A recent article in Industry Week contained an interview with Christian Verstraete, the CTO of Worldwide Manufacturing & Distribution Industries of Hewlett Packard Co. who is pushing the lean frontier to see “how it can be incorporated into the wider view of the complete ecosystem”. This is because companies must have a handle on risk management and mitigation across the supply chain while simultaneously reducing the variants. Rather than do Six Sigma within the company, do Six Sigma across the supply chain“.
HP, which actively models proposed changes to its supply chain in modern simulation software before making any significant changes that could have (significant) repercussions, won Wal-Mart’s 2008 Home Entertainment Design Challenge which revolved around reducing the amount of packaging material in an effort to be environmentally responsible. HP was able to design one package to meet shipping needs for PCs and laptops from China or Thailand that reduced shipping material by 97%.
While the article was short, Christian did make one very good point … a company is a community of human beings and everyone is responsible for doing their part. And today, that means being socially responsible. So before you make a new (global) sourcing decision that’s going to require significant changes to your supply chain, when you’re running that Total Value Model, be sure to take into account the carbon footprint as well. It might not be a very valuable decision after all, especially once carbon credits become mandatory.