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