Why Levi’s Is Moving its Worker Well-Being Program to Blockchain

Source: https://sourcingjournal.com

Levi Strauss & Co. is building on its three-year-old worker well-being program, underpinning new efforts with blockchain in order to enhance trust and transparency and reduce the time from data collection to review and response.

Last week at the World Economic Forum in Davos, Levi’s announced the program development that’s funded by an $800,000 grant awarded to blockchain consultancy Consensys, civic think tank New America and the Sustainability and Health Initiative for NetPositive Enterprise (SHINE) at the Harvard T.H. Chan School of Public Health. SHINE administers Levi’s current global factory worker well-being program, which SHINE founder and director Dr. Eileen McNeely believes will benefit significantly from the adoption of blockchain—a cryptographically secured electronic database system lauded for its immutability and accessibility.

Beginning this year, SHINE will pilot the new system with a supplier in Mexico, administering the worker well-bring surveys to the facility’s 5,000 workers.

The surveys, translated into regional languages and mindful of cultural nuances, seeks a “very comprehensive understanding of well-being,” McNeeley noted, and not just physical health but also emotional state, financial well-being and social standing.

In order to gain an “apples-to-apples” understanding of what workers are experiencing, SHINE administers the survey at fixed, reoccurring times. For example, Sri Lanka’s monsoon season might bring to bear external “pressures in the system” that the survey might be able to uncover given sufficient historical data. Internally, order volumes during any given period of time could also yield certain outcomes identifiable and addressable through survey data, McNeeley explained.

What’s more, current programs are flexible to the needs of each factory site. Many facilities lack internet access, McNeely said, so data at these locations is collected offline on Harvard-owned tablets, and as many as six weeks may pass before that information can be uploaded to the right parties, hampering the ability to move quickly on any actionable worker feedback. Internet connectivity is improving around the globe, the Harvard director added, meaning that a blockchain-based system would vastly accelerate the time from data collection to data review and decision-making.

As it stands today, SHINE staffers manually create the systems and firewalls between confidential worker survey data, reporting an aggregated version of that information to program stakeholders. Blockchain, McNeeley explained, removes the middleman (SHINE) and automatically timestamps entries, essentially verifying the data was uploaded when it says it was. It’ll independently aggregate data, without a third party, to preserve worker anonymity and confidentiality.

“It would build enormous trust if workers could see their data—not individual data but the aggregation of all of the entries,” McNeeley said. This would give individual employees a glimpse into “the pulse of the workforce,” similar to perspective factories and the buyers already have.

“Blockchain is in its infancy and the potential is huge,” McNeeley said. The biggest challenge with the technology today is acclimating people to how blockchain both stores and distributes information, a concept McNeely connecting to the unproven infancy of the Internet’s earliest days.

“There’s so much opportunity for blockchain to make data more transparent, which will make so many inputs and outputs much more efficient,” she said. Blockchain stands to “level the playing field” in which piecemeal data collection systems—from those run by buyers to platforms operated by non-governmental organizations—segregate valuable information, thereby dampening its impact, she added.

SHINE compares worker surveys with data on attrition and absenteeism. “If factories truly want to be more efficient, these are their business goals,” McNeeley said. With this powerful data, buyers might be incentivized to earmark a larger share of their orders to manufacturers that clearly are improving as motivation to keep moving in a positive direction. Publicizing these efforts would improve the reputation of both the brand and the supplier, McNeeley added.

These worker well-being surveys augment existing compliance audits and are not intended as a replacement; however, there are limits to what audit spot-checks can achieve.

“Compliance has its own process and procedures but it doesn’t generate this continuous process improvement system and that’s exactly what we’re hoping to do in the pilot sites [where blockchain will be implemented],” McNeeley explained.

In a blog post on the Levi’s website, Kim Almeida, who directs the worker well-being program for the Levi Strauss Foundation, wants this initiative to “influence the apparel industry” and become “the standard for the sector.”

“We believe that the SHINE work, in partnership with LS&Co., will provide an important tool that gets us one step closer to making this goal of scaling our approach a reality,” she said.

Rather than pure altruism, the program can help apparel companies understand the link between the worker experience and business operations.

“Once you have a gauge of the worker experience, you can use the upstream and downstream indicators of business outcomes to understand how different inputs affect production,” McNeely said. “Preliminary data makes the business case that there’s a correlation between productivity and worker well-being. Every business knows it’s there.”

“It’s just a matter of the bandwidth and metrics to take in that info,” McNeeley continued. “And then, what to do with it.”



Categories: Apparel, Asia, Brands, Business, Sri Lanka, Technology, USA

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