Name: Aamir Pirwany
Title: Sustainable Supply Chain
Instructor: Surjit Rai
Course: Mark 451
Date: July 12, 2013
Table of Contents
Supply Chain Management
Traditional vs. Sustainable
Challenges Building Sustainable Supply Chain
This report starts with the introduction of Sustainable Supply Chain Management (SSCM) and the difference between traditional and sustainable supply chain management. It also explains the competitive advantage for the company's that incorporates SSCM across their supply chain. It also explains how difficult it is to incorporate the SSCM across the supply chain and what steps should be taken to meet the objectives of SSCM. Finally in the end it provides the conclusion of this report of how important it is for firms to follow SSCM.
Sustainable supply chains are the companies that are involved in producing, manufacturing, distributing, etc. of a product; these companies keep economical, social, and environmental concerns in mind before producing or distributing any product; so that they can contribute, through best practices, towards a green environment and provide value to the society. According to Google book of "Sustainable Supply Chain Management: Practical Ideas for Moving Towards Best Practices" authors defines sustainable supply chain management as " Thus, a real definition of sustainable supply chain management must take account of all relevant economic, social and environmental issues" (Balkan Cetinkaya, 2010). Most companies, especially multinational companies, are involved in producing environmental friendly products and they encourage all of their suppliers as well to do the same; Apple, Clorox and Unilever can be considered as one of those companies. "Apple, for example, conducts rigorous on-site audits to ensure that suppliers comply with its code of conduct—and if a violation is unearthed, the facility has to remedy it immediately and implement a preventive action plan within 90 days." (Gary L. Hanifan, 2012). "The Clorox Co., in fact, aims to embed environmental sustainability into all of the company’s core business processes, from product supply and manufacturing through R&D to procurement. And the company’s environmental sustainability office works with each business to develop a list of annual commitments." (Gary L. Hanifan, 2012). "At Unilever, for example, sustainability is integral to the company’s core business strategy. It enjoys the kind of C-suite commitment essential for strong governance, and is recognized right across the organization as a key enhancer of long-term brand equity. The result: Unilever aims to source 75 percent of paper and board for packaging, all palm oil and half of agricultural raw materials sustainably by 2015." (Gary L. Hanifan, 2012). Hence, there are many more companies that are really concerned and want to produce and encourage others to practice business in a way that it helps the environment and creates value to the society. Supply Chain Management
Companies use Supply Chain Management (SCM) not just to flow their products efficiently at lower cost but it, SCM, also helps companies to interact, flow of information, with each other more efficiently. Following are the two different approaches, to choose from, in SCM that companies uses: Traditional vs. Sustainable
In a traditional supply chain management, which is based on Kraljic's purchasing portfolio model, company's uses resources in a manner that it maximizes its return; Kraljic emphasizes on keeping the suppliers to limited number and the purchasing on leverage, which will reduce the cost of the product and maximize the return (Pagell, Wu, & Wasserma, Thinking Differently about Purchasing Portfolios: An Assessment of Sustainable Sourcing., 2010, p. 59). Though there has been much development after this model, where some...
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