For theWeek 8 Critical Thinking Exercise, you will complete the following steps:

1. Watch the "Supply Chain Sustainability at Clif Bar & Company" video
2. Supply Chain Design at Clif Bar & CompanyfromGMC Online Course DevelopmentonVimeo.
3. Review the "Supply Chain Sustainability at Clif Bar & Company" video case on pages 597-598.

VIDEO CASE Supply Chain Sustainability at Clif Bar & Company When Gary Erickson started out on one of his typical long-distance bike treks From the beginning, CLIF BARs were made from wholesome ingredi- in 1990, he expected to have a great ride. What he did not expect was to ents. Yet as Erickson looked at the ingredients being sourced for CLIF BAR, come home with the idea for a sports nutrition energy bar that became the he realized that making a healthy food product and sourcing ingredients from genesis of Clif Bar & Company. farmers, ranchers, and cooperatives using organic growing techniques was a After consuming most of his supply of Power Bars part way through the "natural" fit. The company made a commitment to both sustainable growing 175-mile ride, Erickson could not face the prospect of consuming another techniques and using only organic raw ingredients back then, and by 2003, one. Instead, he figured he could come up with something better. Something had made CLIF BAR 70 percent certified organic. Since then, six of Clif Bar sports enthusiasts would not mind eating in quantities while out on the road & Company's CLIF and LUNA brands are now made with 70 percent organic or the trail. The result? The CLIF BAR, an all-natural combination of grains, ingredients or more. nuts, and fruit, with far more taste appeal than the standard energy bar of The impact on the supply chain for sourcing organic ingredients is tre- the time. mendous. First, there is a limited-but growing-number of organic growers Today, the Berkeley, California-based company has over 100 stock- for the ingredients Clif Bar uses. Second, growers who do not use pesticides, keeping units, or SKUs, in its product mix, including numerous flavorful herbicides, and genetically modified plants are sometimes at risk of produc- versions of the original CLIF BAR plus brands such as LUNA, The Whole Nu- ing lower crop yields. Third, it can be more costly to store the ingredients. trition Bar for Women TM; CLIF Kid Organic ZBaRTM, The Whole Grain Energy And fourth, as more companies commit to environmentally responsible pro- bar for kids; CLIF Mojo TM, The Sweet & Salty Trail Mix Bar; and CLIF Nectar, grams and organic ingredients, competition is great for the available global an organic fruit and nut bar made with just five ingredients. CLIF BARs were supply. originally distributed through cycling shops and other niche retail outlets but The company's forecasters and planners work hard to manage both can now be found in a wide variety of retail outlets in the United States, such the raw ingredient inventory flows from upstream suppliers and the finished as Whole Foods, Trader Joe's, REI, and even your local grocery store. goods flows to downstream customers to be sure products are availablein the right quantities and right locations. Ordering on raw materials and business partners are carefully chosen for their ability to manufacture and packaging materials is aggregated to provide efficient sourcing. Produc- distribute Clif Bar's products, their commitment to quality, and their align- tion is planned, based on both input and output forecasts, to maximize ment with Clif Bar's own value system. This value system, referred to as the customer service and minimize inventory. Several times a year, production company's "Five Aspirations, " holds that Clif Bar & Company will work toward plans are shared with business partners at all points of the supply chain to sustaining its people, brands, business, community, and the planet. Greg make sure the flow of ingredients and products is smooth, and that inven- Ginsburg, Vice President of Supply Chain, wants to be sure all parts of the tories do not accumulate at any point in the supply chain beyond planned supply chain-owned or not-are in agreement with these aspirations. "We volumes. Monthly forecasts and changes to plans also are communicated look at their energy sourcing, labor practices, and workplace environments. to all supply chain partners. And where we source products from small cooperatives, we'll go as far back Clif Bar & Company managers know that consumers' tastes for prod- as possible to assure those tiny growers know about our expectations, " says ucts change regularly, so new flavors and brands are periodically introduced Ginsburg. into the various brands. Likewise, flavors are sometimes retired to make room for new ones. As the company's research and development team pre- QUESTIONS pares to move a new product idea from the test kitchen to the manufacturing plant, supply chain managers must get to work assuring any new ingredients 1. In what ways does Clif Bar have a sustainable supply chain? can be procured. 2. Regarding financial responsibility, what business risks does Clif Bar & As a smaller and privately owned company, Clif Bar does not own Company face with so many parts of its supply chain outsourced? its manufacturing plants and distribution centers, and relies on contrac- 3. What issues or risks to sustainability could Clif Bar & Company encoun tual agreements with outsourcers in the United States. These supply chain ter if it chose to expand to international markets