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Press Release -- August 2nd, 2016
Source: Cisco Systems

Supply chain digitization and positive impact

look at how digitization is helping supply chains be more socially responsible.

AUGUST 02, 2016
Our supply chains are in drastic need of a makeover from the inside out. According to the British Standard Institute’s 2016 study on supply chain risk, global supply chains have incurred $56 billion in extra costs related to catastrophic events ranging from weather disasters, to power outages, to theft, to a myriad of other issues. From a corporate social responsibility standpoint, supply chain transparency is vital for increasing prosperity, promoting sustainability and saving lives.

A vast majority of businesses have supply chain policies in place to prevent labor violations and slavery, lower their carbon footprint, and promote sustainable sourcing. However, labor violations continue to occur across the globe on a daily basis. For this reason, the need for data-driven CSR initiatives is soaring, and open source systems and communication are growing in importance. This is where digitization comes into play.

The 2016 Supply Chain Digitization Benchmark Survey was conducted by Supply Chain Digest. Its 203 online survey respondents represented a diverse range of manufacturing and retail businesses. Nearly 44 percent of them said they find IoT to provide a major opportunity in terms of improving supply chain performance and reducing costs.

How is digitization being used to increase supply chain sustainability, and what digital platforms or apps are being used?

The Electronic Industry Citizenship Coalition (EICC), which supports the rights of workers and communities affected by the global electronics supply chain, is using IoT and digitization to improve its internal and external communications and drive positive impact.

See also: Pushing the Sustainability Envelope: Cisco Supply Chain to Cut 1 Million Metric Tonnes of Greenhouse Gas Emissions by 2020

“Because we have a global industry, our members are all around the world, and it’s technology that holds us together,” says EICC Executive Director Rob Lederer. “Every day we are conducting task force calls around the world with hundreds of key members who are engaged through teleconferencing calls and webinars.”

Specific examples of how tech is aiding EICC’s work with supply chains include:
Enabling companies to analyze massive amounts of data.
Educating consumers on the sustainability of the products they use through websites and mobile apps.
Online training courses that teach factories and CSR managers how to improve conditions in the supply chain.
Mobile apps that survey workers and allow them to report grievances.
Bringing all these activities together, the EICC is leveraging digitization across three platforms including EICC-ON, an e-Learning Academy, and its Workplace of Choice program.

EICC-ON is an online data management system and the cornerstone of how EICC functions.

“It really centers around an extensive risk assessment process, where members can assess risk against EICC’s code of conduct,” explains Lederer.

Using the system, EICC members manage and share sustainability data, including information from EICC’s Validated Audit Process and self-assessment questionnaires that assess risk at the corporate and facility level. And, the connectivity doesn’t end there. Access to other applications provided via the EICC-ON platform include a document sharing library, a GRI (Global Reporting Initiative) tool, the EICC Environmental Reporting Module, and a conflict minerals app.

What do corporations and factories need to learn about supply chain management?

In 2014, EICC launched its e-Learning Academy, which offers EICC members with best-in-class online trainings on a range of sustainability topics from CSR program management to methods on combatting trafficked and forced labor in the supply chain. The curriculum includes more than 50 courses in 14 languages. At the end of May, more than 26,000 online courses were completed via the e-Learning Academy, which has over 30,000 users.

See also: Making Manufacturing Sustainable – Starting with Our Supply Chain

“Audits tell you a problem in a factory, but they don’t tell you how to address and solve the problem. The goal of the academy is to enact change and protect the lives of workers.”

Rob Lederer, EICC executive director
Lederer says that the academy exists to take companies beyond risk audits. “Audits tell you a problem in a factory, but they don’t tell you how to address and solve the problem,” he explains. “The goal of the academy is to enact change and protect the lives of workers.”

EICC’s upcoming Workplace of Choice program is an educational and capacity-building initiative that will link key stakeholders (industry leaders, factory management, civil society organizations, and workers) to help secure safe and fair labor migration practice. Currently being piloted in Malaysia, the program will offer factories free technology that tracks interactions with the worker helplines through the use of digital dashboards and an interactive voice response system.

The plan is for workers to be allowed to call a phone number and select the language of their choice. If it’s a factory-related issue, the call will go to the factory for resolution. If it’s a non-factory issue, it will go to local assistance desks, and if it’s a crime it goes to the local police authority.

There is more work to be done. But it’s safe to say that from corporate executives to factory workers, digitization is helping make the supply chain a more efficient network.


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