Greening The Supply Chain

1. Greening The Supply Chain Nick Seiersen Seiersen Enterprises Inc. Sustainable value for every supply chain dollar Nick@seierseninc.com, 647 299 8360

2. Seiersen Enterprises Supply Chain consulting, implementation, and interim executive services. Gets the job done: on time, on scope, on budget. Demonstrated track record delivering sustainable hard savings in many different contexts – survivor cost cutting, re-positioning for growth, re-alignment for better customer service. Total cost perspective to procurement & logistics win/win long term arrangements. Exceptional breadth and depth of supply chain expertise to drive real innovation, cost reduction, and risk management improvements. • Procurement & Purchasing • More value from suppliers, • efficient & effective operations • Spend analysis • Strategic sourcing • Contracting & compliance • Supplier management • Purchasing operations • Logistics • The right goods & services in • the right place at the right time • Forecasting & planning, S&OP • Physical distribution • Cost management • Stage-gate new product/service • introduction 1

3. Agenda 1

4. What is a Supply Chain? New Products & Services Ideation Development Introduction Trade Spend Management Sales & Operations Planning Plant Scheduling Inventory Management Forecasting Promotions Manufacturing Planning & Control Systems, Overall Equipment Effectiveness Procurement & Strategic Sourcing Inbound Logistics Distribution & Network Design Manufacturing Warehousing & Delivery Consumers Purchasing, Freight, Duties & Security, Contract & Supplier Management Inventory Replenishment Order Processing and Fulfillment Outsourcing: Selection, Implementation, Management, Governance, Renewal,…

5. Supply Chain Trends Pressure for Predictability • Security & Legislation • Traceability and Quality • Sustainability • Critical Infrastructure & Systems Increasing Volatility • Price & Demand Volatility • Longer and More Complex Supply Chains • Politically Motivated Fiscal Changes • Supply Chain Disruptions • Cash-to-Cash Cycles Lengthening • Looming Patent Cliffs • Financial Distress – Cash is King

6. Toughing it out • Stockpiling • Hedging • Rethinking November 12, 2008 Executive Exchange Supply Chain Sustainability So What Are Companies Doing About It? New Network Designs Product Designs Relationships Systems

7. Supply Chain Sustainability Sustainability involves finding a balance between economic, social and ecological factors when making decisions. Sustainable supply chain management takes into account: • Environmental factors that relate to the impact on the environment of the entire life-cycle of a product or service. • Social factors that mainly relate to the living and working conditions within the production chain. • Conventional purchasing criteria such as price of ownership, availability, quality, and risk management. A failure in any of these can lead to a supply chain disruption

8. Sustainability Sustainability – sustainable development- meeting the needs of the present without compromising the ability of future generations to meet their needs (Brundtland commission, 1987)‏

9. Environmental Sustainability • Use of non-renewable resources • Destruction of natural habitat • Noxious emissions • Reduce, Reuse, Recycle • Minimize environmental footprint

10. Pharma Supply Chain Issues

11. GSK Packaging • Worldwide manufacturing plant for certain products • Converted from virgin to recycled paperboard • Saved 2.6 B BTU • Over ½ B lb air emissions & GHG • Over 1.6 M gal water • Almost 6 metric tonnes of water emissions • Over 15 k lb solid waste • Won GSK EH&S Excellence Award

12. Greenhealth’s Greening The Supply Chain Initiative • Environmentally Preferable Purchasing • Standardized Environmental Questionnaire • EPP Business Leadership Coalition & Partnership Program • EPP Specifications to assess “Greenness” objectively

13. Network Optimization

14. Total Life Cycle Cost Model • Full life cycle costs, • Energy requirements, • Consumption of non-renewable resources, • Effluent production and control, • End of life reclamation, • Creation of socially noxious effects, • …

15. Capability Maturity Model

16. Approach Sustainability Program (objectives, policy, organization, training, strategy & plans) • INPUTS • reductions in energy consumption (gas, power & water) • socially-responsible & “green” purchases of food, supplies & services • ACTIVITIES • transportation • production • programs & services • building operations & maintenance • grounds keeping • OUTPUTS • waste reduction • recycling • groundwater diversion • habitat & biodiversity improvements • improved quality of life Practices Reporting (measurements, transparency in communications)

17. What Standard?

18. Set standards & expectations: supplier code of conduct, quality assurance, environmental, … Know your suppliers, what they can and cannot do Leave enough on the table for everyone to live Transaction and shipment visibility Contingency plans Strategic capacity buffers Continuous improvement initiatives Where to Start?

19. The Sustainability Voyage Rewards & Recognition drive SUSTAINABLE change & commitment Training & Coaching to commit & lead to action Communication across the organization Action Sustainability Commitment Buy-in Understanding Awareness

21. Greening The Supply Chain Nick Seiersen Seiersen Enterprises Inc. Sustainable value for every supply chain dollar Nick@seierseninc.com, 647 299 8360