10 lessons from nature for creating sustainable supply chains
Our global context is characterized by a VUCA (volatile, uncertain, complex, ambiguous) environment. Challenges that organizations are facing include climate change, political instability, resource depletion, biodiversity loss, rising social inequalities and conflicts as well as the current COVID-19 pandemic. Many of these issues are a consequence of human activities. Hence, mankind needs to seek for new ways of creating sustainable, resilient and regenerative business operations. But while businesses will need to play a vital role in innovating and scaling new solutions, they often face difficulties in knowing where and how to start.
In order to ignite new ideas and concepts for a sustainable future, businesses should look at how nature serves as paradigm (“biomimicking”). The following 10 lessons from nature can support organizations to create more sustainable supply chains.
1. Ground work – analyzing the basis
Strong networks depend on strong foundations, and no matter where on Earth we live, that foundation is based on soil. Healthy soil is based on a huge number of interactions of life between covering plants and microorganisms, which work together in symbiosis. Healthy soil has the power to absorb CO2, store water, and grow more and better food. Similarly, to unlock the power of sustainability in organizations, we need to analyze their foundation, the diversity of stakeholders involved and their operations’ impact on economic, ecologic and social matters.
2. Values – more than the seeds for growth
In nature, value is generated and continuously reproduced through the collaboration of a diverse set of living beings. Our conventional business view of value is however constrained, as it does neither regard the implications of the business operations for its various stakeholders, nor the fact that resources are exhaustible. A comprehensive approach for measuring value differs from the conventional approach by offering a multi-stakeholder perspective and by allowing to map destroyed and missed value along the value chain, thereby identifying new opportunities for value innovations.
3. Balance and circular design – closing the gap
The “nature of nature” is to reuse or repurpose everything in non-human ecosystems, working as a perfect circular economy. While compelling, the manmade world economy is only 8.6% circular today, and disregards huge value opportunities. In order to capture new opportunities for value, organizations should shift their business and operating models from resource consumption to regeneration. Circular approaches for product design and business models are mandatory for making that shift.
4. Innovation – about Green Swans and smart trees
To address the realities of climate change and other overrunning planetary boundaries, we must innovate our mind-sets, technologies, and business models. Nature has inspired mankind to many technological innovations. But it’s not only distinct products or mechanisms that need to be innovated, but entire systems. Trees demonstrate how they have systemically innovated the way they transport water, a concept which goes beyond the individual mechanics behind. Similarly, businesses must acknowledge the limitations of incremental changes and recognize the need for more fundamental changes towards business models with “Green Swan” characteristics.
5. Diversity – strengths in differences
Diversity is considered a key determinant of resilience, recovery and adaptability, as well as transformability, innovativeness and collective intelligence. In nature, diversity is the norm, not the exception. Monocultures are unbalanced, vulnerable systems, while permacultures and mixed forests are more resilient and more value-adding. In business environments, the linkage between corporate employee diversity and company performance is well established, and is also valid with regard to supplier diversity. Beyond this corporate view, supply chains consist of a number of diverse internal and external stakeholder groups. This diversity opens up new opportunities for co-innovation and creates portfolios of vendors with different responses to disruptions.
6. Communication – basis for strong communities
Communication allows mankind to bond as communities, to transport (complex) information and to share fictions. In nature, not only animals but also other living beings such as trees communicate with each other. Trees communicate olfactory, optically and electrically, and they use different communication channels for transmitting their distinct messages. Similarly, greater communication facilitates the streamlining of stakeholders and processes along the supply chain. Sharing information builds up trust amongst supply chain partners, is a driver for collaboration and allows them to identify and respond to risks and changes in demand and supply.
7. Multi-tier value chains – integrating across boundaries
Nature depends on the aligned interaction between a multitude of different living beings. Our planet’s water supply, for example, is largely dependent on an integrated system of forest ecosystems transporting water from the oceans to the far inland of the continents. In business environments, supply chain integration refers to how aligned processes and activities are across the value chain, both within and between organizations. A common recognition is, that “the whole is greater than the sum of the parts”. The aim of supply chain integration is to drive efficiencies and customer value, eliminate waste and ultimately achieve a common business objective. To achieve this goal, an integrative perspective on performance management and relationship management is required.
8. Managing risk – early warning, joint mitigation
While animals tend to warn their groups by using sound signals, trees spread the news more quietly. They use different means of transportation to warn their fellows about identified risks. They can even adapt their messages depending on the type of risk detected. As a result, trees can protect themselves directly from emerging risks, but also indirectly by preserving the entire forest ecosystem which they need in order to thrive. In business environments, the challenges arising from the VUCA context pose a risk to supply chains and potentially lead to disruptions. Effective risk management can make supply chains more resilient, as risk impacts can be avoided, mitigated or better and faster resolved.
9. Technologies – means of sharing information
Technology and supporting infrastructure are amongst the key factors having the potential to facilitate supply chain transformation. They aim to better integrate supply chains by fostering communication, collaboration and transparency. While the focus of businesses is on digital technologies, trees rather rely on analog means of sharing information. They use their root networks, intermediating “platforms” such as fungi, insects, the wind, but also electrical signals to exchange information. Similarly, there are numerous technologies available to enhance supply chain collaboration, transparency and efficiency. While incorporating these technologies can provide many benefits, it is important to well integrate them by looking at the supply chain holistically.
10. Collaboration & partnerships – “one tree doesn’t make a forest”
Resilient supply chains depend on effective collaboration. Supply chain collaboration is not a new idea, but it has conventionally been rather transactional and driven by financial values such as cost savings and growth opportunities. Looking into nature – trees support each other. And they collaborate with an uncountable number of microorganisms and fungi, to achieve a greater, common good. One tree doesn’t make a forest, but forests make trees more resilient. In business environments, there are multiple forms of vertical and horizontal, internal and external supply chain collaboration. And it is this multi-stakeholder collaboration, which all previous lessons are predicated upon.
The challenges that we have ahead of us in terms of creating a more sustainable future are certainly daunting. But nature can give us guidance in doing the ground work, in redefining values, and in developing resilient business ecosystems. And nature can encourage us to keep evolving and revolutionizing.
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