Main Characteristics of the Green Supply Chains - Essay Example

Discuss the main characteristics of green supply chain and/or the main issues green supply chain aims to deal with. To describe the characteristics of green supply chain and/or the main issues green supply chain aims to deal with, it would be necessary to define what green supply chain is. Green supply chain is the process of using “environmentally friendly inputs and transforming these inputs through change agents-whose byproducts can improve or be recycled within the existing environment develop(ing) outputs that can be reclaimed an re-used at the end of their life cycle, thus creating a sustainable supply chain (Stokes 2009). Baojuan also called the same as Environmentally Conscious Supply Chain Management which meant the use of new means to biologically design “raw materials purchasing, manufacture organizing, distributing and supplying, consuming, and recycling” (2009:122). Green supply chain is a growing trend among companies worldwide as part of their customer responsibility effort to weave environmentally sound practice into their business operations (Barnett 2011). There are several issues that the green supply chain aims to deal with. The most obvious issue is environmental concern where companies are reducing their carbon footprint to the effect of mitigating pollution with the ultimate objective of keeping carbon emission within the regenerative capacity of ecosphere. This is aligned in the consideration of the growing number of customers who are now conscious of the environmental practice of business enterprise coupled with the benefit that effective green supply chain management can in fact increase operational efficiency and reduce operational cost that made green supply chain a business imperative (Zhu 2012). 2. Compare the differences between the traditional supply chain and the green supply chain. The traditional supply chain basically just includes those processes which involve manufacturing the product from making the product to delivering it in the market (Cervera et al 2012). Being such, it is only concern with the optimum use of available resources to create a product that would bring a greater net profit to the enterprise. It involves activities in the company from the design of the product or services to delivery and after support services. It could also add value in the process by creating the competitive infrastructure such as monitoring supply chain activities with the aim of creating net value for the company. This would also include leveraging the worldwide logistics, matching anticipated demand with supply monitoring the same. It is also in the supply chain that involves specific functions in an organization such as customer support and after sales services. The traditional supply chain falls into two categories which are internal supply chain and external supply chain. The internal chain involves activities within the organization which includes the production and distribution process involved in the purchasing department, production department, warehousing, sales network composed of supply and demand. The external supply chain on the other hand relates to activities without the organization that includes procurement of raw materials from the suppliers “manufacturers, storage, transportation, retailers and, ultimately, the network of supply and demand of consumers. It consists of two streams: upstream and downstream” (Lai et al 2012:113). These activities can be summed up in the figure below. Figure 1. Traditional Supply Chain (Google.com) Green supply chain The green supply chain is the integration of a company’s effort to make its traditional supply chain “green” or environmentally friendly including all the processes in the company. These activities would include the previously mentioned “product design, purchases, product design, purchasing, manufacturing processes and the delivery of ?nal product to end customers (Lai et al 2012:113). The biggest difference in green supply chain from the traditional supply chain would be the inclusion of environmental criterion in making supplier evaluation, making the environment criterion a factor in sourcing decisions and the environmental collaboration and environmental monitoring (Vachon 2007). Such, suppliers qualification will encompass the traditional criteria of price and reliability of supply but will now include the supplier’s environmental performance. This operational cycle of supply chain that involves the green criteria is illustrated in the figure below; Figure 2. Green Supply Chain. (Baojuan 2009) In the greening fo a firm’s supply chain process, enterprises have to work closely with upstream suppliers and downstream customers to effectively manage the supply chain environment (Lai et al 2012:113). The activities involves in green supply chain that involves the upstream suppliers and downstream customers as differentiated from the traditional supply chain are the following; Green Design – refers to the primacy in the use of natural, organic and recylable materials with the consideration of the environment in the design of a product or service. The environmental concern influences the design of a product and/or service in addition or besides function, quality, development and cost that would ultimately least affect the environment (Lai 2012) Green Purchasing – meant that the consideration for the environment plays an important part in the sourcing decision and selection of raw materials for production or rendition of service. Thus, it would now require environmental performance from its suppliers apart from the usual consideration of price, reliability and quality. In effect, this meant that hazardous materials and substance would be restricted in the companies procurement of components to produce its products and services (Lai 2012). Green Production meant requiring companies to use clean production method, utilize new technology that would reduce raw materials and resources input which will reduce pollution in the process while increasing output. Green production also includes elimination of waste to optimize the use of resources (Baojuan 2009) Green packaging - green packaging ultimately meant the removal of packaging in the design of products or service because it has no use for consumers except pollute the environment. Thus in the interim, enterprise has to consider putting package materials back to use through recycling (Baojuan 2009). Green marketing – environment should be considered during the whole marketing process from market research, product development, product registration, sales promotion to actual delivery of product or services to consumers (Baojuan 2009) . Green logistics – meant optimization of delivery and reduction of carbon emission in the distribution of the products to minimize waste and pollution (Baojuan 2009) Reuse and Recycling – comples business first to recycle the old products to minimize resource waste and pollution (Baojuan 2009) Bibliography Baojuan, Shi. Green Supply Chain Management and Implementing Strategy. Submitted to School of Economics And Management Hebei Polytechnic University, P.R.China. Retrieved from http://www.seiofbluemountain.com/upload/product/201002/1265187832vo7ihtiq.pdf Barnett, Michael (14 April 2011). The new CSR: This time it's profitable. Retrieved from http://www.marketingweek.co.uk/the-new-csr-this-time-its-profitable/3025435.article [March 19, 2012] Google.com (nd) http://www.google.com.ph/imgres?um=1&hl=fil&sa=N&biw=1920&bih=979&tbm=isch&tbnid=JLO3sjACBu6k7M:&imgrefurl=http://www.metalez.com/Supply-Chain-Management-SCM.cfm&docid=nztCHUW_7Md1XM&imgurl=http://www.metalez.com/photos/web%252520images/Supply-Chain-Management.jpg&w=420&h=251&ei=AWRIUcW2POjamAWX04CYAg&zoom=1&ved=0CGQQhBwwCA&ved=1t:3588,r:8,s:0,i:100&iact=rc&dur=1002&page=1&tbnh=169&tbnw=284&start=0&ndsp=35&tx=129&ty=70 Lai, R, Hsu, L, & Chen, J 2012, 'Green Supply Chain Management systems: A case study in the textile industry', Human Systems Management, 31, 2, pp. 111-121, Business Source Complete, EBSCOhost, viewed 19 March 2013. Stokes, Stephen; Tohamy, Noha (2009). Supply Chain Management Review13. 7(8) Vachon, S 2007, 'Green supply chain practices and the selection of environmental technologies', International Journal Of Production Research, 45, 18/19, pp. 4357-4379, Business Source Complete, EBSCOhost, viewed 18 March 2013. Q. Zhu, J. Sarkis, J. J. Cordeiro, and K.-H. Lai, Firm-level correlates of emergent green supply chain management practices in the Chinese context, Omega 36(4) (2008), 577–591. Read More