By Candice D McLeod
Each week leading up to the Sustainable Brands Innovation Open (SBIO) finals on June 5th, where the runner-up will be decided via live online public vote, we will feature two articles on an SBIO semi-finalists. Meet semi-finalist Efficiency Exchange, (EEx), producer of EEx Charge.
Efficiency Exchange, (EEx), is determined to increase the efficiency and sustainability of global supply chains by creating customized tools for those who actually use them. Their goal is to reduce risks within supply chains by starting at the bottom – factory workers. In fact, the EEx team has a policy of working side-by-side with factory workers to better understand their daily challenges.
“You can never know too much about your customer,” says Taryn Sullivan, founder and CEO of EEx, “Each EEx employee is required to spend at least one week working in a factory when they first join the team."
This includes Sullivan herself, who has spent a week working every job in a Chinese factory - from soldering on the assembly line to running the ERP systems - while living in the dorms and eating in the cafeteria.
It is this primary research data, complemented by a shared wealth of experience in supply chain management and technology, that has enabled EEx to introduce their first product, EEx Charge, an app that provides utility bill analysis for Chinese factories.
EEx Charge is a comprehensive product. It comes equipped with reference materials and step-by-step assistance for “everything from entering an electricity bill, to examining a transformer.” The product also allows suppliers to pinpoint exactly where they can save costs, increasing the incentive for factory managers to implement changes.
Taryn Sullivan founded EEx because she had spent several years working in supply chain management for various retailers, and working directly with factories all over the world. Her experiences allowed her to realize that there was significant room for improvement within supply chains as a result of “poor communication and a failure to understand how factories really operate.” She particularly noticed the need to improve the auditing process.
“Audits may find out what problems are occurring within factories, but unfortunately they do not fix them, and frequently do not produce sustainable changes in operations,” says Sullivan. In addition, audits are not only expensive, they do not track continuous progress, nor do they provide the tools necessary for workers to find solutions.
Therefore, Sullivan created EEx Charge with the objective of effectively addressing these issues. The product is a simple, scalable solution for reducing the energy and environmental impact of large, complex supply chains. It is unique in that it is digital, which reduces costs instantly for its consumers.
“Charge is hosted, and doesn't require installation, local hardware, support contracts, or anything customers might expect from a big ERP system from a traditional vendor,” says Nate Sullivan, who is responsible for EEx product development and marketing.
In addition, no formal training or extensive paperwork is required, as training and analysis has been built into the tool. Furthermore, instead of only generating reports, EEx Charge provides specific recommendations to its users, and tracks future progress.
The company targeted China for its first geographic focus, because of the large number of global operations that rely on Chinese factories, with approximately seven million factories producing many of the world's consumer goods in that country. Sullivan also has extensive experience working with suppliers in the region thanks to her previous career, and is fluent in Mandarin, having learned the language throughout high school and college.
While the overall goal of EEx Charge is to comprehensively address compliance issues, the EEx team is first focusing on increasing energy efficiency in global supply chains.
“In the past, little attention was paid to energy costs, but as systems becoming increasingly more automated to reduce labor costs, energy costs have been rising significantly and are becoming a serious area of concern for companies,” says Sullivan.
She also notes that there is a major shortage of trained energy managers in China, which also exacerbates energy inefficiencies within the supply chain. As a result, energy management training is embedded into the EEx Charge app so factories can learn about these issues when it is most relevant to them - when problems arise everyday - rather than just in a classroom during periodic formal training.
The product, which has now been officially launched, has been piloted in 11 factories in China. EEx has reported a 100 percent success rate from this pilot, which translates into reduced costs for all the test factories. EEx’s current goal is to deploy Charge, which is available as an annual subscription, in 5,000 factories within the next year.
The company also plans to further push the needle on the change that Charge can drive within supply chains by integrating smart meters and increasing the analytical output on the device. Finally, EEx will continue to work on its overall goal of providing solutions for comprehensive compliance issues by adding features to address water management and social issues.
In addition, EEx plans to make retail-focused services available to brands and other non-factory customers as they continue to develop the applications of EEx Charge.
“Private label product development from brands and retailers is definitely way, way bigger than it was ten years ago,” says Sullivan. “It is often higher margin business, and given how tough the retail business is these days, that's hugely important for a lot of brands.”
EEx has already finalized a partnership with a large multinational apparel retailer which will be recommending Charge to its top 50 suppliers. The EEx team hopes that this will be first of many retail partnerships. Other key partnerships for EEx include several key channel agreements in China to help deploy EEx Charge to thousands of qualified factories, including the EHS Academy (funded by the Institute for Sustainable Communities). The Taiwanese Manufacturers Association of Shenzhen has also agreed to promote Charge to its 20,000 members.
Overall, as a digital, inexpensive, in-house energy manager for factories, Charge is positioning itself to disrupt the supply chain management industry and have a significant, tangible impact.
Visit Efficiency Exchange, EEx, to learn more about EEx Charge and the company’s innovative methods of using technology to create environmental benefits. You can also meet founder Taryn Sullivan at the Sustainable Brands Solution Expo at SB’13. Enter the discount NW3pSB13 for free entry.
Candice D. McLeod is the Sustainable Brands Innovation Open Co-Coordinator. She received a Master’s degree in Environmental Studies, concentrating in Energy Management & Policy, as well as a bachelor’s degree in Chemical & Biomolecular Engineering from the University of Pennsylvania. Connect with her on Twitter @candicedmcleod.