Over the last few years, the shift in expectations of both investors and consumers has brought sustainability reporting to the forefront of corporate strategies and board room agendas. Institutional investors are increasingly emphasizing the importance of non-financial metrics, such as sustainability data.

Understandably, the emphasis on quantifiable sustainability practices has found its way into core supply chain function – primarily, procurement. As a result, more companies, across industries and revenue brackets, have enforced their resolve to work with suppliers that adhere to sustainable social and environmental practices.

A Call for Sustainable Supply Chains

According to the CDP Global Supply Chain Report 2020, supply chain emissions account for 92% of an organization’s total greenhouse gas (GHG) emissions. On average supply chain emissions are 11.4 times higher than operational emissions. On the global stage, supply chains account for 60% of all emissions.

The simple truth is achieving supply chain sustainability is a key factor when it comes to overcoming the festering global climate change crisis. The only way for enterprises to make a difference in this regard is to implement environmental, societal, and governance (ESG) measures at each supply chain touchpoint, starting with procurement of sustainable suppliers and vendors.

But implementing a sustainable supply chain strategy involves a numerous consideration around a largely complex business ecosystem. This is often a challenge for enterprises, given the difficulty in accumulating the required data to set clear prequalifying targets and standards when onboarding suppliers. And the fragmented nature of the supplier landscape adds to the concern – especially given the possibility of non-sustainable practices being buried several supplier tiers deep.

Supplier Sustainability Framework: A Technology-led Solution

A supplier procurement framework is foundational for enterprises to create strong, reliable supply chains. And given the business relevance of sustainable practices and the critical role that supply chains play, the need for a sustainable supplier procurement framework cannot be overstated. “2019 Gartner Procurement’s Value Contribution in Supply Chain Survey data shows that 75% of participating organizations reported having a formalized sustainable procurement program in place.”

However, in most cases, the lack of end-to-end supplier visibility impedes the effective implementation of such a framework. This results in several limitations especially when enforcing compliance standards across multi-tiered supplier ecosystems.

Fortunately, the widespread digitization of supply chains has paved the way for technological intervention in the effective implementation of a supplier sustainability framework. “Supplier sustainability applications help companies assess and monitor suppliers’ ESG performance to reduce risk exposure and drive improvements.” Supplier sustainability applications have been growing in significance too. By aggregating and leveraging supplier data from across various touchpoints an interconnected ecosystem and decentralizing compliance ownerships, these applications can help enterprises eliminate non-sustainable practices from the supply chain. The result: a responsible, efficient, and reliable supply chain, safe from unprecedented risks.

To gain a deeper understanding of why supplier sustainability applications are the future of resilient supply chains, you can sign up to view the full 2022 Gartner® Report “Market Guide for Supplier Sustainability Applications” here.

*Report Source: Gartner, Market Guide for Supplier Sustainability Applications. Miguel Cossio, Laura Reiner. Published 1^st June, 2022 **GARTNER is a registered trademark and service mark of Gartner, Inc. and/or its affiliates in the U.S. and internationally and is used here in with permission. All rights reserved.

Gartner does not endorse any vendor, product or service depicted in its research publications, and does not advise technology users to select only those vendors with the highest ratings or other designation. Gartner research publications consist of the opinions of Gartner’s research organization and should not be construed as statements of fact. Gartner disclaims all warranties, expressed or implied, with respect to this research, including any warranties of merchantability or fitness for a particular purpose.

In the world of business, sustainability is a term broadly used to indicate the environmental impacts of operations and products. But from a supply chain perspective, the importance of sustainability extends beyond “going green”. Besides being environmentally woke, sustainable supply chains are socially responsible and ensure more reliable operations and, therefore, improved cashflow. Building a supply chain around a supplier sustainability framework has multiple benefits to its credit.

A network of sustainable suppliers ensures better productivity and reduces the risk of financial loss (through penalties for non-compliance) and reputational damage. Sustainable practices also help enterprises enhance efficiency with significant cost savings. Now, the growing investor- and board-level focus sustainable practices in the supply chain has made its way into supply chain decision-making process. “2019 Gartner Procurement’s Value Contribution in Supply Chain Survey data shows that 75% of participating organizations reported having a formalized sustainable procurement program in place.”

But establishing a supplier sustainability program is easier said than executed; especially given the large, complex, and often fragmented nature of modern supply chains.

The Challenges of Ensuring Supplier Sustainability

While the importance of supplier sustainability cannot be overstated, the challenges around implementing an effective framework to ensure it can often seem overwhelming. Sustainability is a fairly new agenda and legacy enterprises often find it difficult to navigate their own largely non-sustainable practices. Beside a general lack of awareness often tends to leave gaping holes in the supplier sustainability program. Combine that with the magnitude and complexity of modern supply chains that hinder visibility and we’ve got an enterprise-level challenge on our hands.

There are three key challenge areas when it comes to implementing a supplier sustainability program:

• Increase costs: 38% of enterprises believe that increased are the single biggest hurdle on their path to supplier sustainability. On the other hand, global environmental supply chain risks are expected to cost businesses $120 billion by the year 2026.
• Lack of visibility in complex supply chains: This is the second most cited challenge in establishing supplier sustainability. It is often difficult for enterprises to monitor the large number of inter-dependencies and varying degree sustainability maturities across such a supplier network. In case of sustainability measures, a lack of overall awareness adds a layer of complexity.
• Mindsets and cultures: For incumbent enterprises, introducing new ideas – such as sustainability – is often met by resistance and subsequent non-compliance. Without a strong monitoring framework in place, the efficacy of a supplier sustainability framework will falter.

Supplier Sustainability Applications

It is no secret that enterprises that hope to establish supplier sustainability must overcome a complex and largely fragmented supplier ecosystem in terms of capabilities and focus areas. This is an especially difficult task given that many businesses rely on spreadsheets and manual processes to track and measure this data. Fortunately, technology has an answer.

“Supplier sustainability applications help companies assess and monitor suppliers’ ESG performance to reduce risk exposure and drive improvements.” Through effective use, a supplier sustainability application can prove to be a powerful tool in optimizing supplier networks, especially in the long run. These applications are capable of aggregating and leveraging supplier data from across various touchpoints an interconnected ecosystem and decentralizing compliance ownerships. In turn, they allow enterprises to prequalify their suppliers by accounting for the multifarious aspects of sustainability – insurance, risk, compliance, and more.

As a result, enterprises can begin to establish increasingly sustainable practices and build a supply chain that is reliable and responsible, without having to bear a massive cost burden.

To gain a deeper understanding of why supplier sustainability applications are the future of resilient supply chains, you can sign up to view the full 2022 Gartner® Report “Market Guide for Supplier Sustainability Applications” here.

*Report Source: Gartner, Market Guide for Supplier Sustainability Applications. Miguel Cossio, Laura Reiner. Published 1st June, 2022 **GARTNER is a registered trademark and service mark of Gartner, Inc. and/or its affiliates in the U.S. and internationally and is used here in with permission. All rights reserved.

Gartner does not endorse any vendor, product or service depicted in its research publications, and does not advise technology users to select only those vendors with the highest ratings or other designation. Gartner research publications consist of the opinions of Gartner’s research organization and should not be construed as statements of fact. Gartner disclaims all warranties, expressed or implied, with respect to this research, including any warranties of merchantability or fitness for a particular purpose.

For companies who’ve decided to initiate zero-waste policies at their firms, the first step can be the hardest one to take. This is an industry built heavily on routine and repetition, and breaking from the norm can be difficult, even if it is to create a more eco-friendly, sustainable future.

Today, we’re taking a look at how to apply these strategies as you move forward. From existing and in-motion projects to ones you haven’t started yet, we’ll share how to jump in and get started the right way.

Start With a Waste Minimization Plan

A waste minimization plan acts as an inventory and waste monitoring system that can set your construction business up for success. A well-defined plan will contain the following elements:

Defining Goals and Strategies

The first step is to define the goals you want to set around waste minimization and recycling, and the steps you’ll take to get there. Especially if you’re just starting out on this journey, you’ll be mostly referencing existing frameworks and using them to visualize a best-case scenario.

The more you read and learn about projects that are similar to yours in scope and size, the more ideas you’ll be able to incorporate into your own plan. These strategies don’t have to be perfect right now, but it’s important to get them down on paper so you know how to begin.

You’ll also include data tracking and management goals within the plan, so you can use the results of your current project to inform your next one and make it even stronger.

Assessing Local Inventory

It’s important to know which materials are available for reuse or recycling throughout the project. This requires taking a local inventory of not only the materials at the job site but also off-site.

Research what’s available in the community where you’re building, and reach out to public and private resources that can act as third-party material reusers or resellers. Sometimes, location will dictate how feasible this step will be. If there isn’t a local recipient available to take excess waste, the amount of carbon generated by flying that waste elsewhere can offset the intent.

Develop Methods for Tracking Tonnage and Volume

Residential construction companies need concrete methods for tracking the material impact of their activities. This also helps in the costing aspect of each job.

If you’re utilizing third-party services to pick up or transport materials, analyzing these metrics can also help you ensure that your billing and reporting activities are accurate. Scheduling and facilitating these services can be one of the most challenging aspects of waste management and materials management in general, but it’s critical as you make strides toward a zero-waste project.

Define Diversion Channels by Region

Regardless of the specified waste stream (reusable, recyclable, salvageable), there are usually 5 to 10 different innovative ways that construction companies can repurpose and reuse those components.

For instance, items that can be easily removed, such as doors, hardware, and appliances, can be salvaged for donation or used on other jobs. Other common diversion channels include:

• Wood cutoffs: Use when full-length lumber isn’t necessary (e.g. cripples, lintels, blocking)
• Scrap wood: Chip on-site and use as a ground cover
• Gypsum: De-paper, crush, and use as a soil amendment in small quantities
• Brick, concrete, masonry: Recycle on-site and use as subbase material, fill, or driveway bedding
• Insulation: Use excess from exterior walls to deaden noise in interior walls
• Packaging materials: Return unused materials to suppliers for reuse

You can contact regional municipal and green regulatory bodies to maximize your on-site diversion efforts. These entities already have connections, and may already have preferred vendor lists for you to review.

One area of special consideration: Pay close attention to the way your firm uses and repurposes cardboard, especially as items are now being shipped further distances. By volume, wood, drywall, and cardboard make up 60% to 80% of all construction waste. Thankfully, it’s one of the easiest materials to recycle, so you should be able to find a participating program near your job site.

Other Considerations

Other considerations that should be included in your waste minimization plan include:

• Methods for managing hazardous materials
• Processes to measure the expected quality grade of each material waste stream
• Processes for collecting, storing, and hauling materials
• Methods to educate and train the team on zero-waste policies
• The estimated cost of implementing the plan and the savings you expect

Maximizing Your Net-Zero Program

A zero-waste program touches on many different aspects of ESG. As you begin working with your contractors, suppliers, and vendors to begin formulating a waste minimization plan, think about the priorities you’re setting and begin to work those into your procurement considerations.

You can leverage technology platforms to connect with sustainability-compliant suppliers that share your vision.

This way, you’ll only connect with stakeholders that are already familiar with these types of initiatives, and may even be able to bring their own resources to the table.

To get the word out, develop a communication strategy that outlines how you’ll share your zero-waste commitment with existing and new supply chain partners. You can also integrate this plan into your current and future marketing efforts, so your goals become synonymous with your brand.

Interested in learning more about what a zero-waste future looks like in the residential construction industry? Check out our recent webinar: Strategies for Zero Waste in Residential Construction. You can download and view the webinar in full online!

By integrating with SAP^® Ariba^® Supplier Risk, the platform enables businesses to monitor supplier compliance status in real time, helping companies manage safety, sustainability, and business risk.

Orem, Utah and HOUSTON — Oct. 20, 2022 — Avetta®, LLC, a leading provider of supply chain risk management (SCRM) software, today announced that its Supply Chain Risk Management platform is now available on SAP® Store. Through integration with SAP® Ariba® Supplier Risk, the platform provides critical insights into supplier management workflows enabled by SAP Ariba solutions.

“Integrating Avetta’s Supply Chain Risk Management data directly into business processes enables our customers to make better decisions towards safe and sustainable procurement practices,” said Taylor Allis, chief product officer at Avetta. “We are excited to collaborate with SAP and offer our platform on SAP Store to reduce risks in the supply chain for our customers with solutions that will transform supply chain operations.”

Using the Avetta platform, businesses can check supplier compliance status in real-time and identify high-risk vendors within their supply chains. Avetta provides critical decision-making data to help decrease risk events within an organization.

The Avetta Supply Chain Risk Management platform delivers the following benefits:

• For clients, it provides a unified platform that manages risk across safety; liability; workforce qualifications; sustainability and environmental, social and governance; diversity; financial health; and cybersecurity programs.
• For suppliers, it reduces time and cost by demonstrating their superior business qualifications to many clients from a single system.
• For workers, it offers a central workforce portal to digitally store their required job roles, training, competencies and certifications.

SAP Store, found at store.sap.com, delivers a simplified and connected digital customer experience for finding, trying, buying and renewing more than 2,000 solutions from SAP and its partners. There, customers can find the SAP solutions and SAP-validated solutions they need to grow their business. And for each purchase made through SAP Store, SAP will plant a tree.

Avetta is a partner in the SAP PartnerEdge® program. The SAP PartnerEdge program provides the enablement tools, benefits and support to facilitate building high-quality, disruptive applications focused on specific business needs – quickly and cost-effectively.

About Avetta

The Avetta SaaS platform helps clients manage supply chain risk and their suppliers to become more qualified for jobs. For hiring clients in our network, we offer the world’s largest supply chain multi-risk management network to manage supplier safety, sustainability, worker competency and performance, and business and financial risk. We perform contractor prequalification and worker competency management across major industries, all over the globe, including construction, energy, facilities, high tech, manufacturing, mining and telecom.

For suppliers in our network, our audit and verification services help lower their safety incidents rate by 29%. As a result, nearly 50% of members find additional job opportunities within the first year of joining. In addition, our suppliers receive privileged access to the Avetta Marketplace, where dozens of partners offer special discounts for business services like insurance and work gear. Avetta serves 500+ enterprise companies and 125,000+ suppliers across 120+ countries.

Visit https://www.avetta.com/ for more information.

SAP and other SAP products and services mentioned herein as well as their respective logos are trademarks or registered trademarks of SAP SE in Germany and other countries. Please see https://www.sap.com/copyright for additional trademark information and notices. All other product and service names mentioned are the trademarks of their respective companies.

For more information, press only:

SnappConner PR
Mark Fredrickson, +1 801-806-0161
[email protected]   

Avetta
Kendra Lamer
[email protected]

Many are predicting an economic downturn due to inflation rates, recent market performance, and continued global uncertainty caused by events like the Russia war in Ukraine. Forward-thinking companies are starting to prepare now.

A huge lesson from the COVID pandemic was just how fragile supply chains are, and how dependent businesses are on them. When storms are ahead, we tend to see two types of company reactions: those who stay with the “status quo” and those that accelerate IT investment and digitization.

The digitization of supply chain risk management (SCRM) is still growing. Surprisingly, even post-COVID pandemic, recent Gartner research cited that only 21% of supply chain organizations believe they have a highly resilient network today. The best way to weather any upcoming downturn is to improve supply chain resiliency, particularly focusing on digitizing supply chain risk and compliance.

The following are five reasons companies should double-down on their SCRM IT investment before heading into an economic downturn.

1. “Status quo” SCRM operations require significant resources

Avetta did a study on how many full-time employees (FTEs) it takes to proactively operate a successful SCRM program without technology. Our findings show that it takes 18.3 FTEs to proactively manage every 1,000 suppliers. That’s an average of $2.2 million per 1,000 suppliers.

What do we mean by “proactively operate a successful SCRM program”?

• Collecting your organization’s global safety, environmental, ESG & sustainability, legal, business, insurance, and compliance requirements
• Onboarding suppliers and sharing these compliance criteria with them
• Collecting documentation and evidence to assess whether they meet these criteria
• Sending documentation back and providing feedback on gaps if a supplier does not meet your company’s requirements
• Ongoing safety, ESG, financial stability, sanctions list, and worker compliance monitoring
• Supplier support, messaging, and communications
• Site induction, terms and conditions, and corporate and sustainability training
• Contract worker compliance, including site access and badging

2. Manual operations cause more incidents

The simple fact is that no company dedicates 18.3 full-time employees per 1,000 suppliers to manage their supply chain operations. This means that good compliance operations are either not done or are conducted by people who are doing other jobs. As a result, suppliers are likely not trained, educated, or monitored well, which translates to more incidents, accidents, and out-of-compliance events.

3. Incidents are expensive

The National Safety Council (NSC) cites a safety accident as costing $47,000 per accident, and a fatality costing $1.2 million per fatality. Countless other types of incidents (environmental, cyber, financial, etc.) can impact your supply chain and are each quite costly, including the following examples.

• Environmental incidents can cost between $3,000 and $1 million per violation in regulatory fees
• The global average cost of a data breach is $3.86 million
• The U.S. issued $20.9 million in sanctions violations fines in 2021

4. Supply chain disruptions are costly

A Gartner article on SCRM cited that 89% of companies experienced a supplier risk event in the past five years. In this McKinsey report, they stated a long-term disruption could cost companies 30-50% of a year’s EBIDTA and even a disruption that lasts only 30 days could equal losses of 3-5% of EBITDA. Disruptions are caused by accidents, natural disasters, key suppliers going bankrupt or caught in fraud, a cyber-attack, sanctions violations, and many other hidden risks.

5. Brand damage is the most expensive

Many brands don’t recover when they are caught doing business with a contractor involved in a dangerous activity or illegal operations like bribery, child labor, or slave labor. Also, if a supplier leads to an accident or data breach of confidential information, it’s the organization that hired them whose brand is damaged, regardless of whether the liability for the event sits with the supplier.

Harvard Business Review found that 70-80% of an organization’s market value comes from intangible assets like brand reputation. In a study by The Economist, business leaders say the biggest consequence of supply chain disruption is “tarnished brand reputation.” 30% of those leaders have seen more customer complaints due to supply chain issues, and 23% saw less business from regular customers.

The Solution for a Strong Supply Chain

Deploying a multi-risk, global SCRM platform like Avetta One can not only surface hidden risk in your supply chain but can also streamline operations and profitability.

Here are three critical reasons for digitalizing your SCRM program on a platform like Avetta One:

1. 1. Resiliency: Organizations that use the Avetta One SaaS platform can see whether their suppliers have credit problems, liens against their business, a history of safety or environmental incidents, past or current legal proceedings, sanctions violations, or do not have complaint polices or programs in place. These are leading indicators of the health and risk of any supplier that a company may depend upon. If a supplier is at high risk, companies can use the Avetta pre-qualified network to source alternative or backup suppliers that provide similar services in similar regions.

2. 2. Agility: During the COVID pandemic, Avetta companies were able to communicate and deploy new COVID-19 protocols to their entire supply chains in a matter of weeks. By utilizing the Avetta messaging center and compliance tasks lists, new policies were communicated, deployed, and assessed in real-time. As new risk and compliance programs are rapidly evolving, having a digital and collaborative network to manage your supply chain will provide new levels of agility.

3. 3. Cost Savings: Avetta has conducted many ROI and case studies with its clients. Companies that use Avetta on average see:

   • Supplier compliance rates above 80%
   • Reduced safety incidents between 10% and 30%
   • Annual savings of $8 million to $12 million

Economic storms may lie ahead, but your supply chain risks do not have to stay hidden as you weather uncertain economic conditions. The good news is an investment in a SCRM platform today will drive streamlined operations, business continuity, and cost savings that will solidify your supply chain against whatever the future has in store.