Supply Chain Business Engineering
Advancement in technology and the abundance of raw material has resulted in the increased consumption of products and services leading to increased production and then eventually, increased waste products.
All these activities have a toll on the environment.
Organizations are producing more and more users are consuming more than ever before in history; the world population is ever increasing and consequently, more waste is being produced and will continue to be produced if it is not checked.
Organizations underestimate the real cost of waste; both the economical and the ecological costs and in addition to this waste production, the excessive consumption gives increased consumption of energy, water and in machine utilization that leads to increased global warming.
About Supply Chain Business Engineering
The concept of sustainable production is emerging to counter these impending environmental, economic and social crises. A Life Cycle Engineering (LCE) approach therefore aims to reduce the waste by reusing it and therefore readily assists in promoting sustainable development.
Since Life Cycle Engineering promotes systems thinking and is proactive, it leads to collaboration and integration between various groups such as marketing, engineering, production etc.
This helps organizations to get up to date data and possibly run in parallel activities which otherwise would be left to a later date. Organizations, and the leaders and managers in them, will however need to change their mindsets to make room for LCE.
For example, currently packaging development is not considered by many to be an integral part of product development and is considered to be an external activity performed by third party suppliers.
It is also generally considered as a production task and is therefore not started until the production phase.
With LCE however, the packaging development can now become an integral part of product development.
LCE will allow companies to make sourcing, reuse and recycling decisions for packaging while they are still in the product development phase.
As a result, this provides space in decision making, gives bargaining power with suppliers and assists organizations in making time to market reductions.
Some Steps of Supply Chain Business Engineering
This also means that organizations need to make changes to their current working at all of the following three levels:
- Strategic: to define integrated product packaging development policy
- Tactical: to integrate the packaging into the product development planning process
- Operational: to integrate the packaging decision making during the product development process
Life Cycle Engineering forms a basis of Green Supply Chain Planning process in contrast to traditional supply chain strategic planning where supply chain strategy aligns to business strategy. With LCE the potential economic, environmental and technical impacts of products, services or processing methods are analyzed for the entire life cycle at conceptualization and design phases. LCE will therefore allow organizations to:
- Save cost by reusing/recycling within a stage and therefore avoid shifting the burden along different phases of the life cycle
- Reduce potential costs relating to environmental issues
- Focus on preventing pollution and avoiding producing unnecessary productsInstill systems thinking at each stage of the product life cycle and become more responsible ecologically
- Make holistic decisions
- Increase attractiveness of the organization both internally to employees and to external parties
- Be better at collaboration and cooperation along the supply chain and increase their attractiveness as a supply chain partner
When doing this, organizations will then have greener and cleaner sustainable products and will be using methods that are innovative, improved, competitive and growth orientated.
Source : Emmet & Sood – Green Supply Chains : An Action Manifesto. This book was awarded certificate as “The Most innovative Supply Chain book in the last decade (2000-2010)
