Case Study : Green Supply Chain Management

In recent years, when the concept of sustainability is raising up, there is high percentage of customers who aware about the green products (Rather & Rajendran 2014), they do not only consider about the product or

Most of the decisions made by the Green Team seem to result in lower costs for the company. Their decisions of acquiring produce locally, baking bread on site, and working with suppliers to reduce transit time can significantly reduce transportation costs. Also, their decision to re-evaluate inventory strategies can result in lower inventory carrying costs if they are capable

Cooperated with partners and leaders in the field of supply chains and transport, the World Economic Forum’s Global Agenda Council on the Future of Logistics and Transportation started to conduct research on the supply chain. The report “Beyond Supply Chains Empowering Responsible Value Chains” analyses the impact that supply chain practices has brought to business, society and environment, and explores the issue how shared value can be made through better supply chain decisions. The report identifies “a set of 31 proven supply chain practices which provide companies with a blueprint of where they can gain both commercial and socio-environmental advantage (both environment and local economic development)—driving a triple advantage” (). In addition, the report “provides a framework for evaluating the potential value at stake behind each of these practices, and an implementation framework for

Businesses who participate in environmentally friendly practices will become more profitable. There are difficulties and costs that a business will face and profit takes time but is proven to positively impact a business. “The reluctance to address the forces that are polluting the planet always comes down to money (Smith, “6 Reasons Nations Don't Go Green.”). Implementing environmentally friendly practices within a company “will win them customers, and increase profits” (McDonald, “Why Do (or Don’t) Companies Go Green?”). Many global companies today carry out environmental management tools to adapt to environmentally friendly practices, which helps gain customers, and in turn becomes more profitable. In this paper, I will go into further detail explaining why businesses should be more environmentally friendly, the benefits to be gained, costs that come with being environmentally friendly, and management ways that help a company become environmentally friendly.

It focuses on the development of supply chains that have minimal footprint on the environment. Buyers have the responsibility of choosing suppliers that conduct environmental ethics and are environmentally conscious. (C Sisco, 2010)

Companies around the world are focussing on incorporating sustainability policy and practices in their supply chain (Ageron et al, 2011). The topic of sustainability has been of great interest for the last decade and businesses have adopted a certain level of commitment towards sustainability practices (Hassini et al, 2012), yet some business tycoons suffer in developing an effective supply chain model.

Transforming a supply chain into a sustainable network is not an easy thing to do. Amongst the existing obstacles that Johnson (2004) gives us is the considerable size of this network: all along the differents ranks of suppliers that constitute the upstream of the chain, it is very hard to track the original source of the material and to broadcast best practices all accross that path. Furthermore, the lack of legal framework for labor conditions and environment preservation in developing countries makes it the more difficult to enforce

The solution to the faulty global supply chain, presented by Timothy Smith’s Climate Change: Corporate Sustainability in the Supply Chain, lies within including environmental sustainability into; transnational policy regimes, technological development, and consumptive behavior of society.

The concept of “greening of management,” describes the actions taken by managers of all levels within organizations to align their interests with environmentally-friendly interests. More specifically, it is the practice of implementing ecosystem-friendly practices in their everyday management decisions. A prime example of “green management,” can be found through the “khaki conservation” of the United Kingdom military. The UK military has utilized “recycling (practices), waste management, energy efficiency, and conservation,” when using land spaces open to the public (Fiott 2014). The actions taken towards “greening” the military lands was a management decision in reaction to the excessive pollution created through the activities of the military, in addition to the tactical decision to justify military use of areas open to the public. It was also a strategic public relations decision, because green management strategies applied to the Military of Defense was a response to the population’s dislike of the pollution created (Fiott 2014). In this case, the military utilized green practices like recycling and proper disposal of wastes within their everyday functions.

Supply chain management is the active management of supply chain activities to maximize customer value and achieve a sustainable competitive advantage. The management of the supply chain involves the efforts of all partners in the supply chain working together to effectively and efficiently deliver goods (Handfield, R, 20011). Supply chain standards that are shared globally throughout industries results in methods and rules that allows predictability, and agreed standard and guidelines. These standards will enable partners throughout the supply chain the freedom to apply influence on industry standards that will result in sustainable business practices that mirror the needs of and integrated supply chain aiding in maximum efficiency throughout the chain.

Kaplan and Norton (2006) define strategic alignment as the internal consistency of the activ- ities that implement the different attributes of strategy. Environmental sustainability drives firms to not only develop corporate environmental proactively but also to move toward green/sustainable supply chain management (Aragon-Correa and Rubio-Lo´ pez, 2007; Seuring and M¨ uller, 2008). Monczka and Petersen (2012) suggest that environmentally sustainable supply chain management is an integrated strategy which must align closely with and support business strategy in response to a changing marketplace. When alignment is lacking, Monczka and Petersen (2012) mention that supply management cannot sup- port the business in response to socioeconomic pressures. Thus, firms must align their SC and CE strategies in order to boost the overall firm performance. So it is very important for firms to understand their strategies, and the co-relationship between corporate strategy and the supply chain strategy, what sort of resource and capabilities and how to develop the capabilities to help achieving the strategy, and what are the effects of the strategies to both sides, and what is the influence means to the alignment of these two strategies?

Supply chain has gained importance in the current world of business. With the advent of globalization and competitive advantage being key aspects of organizational existence, it is essential to look into sustainability of the same. This research paper focuses on the need for this sustainability and how supply chains can make a difference to the sustainability of the planet. It will also explore supply chain practices that could be a source of competitive advantage.

In comparison, GSCM is green, integrated and ecologically optimized and takes into consideration the human toxicological effects as well. Companies considered ecological requirements as the most important criteria for products and production, to ensure economic profitability and sustainability. Here are the five characteristics of traditional and green supply chain management. The first characteristic is objective and values, Traditional SCM is economic but in Green SCM still have economic but will add-on ecological. Then ecological optimization in Traditional SCM is integrated approach high but Green SCM is ecological impacts. On supplier selection criteria, Traditional SCM is price switching supplier short term relations but to the Green SCM it is a long term relations ecological aspects. The cost prices is low of Traditional SCM and high of Green SCM. The last characteristic is speed and flexibility which is high in Traditional SCM and low in Green SCM. (Ashish J. and Hari,

There are numerous definitions of the terms ‘Sustainable’ and ‘Supply Chain’. For the simplistic but practical definition is “Management of raw materials and services from suppliers to manufacturer/ service provider to customer and back with improvement of the social and environmental impacts explicitly considered”. The supply chain considers the interactions between a business and its customers and suppliers. The greatest benefits are derived by extending the focus as far as possible upstream towards the raw materials, downstream towards the consumer and then back again as the product and wastes are recycled. Sustainable supply chains are among the biggest responsible business challenges. Accomplishing sustainable supply

In order to reach supply chain “nirvana” several principles should be considered and followed. While these principles are not a “be all, end all” they will help guide the management to achieve an efficient and sustainable supply chain.