Marcus Brandenburg

Low carbon supply chain configuration for a new product – a goal programming approach

Green supply chain management and product innovation both have become sources of competitive advantage for companies from different industries. However, research on the configuration of green supply chains for new products represents a comparably new trend. In this paper, a goal programming approach is suggested to optimise the supply chain (SC) configuration for a new consumer product under consideration of economic and environmental criteria. The approach is illustrated by the case example of a fast moving consumer goods manufacturer. In this context, trade-offs between the ecologic factor of carbon emission, on the one hand, and financial value creation and customer service level on the other hand, are assessed in the deterministic analyses. The influence of long-term demand uncertainties is modelled in a scenario approach. It is observed that decentralised SC configurations enable carbon emission reduction without deteriorating the economic SC performance. Furthermore, it is detected that a focused economic optimisation strongly amplifies negative environmental impacts of demand uncertainties.

Impacts of supply chain management on company value: benchmarking companies from the fast moving consumer goods industry

The research question addressed is to which extent supply chain management (SCM) creates value from cost and working capital. The paper provides an empirical evaluation including insights on important criteria for value creation. In a secondary data analysis, 10 leading fast moving consumer goods (FMCG) companies are benchmarked regarding the value created from cost of goods sold (COGS) and working capital within the time horizon 2003–2008. The study applies benchmarking methodology and a discounted cash flow (DCF) based model for quantifying value contributions. It is shown that SCM is realized in a value-adding way with different emphasis on COGS or working capital. Monetarily working capital components (trade payables, trade receivables) have a high relevance for value creation. Continuous improvements and long lasting developments of value drivers are more appropriate for value creation than alternating improvements and deteriorations. Timing aspects of value driver developments have to be considered for value creation. The value of the paper stems from empirical comparison of value created by working capital and COGS and from evidence of important criteria for value creation. Further analysis based on cost components as well as benchmarking with different or extended content, such as fixed asset performance or cross-industry benchmarking, leave room for future research.

A Model for Quantifying Impacts of Supply Chain Cost and Working Capital on the Company Value

Supply Chain Management (SCM) is identified and accepted as a competitive advantage. Nevertheless holistic approaches for value-based SCM to leverage this advantage in a value adding way are missing so far. Efficient approaches to quantify and compare value contributions from Supply Chain (SC) value drivers are needed. This paper contributes to this need by proposing a model to efficiently quantify and compare value contributions from SC cost and working capital, that affect the profitability and asset performance. Properties and characteristics of the model, which is based on the Discounted Cash Flow concept, are illustrated by an industrial example of a single company. In this example, the relevance of timing and continuity of developments of SC cost and working capital for value creation is pointed out.

Eco-Innovation and the Development of Business Models

Developments and directions of eco-innovation.- Part I Models and frameworks supporting eco-innovation.- Managing cross-industry innovations: a search strategy for radical eco-innovations.- How to make eco-innovation a competitive strategy: a perspective on the knowledge-based development.- A framework for developing, evaluating and assessing eco-innovations.- Radical and Systematic Eco-Innovation with TRIZ Methodology.- Part II Application: surveys and case studies on eco-innovation deployment.- Eco-Innovation on Manufacturing Industry: The role of sustainability on innovation processes.- Portraying the Eco-Innovative Landscape in Brazil: determinants, processes and results.- Contextual Factors as Drivers of Eco-innovation Strategies: The Definition of an Organizational Taxonomy in the Brazilian Cellulose, Paper and Paper Products Industry.- Conceptualising industry efforts to eco-innovate among large Swedish companies.- Integrated environmental management tools for product and organizations in clusters.- Towards joint product-service business models: The case of Your Energy Solution.- Business model innovation for eco-innovation: developing a boundary-spanning business model of an ecosystem integrator.- Part III future directions: eco-innovation initiatives.- A new methodology for eco-friendly construction: utilizing quality function deployment to meet LEED requirements.- Light weight small island ferries in Scandinavia - a case of radical eco-innovation.- BioTRIZ: a win-win methodology for eco-innovation.

Quantitative models for value-based supply chain management

It is taken for granted and substantiated by conceptual frameworks, qualitative arguments and empirical research that supply chain management (SCM) influences the value of a firm. However, value-based metrics and quantitative models to measure and compare this influence are found rather seldom in scientific research. Most often, quantitative research approaches are focused on measuring and evaluating the supply chain efficiency or limited to the assessment of selected SCM-related drivers of company value. The paper at hand takes up this research gap. Developments and directions of related scientific research are identified in a literature review, out of which a conceptual framework for value-based SCM is derived. Grounded on this framework, two quantitative models are developed which comprise financial and non-financial SCM-related factors of company value and allow for measuring and financially comparing their value impacts. These models are empirically tested in a secondary data analysis and a case study from the fast moving consumer goods industry.

Value-Based Strategic Supply Chain Planning

This chapter deals with the question how value-based aspects could be reflected in strategic supply chain (SC) planning, in particular how to determine strategic targets for SC value drivers in a long-term horizon of several years from which a framework for tactical and operational SC planning and control can be obtained. It describes an approach to value-based strategic SC planning, in which long-term targets for company value are disaggregated to annual targets for SC cost and working capital under explicit consideration of planned future sales development. A top down determination of annual targets for SC cost and working capital is combined with a bottom up validation to form a closed planning and control cycle. The planning method, which is derived from a discounted cash flow based model for quantifying value impacts from SC cost and working capital, is discussed thoroughly and illustrated by a numerical example. Aspects of integrating this approach with financial planning and tactical SC planning are outlined.

Supply network configuration—A benchmarking problem

Managing supply networks is a highly relevant task that strongly influences the competitiveness of firms from various industries. Designing supply networks is a strategic process that considerably affects the structure of the whole network. In contrast, supply networks for new products are configured without major adaptations of the existing structure, but the network has to be configured before the new product is actually launched in the marketplace. Due to dynamics and uncertainties, the resulting planning problem is highly complex. However, formal models and solution approaches that support supply network configuration decisions for new products are scant. The paper at hand aims at stimulating related model-based research. To formulate mathematical models and solution procedures, a benchmarking problem is introduced which is derived from a case study of a cosmetics manufacturer. Tasks, objectives, and constraints of the problem are described in great detail and numerical values and ranges of all problem parameters are given. In addition, several directions for future research are suggested.

A sustainable aggregate production planning model for the chemical process industry

Abstract Process industries typically involve complex manufacturing operations and thus require adequate decision support for aggregate production planning (APP). In this paper, we focus on two relevant features of APP in process industry operations: (i) sustainable operations planning involving multiple alternative production modes/routings with specific production-related carbon emission and the social dimension of varying operating rates, (ii) integrated campaign planning with the operational level in order to anticipate production mix/volume/routing decisions on campaign lead times and WIP inventories as well as the impact of variability originating from a stochastic manufacturing environment. We focus on the issue of multi-level chemical production processes and highlight the mutual trade-offs along the triple bottom line concerning economic, environmental and social factors. To this end, production-related carbon emission and overtime working hours are considered as externalized factors as well as internalized ones in terms of resulting costs. A hierarchical decision support tool is presented that combines a deterministic linear programming model and an aggregate stochastic queuing network model. The approach is exemplified at a case example from the chemical industry to illustrate managerial insights and methodological benefits of our approach.

Toward the Integration of Sustainability Metrics into the Supply Chain Operations Reference (SCOR) Model

The consideration of ecological and social impacts of supply chains is becoming a pressing issue and a competitive advantage for companies. Therefore, sustainability-related aspects have to be identified and integrated into supply chain management to allow for sustainable performance measurement. However, the widely recognized Supply Chain Operations Reference (SCOR) model and its extensional Green SCOR model do not comprehensively address the triple bottom line (TBL) of sustainability, i.e., the interplay of the economic, environmental, and social dimensions, especially because social aspects are neglected so far. Furthermore, the ecological metrics are mainly output oriented, thereby omitting input factors that are crucial to environmental performance. Against this background, this chapter (1) elaborates on literature concerned with the integration of the TBL of sustainability into supply chain management processes and (2) develops a conceptual framework to match sustainability metrics to the SCOR processes. On the one hand, the resulting conceptualization contributes to closing the current research gap on the integration of sustainability metrics into supply chain process models, and on the other hand, it alleviates practice application through compatibility with the standardized SCOR model. It is found that environmental metrics can be directly related to existing SCOR process elements, while social metrics are more difficult to integrate. Nevertheless, the research presented should subsequently be subject to empirical validation and formal mathematical modeling to shed light on holistic sustainability performance measurement of supply chains.

Sustainable Supply Chains: Recent Developments and Future Trends

Sustainable supply chain management (SSCM) has become a highly relevant topic in scientific research as well as in managerial practice. This chapter summarizes the findings of several reviews of SSCM literature. In addition, propositions and guidelines for future SSCM research are given. Based on these insights, the structure of the book at hand and the coherence of the book chapters are outlined.