Green Logistics

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The University of Sydney

Discuss appropriate ‘green’ strategies that can be implemented in supply chains and analyse the impact on all supply chain members

Warinee Prapai

Submission Date:Friday, 21 April 2006
Unit of Study:TPTM6170, Strategy and Supply Chain Management Degree Enrolled In:Master of International Business (MIB) and Master of Logistics Management (MLM) Student No:305044575

TABLE OF CONTENTS

1INTRODUCTION1
2GREEN STRATEGIES AND LEAN STRATEGIES1
3REVERSE LOGISTICS STRATEGY2
4E-LOGISTICS STRATEGY3
4.1Forward E-logistics3
4.1.1Procurement3
4.1.2Inventory Management and Warehousing3
4.1.3Transportation and Delivery Management4
4.2Reverse E-logistics4
5GREEN PURCHASING STRATEGY5
5.1Green Purchasing Policy5
5.2Supplier Selection Process5
5.3Supplier’s Environmental Evaluation Process6
5.4Raw Materials and Design Process Selection6
6IMPACT ON SUPPLY CHAIN MEMBERS7
6.1Impact of Reverse Logistics Strategy7
6.2Impact of E-logistics Strategy7
6.3Impact of Green Purchasing Strategy8
7CONCLUSION9
8REFERENCES10
APPENDIX 1: COMPARISON OF REVERSE LOGISTICS 14
AND GREEN LOGISTICS
APPENDIX 2: IMPACT OF EFFECTIVE RETURN MANAGEMENT16

1INTRODUCTION
Nowadays, the environmental issues are a part of corporate strategies and sustain companies’ success (Parker, 2000). The pressure of environmental concerns by government legislation, changing customer demands, the development of international certification standards (ISO), and aggressive competition are outstanding reasons that why businesses should implement green/environmental strategies into their supply chains (Enarsson, 1997; Murphy and Poist, 2003).

The implementation of green strategies in supply chains and the impact of green strategies on supply chain participants are discussed and analyzed in this paper.

2GREEN STRATEGIES AND LEAN STRATEGIES
According to Parker (2000), “green strategies are ecocentric strategies that involve the development and implementation of environmental management systems and environmentally friendly products, services, and processes”. Enarsson (1997) defined that the environmental strategies mean procedure that considered as a process to accomplish both internal and external environmental goals. The purpose of green strategies is to improve business environmental performance and inform to customers (Azzone and Bertelè, 1994). Therefore, these strategies must be preventive and proactive approach (Enarsson, 1997). Green/environmental strategies embrace several forms as following;

Reverse logistics strategy;
E-logistics strategy;
Green purchasing strategy;
Green design and manufacturing strategy;
Green packaging strategy;
Green warehousing strategy;
Green distribution and transportation strategy; and
Waste management strategy.

By implementing green/environmental strategies, business can complete competitive advantage and reputation enhancement. It seems as a strategic weapon to sustain improving bottom-line in long term (Madson, 2002). These strategies also assist to reduce costs, improve productivity, and better serve customers requirement (Walton, Handfield, and Melnyk, 1998; Maker, 2006). Lean strategies are a system on reduction wasteful activities that are overproduction, waiting, excessive transportation, inappropriate processing, unnecessary inventory, unnecessary motion, and defects from supply chains (Harrison and Hoek, 2002; Simons and Mason, 2003; Hines and Stewart, 2004). In addition, Harrison and Hoek (2002) stated that “Lean thinking is a cyclical route to seeking perfection by eliminating waste … and thereby enriching value from the customer perspective”. This value stream takes a responsible procedure in the activities that impact on society and environment (Simons and Mason, 2003).

It can be seen that green strategies complement lean logistics strategies. Hence,...
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