UNIT RESPONSIBLE TOURISM SUPPLY CHAINS Picture source: http://images.danviet.vn/CMSImage/Resources/Uploaded/baogiay2/261_11_thu-hoach-ca-chua.jpg Unit outline Objectives By the end of the unit participants will be able to: • Understand the mechanics of supply chains and the importance of building sustainability in the supply chain Topics • Develop a sustainable supply chain policy and action plan • Implement a supply chain sustainability assessment • Identify strategies to support suppliers to meet supply chain sustainability goals • Understand how to monitor the sustainability performance of the supply chain and support continuous improvement Introduction to responsible tourism supply chains Sustainable supply chain policy development and action planning Raising awareness and supporting suppliers to meet sustainability targets Monitoring and evaluate sustainability performance UNIT RESPONSIBLE TOURISM SUPPLY CHAINS TOPIC INTRODUCTION TO Responsible TOURISM supply chains Picture source: http://www.geograph.org.uk/photo/1520478 What is a supply chain? • • • • The system of moving of a product or service from supplier to customer Results in natural resources, raw materials, and components being transformed into a finished product Tourism supply chains involve core and ancillary tourism goods and services The final product purchased in a general tourism supply chain is the holiday Picture sources: vov.vn/Uploaded/VietHoa/2012_11_21/Bieu%20dien%20van%20nghe.jpg http://sinhcafe.com/photo_north/Maichau/maichau_hoabinh_trekking_adventuretoursdotvn.jpg http:// www.schoolanduniversity.com/images/page_uploads/Food-and-beverage-Management.jpg http://upload.wikimedia.org/wikipedia/commons/9/97/Premier_Executive_Transport_Services_Boeing_737-700_KvW.jpg http://www.relaxitsdone.co.nz/_media/images/257-luxury-accommodation-in-queenstown-at-45-south-luxurious-master-bedroom.jpg The key actors in tourism supply chains © 2003 Richard Tapper, Environment Business & Development Group The tourism sector supply chain Picture source: http://piboonrungroj.files.wordpress.com/2011/07/slide03.jpg Two compelling reasons why we need sustainable supply chains in tourism Consumers expect it You are eroding your core product Improved profile / brand • Improved market access • Increased operational efectiveness • Increased sustainability • Some other good reasons to develop a sustainable supply chain Some common sustainability issues in tourism supply chains ECONOMIC ECONOMICPERFORMANCE PERFORMANCEISSUES ISSUES Employee Employeewages wagesand andbenefits benefits Local purchasing Local purchasing Revenue Revenueleakage leakage Linkages Linkageswith withlocal localsuppliers suppliersand andsubcontractors subcontractors Corporate Corporateresponsibility-related responsibility-relatedpayments payments SOCIO-CULTURAL SOCIO-CULTURALPERFORMANCE PERFORMANCEISSUES ISSUES General General Equal Equalopportunities opportunitiesand andnon-discrimination non-discrimination Human Humanrights rights(including (includingcombatting combattingsexual sexualexploitation exploitationofofchildren) children) Workplace Workplace Workplace Workplaceconditions conditions Labour Labourrelations relations(fair (fairwages, wages,job jobsecurity, security,working workinghours hoursetc) etc) ENVIRONMENTAL ENVIRONMENTALPERFORMANCE PERFORMANCEISSUES ISSUES Health Healthand andsafety safety Energy Energyuse use Training Trainingand andeducation education Water Wateruse use Children Childrenininthe theworkplace workplace Waste Wastemanagement management Wastewater Wastewatermanagement management Suppliers Suppliersand andsubcontractors subcontractors Contributions Contributionstotobiodiversity biodiversityand andnature natureconservation conservation Labour Labourrelations relationsand andhuman humanrights rightspractices practices Chemical Chemicaluse use Contracting Contractingwith withsmall smalland andmicro-enterprises micro-enterprises Emissions Emissions(CO2, (CO2,ozone ozonedepleting depletingsubstances) substances) Respect Respectfor forrights rightsofofethnic ethnicand andminorities minoritiesand andofoflocal localcommunities communities Land Landconversion conversion Air, Air,water waterand andland landpollution pollution Community Community Toxicity Toxicityofofmaterials materialsand andproducts productsused used Traditional Traditionalrights rightsand andfreedoms freedoms Purchasing Purchasingguidelines guidelines Local Localconsultation consultationand andparticipatory participatorydecision-making decision-making Built Builtenvironment environment(including (includingprotection protectionofofarchitectural, architectural,historical historicaland andarchaeological archaeologicalheritage) heritage) Contribution Contributionto tocommunity communitydevelopment development Environmental Environmentalmanagement managementsystem system Economic Economiclinkages linkageswith withlocal localcommunities communities Source: Tour Operators’ Initiative for Sustainable Development (TOI) 2004, Supply Chain Engagement for Tour Operators: Three Steps Toward Sustainability, TOI, France 93% of your supply chain is invisible – and why this matters to you! • Most supply chains today are so complex that companies don’t know exactly what’s happening in them • Poor practices in the supply chain can result in serious risk and reputation issues, legislation and litigation issues and lawsuits for false claims relating to human and environmental issues • The impacts of poor practices by others can and will eventually afect you Source: Rowe A 2013, ‘93% of Your Supply Chain Is “Invisible”’, Network for Business Sustainability, Available [online]: http://nbs.net/knowledge/93-of-your-supply-chain-is-invisible/, Accessed: 09/02/2014 Providing support to meet sustainable supply chain goals • • • The process of businesses helping businesses is often referred to as b2b (“business to business”) exchange Improved & more sustainable goods & services b2b exchange refers to the dialogue and actions that take place between companies to create mutual benefits and gains b2b exchange is a good way to foster sustainability improvements in tourism supply chains because: – – – B2B EXCHANGE You have an intimate understanding of your consumers You have access to technology and information ORGANISATION SUPPLIER By helping your suppliers you are helping yourself Awareness raising Capacity building Incentives Picture sources: Pixabay, http://pixabay.com/ Supporting tourism suppliers through capacity building Information res Networks Training Fam trips Mentoring ources The TOI’s recommendations on incentives for suppliers to meet sustainability goals • • • Suppliers need to be convinced of the advantages of taking sustainability measures Recognition and rewards help foster positive action Develop a “preferred supplier” scheme for suppliers that meet sustainability goals which ofers benefits such as: Higher Higher rates rates Longer-term Longer-term contracts contracts Committed Committed guarantees guarantees Joint Joint marketing marketing agreements agreements More More brochure brochure space space Joint Joint promotional promotional activities activities Favoured Favoured status status in in system system sales sales searches searches Source: Tour Operators’ Initiative for Sustainable Development (TOI) 2004, Supply Chain Engagement for Tour Operators: Three Steps Toward Sustainability, TOI, France UNIT RESPONSIBLE TOURISM SUPPLY CHAINS TOPIC Monitor and evaluate sustainability performance Picture sources: Pixabay, http://pixabay.com/ The steps involved in a supply chain sustainability evaluation Picture sources: Pixabay, http://pixabay.com/ Establishing sustainability criteria for the evaluation • • Review results of baseline study Use the sustainability standards and targets that have been established ensuring the targets are: – – – – SMART Prioritised Applied incrementally Written as short statements that require either an absolute figure, a relative figure, or a simple “yes/no” The main types of indicators INDICATOR Source: UNWTO & SNV Netherlands Development Organisation 2010, Manual on Tourism and Poverty Alleviation – Practical Steps for Destinations, UNWTO & SNV Netherlands Development Organisation, Madrid, Spain Communicating the sustainability monitoring programme and criteria • • Use standard communication approaches Ensure the message content includes: Example of letter communicating a sustainability supply chain programme Dear Dearsupplier, supplier, Benefits Thank Thankyou youfor foragreeing agreeingto towork workwith withus usto toimprove improveyour yoursustainability sustainabilityperformance performance.Consumers Consumersand andgovernments governmentsalike alikeare aredemanding demandinggreater greatersustainability sustainabilityand andwe webelieve believethat thatby bystarting startingnow nowyou you and andus uswill willbe beahead aheadof ofthe thecompetition competitionand andalso alsoprepared preparedfor forpotential potentialincreased increasedgovernment governmentregulations regulationsininthe thefuture future At Ataamore moredirect directlevel, level,we wealso alsobelieve believeour oursustainability sustainabilitystandards standardswill willprovide provideimmediate immediatebenefits benefitsto toyou youininthe theform formof ofimproved improvedworker workerperformance, performance,enhanced enhancedreputation reputationand andcost costsavings savings through throughgreater greaterefficiency… efficiency… InInorder orderto tomeasure measurethe thesuccess successof ofthe theprogramme programmewe weneed needto toensure ensureour oursuppliers suppliersare aremeeting meetingour oursupply supplychain chainsustainability sustainabilitystandards standards The Thekey keysustainability sustainabilitycriteria criteriawe weshall shallbe bemonitoring monitoringofof our oursuppliers suppliersinclude: include: Calculations SUSTAINABILITY CRITERIA UNIT OF MEASURE TARGET Supplier has policies on the purchase of local goods and services Formally approved company policy document local procurement policy developed and approved within months Supplier provides employment contracts for all staf Formally approved worker contract documents 50% of workforce have employment contracts in months, 100% in Criteria S O C year E Supplier implements strategies to reduce waste N V … Formally approved action plan At least activities are undertaken in months; 10 activities completed Evidence of waste management activities in year … … Implementation, Our Oursupply supplychain chainmanger mangerwill willcontact contactyou youto toreview reviewthe theprogress progressquarterly, quarterly,and andkindly kindlyrequest requestyour yourparticipation participationininproviding providingevidence evidenceof ofperformance performanceto tomeet meetcriteria criteriasuch suchas aspower powerand andwater water bills, bills,action actionplans, plans,policy policydocuments… documents… …… responsibilities Conducting the sustainability evaluation • Evaluate suppliers based on the size of the organisation and its supply chain and available resources, can be: Organisation led Contracted 3rd party • • Supplier self-evaluation Collect information from suppliers and compile into a spreadsheet table for easy analysis ORGANISATION SUPPLIER Examine results to review performance for: – Individual suppliers to meet supplier targets – Combined results to meet supply chain targets RD PARTY EVALUATION METHODS Example results of a supply chain sustainability assessment Individual supplier assessment SUSTAINABILITY CRITERIA Supplier has policies on the purchase of local goods and services UNIT OF MEASURE SUPPLIER TARGET Formally approved company policy document local procurement policy developed and approved within months Supplier provides employment contracts for Formally approved worker contract 100% of workforce have employment all staf documents contracts in year Evidence of waste management activities … Supplier implements strategies to reduce waste … A B Yes Yes C Drafted but waiting approval D E F Not started Not started Yes G Drafted but waiting approval H I Yes Not started 20% 50% 90% 0% 10% 0% 30% 100% 50% 10 initiatives completed in year 6 6 … Poor Average Good Poor Poor Poor Poor Excellent Average Individual supplier performance assessment Supply chain assessment NO PROCUREMENT POLICIES NO SUPPLIERS EMPLOYMENT CONTRACTS Approved local procurement policies NO SUPPLIERS WASTE MANAGEMENT SUPPLIERS 75%-100% of staf in employment contracts >5 waste management activities 50%-74% of staf in employment contracts 5 waste management activities