Green supply chains: software's hidden role in sustainability

Business applications such as supply-chain management software have a key

role to play in helping organizations meet their growing environmental

responsibilities, according to Ovum.

The market for these solutions will be substantial, but delivering them poses

complex challenges, and leadership of this emerging market is up for grabs, Ovum

has found.

Businesses of all types face growing pressure from consumers, investors and

regulators to be “greener” by reducing the raw materials (including energy)

consumed and pollutants emitted at each step in their products' life cycles,

Ovum says. Achieving this goal creates a “green software” opportunity because

measuring, analyzing, reporting and optimizing for environmental factors is a

business process similar to those already managed by applications such as

enterprise resource planning, business intelligence and supply chain management.

Supply chain management solutions will be crucial to sustainability because

of the need for accurate “cradle to grave” environmental information for

products of all types. But the challenge is complex because meaningful results

require common standards and methodologies, as well as coordination across

industry, geographic and regulatory boundaries.

At the moment, various industries, governmental and non-governmental

organizations are developing standards for aggregating environmental data over

the product life cycle. But it's not clear which of these efforts will gain

traction, so both vendors and customers must familiarize themselves with as many

as they can and understand the challenges and opportunities that will result.

Enterprise application vendors must acquire or partner for environmental

expertise if they want to retain the role of strategic advisor. They must offer

solutions that can be easily tailored to different industries' unique

requirements, which will favour service-oriented platforms to replace rigid

legacy systems. Meanwhile, the need to analyze environmental data alongside

financial and business-process information will favour integrated solutions over

stand-alone applications. It will take several years for mature solutions to

develop, but vendors with foresight are moving now to position themselves in

this emerging market.