Green Supply Chain Management In Manufacturing Industries Management

CHAPTER 2LITERATURE REVIEWIntroduction

This chapter continuing the discussion of the previous chapter which is focuses on Green Supply Chain Management. Further, the reviewing of the literature on definition of Green Supply Chain Management in manufacturing industries in Malaysia, the problem of the Green Supply Chain Management, the factors that influencing Green Supply Chain Management and the stage of implementing of the Green Supply Chain Management.

Overview and definition of Green Supply Chain Management (GSCM)

In recent years, a broad and worldwide consensus has been reached on the great importance of striving for sustainable development (Qinghua Zhu, Raymond P. Cote, 2004). In last few decades, it has been increasing consciousness of the environment. Nowadays, the world's environmental problems aware by the people such as global warming, toxic substance usage and the decreasing of non-replenish usage. Most of the environmental problem is cause of human being from the industries and residences. It is because of irresponsible of the human so that pollution of the environment, water and etc occur.

Actually, government has promoted this environmental problem by campaign to public especially for industries sector. As a result, there just have few organizations responded this problem to their company by applying green principles. For an example, those company will enhance the using of the environmental raw material, reducing the using of recycle papers for packaging and refill all the end rubbish before throw into the refuse dump. Because of the campaign which promoted by the government, few organizations apply green principles and expended green principles to many department which is consist supply chain.

Besides that, many companies be irresolute to embrace actions might negatively impact profitability and competitiveness. Those companies who choose to green principles, their supply chain will focusing on reverse logistics, green product design and etc. Meanwhile, they also have to prevent harmful materials from entering the environment. For the product and design need to address to green and fee of pollution. Nowadays, many companies forced to choose between environment and saving money. But the decision for today for these case that it doesn't have to be one or the other. They success found from the environment and budget by adhering to the three R's of Green Supply Chain Management 'reduce, reuse, recycle'.

Reducing the environmental impact, companies find out the cost saving for their business. Benefit of implementing the green policies, companies will re-evaluate their supply chain. Normally, supply chain for a company start from purchasing, planning and managing the use of the materials to shipping abs distributing final products to customers.

Green Supply Chain Management has been launched in the world from last few years. Green Supply Chain Management widely use in manufacturing industries. This principle covers all the stage in manufacturing sectors. Despite of manufacturing industries, Green Supply Chain Management also can be used to other business sectors such as education, services and other sectors.

Besides that, green supply chain management is a concept that is gaining popularity in the South East Asian region. For many organizations in this region it is a way to demonstrate their sincere commitment to sustainability (Purba Rao and Diane Holt, 2005). Furthermore, many realize that customers and other stakeholders do not always distinguish between a company and its suppliers. If an organization has environmental liabilities, stakeholders may often hold the lead company in a particular supply chain responsible for the adverse environmental impacts of all organizations within a specific supply chain for a particular product.

In fact, most of the manufacturing industries understand that strategies of their organization and practices that incorporate the consideration of the natural environment. The organizational strategies and practices can be a source of competitive advantage. In the environmental management, greening supply chain management becomes a major factor.

The definitions of the green supply chain management are from Srivastara (2007). The definition is based on his study, collected and classified from the previous literature which is relating to green supply chain management. He defined the green supply chain management as integrating environment thinking into supply chain management, including product design, material sourcing and selection, manufacturing processes, delivery of the final product to the consumers and end-of-life management of the product after its useful life.

According to Zhu Qing Hua and Joseph Sarkis (2004), they define a number of possible definitions of GSCM have been put forth over the past decade including:

Green supply refers to the way in which innovation in supply chain management and industrial purchasing may be considered in the context of the environment.

Environmental supply chain management consists of the purchasing function's involvement in activities that include reduction, recycling, reuse and the substitution of materials.

The practice of monitoring and improving environmental performance in the supply chain…

The term 'supply chain' describes the network of suppliers, distributors and consumers. It also includes transportation between supplier and the consumer, as well as the final consumer… the environmental effects of the researching developing, manufacturing, storing, transporting, and using a product, as well as disposing of the product waste, must be considered.

Meanwhile, according to Zhou Feng Fei (2009) in China, Green Supply Chain Management is a sort of modern management mode which could comprehensively consider the environmental influence and resource utilization efficiency in the whole supply chain and how to implement the green supply chain management in special industrial operation at present has become into one of hotspot problems.

Despite of it, one of the definitions from Johnny C. Ho, Maurice K. Shalishali, Tzu-Liang (Bill) Tseng, and David S. Ang, (2009), they define that Green Supply Chain Management involves traditional supply chain management practices which integrate environmental criteria. A green supply chain imitates nature, running in cycles that mimic natural energy and material cycles. GSCM should keeping wastes within the industrial system in order to converse energy and prevent the dissipation of harmful materials into the environment. To design a green supply chain the entire inputs and outputs in the product life cycle need to be holistically considered. Inputs include energy, materials and other resources. Outputs include products, waste and revenues generated. Unnecessary inputs can be eliminated and outputs can be re-used.

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