SUBMITTED BY: ANKUR ASHOK B009 PRAKHAR GUPTA B026 ANIRUDH KOWTHA B035 RAHUL SANGANI B050

Green Supply Chain Management:

The integration of environmentally conscious thinking into all phases of key supply chain management processes.

Green SCM integrates environmental and supply chain management.

Creating Competitive advantage through Green SCM Regulatory mandates require companies to adopt greener practices. Examination of both suppliers and self operational processes Organizations can be held liable for the ecologically irresponsible actions of their vendors in a court of law, the court of public opinion, or both Irregularities may lead to shutdowns which can impede their ability to fulfill customer orders as well as manage reputation risk

Leveraging on the mandates

Though regulations increasingly make environmental responsibility mandatory, compliance can provide a competitive advantage. Careful planning and self-evaluation should be the starting points of any green supply chain initiative. Implement green supply chain reforms internally before asking suppliers to comply as well.

Transition of GSC programs from compliance to value creation: Environmental, Safety, and Health Business Contributions

Source: Forging New Links, GEMI, 2004

Benefits of Green Supply Chain Management

Potential cost reductions Increased resource efficiency, leading to improvements to the bottom line Enhancing corporate reputation Customer preferences Increased sales and marketing activities

Environmental Life Cycle

From materials acquisition and manufacturing to packaging, logistics, and distribution, every stage of the supply chain offers opportunities to reduce waste and pollution.

Green Supply Chain Analysis provides an opportunity to review processes, materials and operational concepts. It targets Waste material Wasted energy or effort Under-utilized resources

Implementing Green Supply Chain Management

Product Design Reducing Material Usage

Reducing Operations involved Ensuring proper usage of Computational fluid dynamics tools to reduce exhaust emissions Material Purchase Implementing Green purchasing policy Providing technical support to vendors to reduce emissions Guidelines for usage of less hazardous substances Production Achieving Economy of scale Implementing Lean Manufacturing Using fuel efficient tools and machines Selecting less carbon intensive fuel sources Packaging Using environmentally friendly packing materials Recycling packing materials Reusing materials Using energy efficient equipments Warehousing Managing Inventory Controlling Materials Flow Improving Materials Management Practices RFID TRACKING Logistics & Reverse Logistics Optimizing Truck Loads Reducing distribution channel (eg. Dell) Reverse Logistics

Gauging Performance of Supply Chain Management

5 key practices that Walmart adapted to green its supply chain:

1. Identifying goals, metrics, and new technologies. 2. Certifying environmentally sustainable products. 3. Providing network partner assistance to suppliers. 4. Committing to larger volumes of environmentally sustainable products. 5. Licensing environmental innovations

Walmarts Green Supply Chain:

Cost reductions through improved energy efficiency Introduced new sources of revenue: o Initial scenario: used to spend $16 mn to bring plastic waste from stores to landfills o Present scenario: pelletizes and sells plastic to its packaging suppliers $28mn of revenue added to bottom line Provide assurance of supply o Chinese government threatened to shut down a number of textile dye houses to reduce pollution before the 2008 Beijing Olympics o Walmart enlisted one of its new NGO partners to help a supplier immediately formulate a more environmentally-friendly process Company has gained greater voice with policy makers easier to enter new markets o Walmarts reputation steadily declining prior to launch in 2005 o 4 years later ranked 3rd among 35 retailers The greatest benefit to Walmarts going green has been a boost in public relations, which helps the company secure permission to open new stores and increases sales in its existing locations. According to Covalence, an organization that measures the ethical reputation of companies by cumulating their positive and negative news coverage, Walmarts reputation was negative and steadily declining prior to the launch of the sustainability strategy in 2009, just four years later, Walmarts reputation was ranked third among 35 multinational retailers (up from last place in 2007).5 The company is now the subject of more positive than negative coverage, led in large part by affirmative press on its sustainability-related activities. What Walmart has done to make a Green Supply Chain? 1. Identifying goals, metrics, new tech a. Sustainability assessment known as the 15 questions.

2.

3.

4.

5.

b. Scorecard for suppliers gives points for transparency and other activities such as carbon and waste management c. Scorecard used to identify where business should be allocated and which suppliers can be engaged at strategic levels d. Life Cycle Analyses (LCA) to study environmental impacts of its products Certifying Environmentally Sustainable Products a. Walmart gains third-party verification of environmental performance value of certification continues to outweigh its costs to Walmart Providing Network Partner Assistance to Suppliers a. facilitating partnerships to help its suppliers realize desired results that, in turn, help the company achieve its goals b. Since the goal was announced in 2008, more than 300 factory visits had been completed by teams of Walmart and NGO representatives Committing to Larger Volumes of Environmentally Sustainable Products a. encourage suppliers to invest in green innovations b. prefers using quantity commitments c. to paying premiums as a way to motivate suppliers Licensing Environmental Innovations a. encourages suppliers working on new environmental or supply chain innovations as part of the sustainability effort to consider licensing those new technologies b. target the top 15 to 20 percent of their suppliers and bring them together in non-competitive working groups c. important problems and where improvements can be made through lifecycle analysis and the identification of sustainability hot spots d. Next experts come in and help the suppliers solve these problems e. Final step monitor changes and establish feedback mechanisms

REFERENCES: