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

Walmart’s 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 Walmart’s reputation steadily declining prior to launch in 2005

o 4 years later ranked 3rd among 35 retailers

The greatest benefit to Walmart’s 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, Walmart’s reputation was negative and steadily declining prior to the launch of the sustainability strategy in 2009, just four years later, Walmart’s 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 techa. Sustainability assessment known as the “15 questions.”

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

2. Certifying Environmentally Sustainable Productsa. Walmart gains third-party verification of environmental

performance value of certification continues to outweigh its costs to Walmart

3. Providing Network Partner Assistance to Suppliersa. facilitating partnerships to help its suppliers realize desired results

that, in turn, help the company achieve its goalsb. Since the goal was announced in 2008, more than 300 factory visits

had been completed by teams of Walmart and NGO representatives4. Committing to Larger Volumes of Environmentally Sustainable Products

a. encourage suppliers to invest in green innovationsb. prefers using quantity commitmentsc. to paying premiums as a way to motivate suppliers

5. Licensing Environmental Innovationsa. 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 problemse. Final step monitor changes and establish feedback mechanisms

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