A supply chain sustainability innovation framework and evaluation methodology

Sustainability is hinged on innovation. The importance of sustainable innovation management in sustainable supply chain management (SSCM) cannot be underestimated. Studies on SSCM have emphasised the need for sustainable innovation in achieving sustainability but none provide deep insights into sustainable innovation management in SSCM implementation. This lack of research depth stimulates this study to identify and investigate criteria for sustainable supply chain management innovation advancement. This paper proposes a sustainable innovation criteria framework for investigating sustainable supply chains in manufacturing companies. To exemplify the applicability and efficiency of the proposed framework, a sample of five Indian manufacturing companies are used to evaluate and prioritise the sustainable innovation management criteria, using the ‘best–worst’ multi-criteria decision-making (BW-MCDM) model. The criteria weights for all companies from BWM are aggregated, averaged and used for ranking. The respondent managers viewed ‘financial availability for innovation’ as the most important sustainable innovation sub-criteria. The results of the study will inform industrial managers, practitioners and decision-makers on which criteria to focus on during the implementation stage, to increase sustainability in manufacturing supply chains, and further advance corporate and supply chain sustainable development. The framework may also serve as a theoretical construct for a future empirical study on sustainable supply chain innovation in the manufacturing sector. This paper sets the stage for further research in sustainable innovation practices in the manufacturing sector and its supply chains.     

Sustainable supply chains for supply chain sustainability: impact of sustainability efforts on supply chain risk

Supply chain managers across the globe are finding it difficult to manage the increasingly complex supply chains despite adopting a variety of risk mitigation strategies. Firms on the other hand have also been adopting various kinds of environmental and social sustainability practices in recent times to reduce carbon footprint and improve their image on the social front. However, very few studies in the extant literature have examined the impact of sustainability practices on supply chain risk. We address this important gap in literature by empirically testing this relationship, using primary data from six manufacturing sectors and 21 different countries including developed as well as emerging markets across the globe. Our findings indicate that risk mitigation strategies do not always reduce the actual supply chain risk experienced by firms, whereas sustainability efforts help reduce supply chain risk, especially in emerging market contexts. In addition, we find that, while reactive risk mitigation strategies on their own fail to reduce supply chain risk, they are effective when used in conjunction with sustainability efforts. We also find that preventive risk mitigation efforts are only effective in mature supply chains such as the OECD countries.     

Traceability as a means to investigate supply chain sustainability: the real case of a leather shoe supply chain

In recent years, the growing attention to environmental challenges has shown that these issues are becoming of more and more interest to both research and industry. Companies are expected to ensure their products are fully traceable and more sustainable, which requires the involvement of all of the actors in the production network. According to this aim, this study proposes a structured approach that uses the traditional traceability concept as a means to identify the main information needed to assess environmental impacts along the whole supply chain (SC). The proposed approach is composed of four main steps: (i) SC modelling to identify all stakeholders and their inter-relations, (ii) data sharing to collect all relevant data, (iii) data elaboration to calculate performance at different levels of detail and (iv) result interpretation to optimise the SC. The distributed implementation of the approach at different SC steps represents a useful means to practically realise a sustainable SC management. A case study involving a leather shoe SC is used to demonstrate the effectiveness of the approach in identifying criticalities, supporting the selection of the most appropriate suppliers and correctly setting a management strategy towards the optimisation of internal and external traceability and environmental sustainability performances.     

Developing sustainability in the Italian meat supply chain: an empirical investigation

Although sustainable supply chain (SC) management has been widely investigated in recent years, the focus has mainly been on the practices adopted by a single company, so missing the big picture at SC level. This study of the Italian meat industry considers the SC as a whole, identifying the critical points for each stage in terms of economic, environmental and social sustainability. To this end, a first set of case studies was conducted of companies at different stages of the SC before turning to focus on the meat processing stage, which was identified as critical and highly relevant. A second set of case studies analysed how these companies leverage SC management practices to develop sustainable SCs. In so doing, specific attention was paid to drivers and contingent variables that foster the adoption of sustainable practices. The results of the two steps were then merged to illuminate how practices adopted by the meat processors can impact on the whole chain, confirming their pivotal role in driving sustainability. These results provide a holistic view of the phenomenon, encompassing the entire chain from end to end and highlighting the interdependences across various stages of the meat SC.     

Estimating vulnerability to risks: an application in a biofuel supply chain

In the present work, we propose a theoretical model to identify and prioritize risks involved in a biofuel supply chain. We adopt a set of indicators associated with determinant factors of the supply chain to identify risks that are characterized through a risk matrix. We consider the five largest world biodiesel producers and included China due to its global market importance and potential impacts of its growth on the environment and society. To determine the impacts and the probability of occurrence of risks, we use the Canberra distance, as metrics. To facilitate the analysis and interpretation, a convenient manner is to express the results in terms of matrices. To exemplify the potentiality of the scheme and for the sake of simplicity, a more comprehensive discussion is focused on the Brazilian case, restricted to the Technology and Innovation, and Integration, Logistics and Infrastructure determining factors (dimensions) of the biodiesel supply chain. Concerning these determining factors, the Brazilian biodiesel chain shows strong vulnerability when compared with developed and developing countries, despite that the evolution of the data over recent years indicates small improvements in Integration, Logistics and Infrastructure dimension. Although in this work the calculations are restricted to the Canberra distance, the present approach may be applied to other distances to compare or validate the results. This work presents a contribution to model vulnerability to risks, providing to policy makers and stakeholders a tool to design, analyze and improve sustainability system by measuring its risks. The study of the contribution of each indicator suggests corrections to be taken and which indicators should be prioritized.     

Revealing interfaces of supply chain resilience and sustainability: a simulation study

Dynamics of structures and processes is one of the underlying challenges in supply chain management, where multiple dimensions of economic efficiency, risk management and sustainability are interconnected. One of the substantiated issues in supply chain dynamics is resilience. Resilience has a number of intersections with supply chain sustainability. This paper aims at analysing disruption propagation in the supply chain with consideration of sustainability factors in order to design resilient supply chain structure in regard to ripple effect mitigation and sustainability increase. Ripple effect in the supply chain occurs if a disruption at a supplier cannot be localised and cascades downstream impacting supply chain performance. This simulation-based study helps to identify what sustainability factors mitigate the ripple effect in the supply chain and what sustainability factors enhance this effect. The results indicate that (i) sustainable single sourcing enhances the ripple effect; (ii) facility fortification at major employers in regions mitigates the ripple effect and enhances sustainability; and (iii) a reduction in storage facilities in the supply chain downstream of a disruption-risky facility increases sustainability but causes the ripple effect.     

Comprehensive framework for the development of a supply chain strategy

Current competition among companies is fought through their supply chains. As the performance of the supply chain depends not only on manufacturing and marketing attributes, it becomes necessary to establish a framework upon which to develop a supply chain strategy. The paper presents the rationale and principles of a customer–product–process–resource (CPPR) framework for the simultaneous analysis of the business, supplier, manufacturing, planning, marketing and customer dimensions of a supply chain strategy. The originality of the CPPR framework is that it establishes a set of supply chain structural elements, that when put together determine the degree of alignment of a supply chain strategy. As the main objective of a supply chain strategy is to achieve customer satisfaction as an output of the supply chain operations, the CPPR framework becomes a realignment tool when used in combination with a realignment methodology, which is also presented in the paper.     

Understanding supply chain management: critical research and a theoretical framework

Increasing global cooperation, vertical disintegration and a focus on core activities have led to the notion that firms are links in a networked supply chain. This strategic viewpoint has created the challenge of coordinating effectively the entire supply chain, from upstream to downstream activities. While supply chains have existed ever since businesses have been organized to bring products and services to customers, the notion of their competitive advantage, and consequently supply chain management (SCM), is a relatively recent thinking in management literature. Although research interests in and the importance of SCM are growing, scholarly materials remain scattered and disjointed, and no research has been directed towards a systematic identification of the core initiatives and constructs involved in SCM. Thus, the purpose of this study is to develop a research framework that improves understanding of SCM and stimulates and facilitates researchers to undertake both theoretical and empirical investigation on the critical constructs of SCM, and the exploration of their impacts on supply chain performance. To this end, we analyse over 400 articles and synthesize the large, fragmented body of work dispersed across many disciplines such as purchasing and supply, logistics and transportation, marketing, organizational dynamics, information management, strategic management, and operations management literature.     

Boosting sustainability and financial performance: the role of supply chain controversies

In recent years, numerous scandals concerning working conditions in Asia have threatened the reputation of large companies like Wal-Mart and Inditex. Since such scandals call attention to activities harmful to sustainable development, it is very important to study the relationships between concerns for sustainable supply chain management (SSCM), sustainability, and organisations’ market value. The added value of our study is, first, to explore SSCM controversies as drivers of or pressures for adopting and applying sustainability practices; and, second, to contribute to the recent but growing literature that analyses the channels through which SSCM and sustainability practices influence the firm’s value. We introduce sustainability environmental, social, and governance (ESG) practices as a mediator between SSCM controversies and market value to examine whether SSCM controversies with firms’ stakeholders lead to improvements in the ESG dimensions of organisational sustainability. We also examine the relationships between the ESG dimensions and market value, measured as Tobin’s Q ratio. The results confirm both the positive relationships of SSCM controversies to the ESG dimensions two years later and a positive relationship of the dimension of governance to Tobin’s Q. We also confirm a negative and significant relationship of the social dimension to Tobin’s Q, and a non-significant relationship of the environmental dimension to Tobin’s Q.     

A framework for designing a supply chain distribution network

Based on the analysis of the pertinent literature, we propose a framework to serve as a guide in designing a distribution network as a component of a supply chain (SC). It consists of three steps that are common to goods and services SCs: position of the decoupling point, structure of the network, and product delivery. For each step, we take into account the peculiarities of both goods and services separately in order to establish a list of available options and evaluate their suitability in relation to the relevant factors that characterise the products and the markets.     

The regenerative supply chain: a framework for developing circular economy indicators

There are widely differing experiences and practices in the development of indicators to monitor, report and communicate progress towards the implementation of the circular economy (CE). We present a framework for developing CE indicators which link to the core goals, principles and building blocks of a CE. To do this we utilise the Ellen MacArthur Foundation butterfly model as a coherent systems overview of key material stocks and flows, and representation of relationships between inputs, outputs, recovery processes, emissions, energy and value loops in physical and financial measures which constitute the CE supply chain. Based on nine multinational organisations and four cases of leading companies engaged with CE activity, we address the types of indicators being used and make recommendations for indicators to reflect key goals and principles of CE. Our research on the development and expansion of circular practices leads to the question of what new opportunities and challenges CE raises for such companies in terms of competitive business advantage and resultant requirements for supply chain redesign and indicator development, over and above pre-existing closed-loop production.     

Product recovery optimization in closed-loop supply chain to improve sustainability in manufacturing

When business practices shift from a traditional open supply chain to a closed loop instead, the environmental and societal issues are efficiently integrated in business development. However, even an efficiently integrated shift introduces a number of trade-offs due to the contradictory goals that emerge from that business’s economical, environmental and social dimensions. In this paper, we propose a multi-objective mixed integer mathematical problem for a generic closed-loop supply chain (CLSC) network to rationalise how a system’s product recovery helps to improve manufacturing sustainability. The CLSC network proposed in this study consists of a hybrid manufacturing facility, warehouse, distribution centres, collection centres and a hybrid recovery facility (HRF). The proposed model determines the best location for the HRF and optimal flow of products, recovered parts and material in the network while it simultaneously maximises profit, saves activity costs, helps to decrease the harmful effects of the manufacturing process and makes a positive impact on societal development. To validate the model, a numerical illustration with the help of a case study from an electrical manufacturing industry is offered. The results authenticate the approach of the model towards the fulfilment of various environmental regulations. A sensitivity analysis, completed on demand, and the return rate also assists decision-makers to manage their decisions with a broader insight towards manufacturing sustainability.     

Concurrent product and closed-loop supply chain design with an application to refrigerators

Increased concern for the environment has lead to new techniques to design products and supply chains that are both economically and ecologically feasible. A literature study shows that many models exist to support product design and logistics separately. In our research, we develop quantitative modelling to support decision-making concerning both the design structure of a product, i.e. modularity, reparability and recyclability, and the design structure of the logistic network. Environmental impacts are measured by linear-energy and waste functions. Economic costs are modelled as linear functions of volumes with a fixed set-up component for facilities. This model is applied to a closed-loop supply chain design problem for refrigerators using real life R&D data of a Japanese consumer electronics company concerning its European operations. The model is run for different scenarios using different parameter settings such as centralized versus decentralized processing, alternative product designs, varying return quality and quantity, and potential environmental legislation based on producer responsibility.     

Multi-objective mixed integer programming and an application in a pharmaceutical supply chain

Multi-objective integer linear and/or mixed integer linear programming (MOILP/MOMILP) are very useful for many areas of application as any model that incorporates discrete phenomena requires the consideration of integer variables. However, the research on the methods for the general multi-objective integer/mixed integer model has been scant when compared to multi-objective linear programming with continuous variables. In this paper, an MOMILP is proposed, which integrates various conflicting objectives. We give importance to the imprecise nature of some of the critical factors used in the modelling that can influence the effectiveness of the model. The uncertainty and the hesitation arising from estimating such imprecise parameters are represented by intuitionistic fuzzy numbers. The MOMILP model with intuitionistic fuzzy parameters is first converted into a crisp MOMILP model, using appropriate defuzzification strategies. Thereafter, the MOMILP is transformed into a single objective problem to yield a compromise solution with an acceptable degree of satisfaction, using suitable scalarisation techniques such as the gamma-connective technique and the minimum bounded sum operator technique. The proposed solution method is applied to several test problems and a multi-objective pharmaceutical supply chain management model with self generated random data.     

A strategic decision framework for a value added supply chain

Supply chains are becoming increasingly complex. The structure of the supply chain and the suppliers who participate in it are critical decisions for managers. The supply chain is no longer simply a source of inputs or services but an integral source of value added. It is clear that in some cases strategic supply chain objectives may require trade-offs, for example, between cost and innovation capability or between managing risk and maximising flexibility. These decisions balancing trade-offs between desirable partner characteristics are critical and can make a significant contribution to business performance. A framework is outlined, based on the foundation of extant literature, within which firms can make strategic decisions on supply chain structure by categorising the characteristics they prioritise in their supply chain strategy. There is also a strong foundation in the literature on developing mathematical models that provide insight into the decision-making process. A mixed integer programming model is specified that incorporates the opportunity for diversification and provides a demand allocation decision. The model is robust enough to allow for single or diversified supplier strategies based not only on capacity constraints but also on risk pooling and minimum performance requirements for key characteristics that form the basis of the strategy. A Lagrangian relaxation is proposed and satisfactory performance results are provided.     

Model for integrating the supply chain of an appliance company: a value of information approach

A supply chain management model is presented in the context of a major household appliance manufacturer in Mexico. Specifically, it provides a capacitated, multistage, multiperiod, multicommodity, multifacility inventory planning model. The mixed-integer programming model deals with the efficient allocation of resources in the supply chain network under the premise that information is a valuable resource that also requires optimal allocation in order to enhance the flow of products and to minimize system-wide costs. The model employs the strategy of risk pooling or time postponement as a cost-reduction driver to account for the provision of safety stocks in the system. Numerical results are presented to demonstrate the feasibility of the application of the real-world, large-scale supply chain models.     

Resilient and sustainable supply chain design: sustainability analysis under disruption risks

Resilience to disruptions and sustainability are both of paramount importance to supply chains. However, the interactions between the two have not been thoroughly explored in the academic literature. We attempt to contribute to this area by presenting a hybrid methodology for the design of a sustainable supply network that performs resiliently in the face of random disruptions. A stochastic bi-objective optimisation model is developed that utilises a fuzzy c-means clustering method to quantify and assess the sustainability performance of the suppliers. The proposed model determines outsourcing decisions and resilience strategies that minimise the expected total cost and maximise the overall sustainability performance in disruptions. Important managerial insights and practical implications are obtained from the model implementation in a case study of plastic pipe industry.     

Dynamic supply chain decisions based on networked sensor data: an application in the chilled food retail chain

With large volume of product flows and complex supply chain processes, more data than ever before is being generated and collected in supply chains through various tracking and sensory technologies. The purpose of this study is to show a potential scenario of using a prototype tracking tool that facilitate the utilisation of sensor data, which is often unstructured and enormous in nature, to support supply chain decisions. The research investigates the potential benefits of the chilled food chain management innovation through sensor data driven pricing decisions. Data generated and recorded through the sensor network are used to predict the remaining shelf-life of perishable foods. Numerical analysis is conducted to examine the benefit of proposed approach under various operational situations and product features. The research findings demonstrate a way of modelling pricing and potential of performance improvement in chilled food chains to provide a vision of smooth transfer and implementation of the sensor data driven supply chain management. The research finding would encourage firms in the food industry to explore innovation opportunities from big data and develop proper data driven strategies to improve their competitiveness.     

A technology selection framework for integrating manufacturing within a supply chain

This paper describes a structured analytical approach for selecting a manufacturing technology. A framework consisting of six integrated steps is proposed by considering the growing importance of supply chains in manufacturing organisations. The framework makes use of the analytical hierarchy process (AHP) approach combined with strategic assessment model (SAM) to evaluate and select the technologies appropriate for providing overall competitive advantage. The framework is intended to assist industrial managers in promoting manufacturing and supply chain collaboration and co-ordination by including intra-organisational perspective in their organisational technology selection decision making process.     

Risk assessment for the supply chain of fast fashion apparel industry: a system dynamics framework

With the rapid progress of science and technology and continuously growing customer expectations, share of merchandise exhibiting characteristics of perishability is on the rise and a wide range of industries are affected by this phenomenon. This paper focuses on the fast fashion apparel industry due to its particular characteristics such as short life cycle products, volatile demand, low predictability, high level of impulse purchase, high level of price competition and global sourcing. A system dynamics model is proposed for analysing the behaviour and relationships of the fast fashion apparel industry with three supply chain levels. The Conditional Value at Risk measure is applied to quantify the risks associated with the supply chain of these products and also to determine the expected value of the losses and their corresponding probabilities. Multiple business situations for effective strategic planning and decision-making are generated. In particular, the impact of lead time and delivery delays on the supply chain performance (inventory, cost, backlog and risk) is analysed as the key to success for this industry is to satisfy customers’ needs in the shortest time.