This case study shows how working through the initial steps of this value chain guide can help a company improve its understanding of both its direct and indirect impacts.
Toyota New Zealand (TNZ) is actively committed to sustainability, in particular, reducing carbon emissions. In 2013 Toyota Motor Company was named Interbrand survey's Best Global Green Brand for the third year in a row. Around the same time, TNZ published its 2013 sustainability report, highlighting a number of local environmental milestones for the company.
Increasingly, TNZ wants to better understand its upstream and downstream operations and its value chain, its ability to assess any risks and actively manage them. TNZ was keen to investigate and apply a value chain exercise, focussing on its energy impacts because energy use is a key aspect of the business and because the company had good information on its direct impacts but less reliable information on its indirect impacts.
Step 1: Mapping the value chain
TNZ and SBC worked together to complete the first three steps of the 6 step process. Toyota then worked with the Energy Efficiency and Conservation Authority (EECA) to further investigate some solutions to the risks and opportunities identified. This exercise helped show the full impact of TNZ's operations on energy use – both direct and indirect.
"We could see the value of this sort of mapping but it was not something we had tried in detail before. However it proved to be a strong foundation for the rest of the process and through the mapping exercise, immediate risks and opportunities and knowledge gaps became apparent. We found value chain thinking to be very useful and we are looking to see how we can apply it more broadly – for example in future sustainability reports," Tristan Lavender, TNZ NZ Environment Manager said.
Example 1. Toyota's working value chain map
Example 2. Toyota's working SBC value chain map
One of the key things TNZ learned from the exercise was that many of the biggest energy impacts occurred outside of the company's direct control. A good example of this was the energy use of its suppliers. To address this TNZ wanted to assist its suppliers to realise the benefits of reducing their energy use and thereby increase TNZ's supply chain resilience to increasing energy costs.
TNZ have subsequently collaborated with SBC and the Energy Efficiency and Conservation Authority's Business Team (EECA Business) to better understand their energy balance and will develop some guidance and engagement methods for its suppliers. Toyota and EECA are aiming to share this guidance with other businesses to assist them with their own supply chains.
Step 2: Assessing risks and opportunities
The table below lists some examples of the risks and opportunities identified.