Aravo: Announcing a New "Sustainable" Direction

Supplier information management vendor Aravo is planning on announcing next week a major new offering in the sustainable supply chain solution area, as they term it. You can register for their introductory webinar that will take place on September 10th on the subject by clicking the previous link. As we all know -- and if you read Tim Minahan's blog with any degree of frequency -- socially and environmentally responsible procurement and supply chain programs are for real. And they're capturing the attention of executives in Europe and beyond.

Some organizations have even made the plunge and are implementing programs and technologies to monitor their suppliers today. From what I've heard from sources close to Aravo, the company already has a few leading (read: very, very large) technology companies signed up and using their sustainability product, and will be announcing them later this year once the results are in.

Without question, corporate social responsibility (CSR) is rising to the board level in many organizations. Some companies are obviously pursuing these programs out of fear (we all remember the Kathi Lee Gifford story). But many are pursuing them not only to prevent bad PR or to meet regulatory requirements, but because they view sustainable procurement and supply chain initiatives as good business practice that can lead to increased profits down the road. As Tim Minahan pointed out in a podcast we recorded this week (stay tuned for its release soon) Wal-Mart is not exactly planning on shifting its purchasing to 100% organic cotton for clothing just because it's bleeding green. Rather, it sees customers willing to pay a premium or at least market parity for a product that is perceived as "better" given its farming and earth-friendly roots.

But how can technology help solve the CSR challenge? So far, it looks like the major focus of these types of applications are threefold as they consider the environmental, labor and social practices and certifications of a company's supply base (and even lower tier suppliers). The Aravo solution appears to be focused on engaging suppliers in these programs, "activating" them as they term it, and then proactively managing them. The benefits, they claim, are reduced business risk, better compliance, reduced total cost of sustainability program management, improved brand perception, and the ability to drive adherence to standards across business units, geographic regions and product lines, among other tangible areas.

I'm looking forward to learning more about what Aravo is up to -- along with other vendors in this area -- in the coming months, so stay tuned!

Jason Busch

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