1 chapter 14 sustainable logistics and supply chain systems professor : lyu ph.d student : mira
TRANSCRIPT
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Chapter 14Sustainable Logistics and Supply
Chain Systems
Professor : Lyu Ph.D
Student : Mira
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Introduction
Look beyond how logistics and SCM can influence organizational success and to consider the issue of sustainability as it applies to logistics and SCM
“Green “ issues Economic sustainability Reverse logistics
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Learning objectives Understand what sustainability involves in the
context of logistics and SCM Understand key terms such as carbon footprints,
food miles, reverse logistics, etc Illustrate best practice examples of attempts to
reduce environmental footprints Understand the link that exists between growth in
logistics and concomitant growth in the demand for transport
Examine the different aspects of the two key dimensions used in logistics to reduce environmental impacts, namely scale and efficiency
Explain the different aspects of reverse logistics
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Sustainability
Sustainability to include environmental management, close-loop supply chain and a broad perspective on triple-bottom-line(3BL)
Sustainable logistics is concerned with reducing the environmental and other disbenefits associated with the movement of freight
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triple-bottom-line(3BL) People, Planet and Profit are used to
concisely describe the triple bottom line and the goal of sustainability
An criteria for measuring organizational success: economic, environment and social
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Five core section
The green revolution and supply chain redesign
The link between economic growth and transport growth
The role of scale in logistics and SCM Efficiency solutions Reverse logistics
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Green Revolution
The international Kyoto Protocol has called for a 60% reduction in carbon emissions by 2050
Carbon footprint: the environmental disbenefits associated with economic activities such as the movement of freight http://www.carbonfootprint.com/index.html
Food miles: the distance by which the various components of a particular food item have to travel before final consumption http://www.food-mileage.com/calculator/
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The drivers behind the increased emphasis on green issues
Legislation
Market pressure
Social Responsibility
CostReduction
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Supply chain redesign
‘Greening’ the supply chain: Largely about forward planning Over 80% of carbon savings are only achievable at the
supply chain design stage, e.g.: deciding where to locate warehouses and distribution
centres deciding which transport modes to use reconfiguring distribution networks so as replace
small deliveries direct to all end customers with centralised deliveries to a hub from where end customers retrieve their goods
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Sustainable logistics and SCM
Supply chain redesign
Promoting scale Enhancing efficiency
Three ways in which to improve the sustainability of logistics and supply chain system
Redesigning supply chain
Using scale to use the negative environmental effects of logistics activities
Promoting various efficiency solutions
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The link between economic growth and transport growth
There is an closely link between economic growth and transport i.e. as economies grow, more transport is
required to move the freight that economic growth inevitably generates
A core issue for policy makers is to endeavour to decouple economic growth and transport growth i.e. to find ways of allowing economic growth
without comparable growth in transport
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The role of scale in logistics and SCM
If all the containers in the world were lined up, it would create a container wall with a length of 108,000 kilometres i.e.2.7 times around the earth at the equator
The volume of freight that can be held in one standard forty foot container is quite significant: 200 dishwashers, 350 bicycles or 5,000 pairs of jeans
The shipping cost per unit is thus quite low: Maersk estimate for freight coming from Asia to Europe it costs £9 per dishwasher, £5 per bicycle and just £0.35 per pair of jeans
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The role of scale in logistics and SCM
Only certain ports can handle ultra large vessels There is growing traffic concentration at certain
other ports Increasingly, many mid-sized ports are playing a feeder
role to the very large ports as hub and spoke networks In these networks the larger vessels ply between the
major transhipment hubs The prosperity of the smaller ports is increasingly
dependent on the route strategies of the major shipping lines
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Efficiency solutions
Many logistics operators are seeking efficiencies with how they move and store freight so as to reduce the environmental impact of their activities
The supply chain strategy can impact the efficiency of the transport services demanded , ex JIT system
Table 14.1 lists some of the many ways in which logistics efficiencies can be generated, and simultaneous environmental penalties reduce , in the case of road haulage
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Table 14.1 Improving Road Haulage Logistics Efficiency and Reducing Environmental Penalties
Reducing empty running, pooling and sharing capacity, obtaining ‘backhaul’ loads (a number of websites have been developed that match carriers who have available capacity with shippers seeking capacity – see the case below on electronic logistics markets).
Increasing vehicle payload capacity (by weight and/or by cubic volume) – double deck and higher trailers, single tractor unit and multiple trailer combinations, etc.
Improved vehicle routing using GPS and other systems
More efficient use of packaging and loading of containers.
Improved vehicle driving (in-cab computer monitoring of driving style, even examining the benefits of air conditioning versus open windows!).
Enhancing vehicle operating efficiency (for example using hybrid fuels, ensuring correct wheel alignment and enhanced aerodynamic styling of trucks).
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Reverse logistics
Reverse logistics encompasses a number of streams of activity: Return of end of life products Return of defective, damaged and unwanted
products Return of packaging and recovery of returnable
equipment such as containers, pallets and barrels
Closed loop supply chains: those which also comprise reverse / return flows
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Closed-loop supply chain
Material Supply
ComponentManufacturing
Assembly orRe-assembly
Distribution
User
CollectionInspectionSeparation
DisassemblyMaterialRecovery
WasteDisposal
Recycle RemanufacturingRepair
Reuse
Disposal
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Green product design
It is at the product design stage that the most contribution can be made towards reducing a products environmental footprint
This is sometimes referred to as green product design
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Comparison of reverse logistic and green logistics
The overlap means there are some activities applied both to reverse logistics and to green logistics
Green logistics investigate supply chain with respects to environmental and ecological activities while reverse logistics emphasizes more on the profitability of strategic recovery options
Production returns
Marketing returns
Secondary markets
Recycling
Remanufacturing
Reusable packaging
Packaging reduction
Air & noise emissions
Environmental impact
Recycling
Remanufacturing
Reusable packaging
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Thank You for Your Attention