How to Evaluate the Best Supply Chain Sustainability Tool or Platform for Your Organization - Last Updated: January 11, 2023
As climate change worsens and more investors, regulators, customers, and partners pressure companies to improve their sustainability, it's increasingly important for physical goods businesses to efficiently trace, measure, and reduce environmental impacts across their supply chain. Within sustainability, supply chain management is increasingly powered by specialized sustainability software instead of spreadsheets or legacy supply chain tools that don't account for ESG KPIs and data.
What is Supply Chain Sustainability? A Quick Definition
Supply chain sustainability manages, supports, and monitors positive environmental and social practices throughout a value chain. This includes responsible raw materials sourcing, efficient, low-impact production and manufacturing, low-carbon transportation and logistics, and supply chain circularity.
Traditionally, supply chain sustainability will look at an organization's upstream supply chain, including raw materials sourcing, processing, production, and transportation of goods. However, it's important to recognize organizations also have a downstream supply chain which involves shipping and delivering products to customers, as well as circular practices like waste management, recycling, and re-use.
Holistic supply chain sustainability improvement focuses on the full value chain (both upstream and downstream), and sustainable supply chain technology should also apply this broader lens.
Why Use Supply Chain Sustainability Software?
Sustainable sourcing and supply chain management are complex processes, particularly for larger businesses with global, multi-tiered supplier relationships. Hopefully, your organization's already moved beyond manual and spreadsheet-based supplier management, which is error-prone and inefficient, and has major visibility, collaboration, accuracy, and governance issues.
If you've moved from spreadsheets to a supplier data base or supply chain software, your existing supply chain technology partner may be able to meet your needs, depending on your sustainability maturity, prioritization, and goals. However, we've also found that many traditional supply chain technologies lack important sustainability features like:
- Carbon accounting and Scope 3 emissions measurement
- Supplier diversity and social compliance tracking
- Product lifecycle assessments (LCAs)
- ESG reporting and compliance
And other capabilities sustainability teams need to effectively collaborate, manage risk, collect critical supply chain data, and move their top initiatives forward.
Given that emissions reporting requirements are being written into everything from SEC regulation to procurement contracts in 2023, this is information that needs to be accurate and easy to access - and shouldn't tie up all your time to collect and calculate.
Plus, as the old management saying goes, "you can't improve what you can't measure." So if your organization's looking to reduce emissions and report on your progress over time, it's much more efficient to use a system that's purpose-built for forecasting, historical comparison, and benchmarking.
Brightest's integrated, all-in-one sustainability reporting and carbon accounting platform
The Supply Chain Sustainability Software Platform in 2023
Given the nature of our work, we get asked questions like "what's the best supply chain sustainability software" a lot. And, our honest answer is, there is no best solution overall. What really matters is what's the best solution for your organization and needs. The best solution for one company may not be the right answer for another.
So instead of trying to rank specific tools and brands, we thought it would be more helpful to share the evaluation framework we recommend companies consider when they're considering carbon accounting tools, or developing RFP or RFI requirements for a carbon accounting platform.
For carbon accounting platform buyers, researchers, and analysts, consider these seven criteria to determine what the best carbon accounting software is for your organization:
- Organization size and supply chain scope
- Value chain type
- Primary problem or use case
- Internal team and technical capabilities
- Other supporting resources
- Org structure
- Compliance, audit, and IT security needs
Let's walk through each one:
1. Organization Size and Supply Chain Scope
A global, enterprise brand has very different supply chain sustainability management needs compared to a small or medium business (SME). Smaller organizations need an easy-to-use, automated, lower-cost solution that can likely be used by one or two administrators. By comparison, global organizations have larger teams and more resources, but also require enterprise workflow and governance support, a system that can manage hundreds or even thousands of suppliers, strict IT security, and comprehensive account management.
Be sure to consider:
- How many admins and users of this tool need to collaborate in it?
- Do you want to self-manage (DIY) the tool, or get dedicated support for it?
- Does it support the roles and permissions my organization requires?
- What's my geographic implementation and deployment scope?
- What language(s) do I need supported? What languages do my suppliers speak? Does this supply chain sustainability tool offer them?
- How much customization and configuration do I need when it comes to areas like supplier engagement, sustainability scorecards, supplier policies, document management, and org environments?
- Can the tool support Scope 3 data collection and emissions measurement? And at what scale of complexity?
- Beyond emissions, can I also track and measure other environmental KPIs like water and waste?
2. Value Chain Type
Generally, there are five supply chain archetypes or organizational structures when it comes to sustainability:
- Product companies - Materials, CPG, retail, fashion, and other organizations with a physical goods supply chain who need product lifecycle (LCA) carbon accounting
- Built environment companies - Real estate firms and organizations whose carbon footprint is primarily concentrated in buildings, embodied carbon, and construction supply chains
- Startups and cloud technology companies - Firms whose emissions are primarily related to server usage, data centers, and employee activity like travel
- Services companies - Organizations whose carbon accounting needs are primarily office and employee-based and don't have significant physical supply chains
- Conglomerates - Organizations with multiple different lines of business who need complex, hierarchical supply chain management across a global value chain
Many supply chain and sustainability tools focus or specialize their product in specific industries and value chain types. Make sure to understand which use case(s) and sector(s) a supply chain sustainability platform serves through their website, case studies, client testimonials, and product roadmap.
3. Primary Supply Chain Sustainability Problem or Use Case
This is another area where it's important to be clear (internally) what your top priorities and criteria are. These can include:
- Regulatory, compliance, and audit-related environmental and social data and document capture
- ESG and/or sustainability-based supplier scorecards and collaboration
- Supplier assessment surveys
- Supplier ESG risk assessments
- Collaborative LCA tools
- Scope 3 carbon accounting in your supply chain
- Better supply chain visibility and collaboration on sustainability KPIs
- Forecasting and scenario analysis (including how supply chain policies, decisions, and actions can influence science-based targets or your firm's net zero strategy)
While Brightest and many other supply chain sustainability systems offer "all-in-one" solutions, by necessity every vendor has to prioritize and focus on specific capabilities at the expense of others. What's most important to your organization? What priority workflows do you want to set up first?
Make sure your specific needs and priorities align with the strengths of the sustainability solution(s) you evaluate.
4. Internal Team and Technical Resources
It's always good to be honest in self-assessing your own internal capacity and ability to integrate a supply chain sustainability platform. This includes:
- What existing supply chain technology does your organization use today? What are the gaps, and where does it fall short in terms of sustainability and ESG?
- What's your level of experience and organizational maturity engaging suppliers and partners on sustainability? How much guidance and support do you need from the vendor?
- What's your overall time availability and capacity for supply chain sustainability compared to our other priorities? How much automation do you need? Are these efforts being driven by the sustainability department? Supply chain directly? Or both teams working in partnership?
- How organized is your supply chain data today? Do you know where our primary sources and gaps are?
- Is IT involved in the evaluation process? What help do you need from them and how actively do they need to be engaged?
- Do you need any integrations? Does the vendor need to manage them or are internal IT resources available for implementation and deployment?
- Have you onboarded a similar tool or system like this before? What were the learnings and areas for improvement?
- How much training, ongoing account support, and vendor guidance do you need?
- What type of implementation timeline can this supply chain sustainability partner provide? How quickly will you be up and running?
Different supply chain sustainability software tools and platforms require different internal commitment levels and resourcing. They also offer different levels of ongoing support and service tiers. Be sure to discuss and understand this during your evaluation.
5. Other Supply Chain Support Resources
After you assess your internal capacity and supply chain sustainability expertise, you may decide you need additional external support. Will that come from the technology vendor? Do you need to hire specialist consultants to support your supply chain programs and reporting? Make sure you adequately resource this project for success.
6. Org Structure and Supply Chain Data Collaboration
As we've written before, your organization structure is another important variable in selecting the right sustainable supply chain technology for your company. Who's leading these efforts internally? What other departments or teams need to be involved? Who owns your Tier 1 supplier relationships? What type of help do you need from other departments and stakeholders in the organization?
Many organizations don't focus enough on developing processes to comprehensively and consistently engage suppliers on sustainability. Be collaborative, prioritize, look for material opportunities to improve, and engage your supply chain partners on best practices and ways they can support your goals.
Brightest unifies supply chain emissions tracking, compliance, scorecards, assessments, and sustainability data collection
7. Software Compliance, Audit & IT Security Needs
If you operate in a region with higher levels of ESG and environmental regulation like the European Union (EU), are a publicly listed firm, or work in a regulated industry like healthcare or finance, your organization will need a sustainability software solution that supports capabilities like:
- GDPR compliance
- Standards compliance (SOC 2, ISO 27001, HIPAA, etc.)
- Audit logs and workflows
- Approval workflows
- Data archiving, retention, storage, and backups
In addition to other strong compliance and security controls. Make sure to work with your IT business partners to evaluate the security and controls of your supply chain sustainability solution provider.
Another related capability to consider is ESG reporting. Most companies' supply chain sustainability targets and programs are an input into their broader ESG and sustainability reporting. Does your supply chain sustainability platform offer integrated ESG reporting? Or does that require an integration or add-on with one or more separate vendors? What are the costs and workflows for that type of solution?
Make sure your supply chain sustainability platform also streamlines and supports your firm's overall sustainability reporting efforts.
Your Next Steps with Supply Chain Sustainability Software
Hopefully this guide has shared some helpful questions you can use to determine the best supply chain sustainability partner to meet your needs and support you on your journey. And, of course, be sure to also consider important intangibles like honesty, expertise, business ethics, and the quality of the relationship. Look for supply chain technology partners who are truly invested in supporting you and your organization.
- Do you get a say in the platform's roadmap?
- Where does your organization fall in that vendor's overall priorities?
- Who can you contact at the vendor to get advice and support from?
- Can your supply chain sustainability partner support you in other areas of your sustainability strategy and implementation?
- How strategic of a technology partner is this company within the context of my overall sustainability strategy?
These relationship aspects really matter.
And finally, a word of caution. Given the supply chain sustainability software space is so new, there's a lot of hype and marketing around it. Ultimately, every company does marketing (including us), and it's expected companies will try to position themselves in the best light. That said, be wary of buzzwords and marketing lingo like "Artificial Intelligence (AI)" and ask thoughtful questions. What does this AI actually do? Is it going assist me with a priority need or workflow?
Most modern software companies (including us) use AI and machine learning - the important question is 'why' and how does it help you?
Similarly, does the product actually exist and work the way it's being demonstrated? Is it in use by companies? Or are you being shown a demo environment that isn't actually in production and widespread use?
Above all, we wish you all the best as you continue your sustainability journey. If we can be helpful at all (at any step in your process), please get in touch. A central part of our mission and work here at Brightest is enabling better data-driven decision-making (and actions) that lead to a better future for us all.
