Green Supply Chain Management-Issues and ChallengesDr P. CHANDIRANAssociate ProfessorCentre for Logistics and Supply Chain ManagementLoyola Institute of Business Administration, Chennai-34
Green SCM
•It involves traditional Supply chain management practices that integrate environmental aspects such as natural resource conservation, limiting on pollution, recycling used products and so on.
•Companies are under pressure to consider all environmental issues while designing their supply chain network
Supply chain activities which impact the environment•Production•Packaging•Transportation•Sourcing•Location of facilities•Disposal of products and recycling•Product design
Some best practices on Green Supply Chain management• Xerox remanufacture their own products for
secondary marker• Canon and Kodak reuse parts• Exide use their smelting plant to recycle batteries
in India• ACC uses waste of other industries like paint and
refinery sludge, soya husk, plastics, tyres etc to fire their kilns to generate energy. (?) and saves 41 crore of rupees.
• Usage of reusable Plastic shipping containers• Location of Ponni sugars and SPP mill near to each
other
Supply chain as NetworkSuppliers
Plants
Dist. Centers Cust. Regions
L.A.
Baton Rouge
Houston
Pittsburgh
Baltimore
Denver
New Plants
New--Eastern US
L.A.
Denver
Chicago
Detroit
Dallas
New Suppliers:
New DCs
Transportation mode or shipment size choice
Product/Process Design
Raw and Virgin
Material
New Components and Parts
Recycled, Reused Material
and Parts
Vendors
Selection
ExternalTransportatio
n
Storage
Inventory Management
Internal Transportation
Fabrication
Assembly
Closed-Loop Manufacturing,
Demanufacturing,Source Reduction
TQEM
Storage
Distribution, Forward Logistics
USE
Purchasing, Materials
Management, Inbound Logistics
ProductionOutbound Logistics
Disposal
Reverse Logistics
Waste Waste Waste
Energy Energy Energy
Energy
Reusable,Remanufacturable,
Recyclable Materials and Components
Location Analysis,Inventory Management,
WarehousingTransportation
Packaging
MarketingEngineering
Customer Relationships Green Marketing Product Stewardship
Waste
Issues in Sourcing
•Environmental friendly process•Packaging•Certification•Controlling emissions•Vendor evaluation in terms of
environmental performance
Issues in Transportation
•Infrastructure•Outsourcing to nearest supplier•Better maintenance•Better routing and scheduling•Synergy and save on environment with
shared resources
Issues in Network design
•Co-location•Co-processing•Optimal location•De-centralised locations in non-capital
intensive facilities
Issues in Product design
•Design for remanufacturing•Design for recycling and disposal•Design with recycled and waste materials
Issues in disposal and recycling•Redesign of network for collection and disposal•Closed-loop supply chain•Handling and storage•Transportation•Location of remanufacturing and recycling
facilities•Recovery portion of materials and components•Economical network design•Many reverse networks are Informal networks
Challenges-Two case studies
•Battery Industry•Waste recycling network in Bangalore
Waste recycling SC in Bangalore•There is a growing demand for solid
waste materials•Municipal corporations are responsible
for collection and disposal of solid waste in cities
•They do very little•Waste pickers collect all kinds of solid
waste and help environment•Their roles are not recognized
Junk Dealers- Small and Medium
Waste Pickers-7 varieties
Itinerary Buyers
House maids & other collectors, direct suppliers
Physical Flow Information
Flow Financial Flow
Waste pickers employed by Junk Dealers
Contractors with IT companies
CollectionSorting and SegregationCleaning
StorageAccumulationUniformityAggregationPacking
Wholesalers and Big Dealers
RecylersStorageHigh UniformityAggregationPacking
Waste Recycling Supply Chain
Waste Recycling SC
•Different types of waste pickers•Economically poor•Living conditions are poor•Most unhygienic conditions•Sometimes organized under some
entrepreneurs•Do all segregation and sorting manually
Junk Dealers
•Buys materials from waste pickers•Sells to wholesalers•Roadside shops•No taxes and registration•Extra cost in terms of Money to corrupted
officials
Wholesalers
•Specialized in one or two category of materials
•Sell to recyclers and manufacturers•Have associations•More organised•Some machineries are used
Recyclers
•Some are in formal sectors•Many in unorganized sectors•Not all are eco-friend•Supply materials to organized sector
manufacturers
How to make it more formal
•Govt. role•Companies role•NGOs role