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Sustainability in the Supply Chain ( Design and Production for …
Sustainability in the Supply Chain
Corporate Social Responsibility
Managerial decision making that consider environmental, societal, and financial impacts.
Developing policies and practices that enhance the competitiveness of an organisation while advancing the economic and social conditions in the communities in which it operates.
2.Sustainability
System view
Looking at a product’s life from design to disposal, including all the resources required.
The product or service itself is a small part of much larger social, economic, and environmental systems.
Understanding systems allows more informed judgments regarding sustainability
Meeting the needs of the present without compromising the
ability of future generations to meet
their needs Including employees, customers, community, and company reputation. More than “going green”
Commons
Common resources often miss allocated
Many inputs to a production system held by the public
Possible solutions include:
1) Moving some of the common to private property
2) Allocation of rights
3) Allocation of yield
Triple Bottom Line
people
1) Globalization and outsourcing complicate the task
2) Supplier selection and performance criteria are important
3) Materials must be safe and environmentally responsible
planet
1) Look for ways to reduce the environmental impact of operations
2) Overarching objective is to conserve scarce resources
3) Carbon footprint and greenhouse gas emissions (GHG)
profit
1) Social and environmental sustainability do not exist without economic sustainability
2) Alternate measures of success include risk profile, intellectual property, employee morale, and company valuation
3)Social accounting can supplement financial accounting to support economic sustainability
Walmart’s Objectives:
1) Improving livelihoods through the creation of productive, healthy, and safe workplaces
2) Building strong communities through access to affordable, high-quality services
3) Preventing exposure to substances that are considered harmful or toxic
4) Promoting health and wellness
Design and Production for
Sustainability
Life cycle assessment valuates the environmental impact of a product, from raw material and energy inputs all the way to the disposal of the product at its end-of-life
The goal is to make decisions that help reduce the environmental impact of a product throughout its entire life
The 3Rs— reduce, reuse, and recycle
Product Design
Design decisions affect materials, quality, cost, processes, related packaging and logistics, and how the product will be processed when
discarded
Incorporate systems
view to lower environmental impact
Alternative materials
Production Process
Reduce the amount of resources in the production process
1) energy
2) water
3)Environmental contamination
Reduce cost and environmental concerns
logistic
Reduce costs by achieving efficient route and delivery networks:
1) Getting shipments to customers promptly
2) Keeping trucks busy
3) Buying inexpensive
fuel
Management analytics can help
Evaluate equipment alternatives
Life cycle ownership costs
End-of-Life Phase
Closed-loop supply
chains or reverse
logistics
Automaker’s design incorporates disassembly, recycling, and reuse
4.Regulations and Industry Standards
Product design
Food and Drug Administration
Consumer Products Safety Commission
National Highway Safety Administration
Manufacturing and assembly activities
Occupational Safety and Health Administration (OSHA)
Environmental Protection Agency (EPA)
State and local agencies
Disassembly and disposal of hazardous products
EPA
Department of Transportation
Nearly all industries have regulations
Commercial builders
Federal Safe Drinking Water Act
Resource Conservation and Recovery Act
International Environmental Policies and Standards
Organizations and governments guiding businesses
1) U.N. Framework Convention on Climate Change (UNFCCC)
2) international Organization for Standardization (ISO)
3) Elimination of greenhouse gas (GHG)
European Union Emissions Trading System
To combat climate change
Reduce industrial GHG emissions
“Cap-and-trade” principle
ISO 14000
Environmental management standards
1) Environmental management
2) Auditing
3)Performance evaluation
4)Labeling
5)Life cycle assessment
Advantages
1) Positive public image, reduced
liability
2) Good systematic approach to pollution prevention
3)Compliance with regulatory requirements, opportunities for competitive advantage
4) Reduction in the need for multiple audits
Implemented by more than 200,000 organizations in 155 countries
Environmental and economic benefits
1) Reduced materials/resource usage
2) Reduced energy consumption
3)Lower distribution costs
4) Improved image
5)Improved process efficiency
6) Reduced waste and disposal costs
SO 14001 addresses environmental management systems
Guidance to minimize harmful effects on the environment