Strategies for Supply Chain Leaders to Ingrain a Circular Economy in their Operations

Many supply chain leaders are exploring the opportunities of this circular economy in their workflows. A few enterprises that have implemented this approach are able to reduce the impact on the environment and result in quicker and more compact supply chain cycles.

According to a recent report by Gartner, approximately 74% of the supply chain leaders that participated in the survey expect a circular economy to improve profits between now and 2025.

The recent pandemic that surged the world showed the importance of local supply chains to ensure the continuity of business operations and other needs of human beings. The same report by Gartner suggests that, on average, all the supply chain enterprises have been implementing circular economy strategies for nearly 16% of their product catalogs for almost three years. Many supply chain leaders are exploring the opportunities of this circular economy in their workflows.

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A few enterprises that have implemented this approach are able to reduce the impact on the environment and result in quicker and more compact supply chain cycles. One of the most significant challenges in adopting circular economy approaches is many businesses lack the capabilities to leverage technology to support circular economy activities, collaborate with vendors, and evaluate the impact of the circular economy on the supply chain.

Here are a few ways leaders should consider shifting their focus to embrace a circular economy in their supply chain:

Reimagine the supply chain

Supply chain leaders should consider reinventing their strategies to procure, manufacture, and distribute their products. Modern supply chains need strong manufacturing and distribution processes that create long-term value for all stakeholders. It is crucial to design a strategy that helps the leaders to bring in a paradigm shift in supply chain management processes that results in a higher conversion rate and minimizes the costs and risks of ingraining operational resiliency throughout the process.

The same report also highlights that approximately 54% of the survey respondents are making strategic changes to their supply chain to seamlessly integrate circular economy products into the planning stage.

A business that finds it challenging to transform its supply chain can partner with experts that have skills, tools, and innovation to seamlessly integrate a circular economy.

Developing circular supply chains

Organizations that aim to ingrain a circular economy into their supply chain needs to make strategic changes to the work culture. Supply chain leaders need to have a long-term strategic plan that embeds a circular economy right from procurement to delivery. It is crucial for organizations to get all the partners involved on board to seamlessly embrace a circular economy in their operations. Many organizations find it challenging to get all the partners in the supply chain on board with this approach.

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Initiation of circular economy in the supply chain

Industry veterans suggest organizations that want to achieve a circular economy start with a less complex supply chain process. Business leaders need to determine how this approach will help to create a positive impact on the workflows. Enterprises need to focus on reimagining product design, business operations, and vendor ecosystems to move successfully to a circular economy. Embracing a circular model is an intricate task and does not occur overnight; Supply chain leaders need to have a strategic plan to ingrain such a model in their operations and deliver value to the enterprise.

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