New compliance regulations have also been enforced by the European Union and the U.S. to restrict the use of toxic materials in packaging. As a result, there is a shift towards making eco-friendly packaging part of initial design phase, and companies are relying more and more on PLM solutions to make this happen.
PLM can be an ideal tool to specify the right packaging specification in tandem with the specified compliances. A packaging sustainability scorecard—similar to the material and supplier sustainability scorecard—can be developed to determine which packaging has the lowest environmental impact.
In a supply chain context, companies are not only held responsible for their own actions but also for the actions of their suppliers. The stakes are too high when it comes to non-ethical and non-compliance issues as they can ruin a company’s brand image and lead to huge financial losses.
The PLM functionality can be used to design a system that captures and evaluates suppliers’ performance on the basis of certain key actions such as energy and water use, waste disposal or greenhouse gas emissions. Companies can create their own set of measures or use the existing measures and scorecards created in the industry to their advantage.
Though the declaration of compliance and sustainability indices are important, companies should not limit and rely on these documents only. A robust evaluation process of suppliers is key to improving the overall brand equity. The PLM reporting functionality can be effectively utilized to pull supplier performance data to create a scorecard and ranking, which will help companies improve transparency in working towards sustainability enhancement.
About the Author: Rajnish Kumar is Global Practice Leader at ITC Infotech, Bangalore, India, an IT services and business solutions company involved in consumer packaged goods & retail; manufacturing & engineering services; and other industries.