Rethinking the global supply chain

We are all part of a global economy, capable of producing and transporting seemingly anything, from anywhere, to anyone. Its lifeblood is an interconnected network of suppliers and producers, retailers and consumers, spanning the planet. But the public typically knows far more about Apple, Nike, and other brands than the logistics empires many tiers below, where firms such as Foxconn and Pou Chen connect vast underlying commodity and labor markets that are relatively hidden from the public eye. This sprawling web of supply chains can raise living standards, improve conditions for workers, and help alleviate poverty. But feeding its unquenchable thirst for energy, water, and other resources puts a strain on the planet. Finding ways to relieve that strain is an enormous challenge and will undoubtedly require greater traceability and transparency.

One step forward is providing better measurements and models and making efforts to standardize and coordinate their use. Researchers are intensely studying how to account for supply-chain demands on ecosystems by integrating carbon, water, energy, and other “footprints” into coordinated schemes (see Hoekstra and Wiedmann, p. 1114). They are also developing better ways to inventory material and energy inputs, from the conception of a product to its grave, via life-cycle assessment tools (see Hellweg and Milà i Canals, p. 1109).

Yet academic insights alone cannot solve these problems. The large-scale cooperation of industry is essential. Many companies and industries are seeking to improve how they collect, synthesize, standardize, and communicate supply-chain data to better inform decision-making (see O'Rourke, p. 1124). A study of the Brazilian Amazon shows how supply-chain initiatives in the beef and soy industries, interacting with economic, social, and policy drivers, can slow deforestation of one of the world's major sources of biodiversity and carbon sequestration (see Nepstad et al., p. 1118).

Logistics and transportation are also ripe for improvement. One approach is drawing inspiration from the digital Internet to create a Physical Internet. The initiative envisions using standardized “packets” and protocols for shipping, and forging the types of industry-wide partnerships that are normally anathema to a free-market system, but perhaps necessary to reduce the congestion, pollution, and inefficiency that make the current system ultimately unsustainable (see Mervis, p. 1104). Although many companies may initially be motivated by improved efficiencies and profit margins, such improvements in supply chains hold out the hope of improving conditions for humanity (see Dooley, p. 1108).