MSL843: Supply Chain Management
Term Project
“Green Supply Chain Management” (GSCM)
1
Introduction
Traditional SCM vs GSCM
Traditional Supply Chain Management focuses on Total
Quality, optimum Cost and best service which in some way
$14B 177 contributed to environment.
GSCM focuses on producing economically and
environmentally friendly quality products which meets the
customer expectation. It is the best practice to be
Saved adopting Env. Perf Index followed since it reduces inventory, saves space and
GSCM practices (EPI) rank India energy
• Green Supply Chain Management is all about delivering products and services
from suppliers, manufacturers to end customers through material flow,
information flow and cash flow in the context of environment
• Companies can find cost savings by reducing the environmental impact of their
business processes. By re-evaluating the company's supply chain, from
purchasing, planning, and managing the use of materials to shipping and
distributing final products, savings are often identified as a benefit of
implementing green policies
• The more robust and green a supply chain becomes, the more it can become a
public relations and marketing boon
Green Supply Chain Management 2
Building a GSCM
Product Selection: Designing the product in such a way that it should be safe for
use, creating least pollution and consumes less energy
Process and production: Process has to be designed so that it conforms to the
Green Supply Chain Management initiatives to reduce environmental negative
impact
Business Partners selection: Selecting suppliers who have proven track records
on practicing lean manufacturing and using environment friendly material
Logistics Design: Efforts should be practiced to reduce fuel consumption
Packaging Material: Replacing package materials which are eco-friendly
Reverse logistics Design: Materials after consuming should be effectively used
for re-use, repair, recycle, remanufacture and redistribution
Information Technology: A Green approach to IT has to be achieved through
various automatic processes thereby reducing carbon foot prints
Green Supply Chain Management 3
GSCM Process Flow
Key Highlights
• Green Purchasing
• Green manufacturing
• Materials Management
• Green marketing Tactics
• Lean distribution
• Reverse Logistics
Green Supply Chain Management 4
GSCM Analysis Metrics
1. Key Metrics in processed 3. Emission from raw material sourcing
Process Metrics Electricity
Raw Total Output Purchased Qty CO2e Emission Total CO2e
Plan Compliance Cost , Non Compliance costs Cnsmp. (kWh /
Material (Units per year) (Units per Year) Factor (kg/kWh) Emission (Tonnes)
associated year)
Source Orders received with correct packaging Material A
Make Energy costs out of the total production Material B
costs Material B
Deliver Fuel Costs out of total delivery costs,
carriers meeting environmental criteria
Return Products returned percentage
refurbishing/disposal of the returned
4. Emission Inbound/Outbound Logistics
products Inbound Total Weight Dist. From CO2e Emission Factor Total CO2e
Across Carbon Emission, Liquid waste generated, Mode of Trans
Logistics (Tonnes) Supplier (gCO2/tonne-km) Emission (Tonnes)
Process Solid waste generated, Recycled Waste
Material A
Material B
Material B
2. Carbon footprint analysis
5. Emission from Manufacturing
Amount of greenhouse gas Power Source at Energy Consumed Total CO2e Emission
generated by various activities, plant (kWh) (Tonnes)
usually (expressed in kilogram or Coal
Fuel Oil
tonne) Natural Gas
Green Supply Chain Management 5
GCSM Benefits
• GSCM will help us to gain a competitive advantage and help us to
attract new customers
• Increased use of resources, improved efficiency and reduced
production cost – Competitive advantage
• It contributes greater towards improved financial performance.
• Reduces risk by avoiding hazardous material that leads to
environmental effect
• Improved quality of products and services gives higher customer
delight and reputation
• Improves public perception and brand image about the organsaiton
Green Supply Chain Management 6
Companies adopting GSCM
Adobe Systems Nike’s Contract Manufacturer
Scorecard Scale
This software company launched an
ecological sensitive redesign of its popular
software package, four years ago. In some
areas, plastic is no longer used, discs are
packed with 1 cardboard layer
overwrap instead of 3
Wal-Mart, “Sustainability 360”
Wall-Mart follows Packaging Scorecard for
suppliers that calculates the “green
quotient” of product packaging based on a
number of attributes, such as greenhouse
gas emission, product to packaging ratio,
space utilization etc.
Green Supply Chain Management 7
Thank You…
