The world is on fire. And drowning. And drying out. All at the same time. Across our planet, climate chaos creates scenarios that haven’t been seen for millions of years. Science is telling us that we humans are the cause of it. And the reality is that supply chains are a major contributor to the greenhouse gases (GHG) causing this crisis.
The purpose of this blog isn’t to shame, blame, or defend the actions that have brought us to this point but rather to highlight the science that is helping us understand what is happening and hopefully inspire collective next steps to stop or slow down the climate crisis.
Let’s examine the situation and then work on how supply chain leaders can address the problem.
First, we need to be clear about where we are. To be honest, it’s not good. I’m not a climate scientist, but it’s not hard to understand sentences from the IPCC Report: Climate Change 2021 like:
It is unequivocal that human influence has warmed the atmosphere, ocean, and land. Widespread and rapid changes in the atmosphere, ocean, cryosphere, and biosphere have occurred.
In 2019, atmospheric CO2 concentrations were higher than at any time in at least 2 million years (high confidence), and concentrations of CH4 and N2O were higher than at any time in at least 800,000 years (very high confidence).
Many changes in the climate system have become more significant in direct relation to increasing global warming. They include increases in the frequency and intensity of hot extremes, marine heatwaves, heavy precipitation, agricultural and ecological droughts in some regions, and proportion of intense tropical cyclones, as well as reductions in Arctic sea ice and snow cover and permafrost.
This is a clear wake-up call that things are going wrong. Very wrong. Unless Elon Musk figures out a way to colonize Mars at scale in the next decade, we’re going to have to face the situation.
Which brings us to the next question, “Can we fix it?” A better question is, “Is there any hope?”
The short answer is yes. The longer answer is “Yes, but not in our lifetime.” The IPCC report states, in section B.5, “Many changes due to past and future greenhouse gas emissions are irreversible for centuries to millennia, especially changes in the ocean, ice sheets and global sea level.”
This means that even if we, across nations, geographies, and corporations, simultaneously took up the mantle tomorrow and said, “We are going to stop contributing CO2 to the environment”, we’ll continue to see temperatures and ocean levels rise, droughts and fires, and other severe weather patterns occur. But the next generation, and the one after that, will benefit from our actions now.
So how does a supply chain leader make a difference and help fix this mess we’ve gotten ourselves into? The good news is there is a silver lining.
Supply chain disruption is guaranteed because of climate change. At some future date, raw materials, manufacturing facilities, or distribution networks (or all three) will be impacted because of this problem. And it is already happening. The ability to do scenario planning will be required to determine the best course of action to mitigate the impacts of climate volatility, either to the bottom line or to the customer experience. So having a digital supply chain twin will be the only way to make sense of all the variables, options, suppliers, and so on to find the optimal solution to this problem. If nothing else, this report highlights the time to embrace a digital supply chain.
By adopting a digital supply chain planning solution, you’re being proactive and preparing for the worst. For your shareholders, that’s a great message. But even more importantly, adopting a digital twin gives you the benefit of better planning. Better quality, real-time information from your trading partners (but also from the market) and better scenario planning contribute to a better outcome. Better planning will reduce obsolete inventory and eliminate waste. A reduction in emissions from transporting products―particularly expedited shipments― and a decrease in electricity required for manufacturing and storage will, you guessed it, minimize and eventually eliminate your organization’s contribution to the CO2 problem. The benefits of better planning your company’s carbon footprint are apparent.
For the altruistic leaders out there who have a stated goal of a green supply chain, adopting a digital supply chain allows your organization to engage in eco-friendly planning and decision-making, helping create a sustainable future. An added benefit of putting a stake in the ground and making environmental sustainability a core value is that, by publicly signaling your intent, you can find and align with suppliers and technology partners with similar agendas. And this is how to get the ball rolling.
Either way, the decision to engage in digital supply chain planning delivers the best of both worlds: The ability to address supply chain challenges with “resiliency in the face of climate-driven volatility” and “sustainable supply chain practices that minimize the lasting impacts of climate change.” A win-win for any leader.
Ultimately the necessary action, regardless of motivation, is clear. The time is now, and whatever rationale resonates best to support a decision to invest in a net-zero carbon future, there are companies, like o9 Solutions, that have the vision, the technology, and the passion for helping us all embrace a greener supply chain future.
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About the author
o9 SolutionsThe Digital Brain Platform
o9 offers a leading AI-powered Planning, Analytics & Data platform called the Digital Brain that helps companies across industry verticals transform traditionally slow and siloed planning into smart, integrated and intelligent planning and decision making across the core supply chain, commercial and P&L functions. With o9’s Digital Brain platform, companies are able to achieve game-changing improvements in quality of data, ability to detect demand and supply risks and opportunities earlier, forecast demand more accurately, evaluate what-if scenarios in real time, match demand and supply intelligently and drive alignment and collaboration across customers, internal stakeholders and suppliers around the integrated supply chain and commercial plans and decisions. Supported by a global ecosystem of partners, o9’s innovative delivery methodology helps companies achieve quick impact in customer service, inventory levels, resource utilization, as well as ESG and financial KPIs—while enabling a long-term, sustainable transformation of their end-to-end planning and decision-making capabilities.