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Using IT to focus on reducing excess inventory and improving sustainability

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A recent blog post on the Harvard Business Review has raised the issue of inventory, its impact on sustainability, and what IT can do about it.

The piece, by Andrew Winston highlighted organisations' previous inability to do much about their estimation processes, and what the consequent excess inventory's impact is on sustainability,

Winston suggests that the world is sitting on roughly $8 trillion worth of goods held for sale.That's $8 trillion worth of embedded environmental footprint, which could be reduced, saving money, energy and material.

The problem is that when it comes to managing inventory levels, organisations are falling down on demand planning i.e.predicting how much product customers want. As Winston points out, consumer product goods (CPG) companies spend a fortune on demand planning. And they have to: P&G's 2010 total inventory, for example, was valued on the balance sheet at $6.4 billion. 

Effective use of IT can play a significant role in making operations more efficient and sustainable. Winston suggests that using both demand sensing software and good management practices has helped P&G cut 17 days and $2.1 billion out of its inventory, saving money in manufacturing, distribution, and ongoing warehousing - and carbon, material, and water.

You can read the complete piece here


Greenpeace challenges the Cloud industry on the environment

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Interesting report from Greenpeace on what it describes as "the energy choices that power Cloud Computing."

"How dirty is your data?" is claimed by Greenpeace to be the first ever report on the energy choices made by IT companies including Akamai, (Amazon Web Services), Apple, Facebook, Google, HP, IBM, Microsoft, Twitter, and Yahoo, and it says, highlights the need for greater transparency from global IT brands on the energy and carbon footprint of their Internet infrastructure.

In its highlights from the report, Greenpeace suggests:

·         The $1 Billion (USD) Apple iData Center in North Carolina, expected to open this spring, will consume as much as 100 MW of electricity, equivalent to the electricity usage of approximately 80,000 homes in the U.S. or over a quarter million in the E.U.. The surrounding energy grid has less than 5 percent clean energy, with the remaining 95 percent coming from dirty, dangerous sources like coal and nuclear.

·         Both Yahoo! and Google seem to understand the importance of a renewable energy supply, with Yahoo! siting most of its data centres near sources of renewable energy, and Google is directly signing power purchasing agreements for renewable energy and investing in solar and wind energy projects in many US states as well as Germany. Their models should be employed and improved upon by other Internet ("cloud computing") companies.

·         Facebook, one of the fastest growing and most popular destinations on the web, is unfortunately on track to be the most dependent cloud computing companies on coal powered electricity with over 53 percent of  its facilities estimated to rely on coal to power the Facebook cloud.

In its executive summary, Greenpeace says:

"Information Technology (IT) is disruptive. Largely for the better, IT has disrupted the way we travel, communicate, conduct business, produce, socialise and manage our homes and lives. This disruptive ability has the potential to reduce our dependence on dirty energy and make society cleaner, more efficient and powered renewably. But as we applaud the positive, visible impacts and measurable, game-changing potential of IT, we also need to pay attention to what's behind the curtain.


The 'Cloud' is IT's biggest innovation and disruption. Cloud computing is converting our work, finances, health and relationships into invisible data, centralised in out-of-the-way

storage facilities or data centres. This report seeks to answer an important question about this trend, currently underway across the globe: As Cloud technology disrupts our lives in many positive ways, are the companies that are changing everything failing to address their own growing environmental footprint?"


Key learnings from the report are that:


•Data centres to house the explosion of virtual information

currently consume 1.5-2% of all global electricity; this is growing

at a rate of 12% a year.


•The IT industry points to cloud computing as the new, green

model for our IT infrastructure needs, but few companies provide

data that would allow us to objectively evaluate these claims.


•The technologies of the 21st century are still largely powered by

the dirty coal power of the past, with over half of the companies

rated herein relying on coal for between 50% and 80% of their

energy needs.


•IT innovations have the potential to cut greenhouse gas

emissions across all sectors of the economy, but IT's own

growing demand for dirty energy remains largely unaddressed by

the world's biggest IT brands.


•There is a lack of transparency across the industry about IT's own

greenhouse gas footprint and a need to open up the books on its

energy footprint.


•In emerging markets, where there is limited reliable grid electricity,

there is a tremendous opportunity for telecom operators to show

leadership by investing in renewable energy, but many are relying

on heavily polluting diesel generators to fuel their growth.


•Data centre clusters (Google, Facebook, Apple) are cropping up

in places like North Carolina and the US Midwest, where cheap

and dirty coal-powered electricity is abundant.


•IT companies are failing to prioritise access to clean and

renewable energy in their infrastructure siting decisions.


•Of the 10 brands graded, Akamai, a global content distribution

network, earned top-of-the-class recognition for transparency;

Yahoo! had the strongest infrastructure siting policy; Google &

IBM demonstrated the most comprehensive overall approach to

reduce its carbon footprint to date.


•Across the board, IT companies have thus far failed to commit to

clean energy in the same way they are embracing energy

efficiency, which is holding the sector back from being truly









IBM gears up to lead Smart Summit

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IBM is gearing up to lead the Smart Summit, an initiative inspired by the Prince of Wales that aims to show what a sustainable future could look like and to demonstrate the simple steps we can all take to make better use of our natural resources taking place.

It's taking place at Lancaster House in London, with nine days all focused on different aspects of sustainability, from smarter cities, to smarter supply chains, and finance and sustainability.

You can view more about the Summit here

And this 'A Smarter Planet' Blog is also worth having a look at


IBM steps up the green supply chain pressure

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Interesting piece in the Harvard Business Review blogs about how IBM is stepping up the pressure on its suppliers.

IBM wants its suppliers to do four things:

  1. Define and deploy an environmental management systems (EMS).
  2. Measure existing environmental impacts and establish goals to improve performance.
  3. Publicly disclose their metrics and results.
  4. "Cascade" these requirements to any suppliers that are material to IBM's products.

Separately, another Harvard Business Review post discusses a new tool for understanding sustainability drivers.


About this Archive

This page is an archive of recent entries in the The Green Supply Chain category.

Sustainability tools is the previous category.

The US Perspective is the next category.

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