The Four-Point Supply Chain Checklist by Michael Hopkins

Authors: Interview by Michael S. Hopkins

Title: The four-point supply chain checklist: How sustainability creates new opportunity

Journal: MIT Sloan Management Review

Key Words: Sustainability; Packaging; Carbon footprint, Supply chain

Overview: This article is an interview with Edgar Blanco, research director at the MIT Center for

Transportation & Logistics. In the interview Edgar Blanco begins by stating that many supply

chain managers are stuck with a cost focus that blinds them from benefits that can be obtained

through innovation and sustainability. Cost will always be important but supply chain managers

need to balance the priority of cost with other initiatives that may not support short-term cost

reductions but rather support longer-term objectives that yield just as great if not greater benefits

to the company in the long-term. It is in this light that Edgar then expands upon the various

dimensions that a company can focus on in order to reap the benefits of sustainability: packaging,

transportation, supplier participation and marketing communication to consumers.

Improved packaging can generate a quick impact to sustainable operations as this represents a

number of the constraints a company faces in the supply chain. Examples are given of changing

geometry of the packaging and changing packaging material in order to reduce material while not

compromising on package strength.

The next area explored is transportation. An interesting example is given of a company that was

using airfreight for 5% of all shipments. The figure of 5% was not initially alarming to the

company. After calculating the carbon footprint of their transportation operations, however, it

was discovered that these air shipments represented 40% of the carbon footprint of the logistics

operation! In this example, the company shifted their focus with vigor to air shipments and

targeted to reduce them to only 1% of all shipments. Once a company looks holistically...