A Moral Revision of Electronic Supply Chains (Guest Post by Bas van Abel, Fairphone)
To make the supply chain more transparent, Fairphone opens up the entire system to understand what shapes our economy. I am happy to share the following guest post by Bas van Abel, CEO and founder of Fairphone. Thank you for contributing to my blog.
Business practices in the supply chains of the electronics industry are in urgent need of moral revision. What do we know about the production of complex electronic devices and the people who make them? By making a phone, Fairphone wants to uncover and expose each link in the supply chain and step-by-step make interventions to improve the way things are made. Instead of hiding behind the complexity of the supply chain, Fairphone wants to unveil the problems associated with the smartphone production like poor labor conditions, the use of conflict minerals and the rise in electronic waste. To do so, we are searching for solutions by engaging in partnerships to come with alternatives to current models. In the first Fairphone that will be released in December 2013, conflict-free tin and tantalum from the Democratic Republic of the Congo has been integrated in the manufacturing of the phone, but that’s only a first step. By growing a movement of people who can share best practices and by creating a platform for discussion, Fairphone aims to raise the bar for the industry meanwhile giving people a choice for fairer electronics.
Bas has a background in interaction design and is an active member of the Maker Movement. He supports open design principles. He has set up projects such as the Waag Society’s Fablab and the Instructables restaurant (an open source restaurant). He is co-editor of the book “Open Design Now”.
Supply Chain Management and Corporate Social Responsibility
Two recent disasters in the garment industry, the Tazreen Fashions fire (2012) and the Rana Plaza building collapse (2013), have caused outrage over the lack of social responsibility across global supply chains. In our new article, The Socially Responsible Supply Chain: An Imperative for Global Corporations, Robert Handfield and I discuss three core principles that are essential for ensuring socially responsible business practices and successfully managing the extended global supply chain: First, a program to audit both products and suppliers needs to be implemented; this program must go beyond direct relationships with tier-one suppliers. Second, visibility is important for those categories of supply that cannot be directly controlled; hereby, electronic and smart technologies promise new opportunities. Finally, collaboration is needed to successfully managing a socially responsible supply chain; this includes collaboration across the industry, with local partners, and with universities. It is time to become serious about socially responsible supply chain management.
Wieland, A., & Handfield, R.B. (2013). The Socially Responsible Supply Chain: An Imperative for Global Corporations. Supply Chain Management Review, 17 (5), 22-29
Responsible Sourcing Insights
Sedex is a nonprofit organization dedicated “to driving improvements in ethical and responsible business practices in global supply chains”. Their new six-part “Responsible Sourcing Insights Films” series tackles key challenges in responsible supply chain management.
Citations of Excellence Awards 2013
Some of you may remember my last year’s post about the 2012 Citations of Excellence Awards. A year has passed since and Emerald Management Reviews has now announced the winners of the 2013 Citation of Excellence Awards. I went through the list of 50 awarded papers and discovered two papers which I think are particularly relevant to our field. First, a paper by Lawson et al. (2009), Knowledge Sharing in Interorganizational Product Development Teams: The Effect of Formal and Informal Socialization Mechanisms, reveals that informal socialization mechanisms, including communication guidelines and social events, “play an important role in facilitating interorganizational knowledge sharing”. Second, a paper by Pagell and Wu (2009), Building a More Complete Theory of Sustainable Supply Chain Management Using Case Studies of 10 Exemplars, examines the supply chain as an entirety and builds “a coherent and testable model of the elements necessary to create a sustainable supply chain”. Congratulations to the winners of the awards.
Lawson, B., Petersen, K.J., Cousins, P.D., & Handfield, R.B. (2009). Knowledge Sharing in Interorganizational Product Development Teams: The Effect of Formal and Informal Socialization Mechanisms. Journal of Product Innovation Management, 26 (2), 156-172 DOI: 10.1111/j.1540-5885.2009.00343.x
Pagell, M., & Wu, Z. (2009). Building a More Complete Theory of Sustainable Supply Chain Management Using Case Studies of 10 Exemplars. Journal of Supply Chain Management, 45 (2), 37-56 DOI: 10.1111/j.1745-493X.2009.03162.x
Supply Chain Management and Bioinvasion
We all know that economic, ecological, social, and ethical aspects need to be considered when managing global supply chains. This includes topics such as resource scarcity, climate change, and labor conditions. So far, however, I did not associate bioinvasion with our field. This has changed now: An article by Seebens et al. (2013), recently published in Ecology Letters, discusses the risk of marine bioinvasion caused by global shipping. The authors argue that “the rate of biological invasions has strongly increased during the last decades, mostly due to the accelerated spread of species by increasing global trade and transport”. They demonstrate that forecasting of bioinvasions needs to take into account information about ballast water transport, biogeographic distribution, and environmental heterogeneity. Particularly, they identify “high-risk invasion routes, hot spots of bioinvasion and major source regions from which bioinvasion is likely to occur”. In sum, their model reveals a new aspect of ecological responsibility in supply chains.
Seebens, H., Gastner, M.T., & Blasius, B. (2013). The Risk of Marine Bioinvasion Caused by Global Shipping. Ecology Letters, 16 (6), 782-790 DOI: 10.1111/ele.12111
The Earth’s Balance Sheet
In this video, José Lopez, Executive Vice President of Operations at Nestlé, warns that “we urgently need to account for things differently, we need to put a value on food and water”.
Full Product Transparency (Guest Post by Ramon Arratia, Interface)
In his new book, Full Product Transparency, sustainability pioneer Ramon Arratia argues that we have to move from corporate to product sustainability. I am happy that Ramon followed my invitation to contribute to my blog:
The conventional approach to exercising corporate responsibility in a company’s supply chain is to draft a company supplier standard and then audit for compliance using that document. Positive and usually well-intentioned, the impact is inherently limited by the narrow scope of the dialogue and the teacher–student nature of the relationship. The typical 700 questions questionnaire sent to suppliers usually asks meaningless things such as: “Does your organisation have an environmental policy in place?” Or: “Does your organisation have an environmental management system (EMS) in place?” This is just bureaucracy for the sake of it, taking lots of time from both parts and adding little transformative value to the real environmental impacts of the products. The ideal question for suppliers is: “Send me the environmental product declaration (EPD) of your product and your plan to radically improve it”. After all, you are not buying the whole company. Besides, around 80% of the environmental impacts of products are not in the manufacturer’s realms but in their supply chain.
Ramon Arratia is a sustainability director at Interface and has previously been employed in similar roles at Vodafone and Ericsson. Interface is the winner of the International Green Awards 2012. Ramon is also a blogger of Cut the Fluff.
Creating Added Value beyond Corporate Boundaries
Some months ago, Symrise, a global supplier of fragrances, flavors, active ingredients, and aroma chemicals, has won the German Sustainability Award 2012 in the “Germany’s Most Sustainable Initiatives” category for its approach to procure vanilla in Madagascar: Symrise closely collaborates with more than 1,000 vanilla farmers and “the entire procurement process takes place locally, from cultivation and harvesting, to the fermentation of the beans, all the way through to extraction”. The company partners with NGOs, development organizations, and farmers’ associations to ensure “that its projects in the areas of environmental protection, income diversification, nutrition, health and education continue to blossom over the long term”. Symrise benefits from these activities by receiving reliable access to top-quality raw materials. This initiative demonstrates how social responsibility, environmental protection, and business success can go hand in hand. It is also an example of good supply chain management, as added value is created beyond corporate boundaries.
Global Supply Chain Survey 2013
I recently received this year’s Global Supply Chain Survey by PricewaterhouseCoopers (PwC). It turns out that the leaders in PwC’s survey “have supply chains that are efficient, fast and tailored – a model that lets companies serve their customers reliably in turbulent market conditions and that differentiates between the needs of different sets of customers”. The authors present six key findings: (1) Companies should view the supply chain as a strategic asset to achieve better financial results; (2) Companies should focus on three key drivers: “perfect order delivery, cost reductions and supply chain flexibility”; (3) Companies should recognize that one size does not fit all; (4) Companies should not outsource core strategic functions (i.e., strategic procurement, sales and operations planning and research and development); (5) Companies in emerging markets should introduce differentiating processes; (6) Companies are increasingly interested in next-generation technologies and sustainable supply chains. Most of these results are in line with my own observations.
How Repairable is the iPhone 5?
In an age of resource scarcity, electronic supply chains should not produce goods that are fast-moving, hardly recyclable, and barely repairable. To evaluate the iPhone 5’s repairability, iFixit has now provided a look inside the device.
