Sunday 22nd Oct 2017 - Logistics & Supply Chain

We will bear the responsibility

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Regrettably, some of us are old enough to remember the UK advertising slogan: go to work on an egg. It was, as I recall, coined in the days when few people cared much where that egg might havecome from.

Nowadays, the slogan would certainly have to mention that the egg was free-range and that the chicken from which it emenated had lived a joyous, open-air life. Which is, perhaps, a slightly facetiousway of introducing a serious subject.

Last year, Marks & Spencer, the grand old lady of British high streets (sadly, it has withdrawn from many of its continental European outposts), decided that it would make the proud claim that not only were its eggs free range, but that any product that contained eggs would also have been laid by the aforesaid free-range chickens.

Now, as it happens, Marks & Spencer has 4,000 products which contain egg or one of its derivatives in some form or other. In fact, it (or rather its suppliers) use 250 million eggs a year in products as diverse as quiches and biscuits.

Cracking the problem
Keeping the promise – and Marks & Spencer has a commendable reputation for doing so – means tracking that no non-free range eggs sneak into the supply chain all the way from the farms to the packing stations to the processors to the food manufacturers.

And that sounds pretty much like a logistics problem. Which makes the neat point that logistics professionals should now be at the heart of a business debate which is becoming increasingly fashionable – about corporate social responsibility (CSR).

Make no mistake, CSR is something that more logistics pros are going to have to know about. During the past year, press coverage on the topic has risen 200 per cent. Three-quarters of FTSE 100 companies now produce annual CSR reports and more outside the top hundred are also doing so.

Not only that, but it turns out that many of the issues which are hotest in the CSR debate are right at the heart of the supply chain – from the impact of road haulage on the environment to the desirability (or not) of having a reverse supply chain for goods ranging from old bangers to clapped-out tellys.

Across a pretty broad agenda, it’s not going to be possible to take logistics decisions without considering the CSR implications of them. So isn’t it about time logistics professionals started thinking about the business case for CSR?

So Mark Goyder’s new report Redefining CSR appears at just the right time. Goyder is director of Tomorrow’s Company, the worthy think-tank that encourages business to aim for sustainable growth. Goyder believes companies move through seven defined steps as they develop their approach to CSR and reap benefit from it.

The first is when entrepreneurs start a company and imbue it with their own values and attitudes. The founders’ values then become, in the second step, those adopted by others as the company grows. ‘New people who join see quickly by example what is expected of them,’ says Goyder.

In the third step, the company starts to spread its values through the relationships it develops with customers, suppliers, communities and shareholders. These relationships are critical to creating value. ‘Companies are only as successful as the quality of these relationships,’ argues Goyder.

But – and this is the fourth step – ‘you cannot have successful relationships unless you have clear purpose and clear values,’ he says. ‘The first role of the leader is to ensure that, in all the relationships of the business, there is a clear and consistent idea of why the company exists and what it stands for.’

And leadership is also key – the fifth step – to making certain that the messages communicated through all the different kinds of relationships are consistent. It’s not possible to say one thing to employees and another to shareholders, for example.

The sixth step of the argument, Goyder says, is to recognise that responsible business practice – such as displaying consistent attitudes in all relationships – is as important an ingredient of business success as the corporate strategy, the quality of products or marketing effectiveness.

Which brings us to the pay-off in the seventh step: effective leadership, based upon clear purpose and values which permeate an organisation and its relationships, is the key to reaping the benefits from CSR – trust from customers, suppliers and business partners.

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