Sustainability in materials management: 3 optimisation opportunities

In a world of growing environmental concerns, the pursuit of sustainable practices is spreading across various industries and areas, including materials management. Faced with finite resources, growing amounts of waste, and increasing emissions caused by production methods, there has become an urgent need to reevaluate and redefine the way we handle materials across their lifecycle.

In this blog post, we caught up with ABL’s Materials Team Technical Lead, Paul Mitchell, who discusses the role that sustainability plays in materials management, exploring the key ways sustainability can be integrated into materials management practices and how we can support you to build a sustainable materials management strategy… 

Do you think sustainability is an important topic in materials management right now?

“There is so much potential to bring sustainable practices into the field of materials management, and this should be a top priority for inventory and material teams across the globe – not only because of the positive impact it can have on a business and the wider environment, but also because of the growing pressure from external governing bodies to comply with regulations.

“However it’s one thing to understand this importance, and another to take action that will fundamentally help achieve a lower carbon footprint across the supply chain.

“If companies are willing to adopt the philosophy of sustainable materials management, they need to be open to delving deeper into auditing their own practices and those of external suppliers, identify changes that will have the greatest impact and embed sustainability into the culture of the entire inventory and materials team to drive this vision forward.”

How can sustainability be integrated into materials management?

“There are lots of ways sustainability can be incorporated into the field of materials management, with the first step requiring materials management teams to sit down and conduct a detailed analysis of the current procedures and processes in place throughout the supply chain. 

“Once an analysis has been conducted, it is then easier for management to identify areas for improvement when it comes to sustainability. This may involve looking at factors such as the centralisation of spare parts, CMMS data and the preservation of stock. 

1. Centralisation of spare parts

“The centralisation of spare parts can be an effective route to reducing your company’s carbon footprint. Not only can this strategy bring important benefits, such as reducing lead times for spare parts, increasing accuracy of spare parts data and reducing costs, there can be significant value gained from a sustainability perspective:

• Optimised stock levels: Centralising your spare parts can avoid overstocking due to having greater visibility, control and accurate data than managing inventory levels across multiple locations. This can lead to a reduction in waste, as fewer spare parts become obsolete or surpass their shelf life. This also minimizes the need to manufacture more parts, which indirectly contributes to lower carbon emissions and resource usage.
• Efficient energy consumption: A single, well managed warehouse and storage facility can reduce energy consumption compared to operating multiple storage locations. Having one single location can also increase the opportunity to introduce energy efficient technologies, as it becomes easier and lower cost – such as electric vehicles, solar power and battery storage.  
• Reduced packaging: By ordering in bulk and storing centrally, you can reduce the amount of packaging required for spare parts. Less packaging means less waste and less energy used in packaging production and disposal.

2. Improving materials management data

“One of the most important factors when it comes to effective materials management is ensuring that data is complete, accurate and up to date. 

“Time and time again, we have witnessed data presenting itself as a root issue for companies struggling to unlock material management excellence, and this can also have a negative impact on sustainability and carbon emissions.

“Incomplete, inaccurate or out of date data in a CMMS can lead to the following sustainability consequences:

• Wastage: Poor quality data can lead to surplus spare parts being ordered unnecessarily, which need to be manufactured, transported, stored and maintained – all which increase the associated carbon footprint for each single part. 
• Understocking: If you do not have reliable data around the availability and location of your materials, this can result in items not being in stock and available when required – and this is even more important for critical spare parts. This can lead to last minute or emergency orders being placed, with expedited shipping often the only option which tends to prioritise speed over sustainable practices that generate less carbon emissions. 
• Inefficiencies and missed optimisation opportunities: Without access to important, up to date data, it’s extremely hard to identify opportunities for improvement or efficiencies around materials management. For example, you may overlook energy efficient alternatives, opportunities to streamline processes, potential areas for waste reduction, and much more. 

“Data is the key to unlocking significant improvements, which can positively contribute to a more sustainable materials management regime.”

3. Preservation maintenance

“A key way to integrate sustainability into your materials management practices is to focus on the preservation of your spare parts and material in storage.

“Instead of purchasing parts and leaving them in a warehouse until they’re required, applying basic inspection, testing and maintenance practices can ensure the parts are fully fit for purpose and will not get thrown out or disposed of.

“Not only does this reduce wastage, it also eliminates the need for emergency orders for replacement parts, which both contribute to a more sustainable, efficient operation – in addition to saving your company significant money.

“Additionally, if you have well-preserved materials that you no longer require, you have the opportunity to sell them back to the manufacturer or others who are actively looking to procure the item. By preserving items correctly, you open up the door to reusing parts and help to halt any new production taking place, creating a more sustainable and circular economy.” 

How ABL can help…

We can help you to achieve a more sustainable materials management strategy through our suite of inventory, procurement and logistics services and award-winning software crafted to enhance the visibility and traceability of your materials.