How the right all-in-one software can accelerate supply chain decarbonisation

Vishnu Nair

Head of Zeigo Activate and Zeigo Hub, Schneider Electric

Companies looking to reduce their supply chain emissions should use well-designed digital tools and software to help scale decarbonisation programmes in the most effective way.

Supply chain decarbonisation is becoming a major focus for businesses due to pressure from customers, investors and a rapidly evolving regulatory environment. Increasingly, companies need to find innovative ways to measure, track and then reduce their own carbon emissions — plus the carbon emissions created by their suppliers.

Realising the supply chain emissions challenge

Vishnu Nair is Head of Zeigo Activate and Zeigo Hub, two solutions from Schneider Electric’s sustainability software brand, which aim to simplify supply chain decarbonisation. “Different companies are waking up to this challenge at different times,” he admits.

“Some may be wedded to 2030 emission reduction targets and are only just realising that they have around five years left to achieve them. Then there are others that haven’t woken up to the problem at all. They are going to find themselves in trouble very soon.”

When sponsor companies encourage their suppliers to take part in a well-designed supply chain programme, the result can be greater collaboration that elicits a significant reduction in overall emissions. However, kickstarting such a programme is not an easy process, warns Nair. So, don’t underestimate it or think that you can sort it out overnight with the aid of a spreadsheet because it’s rather more involved than that.

“Some companies might be tempted to think: ‘How hard can it be?’” he says. “When they start looking into it, they see that it’s far more complicated than they first assumed, particularly if they want to run a large programme. Once they understand what it entails, they realise they’ll need support from decarbonisation software and digital tools.”

Decarbonisation software providing emissions visibility

To begin with, decarbonisation software makes it easier to communicate your programme’s objectives to your supply base, providing them with learning, guidance and other content in a scalable way. It also allows your suppliers to easily provide you with all the data you need, giving you greater visibility of where emissions are created.

Without this type of solution, you would have to rely on emails, phone calls and in-person interactions with all your suppliers — and that’s just not a realistic proposition, particularly if their number runs into the hundreds or even thousands.

Scalable software empowering suppliers

Well-designed software also has the power to open up your programme to a large cohort of suppliers, not just a select, more manageable few. “Take our own supply chain programme as a case in point,” says Nair. “It’s called the Zero Carbon Project and includes more than 1,000 volunteers from our supply base who we have asked to achieve a 50% reduction in their operational emissions by 2025.

“Now, some of these volunteers are large corporations. However, many of our small and medium-sized suppliers were looking to reduce their emissions, too, and asked to be involved — so we gave them access to our software. That’s the beauty of this type of solution. It’s scalable, so it can generate more data from more users, and so create a better, more meaningful impact for the supply chain owner.”

Expert consultation to ensure programme success

However, even the best software won’t give you the results you require if your overall programme has been badly designed. “It’s entirely possible for companies to use great software within a badly designed programme and end up with poor results,” agrees Nair.

“That’s why we feel it’s important to have an in-house or external consultant with subject matter expertise. They can look at your programme’s objectives and ensure that it is properly equipped to tackle challenges such as incentivisation, reporting frequencies and interim goals. Once the initial design is right, it’s the software’s job to enable operational execution and scaling.”

Well-designed software also has the
power to open up your programme
to a large cohort of suppliers.

What to look for in decarbonisation software

Before choosing your decarbonisation software, it’s vital to assess it properly and check that it does everything you need it to do. Is it able to collect consistently reliable, high-quality data from all your suppliers? Can it pull and push data to and from your existing software ecosystem?

Is it purpose-built to drive — and track — supplier engagement in the programme? Is the interface easy to use, both for you and your suppliers, regardless of their size or familiarity with sustainability? Can it deliver valuable carbon emissions education and training content to those who need it?

“A corporate user who is well-versed in decarbonisation may require a solution with more advanced features and workflows,” explains Nair. “Whereas, at the other end of the spectrum, small and medium-sized businesses may lack sustainability expertise and resources. So, if the software can offer users support and guidance on carbon calculation — rather than just asking them for numbers — they are more likely to respond positively to it.”

A solution that removes barriers and drives action

However, don’t be tempted by software that only solves your data problems, warns Nair. Otherwise, it will act as nothing more than a reporting platform. Instead, adopt a long-term view and choose a holistic solution that drives your suppliers to take serious energy efficiency or renewable energy-oriented actions. After all, your real aim isn’t to simply collect information from your suppliers. It’s getting them to reduce their emissions.

“For example, our software provides users with guidance on setting targets for themselves,” says Nair. “It can also ask them if they would like a customised decarbonisation plan, outlining specific projects that they can implement on-site; it can connect them with companies that are able to deliver those projects for them.

So, it’s not just extracting information from users. It’s about giving them something in return and removing barriers to action. If they feel rewarded for regularly providing you with data, they will be motivated to implement decarbonisation measures. As a result, your programme is more likely to be a success.”

Benefits of using an all-in-one service provider

Be aware, too, that not all decarbonisation software is created equally. Different software has different levels of maturity. “Supply chain owners may choose a solution that looks good on paper,” says Nair. “Unfortunately, as they use it, they discover it doesn’t have all the features they need. They may try to solve this issue by going to another vendor — but dealing with multiple vendors only complicates the process.”

That’s why there’s an advantage to partnering with a company that can provide consulting, software and hardware in one vertically integrated delivery model. “If you have to turn to a different vendor every time you face a new challenge, it can slow down your decarbonisation efforts,” says Nair. “It’s easier and faster to work with one consultancy that can help you solve every challenge you meet incrementally.”

Don’t fall behind on using decarbonisation software

Companies that aren’t yet using decarbonisation software to power their supply chain programmes shouldn’t put it off any longer, insists Nair. Time is ticking on. “My message to them is: start yesterday,” he says. “My other piece of advice is: supplier engagement is everything. So, it’s well worth spending extra time to ensure that the solution you choose works for you and will be met favourably by the suppliers in your programme. Ultimately, that’s the best way to decarbonise your supply chain.”