Infor tool manages both carbon emissions and economics

Infor has announced the latest version of its SCM Network Design, a supply chain modeling solution used by some of the world’s most recognisable manufacturers, distributors, transporters, and retailers and thought to be Australia’s first Supply Chain Management Network Design tool that manages both carbon emissions and economics.

In response to increased supply chain costs and the need to implement more carbon efficient networks, new capabilities in Infor SCM Network Design help companies more easily redesign, model and optimize their networks.

Strategic Network Modeling is the process of modeling the entire supply chain to evaluate redesign options to optimise for costs, revenue and service.

Infor SCM Network Design provides advanced modeling capabilities that incorporate relevant costs, facilities and transport modes to help companies make strategic decisions that maximise efficiencies based on criteria most important to the organisation.

In the latest release, Infor SCM Network Design incorporates sustainability criteria, enabling companies to factor carbon emissions related to nodes, such as plants, warehouses and stores, and transport modes, including rail, air, trucking, and ocean freight.

This enables organisations to take the first steps in greening their supply chain, by first calculating the carbon emissions generated from their supply chain network and then fine-tuning it to lower emissions while also achieving cost and service objectives.

According to an April, 2008 Research Brief from Aberdeen Group, “By integrating sustainability targets and goals into the redesign of key supply chain areas, companies are better able to balance the goals of the responsive, cost effective, and resilient supply chain with a wider concept of “costs” that include factors that are economic, environmental, and social.”

“The optimal balance of such factors, result in top service and increased profitability.”

For full Aberdeen report

“Supply chains can become out of tune due to factors like mergers and acquisitions and fluctuating fuel costs,” says Richard Simpson, Infor Senior Business Consultant, Supply Chain Management, APAC.

“Infor SCM Network Design helps companies continually evaluate their networks so they can implement and maintain more cost and carbon efficient supply chains.”

Infor SCM Network Design helps companies make efficient supply chain infrastructure choices, such as the size, location, and number of plants and distribution centres.

For manufacturers, it can evaluate which products should be manufactured at each location and in what quantities.

Distributors can use Infor SCM Network Design to determine where to stock products and what combination of national and local distribution centres is most efficient.

Third-party logistics providers can evaluate their transportation modes to determine optimal sourcing and replenishment strategies for their customers.

In each example, Infor SCM Network Design can create “what-if” models that allow the organisation to balance customer service, costs and carbon emissions to create the most effective mix according to their strategic plan.

For more information on Infor SCM Network Design.

To view a webinar on “The Top 5 Pressures Driving the Green Supply Chain”

Infor SCM Network Design is part of Infor’s portfolio of solutions that help customers implement the business processes essential to driving their green and sustainability programs.

In addition to Supply Chain Management (SCM), these solutions include other key areas such as Enterprise Asset Management (EAM), Product Lifecycle Management (PLM), Performance Management (PM) and ERP.

For more information on Going Green, or take the Infor Green Assessment.

Emissions reporting/trading drives need for better modelling of supply chains

  • Until now, ERP/supply chain software has focused on measuring carbon retrospectively, rather than how to design future supply chain networks with carbon costs as well as traditional economics as a consideration
  • Manufacturers, distributors and logistics companies are some of the hardest hit under the Australian carbon emissions reporting scheme — with TNT publicly stating it has a direct carbon footprint of 1,000 kilotonnes (well above the Australian year one reporting threshold of 125 kilotonnes)
  • The Government’s proposed emissions trading scheme (ie imposts placed on refiners, rather than end users) means increased downstream costs for manufacturers, distributors and even retailers so they now need new tools to help model carbon costs alongside more traditional economics of supply chains such as location of plants/distribution centres, size, what products/where, transport modes (rail, air, trucking etc)
  • Prudent risk management now needs to factor in carbon costs — for example, one European company found through modelling, that the carbon costs of a major shipping port closing due to a natural disaster posed a sufficient threat to relocate one of its manufacturing centres
  • Infor analysis of Australian Government legislation and fuel projection data shows that the cost of carbon may vary between $10 per tonne and $40 per tonne — which means fuel prices may increase by 2.7cents per litre to up to 10.80 cents per litre. This data highlights the need for strategic forward modelling as part of prudent fiscal management
  • The rise of the green supply chain as a customer differentiator eg retailers and even transport companies are now factoring in the carbon costs of the supply chain as a unique selling point
  • Competing vendors such as SAP and Oracle, do not have carbon capabilities in their supply chain design tools, and are lagging the market in strategic planning to accommodate green criteria
  • Infor’s latest green innovation, Infor SCM Network Design, is a modelling solution used by some of the world’s most recognisable manufacturers, distributors, transporters and retailers and will help companies more easily redesign, model and optimise their supply chain networks

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