Elizabeth Rennie | November/December 2012 | 22 | 6
PwC and APICS strengthen sustainable supply chains
Editor’s note: APICS magazine managing editor Elizabeth Rennie recently spoke with Barbara (Bobby) Kipp, who is a partner at PwC Risk Assurance and Sustainable Business Solutions as well as conflict minerals solution leader, and Jonathan Thatcher, APICS director of research. They discussed the growing importance of sustainability in supply chain and operations management and the new PwC-APICS sustainability research partnership.
Rennie: To provide some context about your own company’s efforts, let’s start by sharing with APICS magazine readers the main elements of PwC’s sustainability initiatives and goals.
Kipp: At PwC, we are committed to environmental stewardship because we see it as critical to the long-term success and sustainability of our business and our clients’ businesses. While we do not manufacture goods, we do provide a broad variety of services that have wide-ranging impacts. These include the greenhouse gas emissions associated with our travel; the energy we use in our workspaces; the waste generated in our offices; and the effect we have on our people’s daily choices, such as how to get to work. In fiscal year 2007, we set a goal to reduce our carbon footprint by 20 percent by fiscal year 2012. In 2011, we met that goal, and in fiscal year 2012, we adopted a new goal to cut our absolute carbon emissions by an additional 10 percent by fiscal year 2016. This [equals a] 30 percent overall reduction from our original baseline.
Rennie: Can you give one or two examples of PwC’s green initiatives at work? What has been accomplished?
Kipp: First, green teams. To succeed in our environmental efforts, we need to engage with our people at the office level. Our local green teams support our broad environmental stewardship strategy and make it relevant to individual offices and markets. Since fiscal year 2008, the number of US offices with green teams has increased from 3 to 37—and over 87 percent of our staff work in an office that has a green team.
Second, our green data center. Our firm has made a significant investment in constructing a state-of-the-art data center. The data center opened in March 2010 and received a [Leadership in Energy and Environmental Design] (LEED) gold certification for environmentally sustainable construction through the US Green Building Council. In addition, 38 percent of our office spaces in fiscal year 2011 were in buildings that are LEED-certified or have LEED-certified interiors.
Rennie: What kind of competitive gains has PwC seen from these green efforts?
Kipp: Just as in many of our clients’ organizations, we see PwC’s sustainability strategy as key to our ability to achieve important objectives such as attracting and retaining talent, containing costs, and driving revenue. [As for] net impacts, the “What Workers Want in 2012” survey found two-thirds of students and cross-generational professionals are looking to make a difference in society through their careers, and 80 percent of new recruits say they want to do something that is socially responsible.
Our Sustainable Business Solutions practice engages with leading US companies every day, providing a range of services linked to the sustainability agenda. Our work—from helping integrate sustainability within corporate strategy, to addressing supply chain risks, to capitalizing on reporting and tax opportunities—is about creating the right solutions and aligning them to organizations’ broader business goals or objectives.
Rennie: Tell me about the impetus behind the PwC-APICS partnership. What are the unique benefits that APICS brings to this partnership? Similarly, what special expertise can PwC contribute?
Thatcher: In terms of expertise, APICS brings the not-for-profit ability to pursue research and content that no other organization is in a position to do very well. Topics such as professional career insights, fundamental skill and practice, and opinion research do not always fit the mold of for-profit research. Yet, in comparison to PwC, APICS is small. PwC’s large, global research teams are able to deliver breadth and depth from their large research groups that surpasses what APICS alone could deliver. Combining the capabilities of both organizations brings a best-of-both-worlds reach.
What is also exciting is the way both organizations can get into widespread awareness and practice true insight and best practices. The professionals, customers, and members of both organizations truly span the globe and represent every layer of supply chain and operations management, as well as business management.
Kipp: PwC and APICS have a multifaceted relationship based on a shared vision of continuously elevating the supply chain profession. Our organizations also both share a commitment to sustainability. It was, therefore, an easy decision to combine our interests and resources to create thought-provoking and actionable research … The initiative aims to explore, understand, and overcome the challenges APICS professionals experience in embedding sustainability into supply chain and everyday operations.
Rennie: The APICS 2012 Sustainability Survey is a key aspect of the partnership. What findings are most vital for supply chain and operations managers?
Thatcher: Actual practices at the supply chain and operations management level are very important. Sustainability tends to be integrated in senior management strategy, but is not as clear in shop floor tactics. Even in the nuts-and-bolts world of [sales and operations planning] (S&OP), risk management, lean, et cetera: Many organizations report still-growing advancement. The APICS professional audience is unique in seeing both senior management strategy and shop floor tactics. Its role is to integrate and execute both optimally.
In addition, implementing strategy through perfectly aligned tactics across all levels of an organization and its supply chain is one of the biggest challenges to business management. Strategy and tactics can become disconnected for numerous reasons as movements descend through management levels or across supply chain partners. Operationalizing sustainability for supply chain and operations management is no exception. The PwC-APICS partnership will help build visibility, increase data-driven decision making, increase adoption of best practices, and develop greater maturity. Where specific challenges and difficulties exist, we will be able to research and uncover important trends, triggers, and relationships that help or hinder improvement, practices that the best organizations achieve, and practical suggestions that help connect strategy to tactics and operationalize sustainability in supply chain and operations management.
Kipp: Also, we consistently hear from APICS members about the difficulty in finding the time, budget, and resources to implement innovative sustainability strategies. Our research identifies leading practices and provides insight into tools APICS members employ to best operationalize sustainability for supply chain and operations management. In leveraging the experiences of APICS members globally to operationalize sustainability strategies, we hope to provide pragmatic, tactical outputs that allow members to elevate their supply chain performance.
Rennie: What types of questions will be answered through the partnership?
Thatcher: Our world is complex, and sustainability can add more complexity. Tactically, in terms of priorities, for example, I may choose to save electric power by operating a quality process for a shorter length of time, but end up with more scrap. Which one is more important? Or strategically, from a triple bottom line perspective—people, planet, profit—which one has the highest priority? These are questions that take time and effort to work out because they affect more than just APICS professionals. The company strategy and mission statement sometimes provide guidance, but key supply chain partners may not align with that guidance. As we make decisions, we discover, or work, the consequences. What will our world will look like if we decide one way or the other? Which has a better long-term benefit? Sorting through this kind of complexity is something the PwC-APICS partnership is well suited to do.
Rennie: How will success be measured, and how does this partnership benefit the APICS membership?
Thatcher: Research from the PwC-APICS partnership, like all research generally, tends to be measured first by customer use—by the number of people who say that they value it or act on it. For example, that the partner research helps them manage, plan, act, or decide on important responsibilities; or that the partner research delivers what they need to know at the right time, for their company or personally for their career or their team. Measuring success will also come from the impact the partnership and research has in APICS standards and industry resources. Given the scope of PwC and APICS, from academic students to the most senior C-level executive, insights and important findings can inform our profession at every level. Given these high expectations, I know both organizations are focused on delivering results that serve actual needs, build competitive advantage, and help increase professional and organizational maturity in critical areas.
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