As limited environmental resources, tighter profit margins and increased market competitiveness paint the picture of today, numerous global companies continue to amp up their game on “green” to build more sustainable supply chains and mitigate the impact of their business processes on the environment. And this month, Supply & Demand Chain Executive honors those that enforce green practices as a core function of their operations in our annual “Green Supply Chain Awards.”
Recognizing small, mid-size and large enterprises that leveraged green practices and solutions to further drive sustainable improvements in their supply chain, this year's fifth annual awards warranted a different theme across the board than in the past. Not only have global companies increased their sustainability processes in the last few years but many drive green adoption into the supply chains of their key partners as well. Crown Equipment Co., which in 2011 built its 500th forklift, is operated by a fuel cell to reduce fossil fuels; improve operator efficiency; and reduce carbon emissions and energy costs. Since 2009, Cascades Inc. initiated its own annual Sustainable Supplier Award to honor its most responsible suppliers. In Kenco’s case, the logistics provider works to reduce greenhouse gas emission by 14,000 tons over the 20-year lifecycle of energy-efficient fixtures it upgraded into two Chattanooga, Tenn.-based facilities—this is the air-scrubbing equivalent of a 149-acre forest, or removing 137 cars from the road, according to the U.S. Environmental Protection Agency (EPA).
But perhaps most relevant for this year’s green awards are the sustainable practices that ocean freight companies enforce. This month, we shine a spotlight on the green efforts of Maersk Line, Evergreen and Horizon Lines, who lead the charge to deploy energy-efficient ways in moving cargo long distances while sustaining environmental protection strategies—most significant being the marine atmosphere.
Evergreen Line (www.evergreen-line.com
Founded in 1968, containership company Evergreen Line has had an environmental philosophy since day one implemented by Group Chairman Dr. YF Chang. The company monitors every aspect of vessel operations to ensure it is exceeding the guidelines required from the nearly 100 worldwide ports and communities into which its vessels sail. All of Evergreen's 70 new ships under construction are being built with consistently upgraded green features. Its S-type “greenships” container ships come built with environmental features that still remain beyond worldwide compliance. This year, The L-type new vessels with more than 8,000 TEU are being put into service with enhanced environmental excellence built in. The Evergreen L-Type vessel can reduce about 15 percent of CO2 emission rate. It also adopts the variable frequency control type motor on the main cooling sea water pump so that the motor speed is automatically controlled by the cooling sea water temperature and central cooling fresh water temperature to enhance the electrical power utilization and save energy.
Horizon Lines Inc. (Charlotte, N.C., www.horizonlines.com)
Horizon Lines’ approach emphasizes environmental excellence through conservation techniques, waste stream management, system upgrades and voluntary compliance. To protect the marine environment, Horizon Lines established several programs—including Emissions Horizon Lines and Sustainability Horizon Lines—in addition to the MARPOL and ISM codes created by the International Maritime Organization (IMO). These also include vessel management controls, low sulfur diesel fuel usage and marine terminal pollution mitigation plans. The company’s efforts resulted in an estimated emissions reduction of 231,000 tons of CO2 over the past six years through its fuel conservation and emissions program. Through the EDGE process, Horizon Lines reduced overall fleet fuel consumption by 3.5 percent over the past six years. Horizon Lines initiated a program limiting the discharge of any waste into the oceans, instead sorting our waste to facilitate recycling shore-side, where accepted. Neither U.S. nor international pollution prevention regulations require vessels to treat accumulated water in the cargo holds before pumping it into the sea. Horizon Lines has voluntarily modified some of its vessels systems to provide for the processing of this water through its oily water separator or an independently installed Oil Content Meter (OCM) prior to discharge into the sea.
Maersk Line (Copenhagen, Denmark, www.maerskline.com)
With a goal to be the environmental leader in shipping, Maersk Line provides ocean transportation services that are consistently eight to 10 percent more energy-efficient than the industry average.
Since 2002, the provider worked closely with major shippers and other carriers as part of the Clean Cargo Working Group (CCWG), which deploys standardized methods for calculating and reporting the carbon footprint of shipping and provides a protocol for third-party verification of the emissions factors.
In addition to publishing its own individual vessel performance Maersk supports customers with environmental comparisons for routing options, analyses of the shipper's individual carbon footprint and scorecards. Since 2007, Maersk Line reduced the carbon footprint of containers shipped by 15.6 percent—with an overall goal to achieve a 25 percent reduction by 2020. In another case, the company saved almost 10,000 tons of CO2 emissions in 2011 on shipments for a large sportswear company. Developing markets in Western Africa benefit from Maersk’s WAFMAX vessels, designed to call on these smaller, less developed ports yet still deliver substantially more energy efficiency. The CO2 footprint per container shipped is 28 percent lower than the industry average for that region. Starting in 2013, Maersk’s new Triple E vessels will deliver 50 percent better performance than the vessels on today's already world-class Asia-Europe routes.
The first carbon neutral company in New Zealand, Agility (www.agilitylogistics.com) works with customers to reduce carbon emissions produced by supply chains and to reuse/recycle packaging waste. Agility’s carbon calculator tool allows customers to measure carbon emissions in their supply chains. Its Goods -in-Transit Center (GIT-C) solution saves over six percent on cargo weight and CO2 emissions and provides a reduced overall cost with zero impact on shipping schedules. Agility’s environmental awareness campaign educates teams on sustainable in-house best practices such as energy consumption reduction via less used electricity; incorporated sustainable warehousing design features; and decreased fuel costs/consumption through implemented video conferencing.
Through the Cascades Recovery division—which manages discarded recyclable materials and uses them to manufacture new products—clients of Cascades Inc. (www.cascades.com) can reduce their supply chain ecological footprint and encourage efforts to reduce the amount of waste sent to the landfill. Since 2009, Cascades also rewards its most responsible suppliers with an annual Sustainable Supplier Award.
Cass Information Systems Inc. (www.cassinfo.com) provides technology solutions to reduce paper transactions for shipping documents, billing (freight invoices), payment transactions and information delivery. Customers benefited from annual EDI freight invoice percentage averages over 65 percent; 100 percent electronic invoice processing for such package carriers as UPS and FedEx to reduce paper costs and eliminate mailings.
As a third party transportation and logistics provider, C.H. Robinson Worldwide Inc. (www.chrobinson.com) offers services that optimize business processes to efficiently use transportation and distribution network resources to ultimately drive costs out, maximize logistics opportunity and minimize carbon emissions. The company works directly with growers and retail customers to most efficiently use natural resources and build efficient farm to shelf distribution models. In addition, it works with Cascade Sierra Solutions to help motor carriers reduce fuel consumption and carbon emissions. In the case of Western Growers Association (WGA), C.H. Robinson aligned to offer WGA member shippers a unique transportation program to move fresh produce from growing areas to customers all over the country. Shipper Gills Onions utilized the program for its LTL capabilities; to aggregate freight volumes of all sizes to gain better access to capacity; negotiate strategic contracts for customized pricing; and benefit from high volume surge capacity.
DSC Logistics (www.dsclogistics.com) enhanced sustainability for its customers via network modeling, transportation initiatives, yard management efficiency, logistics center improvements and employee education. DSC developed a solutions team to model and collaborate with customers on maximizing networks. In the area of transportation, the company enforces a “no idling” policy for trucks that are parked for loading or unloading in a DSC-managed logistics center to reduce fuel consumption, minimize exhaust emissions and improve air quality. Its yard management system enables DSC, manufacturers, retailers and carriers to access real-time visibility of shipments across the supply chain for higher efficiency, reduced detention and demurrage fees and less labor and fuel costs. In 2010, DSC Logistics initiated corrugate recycling, implemented at 100 percent of its centers. As a result of sustainable activities so far, the company’s total carbon dioxide equivalent per total square foot released across its nationwide network of logistics centers from January to March 2012 is down 15 percent compared to January to March 2011.
Pluvial water recovery is implemented in half of Frialsa Frigorificos’s (www.frialsa.com.mx) distribution centers. Newer facilities have water-absorption wells connected to the sub-soil and incorporate CO2/NH3 refrigeration systems for increased efficiency and less harmful impact on the environment. Eolic electricity generation will service 80 percent of Frialsa’s total company demand (22 distribution centers) by the end of 2012.
Global 4PL’s (www.global-4pl.com) green initiatives include reduced CO2 and cost reduction per mile. Most recently, the company helped a client convert their fleet of gasoline to natural gas engines for reduced CO2 emissions. The conversion of their fleet will save tons of CO2 and helps Global 4PL clients to initiate a green supply chain.
Through its MaxxForce-powered fleet to meet emissions EPA standards, Hermann Services Inc. (www.hermanntds.com) works to improve energy efficiency, reduce greenhouse gases and air pollutant emissions and improve energy security through greener freight practices. Additionally, the company lowered the motor speed of its tractors by computer control for better fuel mileage.
The One Touch Advantage returns program from Inmar (www.inmar.com) reduces the carbon footprint for all pharmaceutical trading partners through the elimination of redundant touch points. An overall calculation of recognized savings in 2010 by all participating manufacturers in the program equaled an Initiative Environmental Sustainability Annualized Savings Transportation Carbon Footprint of 136 metric tons of carbon dioxide.
IAS DispatchManager from International Asset Systems (IAS, www.interasset.com) automates the drayage tender and assignment by eliminating manual processes and fostering communications among all transport parties. Dispatch productivity improves by 40 percent. At just one port, every one percent of import containers that are used for equipment reloads with DispatchManager save 1,100 tons of CO2.
Industry research points to almost 28 percent of all truck traffic in the U.S. running empty, with evident challenges of capacity, increased fuel costs and potential driver shortages. The Collaborative Distribution supply chain solution from Kane Is Able Inc. (www.kaneisable.com) reduces customers supply chain costs by an average of 35 percent.
As part of the Wisconsin Profitable Sustainability Initiative (PSI) team, LogiServe Inc. (www.logiserve.net) helped develop a diagnostic tool to assist companies to identify, quantify and prioritize their sustainability opportunities. LogiServe's involvement in the PSI program enabled 50 mid-to-modest-sized companies to identify aggregate annual freight savings of more than $4,000,000; an ROI of more than 500 percent; annually reduced truck miles by 12 million; reduced annual fuel consumption by almost two million gallons; annual reduced CO2 emissions by 19.6 million pounds; reduced NOx emissions annually by almost 800,000 pounds; reduced Particulate Matter emissions annually by almost 20,000 pounds; and reduced labor by 70,000 hours.
SaaS provider Prorizon Corp. (www.Prorizon.com) works with a leading entertainment production company, two of the top 10 ITO's and three of the top 20 global ITO's to reduce electronic equipment waste through a planned end-of-life (EOL) strategy. It delivers lower monthly operating costs, error reductions, improved cost to serve and increased revenues.
Ali Salehi, Senior Vice President of Columbia Manufacturing praised SYSPRO (www.syspro.com) ERP software for its material resource planning and forecasting and purchasing, which have been instrumental to the establishment of Columbia’s green practices. “SYSPRO data contributed to our plating operation’s water usage reduction—from 150,000 gallons per day to 3,000 gallons per day—also reducing chrome usage by 93 percent and nickel purchases by 75 percent,” said Salehi.
A part of EPA’s Plug-In To eCycling partnership program, since 2010 T-Mobile USA Inc. (of DeutscheTelekom AG, www.t-mobile.com) installed recycling bins in all of its retail stores and collection bins across college campuses and city offices in the U.S. to enable free drop off of cell phones, batteries, accessories and netbooks to incorporate cell phone and accessory recycling into its supply chain. Results to date include the collection of more than one million cell phones that have been diverted from landfills.
Tyco Retail Solutions’ (www.tycoretailsolutions.com) Vital World environmental program sets and tracks environmental goals using explicit metrics for water consumption, waste generation and emissions of all six greenhouse gases covered under the Kyoto Protocol. Since the program launched in 2009, Tyco reduced greenhouse gas emissions by five percent and reduced water consumption by 20 percent.