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Green supply chain

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Mayank Kumar
Mayank Kumar

Green supply chain management integrates environmental thinking into supply chain management. It aims to reduce the ecological impact of supply chains through approaches like sustainable product design, environmentally-friendly material sourcing, reducing emissions in manufacturing, and end-of-life product management. Major retailers are implementing green supply chain practices like reducing energy consumption in stores, using sustainable packaging, and reducing waste. While it provides benefits, green supply chain management also presents challenges for retailers around higher costs and complex franchise models.

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GREEN SUPPLY CHAIN MANAGEMENT Prepared By: Group 5 Kumar Abhishek (A001) Prity Agarwal (A004) Deeksha Aggarwal (A006) Govind Krishnan (A030) Mayank Kumar (A031) Apoorva Parikh (A043)
Supply Chain • Supply chain is a long channel stretching from suppliers (raw materials, components) to assemblers (finished goods), warehouse, retail shops and final consumer. The supply chain is a value delivery system and each firm in the chain captures only certain percentage • Supply Chain Management is the oversight of materials, information and finances as they move in a process from supplier to manufacturer to wholesaler to retailer to customer
Green supply chain
Green Supply Chain Management “Integrating environment thinking into supply chain management, including product design, material sourcing and selection, manufacturing processes, deliver of the final product to the consumers, and end-of-life management of the product after its useful life” SCM Environmental Concerns GSCM
GSCM Vs Conventional SCM Basis Green SCM Conventional SCM Objective Economic and ecological Economic Ecological Impact Low impact; integrated approach High impact Speed & flexibility Low High Supplier selection criteria Long term relationships Short term relationships Cost and pricing High Low Consumer’s selection criteria Less preferable due to high pricing More preferable due to low pricing
Benefits of GSCM
Why there is need for Green SCM? • Corporate Social Responsibility • Eco-Friendly • Beneficial for Organization • Evolving Consumer and Client Demand • Increasing Environmental Constraints due to Global Warming • State Regulations • Increasing Environmental awareness in stakeholders
Areas to Green the Supply Chain Designing of Products An eco friendly design approach leads: •Less Material Usage •Minimum Operations Purchase • Implementing green purchase policies •Technical support to vendors to reduce emissions • Guidelines for less hazardous usage Production • Achieving economies of scale in production •Lean Manufacturing Approach • Fuel efficient tools and machines •Selecting less carbon intensive energy sources Packaging •Mercury free •Non toxic •Recyclability •Energy efficient •Durability/Reusability •Hazardous waste considerations Logistics •Optimized truck loads •Direct shipment to the customer(Dell) •Routing of distribution •Reverse Logistics
GSCM - Nike • Nike has joined an innovative partnership that can more quickly clean up its supply chain by giving the company easy access to sustainable materials and chemicals. • Tied up with Switzerland-based Bluesign Technologies -- which has created a tool for improving supply chains in the textile industry • Using the "bluefinder" tool, a supplier can access pre-screened and more sustainable textile preparations -- including dye systems, detergents and other process chemicals used in the manufacturing process. It enables suppliers to effectively manage restricted substances and provides the opportunity to increase water and energy efficiency. • Another tool, "blueguide," gives Nike access to 30,000-plus materials that have been produced using these sustainable chemicals. • Before this, Nike had to go through the iterative process of assessing individual factories and suppliers, which obviously takes many years and lots of investment and time.
Current Best Practices • Put your effort where it will do the most good: Large corporations often have tens of thousands of suppliers. So in one form or another, most companies use a version of what has been called the 80/20 Rule to decide where to focus their efforts. Walmart began by pulling together its top 200 suppliers in China in 2008, which constitute 60% to 80% of its total supply chain. GE takes a slightly different approach and uses Life Cycle Analysis (LCA). • Use suppliers as force multipliers: IBM rolled out its Social & Environmental Management System program to its 28,000 first-tier suppliers in 2010. What makes this program so potentially powerful are two additional requirements: Suppliers must publicly disclose their metrics and results, and “cascade” the program to any suppliers that are material to IBM’s products. • Closed-loop supply chain: Xerox doesn’t sell their machines to companies. They lease them, and they maintain and service them. So they know exactly what condition that product is in at all times. they can then re-use parts from the machines they recover. • Logistics Performance Index (LPI): It is a benchmarking tool developed by the World Bank that measures performance along the logistics supply chain within a country. Allowing for comparisons across 155 countries, the index can help countries identify challenges and opportunities and improve their logistics performance.
Green Sigma • Green Sigma™ is an IBM solution that applies Lean Six Sigma principles and practices to energy, water, waste and GHG emissions throughout a company's operations : • Transportation Systems, • Manufacturing and Distribution Centers, • Office facilities, • Retail space, • Research and Development sites • It combines real-time metering and monitoring with advanced analytics and dashboards that allow clients to make better decisions that improve efficiency, lower costs and reduce environmental impact. • The key IT focus areas in GSCM that enable a transition to a green organization are: • Product Life Cycle Management • Supply Chain Network and Logistics Optimization • Process Optimization • Green Reporting
GSCM by Retailers Most retailers are feeling the pressure to turn their retail green and minimise their carbon footprints. The various methods adopted by them are- Reducing energy consumption at stores  Green packaging  Reduced wastages. Drivers for participation of small and medium sized suppliers in GSCM: Green Supply Chain Readiness Buyer’s Preferences Government Involvement Evaluation of success factor of ISO-14001: ISO 14001 contributed to GSCM practices.Companies which facilities with ISO 14001 are 40% more likely to evaluate their suppliers’ environmental performance and 50% more likely to ask their suppliers undertake specific environmental practices.
Problems in GSCM by retailers – The higher costs associated with monitoring and managing GSCM practices in multiple store locations. A franchise ownership business model where decision making is split between the franchisor and franchisees, obtaining support for global initiatives such as GSCM may present a more complex process. Training on Sustainable Store Operations- A series of training sessions for store managers has been organized on “Green Retail”. One of the sessions were conducted in Bengaluru, Mumbai and Delhi on 9th, 12th and 14th October 2015 to highlight the improvement areas like conducting congratulatory programs on purchase of green products.
Retailer Studied by us Shoppers Stop: The various GSCM practices are  Deployment of e-tool like social media platforms and websites to move towards a digital omnipresence. Shoppers Stop’s energy management policy is built on the tenets of the 3 R’s ,i.e., Reduce, reuse , Recycle. It has deployed systems such as Variable Frequency drives(VFD),eco-friendly refrigerants in chillers, LED lights, etc. Shoppers Stop introduced a unique energy management initiative of using solar power at Andheri store in Mumbai. The 30 KW energy generated from these solar panels is utilised to power the second floor of the store.
In the year 2006, Shoppers Stop also overtook the cause of Water Conservation by adopting rainwater harvesting practices in select stores such as Rajouri Garden (New Delhi) and Begumpet (Hyderabad). An interactive page on the intranet site Spandhan has been activated to encourage employees to suggest and initiate activities towards environment conservation. Shoppers Stop’s popular youth exclusive brand Life in 2008 dedicated its Spring-Summer and Autumn –Winter collection to sustainable environment. It was tagged with sachets of neem seeds. 3 lakh neem seeds were distributed with Life merchandise as part of Think Green campaign.
References • https://www.greenbiz.com/news/2013/03/25/nike-moves-faster-clean-its-supply-chain • http://www.inboundlogistics.com/cms/article/g75-inbound-logistics-75-green-supply-chain- partners/ • Initiative for Global Environmental Leadership (IGEL), Wharton University, June 2012, Special Report-Greening the Supply Chain: Best Practices and Future Trends. http://environment.wharton.upenn.edu/ • Ashish Kumar Bhateja, Rajesh Babbar, et al., 2011, International Journal of Computational Engineering & Management, Study of Green Supply Chain Management in the Indian Manufacturing Industries: A Literature Review cum an Analytical Approach for the measurement of performance. http://www.ijcem.org/papers72011/72011_15.pdf • Mohd Javaid, Mohd Shoeb, 2015, International Journal of Advanced Technology in Engineering and Science, Benefits on implementation of green supply chain management in manufacturing industries. http:// www.ijates.com/images/short_pdf/1434549119_P128- 132.pdf • Ranjan Gupta ,2010 http://www.supplychainbrain.com/content/nc/general-scm/single- article-page/article/challenges-and-opportunities-for-greener-supply-chain-management-in- high-tech • http://www-03.ibm.com/press/us/en/pressrelease/27814.wss

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Green supply chain

  • 1. GREEN SUPPLY CHAIN MANAGEMENT Prepared By: Group 5 Kumar Abhishek (A001) Prity Agarwal (A004) Deeksha Aggarwal (A006) Govind Krishnan (A030) Mayank Kumar (A031) Apoorva Parikh (A043)
  • 2. Supply Chain • Supply chain is a long channel stretching from suppliers (raw materials, components) to assemblers (finished goods), warehouse, retail shops and final consumer. The supply chain is a value delivery system and each firm in the chain captures only certain percentage • Supply Chain Management is the oversight of materials, information and finances as they move in a process from supplier to manufacturer to wholesaler to retailer to customer
  • 4. Green Supply Chain Management “Integrating environment thinking into supply chain management, including product design, material sourcing and selection, manufacturing processes, deliver of the final product to the consumers, and end-of-life management of the product after its useful life” SCM Environmental Concerns GSCM
  • 5. GSCM Vs Conventional SCM Basis Green SCM Conventional SCM Objective Economic and ecological Economic Ecological Impact Low impact; integrated approach High impact Speed & flexibility Low High Supplier selection criteria Long term relationships Short term relationships Cost and pricing High Low Consumer’s selection criteria Less preferable due to high pricing More preferable due to low pricing
  • 7. Why there is need for Green SCM? • Corporate Social Responsibility • Eco-Friendly • Beneficial for Organization • Evolving Consumer and Client Demand • Increasing Environmental Constraints due to Global Warming • State Regulations • Increasing Environmental awareness in stakeholders
  • 8. Areas to Green the Supply Chain Designing of Products An eco friendly design approach leads: •Less Material Usage •Minimum Operations Purchase • Implementing green purchase policies •Technical support to vendors to reduce emissions • Guidelines for less hazardous usage Production • Achieving economies of scale in production •Lean Manufacturing Approach • Fuel efficient tools and machines •Selecting less carbon intensive energy sources Packaging •Mercury free •Non toxic •Recyclability •Energy efficient •Durability/Reusability •Hazardous waste considerations Logistics •Optimized truck loads •Direct shipment to the customer(Dell) •Routing of distribution •Reverse Logistics
  • 9. GSCM - Nike • Nike has joined an innovative partnership that can more quickly clean up its supply chain by giving the company easy access to sustainable materials and chemicals. • Tied up with Switzerland-based Bluesign Technologies -- which has created a tool for improving supply chains in the textile industry • Using the "bluefinder" tool, a supplier can access pre-screened and more sustainable textile preparations -- including dye systems, detergents and other process chemicals used in the manufacturing process. It enables suppliers to effectively manage restricted substances and provides the opportunity to increase water and energy efficiency. • Another tool, "blueguide," gives Nike access to 30,000-plus materials that have been produced using these sustainable chemicals. • Before this, Nike had to go through the iterative process of assessing individual factories and suppliers, which obviously takes many years and lots of investment and time.
  • 10. Current Best Practices • Put your effort where it will do the most good: Large corporations often have tens of thousands of suppliers. So in one form or another, most companies use a version of what has been called the 80/20 Rule to decide where to focus their efforts. Walmart began by pulling together its top 200 suppliers in China in 2008, which constitute 60% to 80% of its total supply chain. GE takes a slightly different approach and uses Life Cycle Analysis (LCA). • Use suppliers as force multipliers: IBM rolled out its Social & Environmental Management System program to its 28,000 first-tier suppliers in 2010. What makes this program so potentially powerful are two additional requirements: Suppliers must publicly disclose their metrics and results, and “cascade” the program to any suppliers that are material to IBM’s products. • Closed-loop supply chain: Xerox doesn’t sell their machines to companies. They lease them, and they maintain and service them. So they know exactly what condition that product is in at all times. they can then re-use parts from the machines they recover. • Logistics Performance Index (LPI): It is a benchmarking tool developed by the World Bank that measures performance along the logistics supply chain within a country. Allowing for comparisons across 155 countries, the index can help countries identify challenges and opportunities and improve their logistics performance.
  • 11. Green Sigma • Green Sigma™ is an IBM solution that applies Lean Six Sigma principles and practices to energy, water, waste and GHG emissions throughout a company's operations : • Transportation Systems, • Manufacturing and Distribution Centers, • Office facilities, • Retail space, • Research and Development sites • It combines real-time metering and monitoring with advanced analytics and dashboards that allow clients to make better decisions that improve efficiency, lower costs and reduce environmental impact. • The key IT focus areas in GSCM that enable a transition to a green organization are: • Product Life Cycle Management • Supply Chain Network and Logistics Optimization • Process Optimization • Green Reporting
  • 12. GSCM by Retailers Most retailers are feeling the pressure to turn their retail green and minimise their carbon footprints. The various methods adopted by them are- Reducing energy consumption at stores  Green packaging  Reduced wastages. Drivers for participation of small and medium sized suppliers in GSCM: Green Supply Chain Readiness Buyer’s Preferences Government Involvement Evaluation of success factor of ISO-14001: ISO 14001 contributed to GSCM practices.Companies which facilities with ISO 14001 are 40% more likely to evaluate their suppliers’ environmental performance and 50% more likely to ask their suppliers undertake specific environmental practices.
  • 13. Problems in GSCM by retailers – The higher costs associated with monitoring and managing GSCM practices in multiple store locations. A franchise ownership business model where decision making is split between the franchisor and franchisees, obtaining support for global initiatives such as GSCM may present a more complex process. Training on Sustainable Store Operations- A series of training sessions for store managers has been organized on “Green Retail”. One of the sessions were conducted in Bengaluru, Mumbai and Delhi on 9th, 12th and 14th October 2015 to highlight the improvement areas like conducting congratulatory programs on purchase of green products.
  • 14. Retailer Studied by us Shoppers Stop: The various GSCM practices are  Deployment of e-tool like social media platforms and websites to move towards a digital omnipresence. Shoppers Stop’s energy management policy is built on the tenets of the 3 R’s ,i.e., Reduce, reuse , Recycle. It has deployed systems such as Variable Frequency drives(VFD),eco-friendly refrigerants in chillers, LED lights, etc. Shoppers Stop introduced a unique energy management initiative of using solar power at Andheri store in Mumbai. The 30 KW energy generated from these solar panels is utilised to power the second floor of the store.
  • 15. In the year 2006, Shoppers Stop also overtook the cause of Water Conservation by adopting rainwater harvesting practices in select stores such as Rajouri Garden (New Delhi) and Begumpet (Hyderabad). An interactive page on the intranet site Spandhan has been activated to encourage employees to suggest and initiate activities towards environment conservation. Shoppers Stop’s popular youth exclusive brand Life in 2008 dedicated its Spring-Summer and Autumn –Winter collection to sustainable environment. It was tagged with sachets of neem seeds. 3 lakh neem seeds were distributed with Life merchandise as part of Think Green campaign.
  • 16. References • https://www.greenbiz.com/news/2013/03/25/nike-moves-faster-clean-its-supply-chain • http://www.inboundlogistics.com/cms/article/g75-inbound-logistics-75-green-supply-chain- partners/ • Initiative for Global Environmental Leadership (IGEL), Wharton University, June 2012, Special Report-Greening the Supply Chain: Best Practices and Future Trends. http://environment.wharton.upenn.edu/ • Ashish Kumar Bhateja, Rajesh Babbar, et al., 2011, International Journal of Computational Engineering & Management, Study of Green Supply Chain Management in the Indian Manufacturing Industries: A Literature Review cum an Analytical Approach for the measurement of performance. http://www.ijcem.org/papers72011/72011_15.pdf • Mohd Javaid, Mohd Shoeb, 2015, International Journal of Advanced Technology in Engineering and Science, Benefits on implementation of green supply chain management in manufacturing industries. http:// www.ijates.com/images/short_pdf/1434549119_P128- 132.pdf • Ranjan Gupta ,2010 http://www.supplychainbrain.com/content/nc/general-scm/single- article-page/article/challenges-and-opportunities-for-greener-supply-chain-management-in- high-tech • http://www-03.ibm.com/press/us/en/pressrelease/27814.wss