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Introduction to green supply chain management


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Introduction to green supply chain management

  2. 2. MEMBERS HILLARY K. KIPLAGAT…..D61/82728/2015 VIRGINIA MWAI……………D61/77435/2015
  3. 3. Green supply chain management ….. can be defined as the process of integrating environmental thinking into supply chain management including production design, material sourcing and selection, manufacturing processes, delivery of the final production to the customers and end of life management of the production after its useful life. Introduction to Green Supply chain Management
  4. 4. CONTINUA…  Green supply chain on the other hand is the process of using environmentally friendly inputs and transforming these inputs through change agents whose by products can improve or improve or be recycled within existing environment.  Supply chain management is the coordination and management of complex network of activities involved in delivering a finished product to the user/customer. The supply chain itself is a process that at the end may produce waste causing serious pollution to the environmental threatening human health and ecological balance therefore the need to go green becomes a point of concern to many organizations.
  5. 5. The concept of green supply chain GSCM was first proposed by the Manufacturing Research Consortium (MRC) of Michigan State University in the U.S. in 1996, for comprehensively considering environmental impacts and resources optimization of manufacturing supply chains. It aimed at minimizing the environmental impacts of the products end-of-use by tracking and controlling the raw material procurement, in order to ensure compliance with environmental rules and regulations starting from the stage of product research and development.
  6. 6. Scholars who have contributed to the understanding of GSCM Among the scholars who have contributed to the understanding of GSCM are :  Hervani and Helms (2005), According to them, GSCM comprises of Green Purchasing, Reverse materials management, Green distribution and Reverse logistics  Srivastara (2007) He defined the concept as an integrative environmental thinking into supply chain management including product design, material sourcing and selection, manufacturing processes, delivery of final products to the consumer and the end-life management of the product and its useful life
  7. 7. Reasons for increased significance on GSCM among Kenyan firms. In recent times, Green Supply Chain Management (Green SCM) is gaining significance among manufacturers due to the following reasons:  Diminishing raw materials  Deterioration of environment  Overflowing waste lands  Increasing levels of pollution
  8. 8. Green Supply Chain Management Practices These are practices which a firm should embrace in order to be associated with greenness. This practices includes and not limited to the following;  Green packaging  Green purchasing  Green production  Reverse logistics  Recycling and reusing products  Eco design and green marketing  Environmental monitoring and collaboration
  9. 9. GSCM PRACTICES  Green purchasing It is considering environmental impact such as prices, performance and other factors when making purchasing decisions . It is environmental purchasing activities that include the reduction, reuse and recycling of materials in the process of purchasing. It is a solution for environmentally concerned and economically conservative business, and a concept of acquiring a selection of products and services that minimizes environmental impact (Salam, 2008).
  10. 10. Practices  Green marketing It is the marketing of products that are presumed to be environmentally friendly? Thus green marketing incorporates a broad range of activities, including product modification, changes to the production process, packaging changes, as well as modifying advertising
  11. 11. CONTI…  Eco/Green design Green design is an important sub-attribute to Green supply chain management. It is design for the environment / for disassembly and product life cycle assessment, specifically to consider environmental aspects in the products design. It is also about designing a product or a service with environmental awareness.
  12. 12. CONTINU….  Recycling and reusing products It is a practice of producing outputs or products that have the ability to be recycled and use to package products instead of producing another packaging containers. Reusing of packaging materials is also considered a driver in attaining green procurement where packaging containers are used by customers for other purposes after consuming the packed products.
  13. 13. Continu..  Green production/ Manufacturing It is defined as production processes using inputs with relatively low environmental impacts, which are highly efficient, and that generate little or no waste or pollution (Atlas and Florida (1998).  Green packaging It is the practice of packaging products using environmentally friendly packages which have less impact on environmental habitats because they can easily decompose.
  14. 14.  Reverse logistics Its is defined as end use customer to the secondary market from a series of activities. These activities include; recycling, maintenance, transportation, reuse, re-manufacturing, inspection, classification and disposal. The value of remaining reverse logistics terminals affect the different treatment of flow treatment, and is designed to create value or improve waste treatment.
  15. 15. BENEFITS OF GSCM Greening the supply chain benefits the enterprise in terms of cost reduction, integrating suppliers in a participative decision making process that encourages environmental innovation. The benefits are as follows;  Reducing Operational Costs  Boosting Brand Image  Reduction of waste  Increases employee morale.  Positive public relations  Increasing firms profitability  Low environmental risk and fines from regulatory bodies(NEMA)
  16. 16. CHALLENGES OF GSCM  Green supply chain management just like any other business is faced with challenges; this is probably because it is new to many organizations. Businesses need to overcome these challenges in order to ensure their green efforts become a reality. These challenges includes and not limited to the following;  Lack of IT implementation  Resistance to change  Fear of uncertainty  High cost of implementation  Issues of stakeholder positions  Poor quality of human resources  Lack of awareness from customers and firms  Standards and rules of greenness
  17. 17. ENABLERS OF GSCM There is need for drive towards green supply chain to ensure customer requirements are met, cutting on cost and even strengthening corporate relationship with the suppliers. The drivers to green supply chain management in Kenyan organizations include ;  Regulatory compliance  corporate social responsibility  Competitive pressures and  Customer and public pressures  Economic globalization
  18. 18. MEASURING GREENNESS There is need for firms to measure and evaluate the level of greenness within their firms so as to be able to come up with new greenness strategies which will ensure their supply chain goals are of the strategic tool which can be used for this purpose is the balance score card which emphasizes on four aspects of the firm. These perspectives are customer measures, internal business processes measures, learning and growth measures and financial measures
  19. 19. Measuring the level of greenness  Customer measures This can be accomplished by looking at the safety of the products an organization is offering i.e do they pose as hazards to the customer? This can be established by doing statistics on the preferred products against others.  Internal process measures The percentage of materials that are recycled can be used to show how green a supply chain is. A green supply chain will tend to have green suppliers to manage the chain so the number of certified suppliers will help one to determine how green a supply chain is
  20. 20. continuation  Financial measures A green supply chain is one which eliminates wastes into the environment and therefore a green supply chain should have minimum or no disposal costs at all  Learning and growth measures During implementation of the green supply chain management, staff needs to be trained. The number of trainees trained and retention rate in an organization can be used to measure how green a supply chain is.The number of violations reported by employees, and number of awards received as a result of achieving environmental related goals.
  21. 21. Conclusion  GSC is a very important aspect which all the organizations should implement in order to save the environment and improve the health of people through the reduction in pollution. Despite it being expensive to implement, its benefits are more and results to reduction of products costs through recycling materials and reduction of waste in each and every stage of production process. A green strategy provides prudent business processes. Successful green supply chain will feature cross functional collaboration, emphasize innovation, and stay tune to the strategic focus of supply chain and enterprise as a whole. Such a framework emphasizes network redesign, packaging changes, and business collaboration that promote a smaller carbon footprint and generates cost saving.