Environmental Resources Management (ERM) is seeking to shape a sustainable future in tandem with the world’s leading organisations.
As the world’s largest specialist sustainability consultancy, ERM partners with clients to operationalise sustainability at pace and scale, deploying a unique combination of strategic transformation and technical delivery capabilities.
This approach helps clients to accelerate the integration of sustainability at every level of their business. With more than 50 years of experience, ERM’s diverse team of 8,000+ experts in 40 countries and territories helps clients create innovative solutions to their sustainability challenges, unlocking commercial opportunities that meet the needs of today while preserving opportunity for future generations.
Speaking exclusively to SupplyChain Strategy ahead of ASCM CONNECT 2024, Ed Struzik, Partner, Supply Chain at ERM, discusses the current state of play in modern supply chain amidst digital and sustainability transformation.
Would you be able to give us a brief introduction to your role and the company you work for?
Ed Struzik: “I am a Partner at ERM, the world’s largest pure play sustainability consulting firm. ERM partners with clients to operationalise sustainability at pace and scale through our unique combination of strategic transformation and technical delivery capabilities. I lead our Sustainable Supply Chain Group in North America.”
ASCM CONNECT 2024
What is the value of events like ASCM CONNECT 2024: North America? How important is this conference in the supply chain calendar?
Ed Struzik: “ASCM Connect provides educational opportunities as well as the opportunity to exchange ideas and best practices. This is in addition to bringing the most up-to-date thinking to supply chain practitioners across the globe. For me, this conference is one of the top three must-attend events on my calendar!”
Is there anything that makes this event stand out for you? How is it different from others you’ve attended?
Ed Struzik: “It is the way the sessions are intentionally set up to inform and educate. There is not one opinion, there are, of course, better practices presented, but the objective is an open exchange of ideas, sessions, small and large and workshops which help take away actual knowledge!”
Global supply chain
Given the backdrop of the global disruption over the past few years (COVID, wars, inflation etc), how would you sum up where the supply chain space finds itself today?
Ed Struzik: “The supply chain today is at a VERY important crossroads. You have disruptions—which lead to the need for resiliency, you have regulations, which lead to the need for traceability and you have consumer pressure/sustainability which leads to the need for better design, packaging and less waste. Now, these three do have some overlap and traceability can advance all of these areas rapidly.”
What do you feel are the biggest lessons supply chains have learnt over the past few years and how well equipped is the modern day supply chain now to deal with ‘black swan’ events like the ones we’ve seen recently?
Ed Struzik: “I think supply chains have learned to shy away from ‘just in time’ in favour of buffer inventory in order to offset the impacts of the black swan, this is not a great trend. A smaller movement, but one that will make supply chains less susceptible to black swans is an effort to re-shore/near shore. This also cuts down the number of places to track the material from and can also lead to improved sustainability. There is also a fast-evolving need for good tracking software…. Digital Product Passports, blockchain/digital ledgers should be gaining much more traction than they are.”
Sustainability
Sustainability is an important item on most Chief Supply Chain Officers’ agenda. Amid government legislation and changing customer demands, is a sustainable supply a non-negotiable in today’s world?
Ed Struzik: “Between the traceability requirements of regulations (CSDDD, CSRD, etc.) as well as consumer, board and financial pressures to be better corporate citizens, OEMS/companies are being held accountable for the sustainability practices of their suppliers. It is exactly the right time to collaborate, partner and improve or risk being left behind.”
In what ways have you incorporated sustainability into operations?
Ed Struzik: “As a consultancy, we assist clients every day with their sustainability needs and how to integrate them into operations. Whether that is through improved health and safety policies, responsible sourcing, re-designed, more sustainable packaging, circularity and recycling audits we are a one-stop shop for our clients. ERM’s comprehensive approach to sustainability is embedded in our corporate strategy with a stated purpose: to shape a sustainable future with the world’s leading organisations. ERM strives to operate sustainably in support of the Sustainable Development Goals (SDGs) which we’ve been involved in since the start of their development in 2012.”
Digital transformation
Where are generative and conversational AI having the biggest impact in the supply chain? What types of supply chain and procurement decisions are now possible, or much easier to make, with the rise of AI and LLMs? How does this compare to just a couple of years ago?
Ed Struzik: “While AI and ML have existed, it was only recently that they have taken off. Analysis of routes, lanes, GHG considerations, and when to optimise freight or inventory levels can all be accelerated through the use of AI and ML. In addition, the receiving, billing, tender process, etc. can all be improved and run faster with the use of AI.”
What should CSCOs out there do first? What needs to be considered before starting the gen AI journey?
Ed Struzik: “I would want to get supply chain fully mapped. It is 100% traceability to the commodity. Then we can get more creative. Use of AI for alternates, reduction of bottlenecks, etc. let the AI run the scheduling algorithms and make recommendations faster. Next, I would link all those accepted decisions to a digital ledger, let it keep track of actuals, lots, locations, price, assay, composition, recycled content etc. as it can hold way more information than an ERP system and it is accessible to the next person in the chain as you want it to be!”
Data challenge
What are the biggest challenges or hesitations you’re seeing companies have around AI? What should organisations look for in technology to hedge against these concerns?
Ed Struzik: “Number one is fear of the unknown. No one wants to be the one who took a big swing at running their supply chain with AI and failed. They need to hedge. And they are by implementing AI in pockets, small functions, small products, pilots etc.”
What are the underlying issues in how companies are currently storing and looking at their supply chain data? Why is this a problem and how can they overcome those challenges with generative AI and knowledge graphs?
Ed Struzik: “There are too many systems. As AI improves and companies properly set up digital twins and data lakes they will be able to let AI fill gaps in actuals and then get them presented in a unified, single dashboard—set up for different levels in the organization. This has been a promise of several SCP packages for years, but no one has ever gone all in on any of them.”
Talent management
People are a company’s greatest asset but can also be a hurdle to overcome when it comes to innovation. How do you manage the people challenge and get them on board with change?
Ed Struzik: “As a consultancy we do a lot of supplier education and upskilling, especially around sustainability in the supply chain.”
What about the next generation of talent? What is the key to encouraging more people into a career within the supply chain?
Ed Struzik: “In terms of sustainability, the next generation of supply chain talent is there, they want to make a difference, they do not need motivation for that, they will actually be frustrated with the corporate ‘slowness’ to adopt the change. They need to be educated and lead the charge on alternate sources of supply, new methods of vendor selection, etc.”
Supply chain’s next step
How can the supply chain industry take that next step and what strategies can be implemented to push the industry forward even further?
Ed Struzik: “Regulations will not stop, consumer pressure will not stop, the need for resiliency will not stop. The number one strategy is to figure out how to be traceable, sustainable and resilient. Manually this will not happen. Digital solutions are the only way—mapping and digital ledgers are at the forefront of this movement.”
Are there any exciting projects that you’re currently working on or any past ones that you’re proud of that you’d like to highlight?
Ed Struzik: “ERM has been at the forefront of supplier engagement, especially for decarbonisation. Every one of these has been special to me because they improve our client’s position and help improve the planet. I have also personally developed a lot of the material ERM uses to engage our clients on sustainable supply chain creation and this continues to grow and expand.”
Future
How exciting a future does supply chain and procurement have? Some people say that now is the greatest time to be in the space. Is that true?
Ed Struzik: “The future is on fire for supply chain and procurement. Never in history has it been so talked about and become such a business differentiator. The sheer volume of supply chain regulations and the need for responsible sourcing puts way more power and emphasis on procurement than ever before. The days of getting the cheapest part that meets spec to my door the fastest are long gone. Cost, quality and OTD are only a part of the equation now. Is it sustainable, how recyclable it is, who made it is table stakes now and the new supply chain and procurement professionals need to embrace it.”
Learn more about ERM here.
- Digital Supply Chain
