Value Chain approach to navigating the green economy for your business
The ability to bounce back from shocks has become more pressing as the pressures of climate change, economic instability and unforeseen global disasters become more prevalent. One way to bounce back faster and better is to map and develop your value chains with a holistic life-cycle thinking approach.
TOMA-Now are value chain experts. After years in different sectors and settings, with countless engagements, shared journeys and insights, we have some lessons that we’d like to share. Most importantly, the road to an inclusive green economy can be navigated easily when you have mapped out your value chains to identify where the most value for your business can be generated.
We take a look at what is needed to future-proof your organisation:
Technology as a core strategic driver
The 4th Industrial Revolution is here, and we need to ensure value chains that are integrated and agile. Production networks, particularly those using global supply chains, can be complex, with issues related to outsourcing, safety standards and questionable environmental and labour practices. This complexity has driven the development of technologies for transparency and traceability, such as blockchain and the increasing automation of production. Aside from operational support, big data and analytics are helping with strategic areas like sustainability, accountability and marketing to interested customers, who demand responsible production and management of end of life. It’s no longer about merely collecting data but rather using the data for impactful strategic business decisions.
Transparency for tomorrow
Although this topic has been around for a while, it has recently become even more prominent. There is an emphasis on ensuring a balance between flexibility in reducing environmental impacts while keeping in mind stakeholder demand for transparency. With near limitless information at everyone’s disposal, there is no option for partial disclosure.
A continuous investigation is called for, as stakeholders demand more transparency regarding environmental and social impacts across the supply chain. Better traceability, with improved systems for accountability, helps significantly. There is a growing need to not only track where a product physically is, but whether it has been modified in any way, and how it is impacting the environment.
The shift to a circular economy is driving the idea of closing the loop. This approach is also synonymous with better asset management and working more effectively with resources. It’s focused on using a feedback loop to work with waste and recycled content as raw materials in manufacturing processes. Closed-loop thinking can act as both a challenge and opportunity with cost savings, value creation and reduced exposure to volatile commodity prices, as recently seen with fluctuations in the oil price. It does require a different, innovative way of looking at products as components rather than a single finished unit. There are several benefits, including enhanced environmental footprint and the development of new (recycling) economies.
Focused, incremental change
Small improvements for big success is why we emphasise working with the value chain: Focus on individual parts of your chain and optimise incrementally. This is especially true for highly complex supply chains. Working with the value chain allows for a specific focus on areas where product value is generated. A special hyper-focus on areas of importance to the company such as carbon footprint, energy consumption or water scarcity can create a more action-oriented high impact outcome.
We need to say that again – better, stronger relationships! The quality and nature of relationships have never been more critical. So many potential opportunities are lost, or projects break down due to a lack of authentic relationship dynamics. Mutually beneficial collaborations create a balanced and mindful customer-supplier relationship. As we navigate global challenges, international and multilateral relationships are the key to truly impactful initiatives with sustained beneficial outcomes. The age of collaboration is now.
About the Author
Janie Potgieter is passionate about the role individuals play in the collective. Using her background in education and the psychology of language, she inspires leaders to become change makers, challenging the business as usual paradigm. Her focus is on developing strong business narratives that empower stakeholders to participate in collaborative practices. She drives TOMA-Now’s social impact and stakeholder engagement. She holds an M.A. in Linguistics from the University of Stellenbosch.