Supply chain is the sequence of processes that is involved in the production and distribution of a products or services. It is a network between a firm and its suppliers for producing and distributing products. Supply chain comprises of every company that falls in contact with a specific product along with including firms that accumulate and transport component parts to the producer or manufacturer (Nidumolu,Prahalad and Rangaswami, 2009). In the current study, an overview of the overall supply-chain of Unilever would be provided. Based on the supply chain and operational processes of the company, two specific steps would be identified and developed for recommending more sustainable and future-thinking enhancement.
Unilever is an international end-user goods firm.Its products include personal care products, cleaning agents, food and beverages. Eight disciplines that is; engineering, planning, manufacturing, logistics, procuring, customer service, quality and safety are leveraged by End-to-end supply chain of the firm. The company operates through 460 warehouses and 260 factories in 90 nations serving around 2 billion customers (Unilever, 2016b). However, it has been observed that recently,the company has been facing some sustainability issues with its supply chain. One issue is related with the speed of order fulfilment (Supplychainbrain, 2013). The customers have claimed that they have to wait for a long period of time to receive their ordered products. The reason for such an issue is due to problem in decline in the procurement process of resources and materials. This has created a delay in delivering the products to the customers. On the other hand, another issue found is related with the welfare of employees that are a part of supply chain of Unilever. A report by Oxfam showed that there is problem in wage levels, working hours, stability of employment and relations between labourers and management of Unilever(Morden, 2013).
The concept of sustainability is designed around there elements, environmental, social and economic development. Embracing environmentally sustainable business practices provide a number of advantages (Reilly, 2009). It enables the firm to be more responsible towards its business and customers with whom they deal with. The organisations with proven records in local and global sustainability could make income through investments (due to good public reputation), employee productivity and better long-term public following (Bowers, 2010). Sustainability is not only restricted to environment but is well infused in employment, business practice and supply chain and other elements. In context to Unilever, the company also adopts the sustainability approach. The company not just includes environmental factors but also increases the experiences of workers and employees whoare involved in its supply chain. For being more sustainable corporate citizens, the company is aiming to drive recycling and efficiency and reduce carbon emissions from its manufacturing sites. It is evident that Unilever sourced 14% agricultural supplies sustainably in 2010, which has now increased to 48% (Sunlight, 2014). It indicates that the company has well understood and applied the sustainability concept, which is seen through its different operational activities.
On the other hand, it has been studied that there is a significant link between sustainability and supply chain management. The relation could be evaluated by analysing the impact of sustainability on supply chain management (Reilly and Weirup, 2012). Unilever promotes sustainable farming methods as it helps in increasing yields considerably, providing social and economic benefits to farmers, their families and adjacent communities and alleviating the impacts of environment change. This supports the company in procuring materials in a sustainable form and thereby, provides quality products to the customers. As a result, the company receives a positive feedback from the consumers for being a sustainable responsible corporation (Mirvis, 2011). On the other hand, it has been observed that Unilever’s sustainable sourcing approach helps it to secure supplies and limit the risk and volatility in its raw material supply chains (Unilever, 2016a). It offers prospects for innovation through concentrating on sustainable livelihood needs of people and consumer penchant. This helps in building a stronger brand name globally.
Further, Unilever gives high importance to sharing information with its stakeholders. Through informing about where its products come from, helps the company to meet the emerging desires of the consumers for more sustainable products. This helps in increasing the sales of the products desired by the people. Moreover, maintaining a sustainable supply chain has placed Unilever among the top 10 supply chains in the world. Due to a sustainable practice, the company has been successful to increase its customer base to 150000 globally by serving around 60000 products (Unilever, 2016a).
To effectively compete, succeed and hold market share in the global market, organisations need to have a potential supply chain management. For implementingstrategic supply chain management, Unilever would require to focus on building a relationship with its suppliers and their level of commitment and trust. The environment setting of company relates to the organisation’s anticipations of quality, rivalry in the industry, on time delivery and the scale of competition among the companies (Kashmanian, Wells and Keenan, 2011). However, uncertainty could negatively impact the performance of the company. Therefore, building a strategic relationship with the critical suppliers would help Unilever to deal with the environmental uncertainties in the supply chain; thereby, help in executing an effective SCM.
The other factor could be reducing or eliminating organisational process inefficiencies and redundancies. It would support Unilever in having a standardised workflow process in its supply chain which would help in minimising customised procurement and other non-system processes (Trexler and Schendler, 2015).