BUS606: Operations and Supply Chain Management

Many companies are concerned about the measurability of sustainability. Top management needs clear, relevant metrics to track implementation progress, benchmark against other companies, and to report their progress to the outside world. The metrics should be linked to business metrics that executives and shareholders care about as sustainability programs built solely upon philanthropy will not survive. For example, to track and monitor customer integration, management may consider using an employee survey or appointing an expert to track benefits customers give to the NPD process and then assess the feasibility of the customers' ideas. To measure the efficiency of internal cross-functional integration, management should question employees about how the integration practice contributes to the progress of the NPD process, and track the frequency and quality of NPD teams' meetings. With regard to external partners, management may consider monitoring the level of trust and seek allies that offer complementary capabilities. Corporate attainment of sustainability certifications, such as ISO-14000 and ISO-26000, represent a commitment to sustainability.

Several frameworks to evaluate sustainability for the entire product life cycle exist, such as the Dow Jones Sustainability Index, the Corporate Social Responsibility and Sustainability Ratings and Information Database (CSRHub), and Corporate Executive Board. The DJSI monitors sustainability for the entire product life cycle across many functions and is useful at the company level for benchmarking; however, it is expensive and time consuming. CSRHub, which is a broad-based model that is divided into community, employees, environment and governance, gives corporate social responsibility ratings for several companies, industries and countries. With a paid subscription, CSRHub allows additional benchmarking information. Unfortunately, CSRHub is difficult to use to develop a strategy to improve sustainability maturity within R&D and NPD functions. CEB uses several dimensions grouped by focus areas and scores each dimension according to its importance to the organization. With CEB, the organization's effectiveness relative to each dimension and information relative to R&D and NPD is available. Unfortunately, CEB is proprietary, and best practice tools and processes for various elements are only available to Council members, which limits its use as an improvement tool.

Specific to NPD and the environment, developed a model that considered the impact of NPD decisions on future resources and environmental conditions. The model uses system analysis to develop the financial performance relative to design and process characteristics that affect future resources and the environment, but does not consider social sustainability. The model focuses on the product definition but is a predictive model rather than an evaluative model. The IRI Sustainability model focuses on R&D and NPD functions that support them, using 14 dimensions organized by strategy and design tool to give a holistic view of R&D and NPD sustainability. Strategic dimensions include: corporate sustainability policy, overall sustainability policy, government policy and regulation, impact of trends, supply chain, green labeling, and sustainability DfE, while design tool dimensions include: specifications/customer insights, life cycle assessment (LCA) process, DfE-Material, and Part Selection, DfE-Supply Chain, DfE-Manufacturing Impact, DfE-Use Phase Impact, and DfE-End of Life Impact. The IRI Sustainability Maturity Model can be used to measure sustainability process maturity and to benchmark against other sustainability innovation programs; however, a statistically insignificant number of firms to date use this model and each dimension is equal.