Ever since its modern avatar at
Athens, Greece in the summer of 1896, Olympic Games
have been a fascinating movement attracting interest of professionals from all
walks of life. Countless articles have been written on lessons one can draw
from Olympics movement. And why not; it represents the best! Take
first, its motto - Citius, Altius, Fortius —
Faster, Higher and Stronger. This could be the motto for every organisations,
be it public, private or non-profit! In fact, the Olympics have motivated
organising countries to showcase new technologies and industrial progresses,
bringing the latest innovations into the global spotlight. Examples
of innovations galore, from the groundbreaking worldwide radio broadcasts of
Paris Olympics in 1924, to the 1964 Tokyo Olympics which were the first Games
broadcast by satellite to television screens around the globe. In more recent
times, London Olympics held in 2012, has left a lasting learning legacy on how
to deliver a sustainable development project.
In this blog, my intention is to focus specifically on
valuable insights that sustainable procurement professionals can draw from
the sustainability efforts that recent Olympic Games have made in implementing
sustainable practices in procurement of goods, works and services. In my
opinion, International Olympics Committee (IOC) made their commitment for
environment and sustainable development known for the first time by amending
the Olympic Charter in 1994 and subsequently publishing Olympic Movement’s
Agenda 21 in 1999. However, sustainable actions in games, specially sustainable
procurement, picked up only in Vancouver 2010 and London 2012, which pioneered the
first sustainable supply chain programmes. Rio 2016 has committed to continue these
excellent initiatives, analysing lessons learnt in each occasion and applying
the best practices.
London 2012 sustainability effort began much before
its bidding process. The London bid team created an aspirational vision called
“Towards a One Planet Olympics” to deliver a sustainable legacy. It addressed
environment with objectives on GHG emission, water and waste; social issues
like noise, communities, transport and mobility; and economic factors like
employment and business. Since the very beginning, Olympics Development
Authority (ODA) sent a clear message to industries about delivering
sustainability through procurement. The ODA’s Procurement Policy stated that “the
ODA would seek to use its purchasing power to support sustainable development
in London and the UK and ………., and would aim to ensure that sustainability is
integrated into business cases, procurement plans and related contracts”.
The ODA set specific, clear, and challenging
sustainability targets from the outset to ensure early consideration of
sustainability issues. The design team was tasked to meet core sustainability
criteria along with other performance criteria while specifying requirement for
products and works. Sustainability criteria formed part of the award criteria
and all tenders were evaluated based on the most economically advantageous
tender (MEAT). In order that SMEs don’t get discouraged from bidding
process, they were supported to make them business ready. The technical
evaluation included environmental sustainability assessment too. The technical
evaluation criteria scores were weighted as much as 70 per cent with respect to
the commercial scores. It was made mandatory to report on sustainability Key
Performance Indicators (KPIs). Through all systems in place, sustainability was
impregnated into DNA of London 2012, leaving nothing to chance. Thanks to this
commitment, the London Games raised the bar and set new standards for
sustainability in many areas by saving 400,000 tonnes CO2 equivalent,
achieving ‘zero waste’ to landfill target, using 100% sustainability sourced
timber etc. and most of all inspiring sustainable living in many
Londoners.
Building on the successes of London Olympics, Rio 2016
is hoping to replicate and surpass London 2012’s stunning sustainability feat.
Its intentions are very clear on its website i.e., to adopt new practices of
production and use, which are less environmentally aggressive. With a project
budget of R$ 3 billion, Sustainable Supply Chain Guide, issued by Rio 2016,
aims to convert procurement of goods and services into a tool to promote and
encourage the use of sustainable technologies, supplies, processes and
services. The document encourages suppliers to adopt sustainability management
system, such as ISO 14001, OHSAS 18001, SA 8000 etc., which will be used as competitive
differentials in evaluation processes. As per this guide, Rio 2016 aims to
minimize and offset emissions of carbon dioxide and other greenhouse gases
(GHG). Therefore, efficient emission management by suppliers during production
and distribution will be deemed as an important technical and commercial
competitive advantage, as emission offsetting costs will be integrated into the
total cost of ownership analysis. In nutshell, a simple glance through the
guide provides enough hints on what to expect during Olympics on sustainability
front. But, what overwhelmed me most is Rio 2016’s plan to establish
and communicate requirements i.e., outlining the sustainability assessment
criteria and minimum requirements, well in advance to suppliers. This
would provide abundant time and opportunity to vendors to take measures to
enhance and make their management systems worthy of the huge business generated
by Rio 2016.
Looking beyond just a sporting event, can we draw
something from Olympics? The London Olympics provides a proven template on how
to approach sustainability in procurement. It has demonstrated that with
innovation in design and materials specification, environmental benefits go
hand in hand with economic savings. Both London and Rio convey importance of
early engagement with vendors while implementing sustainability strategy.
People often confront me – do you have vendors for
supplying greener products and services? I see this situation merely as a
communication problem. It typically exemplifies chicken and egg situation.
Unless you communicate with vendors and sound your intent to purchase greener
products and services, they would think – Oh! Where is demand for greener
products? Who is going to buy if I invest in developing sustainable
products that save resources and energy at the same time? The only way to get
rid of this situation is to proactively communicate your requirements with
vendors. The vendors are not dumb and they can read the writing on the wall
provided we engage and communicate with them. When Olympics can source products
with sustainability criteria, there is no reason why others can’t.
Here is an interesting encounter I had last year with
one of our vendors. My organization purchases lots of Carbon copy paper,
that use carbon sheet in between papers, for preparing passenger charts, giving
details of name, age, sex, berth number etc. While discussing sustainable procurement, one of the
vendors asked me – why don’t you use Carbonless copy paper (CCP) or NCR
paper for your charting paper requirements? He also explained that the thin
carbon sheet used in Carbon copy paper takes many years to biologically
decompose. When I asked for the cost comparison between these two types of
papers, he gave me a thought provoking reply. He said that though the cost of
Carbonless copy paper is currently more than that of Carbon copy paper, the
purchase order may be placed on him only when his product is competitive
and meets organisation's quality and other requirements, but he should not be denied the
opportunity to participate in tender process by limiting the properties or
requirements for Carbon copy paper.
This incident made me think how, by just communicating
your requirements, public authorities can drive market for innovative
sustainable products. Most definitely, Olympics learnt and internilised
importance of communication much earlier! I am sure, with the kind of
commitment and management support for sustainability, innovation in
sustainability will continue to be showcased in Olympic Games. We,
purchasing professionals, can expect more revelations and interesting surprises
– no matter where in the world the events are held. Let us hope that as the
Olympics torch spreads the message of the Games throughout the world, so may
the light of knowledge of SPP implementation spread to organizations. Long live
the Olympics spirit!
