How Standardization Advances Supply Chain Responsibility

Build a consensus among your partners with standardization to develop a uniform system through which all components of your Supply Chain will be developed or measured.

Imagine requesting a Q1 financial report from a vendor and receiving data for September through November. “What?” the vendor asks incredulously…“That’s our Q1.” Having a common framework and understanding of terms, requirements, and measurements for evaluation—or standardization—is critical to well-functioning business processes. This is especially true in the case of supply chain sustainability.

Broadly speaking, standardization refers to the process of building consensus among partners to develop a uniform system through which all components of a product or process will be developed or measured.

Standardization in supply chain responsibility is critical for corporations embarking on the journey to reduce the social and environmental impacts of their goods and services. When industry partners apply existing standards, everyone becomes fluent in the common language of process and evaluation. This provides a framework through which to establish goals and metrics, with corresponding action plans to reach those goals.

Given the decades-long history of utilizing standards to define best practices, drive efficiency, and compel innovation, organizations can apply this principle to achieve supply chain sustainability goals while significantly reducing the time, effort, and money needed to do so. By tapping into existing standards, you create a straightforward process to implement action plans, without needing to start from the beginning every time you need to get a new assessment off the ground.

These common frameworks greatly reduce operational burdens for both the organization launching a program and the suppliers working to satisfy it. Suppliers must manage demands for data from multiple sources, both internal and external. When everyone is speaking the same language, it lessens the effort required to engage and heightens the chance that suppliers have bandwidth to work with you on actually improving sustainability performance. It also enhances your ability to measure changes to supplier performance over time.

An example of this principle in action is the Accountability Framework (AFi), which brings together organizations from around the world to “specify good practices for ethical supply chains, clarify how companies can use existing tools, and provide new guidance and clarity on topics where it is now lacking.” Focused in the agriculture and forestry sectors, the framework has already helped to drive change in the private sector as industries face a growing call for accountability. Cargill has developed an action plan using the framework and has since pledged $30 million in seed funding to identify solutions to deforestation in Brazil.

The Rainforest Alliance, part of the Accountability Framework’s steering group, offers standard assessments in alignment with the framework for responsible soy, paper, and wood on the Sphera network.

Frameworks like AFi underscore how industry standardization and collaboration enable sustainability at scale. Instead of approaching each concept, product, or process independently, the collective power of organizations working together within a common system helps to accelerate the change that is so critical.

To scale sustainability within your supply chain, you must be able to replicate the process and results over time and across business units. This provides the most robust data, ensures optimal efficiency, and enables continuous improvement with your suppliers through uniform tools and metrics. Advancing your company’s sustainability story will reduce reputational risk, build customer loyalty, and ultimately improve your bottom line.

Achieving sustainability at scale becomes much more attainable when existing standards are applied. Organizations no longer need to invest so much time and energy to align suppliers and partners around agreed-upon definitions and metrics. The conversation flows readily among participants with the same native tongue.

By partnering with established experts across a variety of sectors, Sphera is making this common language widely available, relying on long-established science to remove the barriers for entry. Explore our suite of standard assessments to help your organization get started.

 

SupplyShift was acquired by Sphera in January 2024. This content originally appeared on the SupplyShift website and was slightly modified for sphera.com.

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