Greening Your Supply Chain... and Your Bottom Line
"If too little attention is paid to sustainability and green initiatives, profitability and survival can be put at risk."This month's issue of Manufacturing Today features an informative article entitled You Can Go Green. The article, which was co-authored by Profit Point's President, Dr. Alan Kosansky, and the firm's Director of Supply Chain Services, Ted Schaefer, reviews the trade-offs and consequences of improving financial performance of the supply chain footprint, while also reducing the environmental impact.
You can read the complete article here.
To learn more about Profit Point's Supply Chain Optimization services, please contact us.
Posted with permission from Manufacturing Today.
Labels: Green Optimization, Publications, Supply Chain Intelligence, Sustainability
Thursday, July 09, 2009
Improving Your Odds of Winning a Stimulus Grant via Innovation, Sustainability and Partnerships
The U.S. Department of Transportation (DOT) has issued final guidance for the $1.5 billion in surface transportation grants it will award by next February, and among the top selection criteria will be environmental sustainability, innovation, and partnerships. DOT has included sustainability - improved energy efficiency, lower greenhouse gases, and/or less dependence on foreign oil - as one of five criteria it will consider in evaluating a proposed project's long-term beneficial outcomes for a metropolitan area, a region, or the country. Long-term outcomes, along with a project's impact on job creation and near-term economic stimulus, will be DOT's primary criteria for awarding grants.
DOT will also be considering two secondary criteria - innovation and partnerships. DOT is soliciting projects that use innovative technologies to achieve long-term outcomes or significantly enhance the operational performance of transportation systems, and projects that involve partnerships with non-Federal entities and the use of non-Federal funds. Priority will be given to projects for which a grant will help complete an overall financing package.
Recent estimates from DOT suggest that up to $50 Billion in grant requests may be submitted, making this a highly competitive process. It will be essential for an applicant to thoroughly meet the primary guidelines and to score well on secondary guidelines to win tiebreakers. If your project doesn't yet adequately address the three considerations of innovation, sustainability and partnership, Profit Point may be able to improve your chances of success:
Sustainability
Profit Point provides mathematics-based solutions that optimize the use of resources for maximal efficiency. Frequently this optimization results in reduced transportation mileage which minimizes greenhouse gas emissions as well as fuel consumption. It might also involve minimizing water use, minimizing output of toxic pollutants or maximizing production of beneficial byproducts.
Some examples include:
- Scheduling ship berths at ports to minimize ship idle time in a harbor
- Scheduling port (or canal) maritime traffic
- Optimizing a port drayage schedule to minimize delays and overland carrier idle times
- Optimizing local school bus or public transit system routes to minimize greenhouse gas emissions while providing optimal service
- Routing your deliveries or pickups using the fewest miles traveled
- Providing the algorithm to trigger variable speed limits on traffic leading to a congested area such as a city center or bridge
- Optimizing deliveries for the elderly, such as "Meal on Wheels," to minimize vehicle costs and emissions
- Conducting infrastructure studies to evaluate the full impact of a project, such as a port expansion with intermodal considerations
Innovation
While innovation is not a primary criterion for selection, it will be used to rank similar projects in order to break a tie. Adding leading edge technology such as mathematics-based optimization to your grant application provides one way of strengthening its innovative appeal.
Optimization is one of the hottest topics in industry today because it not only ensures operations are maximizing their current objectives, but also allows 'what if' modeling for future scenarios. "What if modeling" helps ensure continued achievement of your objectives, no matter what set of circumstances may occur.
Partnerships
After DOT considers primary criteria, priority will be given to innovative projects and those that involve State and local governments or private or nonprofit entities.
While there are certainly many partners available, adding a private, small business partner such as Profit Point, Inc. to the application may strengthen its overall appeal. Building on Profit Point's extensive sustainable logistics and mathematical optimization experience can help make your project application unique.
Presenting the Proposal
Should you need assistance preparing your application or prefer advice from a transportation expert, you may wish to work with an experienced consultant on surface transportation issues. Phillips Strategic Services, a Northern Virginia firm with strong ties to both industry and government, is one firm available to assist you. Phillips Strategic Services experience includes:
- Policy leadership at the Federal Highway Administration;
- Policy development and lobbying for American Trucking Associations;
- Senior staff to a Senate Committee handling surface transportation issues; and
- Various government affairs, marketing, and strategic planning positions with Union Pacific Railroad, Conrail and CSX
In conclusion, nearly any type of surface transportation project is eligible for funding under the discretionary program, which was authorized by the American Recovery and Reinvestment Act (ARRA) of 2009. DOT has named the program "Grants for Transportation Investment Generating Economic Recovery" or TIGER Discretionary Grants, and applications are due by September 15, 2009 with all grants to be awarded by February 17, 2010.
If you'd like to improve your chances of success by strengthening the sustainability and innovative appeal, or if you need a partner to help you present your application most effectively, please contact us:
Profit Point, Inc.
No. Brookfield, MA
Cindy Engers: (925) 736-6800, cengers@profitpt.com
Richard Guy: (435) 487-9141, rguy@profitpt.com
Phillips Strategic Services Ltd.
Alexandria, VA
Mary Phillips: (703) 360-3560, mphillips@phillipsstrategicservices.com
Labels: Government, Green Optimization, Optimization, Sustainability, Transportation
Monday, April 20, 2009
EPA Sets the Stage for a Green Supply Chain Mandate
Climate change – or global warming – and the effort to curb the impact of human activities thought to contribute to it – are continuously becoming a higher priority on the agendas of governments, commercial and non-governmental organizations and individuals around the world. In the United States of America the Environmental Protection Agency, the main federal government environmental watchdog and regulator, recently issued a report finding that projected future levels of greenhouse gases (GHGs) "endanger the public health and welfare of current and future generations", setting the stage for a more intense GHG regulatory regime in the future in a country that has lagged behind imposing the regulatory restraints now in place in many other parts of the world.A combination of internal and external factors have motivated many companies to work towards better measurement, and control, of their impact on the environment, whether in the areas generation of greenhouse gasses, emission of waste water and other effluents or consumption of renewable and non-renewable resources. But as always, companies need to ensure that they make changes in their activities in a cost-effective, as well as environmentally-effective, manner. We at Profit Point recognize the need to do this, and are working with our clients to help them make the best decisions in this regard.
Our Profit Network supply chain planning software has helped various clients make such decisions as:
- how do we consolidate separate distribution systems after a merger of two organizations, or
- where to produce and how to ship new products coming into the marketplace?
However, Profit Network is capable of taking into account not only the cost of such plans, but also the environmental impact. We recently worked with a client who had significant environmental constraints at both the entrance to and exit from their factories – they had significant limits on the amount of source water (a key raw material required for their manufacturing) that they could draw from surface and underground sources, and also had constraints at many facilities regarding the amount for waste water they could dispose of. Both of these constraints varied over the course of the year and geographically over the service territory. Using Profit Network they were able to see the cost and production location impact of the environmental constraints, and make choices regarding how to respond to their situation.
Another major concern of companies is their levels of emissions of greenhouse gasses. A major corporation in the United States of America recently announced that it was working to reduce its GHG impact through
- Retiring less efficient and higher-emitting production facilities;
- Reducing leakage of GHGs from its production and distribution systems;
- Increasing energy efficiency in its buildings;
- Increasing the fuel efficiency of its vehicle fleet.
Profit Point is here to help our clients make better decisions – this includes making better decisions regarding the many environmental choices that companies have in today’s increasingly regulated environment.
This article was written by Dr. Gene Ramsay, Profit Point's Infrastructure Planning Practice Leader. To learn more about designing a sustainable supply, contact us here.
Author's Notes:
1. Reference for the company mentioned in the text above: http://www.eponline.com/articles/71680/.
2. Reference for the EPA announcement: http://www.mercurynews.com/politics/ci_12168524.
Labels: Green Network, Green Optimization, Infrastructure Planning, Sustainability
Monday, December 01, 2008
Profit Point Wins 2008 Green Supply Chain Award
Green Network software is recognized for its role in helping to build environmentally sustainable businesses.Supply & Demand Chain Executive magazine honored Profit Point, a leading supply chain optimization company , with a 2008 Green Supply Chain Award. The company and its Green Network supply chain design software was recognized as a Green Supply Chain Enabler. Profit Point is showcased with other award winners in the latest issue of Supply & Demand Chain Executive.
Profit Point has been delivering supply chain optimization services and software to Fortune 500 companies for more than a decade. Earlier this year, the company introduced Green Network when it recognized that its clients needed a robust tool to account for and optimize away manufacturing waste, such as industrial pollutants and green house gas emissions.
"Profit Network software has been helping large companies around the world build more robust and profitable supply chains for more than 10 years," said Jim Piermarini, Profit Point's CTO. "From our clients' perspective it makes sense to incorporate environmental byproducts in to the network design to evaluate opportunities and costs and conduct scenario testing in advance of these critical infrastructure decisions."
The company's software products are now used to help companies manage the tradeoffs associated with environmental resource constraints, such as limited water supplies in developing countries. Profit Point's transportation and distribution clients achieve more efficient territory planning and vehicle routes, which mitigates unnecessary fuel consumption and carbon dioxide emissions.
The Green Supply Chain Awards recognize small, midsize and large organizations that are taking steps to realize eco-efficiency goals. Submissions were judged based on the clarity and content of each program's goals and strategy, the extent of the steps being taken, the impact of the results to date and projected results, and the form and presentation of the information submitted.
"We are honored to be recognized by Supply & Demand Chain Executive for our focus on sustainability and we're delighted to play a role in helping business managers define and reach environmental sustainability objectives across their supply chain," said Alan Kosansky, President of Profit Point. "We look forward to any opportunity to help create a more sustainable business environment."
To learn more about Profit Point's supply chain software and services, visit www.profitpt.com.
About Profit Point:
Profit Point Inc. was founded in 1995 and is now a global leader in supply chain optimization. The company's team of supply chain consultants includes industry leaders in the fields infrastructure planning, green operations, supply chain planning, distribution, scheduling, transportation, warehouse improvement and business optimization. Profit Point's has combined software and service solutions that have been successfully applied across a breadth of industries and by a diverse set of companies, including The Coca-Cola Company, General Electric, Logitech, Rohm and Haas and Toyota.
Labels: Awards, Green Network, Green Optimization, Press Releases, Publications, Sustainability
Monday, September 29, 2008
Can you be green and profitable?
This month's cover story in the CSCMP's Supply Chain Quarterly magazine feature's an excellent article written by Profit Point's Green Optimization Practice Leader, Ted Schaefer, and the firm's President, Dr. Alan Kosansky.The article, Can you be green and profitable?, deals with two competing, yet critical issues that face supply chain managers across the globe. As the authors point out, "profitability and sustainability don't have to be mutually exclusive. By considering environmental issues when setting financial objectives for a supply chain network analysis, companies can successfully balance the trade-offs between them."
You can read the complete article here.
If you would like to learn more about our Green Supply Chain Optimization services please contact us.
Labels: Green Network, Green Optimization, Infrastructure Planning, Optimization, Publications, SC Operations Planning, Sustainability
Sunday, April 20, 2008
Dwight Collins Interviewed at Cornell's Sustainable Energy Conference
Dwight Collins, Profit Point's Green Supply Chain expert, attended the Sustainable Energy Conference at Cornell University and was interviewed by the Cornell Chronicle for his work on sustainable operations research. The conference, entitled "Sustainable Energy Systems: Investing in Our Future," provided a full slate of talks that outlined the relationship between energy and climate challenge and considered the viability of an array of solutions ranging from conservation, petroleum and coal to nuclear, solar, wind, geothermal, hydroelectric and biofuels sources.Collins, who teaches sustainable operations management at the Presidio School of Management, noted that the "the OR profession is missing out on some major opportunities for leadership in the field of sustainable business."
Read the complete article here.
Labels: Green Optimization, Operations Research, Supply Chain Intelligence, Sustainability
Friday, April 04, 2008
Profit Point Releases Green Supply Chain Software Solution
Profit Point, a leading supply chain optimization firm, announces the introduction of Green Network, a green supply chain network design application.North Brookfield, MA (PRWEB) April 4, 2008 -- Profit Point, Inc., a leading supply chain optimization consultant, today announced the release of Green Network, a supply chain network design application that empowers a supply chain manager to gain visibility in to the trade-offs they will face when designing a green supply chain. Built upon proven technology, Green Network extends the company's Profit Network application by enabling supply chain managers to include any number of environmental byproducts, including carbon dioxide, nitrogen oxide, particulates, and wastewater, in to the analysis process. The user can also manage total energy consumption or the type of energy consumed (coal, natural gas, hydroelectric, thermal, wind, etc.) in the design of the supply chain.
"Many of our clients have expressed a strong interest in greening their supply chains to meet the growing demand by consumers," said Alan Kosansky, Profit Point's President. "Designing a sustainable supply chain is becoming a significant priority for our clients, but not at any cost. The key to building a sustainable supply chain comes in truly understanding the trade-offs that are faced by decision makers."
Green Network was designed as an out-growth of Profit Network, an industry-leading supply chain network design software system. Profit Network is a robust, yet cost-effective tool that helps companies of all sizes optimize their supply chain for maximum profitability.
"Profit Network software has been helping Fortune 500 companies around the world build more robust and profitable supply chains for more than 10 years," said Jim Piermarini, Profit Point's CTO. "By leveraging our work in Profit Network, we were able to build a powerful tool that accounts for environmental impact and profitability."
In addition to Profit Network and Green Network, Profit Point's line of supply chain software also includes Profit Vehicle Router, a system for optimizing transportation routing, Profit Distribution Scheduler for easy production and distribution scheduling and Profit Meeting Scheduler, a sophisticated conference scheduler used by major trade organizations.
For additional information about Profit Point's supply chain design and optimization software and consulting services, contact Richard Guy or visit www.ProfitPt.com.
About Profit Point:
Profit Point Inc. is a supply chain consulting firm founded in 1995 and is now a global leader in supply chain optimization. The company's team of supply chain consultants includes industry leaders in the fields infrastructure planning, green operation, supply chain planning, distribution, scheduling, transportation, warehouse improvement and business optimization. Profit Point's has combined software and service solutions that have been successfully applied across a breadth of industries and by a diverse set of companies, including The Coca-Cola Company, General Electric, Rohm and Haas and Toyota.
Contact:
Richard Guy
Profit Point
(866) 347-1130
Labels: Green Network, Green Optimization, Press Releases, Sustainability
Friday, February 22, 2008
"Green" Supply Chain Optimization
Adding Sustainability into the Equation
Hardly a day goes by anymore when we don't see sustainability issues making headlines in our newspapers, magazines or on TV. Terms like, "global warming", "greenhouse gases", "watershed impact" and "energy reduction" are all becoming more important in both the news media and in the supply chains of large and small companies around the world. The US EPA's Smartway Transport Partnership, the EU's "Climate action and renewable energy package" and the UN's "Water for Life Decade" are but three of the many programs that are already underway or are under consideration by major government bodies around the world. Clearly, the case for improved sustainability has been made and will be a major driver of change in the coming years.
So, how do you, as a supply chain manager, integrate your company's sustainability goals into your supply chain without burdening it with unnecessary costs or adding additional steps that slow it down or impact customer service? Is it possible that you can implement changes that both improve sustainability and your profits at the same time? I'll try to answer both of those questions in this article.
Integrating Sustainability Goals into Your Supply Chain
Green Optimization is Profit Point's next generation of supply chain design. Here are 7 steps we can take to integrate your sustainability goals into your supply chain:
1. "Sustainability" is a term that is used very broadly throughout industry, regulatory agencies, communities, and the news media. We need to determine what, precisely, we are trying to accomplish with respect to sustainability. Are we trying to reduce our impact on the watersheds in which we operate? Are we trying to reduce packaging waste? Are we involved in a regional plan to cut certain types of emissions or reduce peak energy consumption? Are we trying to reduce our carbon dioxide (CO2) footprint? And, for any of these questions, is there a certain targeted reduction that we have in mind? Without answers to these questions, it is very difficult to analyze your alternatives and develop a plan to meet your goals.Can Sustainability and Profitability Go Hand in Hand?
2. We need to determine the boundaries of the supply chain we are trying to improve. Are we looking at our entire global supply chain, or are focusing on our distribution operations in a single region of the world? Are we bounding our analysis within assets and processes that are totally controlled by our company, or are we including our suppliers and/or customers in the analysis? Are we trying to achieve our sustainability goals within our existing supply chain infrastructure, or do we need to factor in potential expansions or contractions of the supply chain?
3. Once we have unambiguously defined our goal and have clear boundaries around the supply chain we must improve, we need to collect and understand the information that is available to analyze and model our supply chain. This will be information will include things like production capacity, plant operating costs, grams of CO2 produced per kg of finished goods, transportation costs, and product pricing. We may want to include the sources of electricity used by our manufacturing facilities or raw material suppliers to favor those sites using renewable sources of electricity over those that use coal-based electricity. Likewise, we may want to include our transportation suppliers so that we favor carriers with more fuel-efficient fleets. This step is usually the most time-consuming step in the process but is critical to the generation and implementation of the changes you will make to meet your goals.
4. With this collection of information, we need to model the supply chain to generate options that both meet our sustainability goals and maximize our profitability. In this step, the "art and science" of green optimization comes to bear. It is here that we may need to make trade-offs between sustainability goals and profitability or cost goals. For example, we may be able to make a very significant reduction in our CO2 footprint with a very slight increase in cost or reduce peak energy consumption by carrying more inventory. Where these trade-offs can be accurately quantified, the "science" is used. However, where the sustainability improvements cannot be quantified, then we use the "art" to bracket the value and the cost of the improvement.
5. Now that we have selected the top options, we need to discuss them with the key stakeholders and decision-makers to get buy-in for a single option so that a successful implementation can follow. This discussion is especially important when future-based assumptions have been made in the analysis. For example, if we've assumed a 5% growth in demand and assumed the price of crude at $85/bbl to choose the best solution, will our choice still be the best one if our demand only grows by 2% and the price of crude moves to $100/bbl? If there is a lot of uncertainty in these key parameters, it is important that all stakeholders have a good understanding of the risks associated with each of the options presented. In fact, it may well be time for a more robust type of optimization analysis, but that will be the subject of a future blog article.
6. With all stakeholders on board, it is time to implement our new plan to achieve our sustainability goals. In addition to the communication, selling and training/education facets of our change management plan, we need to include a measurement system ensure we are getting the improvements we anticipated and to check for unintended consequences of our change. This measurement system will also directly feed the last step in this process...
7. ... which is to periodically recheck our assumptions and refine our analysis and plan as external events like new customers or unanticipated costs present themselves, or as we find that a key assumption does not hold true for our sustainability gains.
As in many broad-based business questions, it depends. Many companies are finding that their search for sustainability is also leading to reductions in cost, particularly in the area of greenhouse gas reduction. In these companies, the addition of the carbon footprint to the optimization equation further strengthens the case to improve transportation efficiency or improve production planning and scheduling to produce only what is needed by a customer and only when it's needed.
In other companies, for example those that are looking to reduce watershed impact, they may find that a small increase in cost will result in a very large reduction in watershed impact. Although this may show up as a short term "hit" to the P&L, it can be a large source of goodwill that will translate into greater customer loyalty for years to come. It is important to remember that from our neighborhoods to national governments and international organizations like the UN, we all receive a "license to operate," both from the regulatory and the public opinion perspective. Our customers want to know what we're doing about sustainability and so do our communities and governments. We need to be able to show them tangible results.
In the end, adding sustainability into your supply chain goals is simply another tradeoff in an existing decision making process based on tradeoffs. However, considering sustainability from the beginning of the process allows you to influence your corporate culture and processes to be more responsive to an ever growing set of business objectives.
If you're interested in learning more about Supply Chain Sustainability, please contact us or take a visit our website at ProfitPt.com.
This article was written by Ted Schaefer, Director of Logistics and Supply Chain Services at Profit Point.
Labels: Supply Chain Intelligence, Sustainability
Wednesday, February 18, 2004
The Social Side of the Supply Chain
Download the new article about the "The social side of the supply chain" co-authored by Alan Kosansky and Jim Piermarini from Amazon.com here.
Labels: Press Releases, SC Operations Planning, Sustainability
Tuesday, November 18, 2003
Achieving a Sustainable Supply Chain
Achieving sustainable supply chain improvement is of the highest urgency in today's highly competitive world, and will probably be even more so in the future. Despite the urgency, the majority of supply chain initiatives have failed to deliver expected results. This paper argues that these failures arise from two flaws:
- The improvement initiatives have been piecemeal instead of whole-system; and
- The initiatives have attended to the technology and business processes, but have ignored the human side of organizations.
Read the complete article on Achieving a Sustainable Supply Chain.
Labels: Green Optimization, SC Operations Planning, Supply Chain Intelligence, Sustainability
