Sales and Fulfillment
Green transportation: Driving logistics on a sustainable track
As businesses digitise and expand their reach across geographies, logistics management has spread its network to reach the last mile in the chain. Transportation is the wheel that moves this machine. However, powered by fossil fuels, transportation is also one of the most significant contributors to rising greenhouse gas (GHG) emissions. A recent IPCC report revealed that the transport sector accounts for about 15% of total GHG emissions and about 23% of global energy-related CO2 emissions.
Transportation’s current costs to the environment is driving the need for green logistics. The CDP (Carbon Disclosure Project) revealed that by 2026, companies would face $120 billion in losses in supply chain disruptions caused by environmental risks. Hence, sustainability is critical for businesses to be buoyant in a changing market, and green transportation is one way to minimise the environmental impact.
What is green transportation?
All sustainable forms of transportation can be termed green transportation. Greening transportation refers to the methods a business adopts to ensure that its vehicles and other modes of transportation are environmentally friendly. To go green, transportation choices made by businesses range from replacing their existing fleet with electric vehicles and introducing biofuels to using technology to optimise routes. Green transportation comes under the larger purview of green logistics that extends to other carbon-neutral practices - such as eco-conscious procurement, investing in green technology, optimising energy consumption, and other measures implemented - to reduce the ecological impact of storage, transportation, and distribution of goods and services.
How greening logistics can benefit businesses?
Sustainable transport and supply chain management requires a holistic approach marked by environment-friendly and socially responsible methods that address environmental, economic, and social challenges. It can benefit not just the people and the environment but also your business.
Boost reputation:Environment protection is seen as a social responsibility of corporates. Hence, adopting sustainable practices boosts the reputation of businesses and inspires trust. Companies that ignore this aspect risk their reputation and are at a competitive disadvantage.
Long-term profitability:A recent study showed that despite the initial cost of implementing green strategies, highly sustainable businesses outperform non-sustainable companies over the long term.Cost advantages in the form of reduced waste, streamlined supply chains, and optimised distribution networks are proof of the profitability in going green.
Customer loyalty:Awareness about global warming is driving customer demand for environment-friendly products and services. Moreover, due to large businesses’ environmental impact, customers expect corporates to actively work towards reducing their carbon footprint. Hence, they prefer eco-friendly companies over those not initiating action against climate change.
New partnerships:As witnessed at the COP26, 2021, the corporate world needs to unite in order to implement changes in their business approaches and work towards a net-zero future. A green supply chain strengthens a business’ environmental credentials, making it easier for other businesses looking for a partner with similar values.
Implementing green transportation for your business
There are some common practices that organisations can introduce, such as eco-friendly vehicles, route optimisation, and alternative fuels to reduce emissions.
Energy-efficient vehicles:By investing in electric or hybrid vehicles, businesses can reduce emissions, especially for road transport, as it contributes significantly to GHG emissions. Although replacing an entire fleet demands hefty investment, your business can do so gradually by replacing ageing vehicles first with fuel-efficient ones. Green tech, such as tail pipe carbon capturing and converting existing vehicles to run on renewable fuels, is gaining popularity.
Alternative fuels:From biofuels and additives to sustainable aviation fuel, alternative fuels are another way to reduce emissions from transportation. These fuels - which are manufactured from various feedstocks, used cooking oil, agricultural residues, and municipal solid waste - promise decarbonisation solutions for trucks, ships, and aeroplanes.
Fleet management:Real-time fleet management and AI-powered software to optimise carrying capacity and routes are helping businesses streamline their logistics. Not only does it minimise time, but it also reduces waste. Moreover, it means goods stay in trucks for a limited period and empty trucks do not consume precious fuel. The resultant operational efficiency reduces costs and decreases the business’s carbon footprint for last-mile logistics with fewer trips.
For organisations on the digital transformation journey, agility is key in responding to a rapidly changing technology and business landscape. Now more than ever, it is crucial to deliver and exceed on organisational expectations with a robust digital mindset backed by innovation. Enabling businesses to sense, learn, respond, and evolve like a living organism, will be imperative for business excellence going forward. A comprehensive, yet modular suite of services is doing exactly that. Equipping organisations with intuitive decision-making automatically at scale, actionable insights based on real-time solutions, anytime/anywhere experience, and in-depth data visibility across functions leading to hyper-productivity, Live Enterprise is building connected organisations that are innovating collaboratively for the future.
How can Infosys BPM help?
Software solutions and data analytics can create a lean and streamlined logistics supply chain by minimising operational costs and improving global logistics compliance. With solid domain experience, Infosys BPM offers a unique and robust process delivery and logistics services framework that improves
- Delivery in Full On-Time (DIFOT) compliance
- Total transport cost reduction
- Asset and capacity optimisation
- Sustainable logistics and carbon reduction
- Chain or responsibility compliance