29. Describe one or two ways that a firm can improve the energy efficiency of its supply chains. From the Internet, find an example of one of this. Provide the URL and briefly describe your example.
One of the major ways a company can improve its energy efficiency in the supply chain is to reduce the transportation distance. This can be accomplished by locating facilities or manufacturing centers close to customers, or by route planning. Another popular approach is the nearest neighbor heuristic, which involves starting at the central hub and choosing the closest next location until you are back at the start location. Choosing the most efficient transportation mode for a given distance is another way to reduce energy consumption (Krajewski & Malhotra, 2022) . An example of reducing the distance of transportation is UPS’ route picking software known as ORION. On-Road Integrated Optimization and Navigation is a comprehensive software UPS developed to optimize their package delivery routes for trucks. It uses machine learning to optimize delivery routes to customers receiving packages using UPS freight services. UPS claims that ORION has saved them 10 million gallons of fuel per year on delivery routes. This is an example of how route optimization can increase energy efficiency, which is good for the environment, and also a massive cost savings to the organization.
