This year’s Times Square New Year’s Eve ball was “green”-i.e., more environmentally-friendly.  Instead of the 600 incandescent and halogen bulbs used in previous years, this ball contained 9,576 light-emitting diode (LED) bulbs manufactured by Philips Lighting and it used the same amount of electricity as ten toasters.  And so began 2009, so green and so bright. 

The “green” movement in supply chain management began several years ago and continues to gain momentum.  Last month, for example, I came across a press release that caught my attention, but I wasn’t able to comment on it until now.  The quick synopsis: Walmart, Sam’s Club, Wegmans, SYSCO, Unilever, Heinz, and more than 25 other entities formed the Stewardship Index for Specialty Crops, an initiative “to develop a system for measuring sustainable performance throughout the specialty crop supply chain.”  Included in “specialty crops” are fruits, vegetables, nuts, and horticulture.  You can get more details about the project at the Stewardship Index website.

Here’s what caught my attention: the primary objective of the project is to develop “a suite of outcomes-based metrics [emphasis mine] to enable operators at any point along the supply chain to benchmark, compare, and communicate their own performance.”  As I’ve written about in the past, the lack of metrics and standards in this area has limited the adoption of “green” business practices.  In a survey ARC conducted last year in collaboration with Florida International University, almost 40 percent of the companies engaged in “green” activities did not have any metrics to measure their green/sustainability performance.  These results raised a serious question: if you can’t manage what you can’t measure, then how do these companies know if their “green” initiatives are having a positive impact on the environment?

Therefore, I believe the members of the Stewardship Index are focused on the right objective, including their emphasis on “performance-based” metrics instead of “practices-based” ones.  As the group states in its website, “By focusing on outcomes, instead of practices, individual firms are freed to innovate and find the practices that work best for them while providing the public with actual data to demonstrate benefits.”

This focus also relates to another decision the group has made that’s worth noting.  The project is aimed at developing metrics, not standards.  The latter, from the project’s perspective, imposes required performance scores and practices, whereas metrics defines how to measure performance.  In my experience, it’s much easier (albeit still time consuming) for a diverse group of entities to agree on a metric than to approve a standard.  In my opinion, global standards ultimately need to be developed, but it shouldn’t delay efforts to develop metrics.

However, are there already too many cooks in the kitchen?  There are other sustainability-related efforts in this industry, such as the work the Leonardo Academy is doing through the American National Standards Institute (ANSI) to develop a national sustainable agriculture standard.  Unless these various groups work in a coordinated and collaborative manner, industry participants may get overburdened with various (perhaps competing) initiatives, which could ultimately slow down progress.

The project participants are soliciting feedback (by February 1) on a proposed list of stewardship issues that should be measured throughout the specialty crop supply chain.  Energy use, greenhouse gas emissions, and packaging are among the items listed.  Considering that many Logistics Service Providers play a critical role in this supply chain, including packaging, I’m surprised that there are no LSPs listed as members on the website.  The smart LSPs focused on this industry will take the initiative now to learn more about this project and provide their feedback, instead of waiting for Walmart or Unilever to call them down the road once these proposed metrics are finalized.  As I commented in another piece, “green” initiatives may impose additional costs and requirements on LSPs, but they also open doors to new business opportunities. 

And who knows where else this may lead.  Maybe next year’s New Year’s Eve ball won’t have LED bulbs, but use red, yellow, and green bell peppers instead.