Green Supply Chain Management

ECONOMIC AND ENVIRONMENTAL MANAGEMENT

Leonard Merari 122140085

Firdaus Albarqoni
122140058
Ricky Agustinus 122140126
Indrawan Mulia 122131052
Rama Kresandi 122131136
M.Dimmitri
122140171
Dharma Putra Rambe 122140161

Content
1

Overview Green Supply Chain Management

Trends Green Supply Chain Management

Literature Green Supply Chain Management

Case Study : Benefit Cost Analysis GSCM

Summary

Economic and Environmental Management MM Trisakti July 2015

Overview
Supply Chain Management
(Council of Supply Chain Management Professionals)

Logistics Management
(Council of Supply Chain Management Professionals)

Supply chain management encompasses the

Logistics management is that part of supply chain

planning and management of all activities involved

management

in sourcing and procurement, conversion, and

controls the efficient, effective forward and

all logistics management activities

reverses flow and storage of goods, services and

that

plans,

implements,

and

related information between the point of origin

and the point of consumption in order to meet
customers' requirements.

Economic and Environmental Management MM Trisakti July 2015

Overview

Source : Performance measurement for green supply chain management. Emerald

Group Publishing Limited. Benchmarking : An International Journal, Vol. 12 No
4, 2005.

Green Supply Chain Management (GSCM)

Adding the green component to supply chain management involves addressing the influence and
relationships of supply chain management to the natural environment. Motivated by an environmentallyconscious mindset, it can also stem from a competitiveness motive within organizations.
Green Supply Chain Management (GSCM) defined as :
= Green Purchasing + Green Manufacturing / Materials Management + Green Distribution / Marketing +
Reverse Logistics

Economic and Environmental Management MM Trisakti July 2015

Overview

Source : Green Logistics : Global Practices and their Implementation in Emerging

Markets, 2011

Green Logistics
Green logistics consists of all activities related to the eco-efficient management of the
forward and reverse flows of products and information between the point of origin and the
point of consumption whose purpose is to meet or exceed customer demand

Economic and Environmental Management MM Trisakti July 2015

Trends

Source : Greening The Supply Chain : Best Practices and Future Trends

Decrease carbon usage across supply

chain.

Green

purchasing

practices

with

choose the right suppliers, Company send RFP

(request for proposals) include very specific
questions as a part of its selection criteria
everything from Whats your carbon-neutral
strategy? to Were looking to lower our
carbon footprint in transportation. What tools
do you have that you can provide to us?

Economic and Environmental Management MM Trisakti July 2015

A carbon footprint is historically defined as "the total sets

of greenhouse gas emissions caused by an organization, event, product
or person

Trends
Supply chain network optimization.
Company study their Supplier, DC and Outlet
facilities to reduce total cost and also
decrease their fuel consumptions.
Key factors network optimization study :
-

Supplier, DC and Outlet location

Mode of Transportation

Investment of new facility

Indonesia trends :

Economic and Environmental Management MM Trisakti July 2015

Short sea shipping

Tol Laut

Railways (KA Logistics)

Development infrastructure for new port

Trends

Pick / Put to light

RFID Technology

Handheld / Gadget

GPS Tracking System

Reducing paper consumptions

and

process

automation.

Implementation of technology to
reducing

paper

and

process

automation.
eg : Pick/Put to light technology,
Handheld / Device, RFID (Radio
Frequency

Indentification),

GPS

Tracking System

Economic and Environmental Management MM Trisakti July 2015

Trends
Roff lighting

Green
minimize

Warehousing.
carbon

and

Warehouse
energy

operation

consumption.

Warehouse Key Performance Indicator.

eg : Roof lighting, LED Light, Fuel cell forklift

Economic and Environmental Management MM Trisakti July 2015

Trends

Source : C.Ho, Opportunities in Green Supply Chain Management.

The Coastal Business Journal. Spring 2009, Volume 8 (1)

Green Packaging, sustainable packing with least or no impact on environment.

Bioplastics and other biodegradable materials belong to this category.

Literature GSCM

Source : Ninlawan, 2010, The Implementation of Green Supply Chain

Management Practices in Electronics Industry.
Adobe Acrobat
Document
Proceedings of the International Multiconference of Engineers, 2010.

Object research : Computer parts manufacturers in Thailand.

Output : Measure implementation GSCM practices
Methodology :
-

Questionnaire : In-depth interview about GSCM to measure.

Responden : Supply chain mid level managers from 37

organizational which 86,5% are large sized company

Questionnaire Items : GSCM practices, GSCM performance,

and GSCM pressure/driver.

Literature GSCM

Source : Ninlawan, 2010, The Implementation of Green Supply Chain

Management Practices in Electronics Industry.
Proceedings of the International Multiconference of Engineers, 2010.

Literature GSCM
Conclusion of research :

Promote Ecodesign. Developing environmentally friendly products is cause to change in product design using 2
principles: (1) designed to extend lifetime of product, it can be improved, repair, and re-use of products such as modular
design (2) designed for recycling / design for disassembly, after end of life products that can be more recovery.

Control hazardous substances: complying with RoHS and other regulations.

Set rules for disposing electronics waste and consider more investment in recycle plants.

Propagate GSCM knowledge and encourage using environmentally friendly goods and services.

Set a direct responsible unit to take in charge of electronics waste only which will increase reverse logistics efficiently.

Promote refurbishing and recycling through campaigns/ activities to raise reuse/recycle awareness in electronics
consumption

Expand product lifespan by designing for disassembly or upgrading computer specification instead of buying new ones
or using computer rental services

Literature GSCM
Conclusion of research (cont) :

Set a database unit to collect and record information About production, import/export data, and waste management (do
traceability).

Encourage team building and train skilled labors for reverse logistics management

Raise the applications in Extended Producer Responsibility (EPR); EPR is an environmental protection strategy based on
the "polluter pays" principle, by making the manufacturer of the product responsible for the entire life-cycle of the product
and packaging they produce

Case : Benefit Cost Analysis Modelling GSCM

Overview Pick/Put to Light System
Pick/Put to light technology reducing paper usage and
decrease number of worker on warehouse operation.
Before decide to invest on this technology, company
needs to do benefit cost analysis.

Pick / Put to light

Case : Benefit Cost Analysis Modelling GSCM

Case : Benefit Cost Analysis Modelling GSCM

Case : Benefit Cost Analysis Modelling GSCM

Case : Benefit Cost Analysis Modelling GSCM

Summary
1. Green Supply Chain scope : Green Purchasing + Green Manufacturing / Materials Management + Green Distribution /
Marketing + Reverse Logistics
2. Company needs to do research regarding key trends of implementation GSCM
3. One of method to measure GSCM practices is questionnaire to survey response from supply chain practicioner
4. Case study showing result as follows :

Break even point

: 45 months

Net Present Value

: IDR 199,516,032

Internal Rate of Return

: 16,7%