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Running Head: TRADE-OFF IN SUSTAINABLE SUPPLY CHAIN MANAGEMENT 1
Trade-Off in Sustainable Supply Chain Management
TRADE-OFF IN SUSTAINABLE SUPPLY CHAIN MANAGEMENT 2
Executive Summary
This report describes the sustainable supply chain management in different manufacturing
firms about the trade-off in the management of supply chain. The study makes an effort to
understand the trade-off in supply chain and to get a trade-off balance in the components of
sustainability which are economic development, social needs, and environmental
performance. The major challenges in sustainable supply chain management are costs,
complexity, operationalisation, uncertainties and so on. The report suggests the use of life
cycle assessment and modelling techniques for the manufacturing firms is required to achieve
trade-off in the supply chain to achieve sustainable supply chain management and manage the
challenges. The supply chain executives are looking or use of technologies and evaluating the
trade-off in various operations such as sourcing, inventory cost management, transportation
cost, the cost of labour, etc. to achieve sustainable supply chain and also seeking solutions to
balance the trade-off between economic development, social needs, and environmental
performance.
TRADE-OFF IN SUSTAINABLE SUPPLY CHAIN MANAGEMENT 3
Table of Contents
Executive Summary ................................................................................................................... 2
Introduction ................................................................................................................................ 4
Sustainable supply chain management ...................................................................................... 4
Analysis of Drivers .................................................................................................................... 5
Analysis of Challenges .............................................................................................................. 6
Conclusion ................................................................................................................................. 9
References ................................................................................................................................ 11
TRADE-OFF IN SUSTAINABLE SUPPLY CHAIN MANAGEMENT 4
Introduction
The growing significance of environmental concerns and environmental performance had put
immense pressure on the manufacturing firms to make an effort to manage the activities of
the supply chain in the most efficient manner for optimal resource utilisation. There have
been increasing the investments in managing sustainability in the supply chain for better
environmental performance (Gunasekaran & Ngai, 2012). It is, therefore, important to
understand to what extent the progress have been made and what sacrifices have been made
to achieve the bottom line of sustainability which includes preservation of the environment,
social system welfare, and economic development. However, for the optimisation and
management of sustainable chain, it is essential to measure and balance the trade-off in the
different components of sustainability such as environment, economic and social aspects.
Sustainable supply chain management
Sustainable supply chain management includes the integration of the economic, social and
environmental goals to achieve systematic business process and transparency in logistic
operations in the entire supply chain for long-term advantage of the firm (Seuring, 2013).
Many production firms are investing time, money and effort to optimise the resource
utilisation and manage the operations of the supply chain to control the cost. One of the top
priorities of manufacturing businesses is to reduce carbon footprints as sustainability measure
(Brandenburg et al., 2014). Under the sustainable chain management, the practices of green
supply chain management incorporate social goals to develop business management. On the
other hand, this integration of social goals with economy development is not established by
many firms as the social needs pose optimization problem in the logistics network
(Gunasekaran & Ngai, 2012).
TRADE-OFF IN SUSTAINABLE SUPPLY CHAIN MANAGEMENT 5
Analysis of Drivers
The major drivers of sustainable supply chain management are environment, social and
internal business processes, legislations and regulations as well as the customers. The firms
are tracking, adopting green practices and reducing waste to manage the emissions from the
activities of supply chain as supply chain operations are the major contributions in gas
emission and carbon footprints (Tognetti et al., 2015). Also, the firms are identifying the
loopholes in the process of electricity consumption and water consumption to reduce wastage
and reduce the cost further. However, the improvement in one sustainability dimension is
having an impact on other parameters of sustainability. Such trade-off in sustainable chain
management is mostly seen in between environmental components and social system
commitment. For instance, a supply chain management which adopts socially responsible
practices is linked to high environmental concerns...