 Welcome to MIT Supply Chain Frontiers, where we discover the future of global supply chain education, research, and innovation. Brought to you by the MIT Center for Transportation and Logistics, every episode features center researchers and staff who welcome experts from the field for in-depth conversations about business, education, and beyond. Today, MIT CTL editorial director Ken Cottrell speaks with Alexis Bateman, research scientist and director of the MIT Sustainable Supply Chain Initiative. Take it away, Ken. Alexis, welcome. Thanks for having me, Ken. Let me talk a little bit about sustainable supply chains. We recently, in 2018, created sustainable supply chains to be an umbrella initiative that brings together sustainability research from across the center, so topics ranging from circular supply chains, reverse logistics, sustainable logistics, transparency, disclosure, all the different facets of supply chain sustainability. We have so much research, we're bringing that together to show the breadth of coverage. I wear that hat a lot of the time, and I also work on our digital learning micro-master's credential in supply chain management, which is our approach to reaching as many supply chain professionals for free or low-cost supply chain education. Obviously, a lot of experience in sustainability. What do you see at the moment as the main issues that are really driving your research and driving your interest? It's been an evolution from when I started this work, so I think that broadly the last few years, and especially in 2019, sustainability is becoming front and center for supply chains, and that is for a myriad of different reasons, whether that be the pressures of, for instance, China refusing to take plastics recycling from other countries, and so that is put pressure on supply chains to reduce their waste and their plastics waste in particular. Certain headlines and certain changes in the global environment have put sustainability front and center, the climate strikes and focus on climate change as an impact with supply chains playing a key role as a contributor to greenhouse gas emissions has also put that on the agenda of most supply chain executives added to the fact that, you know, to a lesser extent, but still a growing number of consumers are asking for this, asking for more information about their products, asking for transparency so that they can know where their products came from, how they were produced, what impact they had, and so that pressure to act is really diffused across almost every industry and multiple different topics. So it has moved from sort of this side, you know, nice to have this kind of, you know, responsibility that companies do have and many have been doing it for quite some time, but I think that it is really in the last year put come to almost the, the core focus of most companies with a supply chain that is no longer, it's a non-negotiable now, there needs to be some focus on it in the coming years. In that vein, it seems that companies are recognizing more and more that in terms of sustainability, supply chain is really a key, you know, playing a key role that if you're going to improve your sustainability performance, you have to look at supply chain. Absolutely. So, you know, something we've seen as we've seen not only this come into the front and center for most corporate supply chains, we're seeing this evolutionary role of the supply chain professional and the supply chain executive increasingly owning sustainability because they are so intertwined because you really can't claim sustainability, you can't claim really, you know, full supply chain sustainability without marrying that with supply chain processes and practices. So this is, you know, really becoming core that instead of having sort of this side sustainability department that they're being married to supply chain, you know, manufacturing sourcing really where that kind of strategic positioning is sitting and transitioning. So that has been occurring in the last couple of years and I'm seeing that, you know, change how it's owned, how it's diffused through the supply chain that there is a more operational expertise that there is more technical capabilities to drive that deeper into the supply chain. And so I think that that change is really making progress more significant and also making supply chains so core to what everything is in corporate sustainability. Right. So do you think that, you know, supply chain practitioners are ready for that new role because there are new responsibilities and in many ways it's bringing them into contact with other disciplines as well. So do you think this there's things that the profession can do or practitioners can do to make it easier for them to take on those responsibilities? Yes, absolutely. So are they ready? I think that there's, you know, emerging portion of supply chain professionals have already internalized sustainability as a key component of their work. So there is a group that have found this as, you know, they're seeking out additional training additional expertise so that they can embed that in their day to day lives. But on the whole, I think that a lot of supply chain professionals don't feel ready to take that on as their day to day tasks. And so it's being driven externally and often, you know, sort of executive pressure to internalize sustainability, but then that's not really getting into the day to day supply chain professionals, you know, tasks. And so I think for that there needs to be a new support system. There needs to be corporate training to bring supply chain professionals those additional expertise for, you know, accounting for environmental and social impact for how to work with suppliers to, you know, adopt these to, you know, really get that full expertise in addition to their existing, you know, supply chain capacities. I mean, in in our own, you know, SEM program, we're seeing we're not only re-offering more opportunities to learn about sustainability, but our incoming applicants and students are actually asking for it. So almost 20% of applicants cited sustainability is a key reason that they want to dive into supply chain. So we're seeing this from all angles that while there is not, you know, an absolute expertise at this time that they're seeking it out, that companies are offering that as an additional expertise, but I think it's still taking time to diffuse into those, you know, what we're calling front line supply chain professionals that they're really touching the day to day. So it's it's coming, but it's not really as diffuse yet, as I think it's going to be down the line. Right. And that's interesting, isn't it, that you say that recruits, that students that you see are showing a lot more interest in sustainability. Just sort of flipping that a little bit. Does that also imply that, you know, companies can be more attractive if they have a high profile sustainability record, if they're seen in the marketplace to be conscientious in that area. Do you think that attracts the kind of talent that MIT CTL trains as part of their supply chain programs? Yes, absolutely. So we're seeing, you know, as we've all seen for many years now that there is high competition for good supply chain talent, right? So these skilled trained professionals that are entering the workforce, there's really quite a bit of competition for those professionals. And so both on the fact that now they're being skilled in more diverse ways, including sustainability, but then on the other side, that companies need to be attracted to those professionals that are in high demand. And so what we're seeing is that those companies that do have a better, you know, reputation are more transparent, are more notably sustainable, are getting, you know, more interest from the professionals as applicants. And so, you know, of course, the most famous case, Patagonia has been public about the amount of applicants that they have on the whole for their size of their company is quite significant. They also have an extremely low employee turnover rate at 4%. As we know, Patagonia is a very, you know, transparent, very public about their sustainability efforts. So they're getting those professionals to not only come at a higher rate, but stay over time because they want to work for trustworthy companies. They want to work for companies that are ethical. And so, you know, maybe it's not moving the needle in all cases, but when there's that differentiator between a company that is notably more rep, more authentic, more trustworthy, relative to those that are not, those are getting the professionals to apply and stay at a higher rate. So let's shift a little bit more towards the kinds of sustainability issues that you think need to be paid more attention to. Certainly in terms of someone like MIT, where we have a big responsibility to make sure that the education we provide covers areas that companies want to be covered. You know, I'm seeing terms like, for example, circular supply chain a lot more now. Are you seeing in general that companies are just more interested in how to develop circular supply chains? I think, you know, there's many topics that are coming top of mind. But given, you know, China's announcement and this increasing focus on just the amount of waste that we're generating, you know, in particular in North American culture, I think that that is something that has come front and center in terms of supply chain capabilities and know how. And it's a, you know, it's a vastly different way of thinking about the supply chain as opposed to being sort of, you know, having no more responsibility once your product reaches the customer's hands that there is now a take back component that you're responsible for the end of life of that packaging and that product. And that's just not how supply chains were designed or how we were trained to think. So I think that, you know, both the educational component is changing. Offerings are being increased. And then once you enter into, you know, your position in the company that there are opportunities to think differently about that product and packaging once it hits a customer's hands, that there are creative solutions to minimize waste and then also, you know, change the dialogue around that being waste and do some input for another product or process. And so I think this is something that has really come quite significantly into focus in the last couple of years because of some of the, you know, new announcements of how we're going to, how, you know, recycling is being accepted and understanding that domestic recycling systems are broken. And so they're not recycling and treating the portion of waste that, you know, we once thought and there is not the value that we were hoping that some of these waste sources would turn into in terms of end-of-light processing and recycling. So recognizing that there's a lot of pressures leading up to this point, the imperative for specialized training and educational offerings is on top of mind so that we have supply chain professionals entering the market that know how to think differently about it, how then, you know, once they are in a corporate setting, they can think about that and bring that expertise. Right. We had a round table on circular supply chains fairly recently, which I attended with you. And what struck me about the round table was just how much companies appreciated getting together in that kind of a forum, companies, you know, across different industrial sectors and how much they learn from each other. And that seems to be one of the areas that perhaps MIT can play an important role in bringing companies together to learn from each other because it's a massive undertaking, isn't it, to shift away from the traditional forward-looking supply chain to a circular supply chain? Yeah. In our position at MIT, TCTL and in my position as a research scientist, I'm so fortunate to speak with so many different supply chain professionals and executives that are dealing with these issues. So I get to be privy for the challenges and opportunities and innovations, but I think that value really needs to extend beyond talking to me, which then, when we bring them all in the room, that many companies can learn from each other in that pre-competitive space, so that opportunities sit down with companies of all sizes from all industries at all scopes of progress and sustainability. That open learning space is, you know, it's non-replaceable, right? You know, what we seek, especially to do on sustainable supply chains, that we can provide these venues that, you know, we're recognizing that not only is there a lot of interest in this space, but there is a gap in know-how. And so, you know, of course, we can fuel the professionals and see the professionals that we're sending out with more expertise, but then, you know, how do we work within the existing, you know, environment and what, you know, outreach offerings, what educational offerings can we do to kind of allow and embed more information, more opportunities to share and get more know-how out there. Right. So perhaps you could give us a little bit more of a sense as to those sorts of gaps in the knowledge that you're talking about. I mean, I remember from the round table, for example, that one of the topics that came up time and time again was a lack of standardization, particularly in things like materials. So when you're recycling materials, because different products have different mixtures of materials, it's sometimes very difficult to design recycling programs that are efficient. That's one issue. Can you maybe mention any other issues you think that really need to be addressed? Ah, many. So thinking, you know, one about standardization and kind of that imperative is that the way, you know, supply chains and businesses have, you know, long work is so that the product is the best for the consumer, which is, you know, really the customer and the consumer that you're creating a value and you're serving a need. And that was sort of the end of the story, right? And you create all your functions around that. But now we're adding in new layers of, do we need to take it back? Do we need to know where that product came from and how it was produced along the way? These new, you know, capacities need to be added in on top of sort of the ultimate objective of, you know, providing a service and a product at the end of the day. So I think that that bigger systems perspective, which, you know, you then need to look throughout the entire supply chain from product design to end of life and understand what are the gaps in information, what are the gaps in capacities that we don't actually have one visibility to or the know-how or the right collaboration to enable that. And so, you know, scaling this out into sort of a systems perspective from the gaps in information, the gaps in cooperation, you know, supplier and buyer collaboration, right? There's these key opportunities that by looking at what, you know, our original business imperative was to now what we need to add in, and then you can really understand where the gaps in capacity lie. So I think that knowing what's coming down the line, what are the key pressures? Who you are as a business, what are you serving? And then thinking a little bit more broadly about how we can work those together can create some really innovative solutions. So another really substantial research project that you're involved in at the moment is a joint study with the council for supply chain management professionals and that you're looking at sustainability. Maybe you could just tell us a little bit about why that study was launched and what you're researching. Yes, in 2019, we initiated a new research project with council of supply chain management professionals on the state of supply chain sustainability. The big reason behind that was seeing the change over time in supply chain sustainability. So in my time exploring this topic, I've seen the pressure and the imperative grow substantially. Went from being sort of this side cute thing that people wanted to add on to now really it is a fundamental objective of many companies that they know this is non-negotiable, that this needs to be part of their mission and needs to be part of how they're doing business. And so that transition and I anecdotally could always speak to the fact that this was happening, but it didn't have the numbers to back that up. CSCMP with their engagement with industry professionals and with supply chain professionals have equally seen growth and interest from their side in terms of what the supply chain professional needs and wants. And so they equally wanted to see some of this transition over time. So we wanted one to see, start something that was annual to be able to track change over time in how companies are diffusing this into the supply chain, what role the supply chain professional plays in this, what are key issues that the supply chain is placing and what are the differences between industries. So for this project, we really wanted to deep dive into those topics, but also really directed towards the lay supply chain professionals. So as many supply chain groups, we get into our little bubble of people that speak all the same language, right? I love to talk to other sustainability folks, but we know they already drank the Kool-Aid. That report is for them, but it's for the broad audience that everyone can really access the information, understand how this is gonna be impacting their work in the near future, what their peers are doing, and so making this sort of open and very accessible reporting of what the state of was in 2019 and then going forward annually. So that was the key objective. We've collected three sources of data that we're gonna triangulate to really to ultimately contribute those findings, one of which was a very large scale survey that we sent out globally across industries to supply chain frontline professionals about how they perceive supply chain sustainability, what role they play, what they see the future. We're now also talking supply chain executives to get their insights and perspectives on how they're seeing it currently and in the future. And then we're also looking at disclosures and media and other content analysis to understand really what's in the public environment and what's in the news to see how that is reflecting within what corporate actions are. And it sounds like a fairly unique piece of research, certainly in terms of the, how comprehensive it is. Is that fair to say that there's nothing else like it? I don't think that there is. Of course, there's been deep dives into supply chain sustainability, but they've been from different angles, largely either from those that are already leaders in the space or purely from an executive point of view. Here we really wanted to see the full range of perspectives, the full range of adoption diffusion, looking across the supply chain, really an end to end scope of all topics. And so then in that way, you get that bigger picture of supply chain sustainability at all levels of supply chain and really trying to create this bigger picture report using multiple sources of data that we're seeing a lot of relationships of why companies are doing what they're doing, what pressures they're receiving, what's coming down the line, so that we can have these findings that are quite robust, that are usable by supply chain professionals. And I gather you're gonna be talking about the study at MIT CTL's forthcoming Crossroads Conference on April the 28th. Understanding uncertain futures is the theme of the conference. There are uncertain futures. What can we know about the future to at least give some certainty? So knowing sustainability is going to be on top of mine. And while it is ambiguous to many, what are key things that we can start thinking about to reduce that uncertainty as we go forward in 2020? Well, great, looking forward to that talk, Alexis. Thank you for your time, much appreciated. Thanks, Ken. All right, everyone, thank you for listening. I hope you enjoyed this edition of MIT Supply Chain Frontiers. My name is Arthur Grau, Communications Officer for the Center. I invite you to visit anytime at ctl.mit.edu or search for MIT Supply Chain Frontiers on your favorite listening platform. Until next time.