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Managing sustainable initiatives

Andy Cocks | Jan. 30, 2012
Building sustainability into your supply chain through e-procurement.

4.       Enabled supplier relationship

Exchanging documents and communications electronically and in an automated fashion across the supply chair confers tangible paper and energy savings. Even with something as simple as electronic quotations and purchase orders you can drive significant savings in your paper usage and energy consumption.

Another part of your sustainable procurement policy should be vendor selection criteria. If you're able to actively manage supplier information via an automated or self-service process, you have the means to review up-to-date credentials and information such as government and agency certifications, carbon disclosure, and corporate environmental policies.

5.       Conducting spend data analysis and increasing visibility through reporting tools 

Implementing an electronic purchasing process in your organisation will help your sustainable procurement initiative in two ways.

The first is with price negotiations. One of the challenges of sustainable procurement is that environmentally friendly products often cost more. Although there's a greater likelihood of realising long-term cost benefits, buying these products still results in a significant impact on the corporate wallet today. Being able to show past purchasing patterns with a particular vendor and/or predict future purchasing patterns can really help you negotiate.

The second way is through volume predictability. By telling the vendor upfront how much product you predict you will need to purchase, you can make sure they're able to meet your needs. Sustainable products are often new and haven't had the same level of adoption, so suppliers may produce these products in smaller quantities to 'field test' the demand.

6.       Custom vendor e-catalogues

Custom catalogues or pricelists are a standard best practice implemented with most e-procurement systems, and a fantastic tool for enabling sustainable purchasing policy. If you already have certain products or vendors identified as meeting your sustainability criteria, then you should be utilising your e-procurement system to create purchasing templates with these preferred products.

By leveraging custom e-catalogues in conjunction with an automated workflow approval process, you're able to put controls in place that will help ensure your organisation is indeed purchasing the preferred sustainable products. These may include products with official sustainability certifications, such as Energy Star or Blue Angel ratings.

Tap into the benefits of sustainable e-procurement without an e-procurement system in place. 

There are two ways in which you can leverage the best practices and subsequent benefits:

  • By working exclusively with vendors who offer their own client-facing purchasing portals, or
  • By working with a third-party service provider that utilises an automated procurement process with a network of vendors and suppliers

If you typically buy from small manufacturers, you may have to go with the latter option, as smaller organisations are not likely to offer clients an online purchasing portal. However, an emerging group of large companies - often third party suppliers or VARs - offer the benefits of e-procurement via their own custom built tools or Web portals.

 

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