Back to the Supply Chain Gang. I reread this Carbon Trust mini-white paper (Carbon footprints in the supply chain) this morning with a view to picking out the Open possibilities, as the term relates to supply chains.
Rather than a polluter pays approach the paper advocates an holistic view on the entire supply chain for two test cases, the Trinity Mirror produced Daily Mirror and three products Walkers Crisps produces. Let’s get some muck behind our ears and look at the spuds.
Walkers was encouraged to “own” the entire supply chain from start to finish. Broken into three stages this chain incorporates:
- Raw material
- Distribution, manufacturing and retailing steps
- Product use and disposal
Crucially using this methodology Walkers is to take responsibility for the carbon in parts of the supply chain that it traditionally doesn’t own, e.g. the production of the actual potatoes.
For each of the products, the full product life-cycle was analyzed, considering emissions from fuel use in raw material production and distribution through manufacturing and product distribution to disposal and recycling…
Suppliers and other supply chain partners were engaged to provide energy data…
The data gathered was used to build a mass balance map of the flows of materials and energy through the supply chain and to build a footprint of the life-cycle emissions for each product. These results were then used to identify opportunities to reduce emissions by changing process flows and by changing the way the supply chain is structured.
The report goes on to list lots of expected insights. In the case of Walkers it presents this rather interesting finding:
A key opportunity relates to the water content of the potatoes. The overall supply chain can save up to 9,200 tonnes of CO2 and £1.2m per annum by changing the way that potatoes are traded; Walkers can reduce the emissions from the potato frying stage by up to 10%.
…By changing the way potatoes are purchased, savings can be made by both parties.
The Problem for Farmers
- Spuds purchased by weight
- Spuds are stored in artificially humidified warehousing
- This increases water content (thus their weight and saleprice)
- Humidifiers use lots of energy. Energy = CO2
The Problem for Walkers
- Spuds are fried to drive off moisture once sliced
- Extra moisture in spuds increases frying time. Ergo more CO2 used in cooking
You’re seeing where this is going right.
- Price spuds by water content. Reward farmers for extra dry spuds
- No commercial incentive for humidifying spuds means < CO2
- < water means < frying means < CO2 = WINWIN
Okay, so that’s a nice little standalone study. Join up the supply chains and look for efficiencies. Easy to do in this case, not so easy once we get exponentially bigger supply chains.
Imagine the pack of salt + vinegar crisps is part of a ready meal. The ready meal is served on a plane. And the flight is part of a package holiday to Lanzarote. How we begin to put all that together so that Thomas Cook can add everything together to find efficiencies. Something it probably hasn’t even countenanced doing yet.
We open up the chain. We expose the information to whoever can use it, or add to it. What next? Can we build a reward economy around creating new efficiencies? Can we introduce a self-learning algorithm to capture these efficiencies and migrate them to similar systems/chains? From a software engineering perspective the answer is undoubtedly yes. How about social engineering?
It strikes me that if some of this were to be done we’d be faced with a problem analogous to those Wikipedia and Flickr have answered so successfully. In Wikipedia’s case it’s giving ownership and trust to its team of non-paid admins, without which it couldn’t function. In Flickr’s case it’s allowing you, I or anybody add descriptive tags, metadata, to each and every photo.
So at last a planet saving use for the social surplus. But how do we engage. Why would a member of Clay Shirky’s gin-soaked masses want to “tag” an Open Supply Chain rather than edit a Wikipedia article or sort a Flicker archive? Figure that one out and we may have a business model here. So answers on a (creative commons attributed) postcard please.