May 17, 2020

How digital transformation is enabling a resilient and sustainable supply chain

digital transformation supply chain
Supply Chain Digital
HP supply chain
Technology
Cliff Henson, Sr. VP Global Su...
5 min
Cliff Henson, Sr. VP Global Supply Chain, Hewlett Packard Enterprise
The triple blows from hurricanes Harvey, Irma, and Maria in the United States were a wake-up call to many businesses on the importance of managing and p...

The triple blows from hurricanes Harvey, Irma, and Maria in the United States were a wake-up call to many businesses on the importance of managing and predicting supply chain risks.

While the long-term impacts of these disasters are still unclear, operations across the country were immediately disrupted as factories and business shut down, transportation came to a standstill, and fuel prices skyrocketed. Yet the impacts were far less disruptive compared to even one or two years ago thanks to the adaptability that new digital technologies provide.

Digitisation is uniting a once siloed supply chain into an integrated end-to-end digital ecosystem – from the procurement of raw materials, to manufacturing and logistics, and finally to customer fulfillment. According to a recent PwC study, nearly 75% of companies expect to have achieved advanced levels of digitisation within the next three years. For large and complex supply chains like Hewlett Packard Enterprise (HPE), this digital transformation not only offers unprecedented flexibility and visibility, but has the ability to drive efficiencies, boost innovation, and reduce risk.

Increasing resiliency and responsiveness

Our ability to minimise disruptions has been accelerated by the rise of predictive analytics and big data, which anticipate shifts in customer demand, foresee the availability of raw materials, and can prepare us for catastrophic events. Machine learning will soon be able to combine real-time supplier data like stock inventories and logistics trackers with external weather and news sources to make smarter decisions, faster. In fact, near-real time visibility and tracking in our supply chains already have the ability to produce immediate insights that can reduce reaction times from days or weeks to just hours or minutes.

For HPE, the digitisation of a management process that was manual and laborious only a few years ago was a critical asset in our ability to quickly shift demand, reposition materials, and reroute orders in the wake of Hurricane Harvey. Our digital platform allowed us to seamlessly aggregate data from various suppliers, sites, and systems in order to provide insights to suppliers and logistics providers, ensuring the end-to-end instrumentation of a continuous process.

Severe disruptions will continue to test our resiliencies as climate impacts are felt across the world. Operating models that are adaptable, automated, and data-driven will be the future of industry – ultimately increasing predictability, accelerating manufacturing, and enabling cost reductions for business.

Enabling the connected factory

Nowhere is digital disruption more evident today than with the Industrial Internet of Things (IoT), enabling manufacturers to collect and analyse data from connected assets, people and places, to deliver actionable insights in an industrial environment. Imagine a factory where customers can validate their order remotely, machine maintenance needs can be predicted, and utilities can be optimised by understanding their loads from a remote dashboard.

Automation and advanced manufacturing will reshape industry, raising new challenges related to workforce displacement while offering new opportunities to capitalise on the huge volume of real-time data. This IoT data can enable industrial organisations to reduce example, by monitoring energy use in manufacturing facilities with smart sensors and analytics, we can lower consumption, improve performance and change the way energy is consumed.

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But IoT isn’t just about making efficiency gains; it’s about a complete transformation of industry. Beyond the factory, supply chains will see logistics reimagined with the connected vehicle, and purchasing decisions will become increasingly interactive and transparent. Those who succeed in truly integrating IoT into their value chains can capture a portion of a trillion-dollar opportunity.

Defining the future of sustainable production

In an increasingly competitive world, industrial supply chains cannot afford to lose out on operational efficiencies nor waiver in ethical practices. Their goal must be to deliver a quality product to the customer quickly, responsibly, efficiently, and cost effectively. Those organisations that pursue their digital vision while counting sustainability among the outcomes they seek will be more resilient and well-positioned for long-term success.

Businesses and NGOs must continue to partner together to tackle the world’s most complex challenges. Initiatives like the World Economic Forum’s Accelerating Sustainable Production bring together thought leaders across sectors to identify ways that emerging technologies can enable the transformation of production systems to be more efficient with minimal negative impact to environment and wellbeing.

Companies are also increasingly focused on building the capabilities of their suppliers, whether to partner on innovative solutions or to help achieve supply chain targets. As the owner of one of the industry’s most extensive supply chains, we at HPE believe it’s imperative that we manage our outsourced manufacturing in a responsible way, and work together with our suppliers to ensure the resiliency of our value chain by mitigating risks like climate change and resource scarcity.

Earlier this year, HPE launched a first-of-its-kind supply chain management programme based on climate science, which aims to avoid 100mn tonnes of emissions by enabling manufacturing suppliers to set emissions reduction targets within their own operations. It is our hope that this programme will catalyse the IT industry and beyond by setting a new standard for supply chain emissions engagement and abatement.

As supply chains become increasingly connected we are already seeing how digitisation can enable supply chains to be more adaptable and responsive. Advanced risk prediction tools will include dimensions such as environmental and ethical risk monitoring, and transformative technologies will break down the barriers of our current supply chain processes to create a transparent and collaborative network. By weaving sustainability into the fabric of our digital supply chain strategy and leveraging it as a driver of innovation, businesses can secure a competitive advantage.

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Jul 30, 2021

QR technology: The Bridge to a Sustainable Fashion Industry

ESG
Sustainability
CircularSupplyChain
Technology
6 min
Supply Chain Digital discusses how the fashion industry supply chains can create a more circular economy and be more sustainable with QR code technology

As one of the top polluting industries, Sara Swenson, Global Senior Manager Sustainability at Avery Dennison explains “there's debate whether it's the third, fourth or fifth most polluting industry, but it's generally well known that about 4% of global carbon emissions and about 20% of water pollution comes from the fashion supply chain. So obviously it’s massive. On the US side, we dispose of about 70 pounds, which is about 30 to 32 kilogrammes clothes every year. So it's a growing impact that has dramatically started impacting the world.”

Could Technology be the Answer to Sustainability Challenges?


Year after year, over 100 billion new garments are made, with US$450bn worth of textiles thrown away around the world. The emergence of a ‘fast fashion’ society has resulted in the average person not only buying 60% more clothes than in 2000 but also discarding more. On average, a family in the Western World throws away 30kg of clothing a year, with only 15% being recycled or donated. 

“Over the past 20 years, environmental issues have ramped up and ‘fast fashion’ is partly to blame,” says Swenson. “Fast fashion has changed the mindset of how quickly styles and consumers want to update their clothing lines. But over the past 20 years, consumers purchased about 60% more clothes than we did in 2000 and we're not circulating those materials back in. They're really going in a linear fashion: take, make and waste out. 

“We've really switched from having high quality garments to lower quality, more plastic based garments, and out of those that are manufactured every year, about 30% are just overstocked, they're never even sold. So there's all these waste stitches along the supply chain that need to be figured out, and then the recirculation of those raw materials back into the supply chain. None of that's happening with fast fashion, because everything is done so quickly and consumers want new products so much faster than ever before.”

Adopting a circular economy approach, instead of a linear one can help the fashion industry to become more sustainable. “A Circular economy is really about designing out that waste and pollution that I was talking about within the supply chain, and then keeping those products and materials in use for as long as possible, and then regenerating them back into the supply chain at the end of their life,” says Swenson who strongly believes that this is important to do, “because A: we all know the risks to the environmental factors, and then B: customers and consumers want us to solve these problems. We're getting more and more educated consumers that are willing to dive into the data. Brands are no longer able to greenwash and say, ‘Hey, we're doing something sustainable’, they actually have to prove they’re doing something sustainable with the data that backs it up or approves it.” 

Mobile Technology: The Future of Sustainable, Transparent and Ethical Fashion


With 60% of consumers valuing brands that are transparent about their operations, fashion brands are turning to mobile technology such as QR Codes and NFC tags to provide their customers with end-to-end information on the product they have purchased from raw materials and production, right through to distribution and beyond. 

“Technology is probably going to be the easiest way to create data to show that brands are making more sustainable actions, that they are not just greenwashing their sustainability progress. It also gives supply chain stakeholders the right to ask questions and engage, as well as consumers to understand ‘if you make this choice in how you're going to dispose of our garments, this is going to be your environmental impact. So it provides the right data that's available to both the consumer and the brand and other stakeholders to make those choices,” says Swenson.

“Right now we're asking stakeholders to make choices without data and without an easy solution. Consumers are not going to go through extensive links to find the right recycler, or find the right reseller. But if that information is at the tip of their fingers, on the garments that they can access, then they're much more likely to make those appropriate environmental decisions as well.”

With it still being legislation to have physical care and contents information written on a garment, Swenson adds that “many brands are now adding a QR code with information such as how to better wash your garment, how to take care of it so that it has a longer life, the benefits of high quality garments that you want to dispose of, but is still good quality to resell, how to brand authenticate it, and then how it can be recycled at its end of life.”

Whilst Swenson explains that “labels are by no means the solution that is going to solve everything in the apparel supply chain, it is the place that most people go to find more information on their environment.”

Fashion brands adopting QR and NFC technology include PANGAIA, Sheep Inc., and Skopes.

PANGAIA


In May 2021, materials science company - PANGAIA - partnered with EON to create ‘digital passports’ for its products. The lifestyle products brand uses QR code technology to accelerate greater transparency, traceability and circularity in the fashion industry, inspiring responsible consumer choices. 

QR codes are printed directly onto the care labels unlocking a bespoke digital experience when scanned with a mobile phone. The experience takes the customer on a journey from the product's origin through to purchase, dyeing, production, distribution, transportation and aftercare. 

The digitalisation of this experience allows customers to be updated in real-time, bridging the gap towards a full circular model, providing authenticity and visibility of lifecycle data.

Sheep Inc.


Also partnering with EON, Sheep Inc. - the world’s first carbon-negative fashion brand - is leveraging a bio-based NFC tag that provides each customer with a unique ID to trace and discover their product's supply chain journey.

The knitwear company leverages this technology to communicate with their customers the product’s carbon footprint at each stage of its supply chain journey from raw materials to manufacturing, distribution, and approximate usage. 

“Finding out how well or badly a brand has behaved shouldn’t have to turn into an exploratory mission. It should be instantly visible when you go to buy a garment.” commented Edzard van der Wyck, CEO and Co-Founder of Sheep Inc., on the partnership. “We need to get to the stage where brands give customers the full, non-redacted picture of the journey and the impact behind the things they buy.”

Skopes


In 2020, Leeds-based brand - Skopes - coincided with the launch of its first sustainably sourced suit collection - made using plastic bottles - with its use of care labels with QR codes allowing customers to see exactly how and where their suits are made.

“We are really keen to reduce our environmental impact and have developed this collection diligently with Lyfcycle over the past 18 months,” commented Nick McGlynn, head of buying at Skopes, on the launch. “The aim with Lyfcycle is to create a fully self-sufficient, transparent loop of sustainable and traceable sourcing, production and delivery,” adds McGlynn.

Concluding on the future for this technology Swenson says, “the industry has made huge strides, and I think with technology and the availability of tracing and triggers on garments to hold that data, I think it really helps jump the industry forward into providing some actionable data that can be used to showcase a lot of their great efforts that are going unnoticed now, or focus on what they're not doing and that they need to increase, increase what they are doing because  it's not working for their consumers or garments aren't getting where they need to go. So some pretty exciting stuff is finally happening in this.”
 

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