover, 7% in the 1 billion to 5 billion bracket and 13% in the 500 million to 1 billion range. In the mid-range 20% have between 100 million and 500 million turnover and 10% 50 million to 100 million. At the smaller end 16% have a turnover between 10 million and 50 million and 18% 5 million to 10 million.

About PMP Research

PMP Research, founded in 1990, provides bespoke research, analysis and consultancy typically within the IT, telecoms and professional services markets.

About the Evaluation Centre

The Evaluation Centre is an interactive service for end users and consultants to assist them in the procurement process for software, services and technology.

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