The pressure to become environmentally sustainable has intensified over the past few years. Increased energy costs, customer awareness, worldwide regulations, and lobbying efforts have pushed companies to reassess their environmental policies. But how does a company "go green" while keeping the bottom line in the black? The right operational strategy can turn the green challenge into a competitive advantage.

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The chemical industry's business environment of falling prices, poor returns on capital, overcapacity, corporate consolidation and the move to the East are all factors that point to supply chain management as an essential ingredient for corporate survival. Changes in network design, customer delivery commitments, and manufacturing to unlock business value will necessarily challenge the status quo of reported unit costs and commercial operations. But the value of eliminating waste can be significant and there are few boards that can afford to ignore this opportunity.

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Global Trade Management (GTM) software solutions allow companies to automate import and export processes, provide higher visibility to goods at supplier sites and in-transit materials, address compliance issues, and improve their inventory management capabilities. These benefits have a positive impact on a company's bottom line. While a GTM solution can be of value to companies involved in global trade, the expected benefits must be compared to the initial installation and ongoing costs in order to understand the net impact. This paper presents a comprehensive model for quantifying the net benefits of a GTM solution.

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In 2007, the CEO of Unilever committed to a 25% reduction of CO2 emissions from global manufacturing operations in 2012. Unilever Europe Logistics has aligned to this target. To achieve this objective, the management of European logistics department decided to build a carbon emission estimation methodology to quantify the CO2 emissions, emitted from the sourcing units to the distribution centers. In cooperation with the Technical University of Eindhoven, a new methodology was developed that allows transport-buying companies to estimate the CO2 emissions in transport.

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In a business environment that requires more responsiveness and focus on the bottom line, supply chain performance management is vital to competitive advantage and sustainable business improvement. SCPM enables companies to identify performance exceptions, understand issues and alternatives, act on high impact problems and opportunities, and continuously validate actions relative to objectives and results. By adopting such systems, companies have increased responsiveness and customer service, reduced inventory and procurement costs, and improved the utilization of production and distribution assets. The benefits are compelling and the path to success has been validated.

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Companies that have mastered demand chain excellence are widening their margin of market leadership and shareholder returns. They are using scientific replenishment methodologies that incorporate statistical and operations research techniques to analyze data and deduce patterns, trends, variability, and the dynamics of customer demand. These scientific techniques enable the balancing of various costs—inventory, transportation, handling, warehousing and other direct and indirect labor—while providing optimal customer service. This balancing act requires timely and accurate data coupled with the appropriate analytical techniques. Learn how to avoid common pitfalls and reap the benefits of demand chain management.

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Companies that have mastered demand chain excellence are widening their margin of market leadership and shareholder returns. They are using scientific replenishment methodologies that incorporate statistical and operations research techniques to analyze data and deduce patterns, trends, variability, and the dynamics of customer demand. These scientific techniques enable the balancing of various costs—inventory, transportation, handling, warehousing and other direct and indirect labor—while providing optimal customer service. This balancing act requires timely and accurate data coupled with the appropriate analytical techniques. Learn how to avoid common pitfalls and reap the benefits of demand chain management.

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For many years, business process outsourcing (BPO) has been identified as a strategic trend. This study examines the business and technical benefits of global business-to-business e-commerce outsourcing. Areas covered include the elements of business value realized by companies that outsource B2B operations, the ROI associated with B2B outsourcing, and best practices in B2B outsourcing that contribute to these results.

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As a result of e-business, many core supply chain concepts and principles have become much more effective. These concepts include information sharing, multi-party collaboration, design for supply chain management, postponement for mass customization, outsourcing and partnerships, and extended or joint performance measures. The Internet has allowed companies to come up with highly innovative solutions that accelerated the widespread adoption of these core supply chain principles. These advancements have accelerated the movement towards supply chain integration; companies that leverage e-business to redefine supply chain integration will achieve significant increases in efficiency and gain competitive edge.

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In a world of globalization and outsourcing, environmental legislation became a main driver for doing eco-design. Eco-innovation and green money are concepts to create marketing advantages and differentiation from their competitors, transforming a legislative handicap into financial benefits and societal recognition. This research introduces Life cycle Environmental Value Chain Analysis (LC-EVCA) and Environmental Worth Analysis (EWA) to identify the stakeholders implementing environmental improvement programs and the value relationships among them.

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This paper investigates the impact of e-waste regulation on new product introduction in a stylized model of the electronics industry. The price of a new product increases with its quality and consumers' rational expectation about the time until the next new product will be introduced. Unfortunately, existing "fee-upon-sale" types of e-waste regulation fail to motivate manufacturers to design for recyclability. In contrast, "fee-upon-disposal" types of e-waste regulation such as individual extended producer responsibility motivate design for recyclability but, in competitive product categories, fail to reduce the frequency of new product introduction.

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Fluctuating oil prices are a fact of life—and a major challenge for any company that ships goods to customers worldwide. Yet many companies are unable to mitigate the impact of oil price swings on financial performance. To address this problem effectively, it is essential to understand all the ways oil price volatility affects transportation costs. Then companies can develop configuration, packaging, and pricing strategies to bolster the bottom line, regardless of the path oil prices take.

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In a period of contraction, offshoring can bring much-needed cost savings and access to new markets. But it can also lessen supply chain flexibility and, ultimately, impede competitiveness. Our survey of 300 global companies high- lights the challenges companies face as they move operations offshore—and, at the same time, reveals some of the innovative supply chain practices helping them succeed. Going one step further, some companies are using these practices to develop more competitive business and operational strategies.

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Four years ago, Walmart made headlines when its CEO announced that the company was launching a new business sustainability strategy designed to meet three sweeping environmental goals: to be supplied 100 percent by renewable energy; to create zero waste; and to sell products that sustain people and the environment. Achievement of these goals would require fundamental change in how Walmart managed its supply chain. Stanford's Erica Plambeck and Lyn Denend revisit those initiatives to assess what Walmart has accomplished to date—and what still needs to be done.

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As the pace of globalization accelerates, companies are finding it increasingly difficult to keep up. Our recent research provides a new framework— the Globalization Maturity Model—that firms can use to assess how well they’ve mastered the challenges of global expansion, and what they need to do operationally to realize their strategic goals.

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This paper examines the value of information sharing and how it can address the bullwhip effect. We start with a general demand model, coupled with a smoothing policy for order variability control. In addition, we do not require that the supplier has full knowledge of the retailer's demand model and order policy, but instead let the retailer share its projected future orders. We first obtain a unifying formula for the magnitude of the bullwhip effect. The formula indicates that it is the forecast correlation over the exposure period as a whole that determines the magnitude of the bullwhip effect. We then quantify the value of information sharing. Finally, we explore the optimal smoothing parameters that could benefit the total supply chain. The resulting optimal policy resembles the postponement strategy. We find that information sharing together with order postponement improves supply chain performance, even though order variability may amplify in some cases.

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Political unrest, natural disasters and many other unforeseen events such as product contamination and adulteration, shortages, border closings and strikes by ports, have made firms more aware of the vulnerability of their supply chains, and encouraged them to seek ways to reduce risk. While security initiatives—both voluntary and government mandated—allow companies to maintain their level of operations and/or to reduce risks, they require significant levels of investment. Many organizations have found it difficult to provide a business case to justify security investments, and are therefore reluctant to invest in security beyond the minimum necessary. This study documents how, when properly leveraged, investments in supply chain security can be offset by the resulting benefits.

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A multi-echelon distribution network presents many opportunities for inventory optimization that the enterprise must pursue to offset potential increases in transportation, warehouse and occupancy costs. The key to achieving those savings is to use a true multi-echelon strategy to manage inventory. Pursue such a strategy is complicated by the multiplicities of inventory drivers and the complexities in modeling the interactions of the drivers between echelons. Nevertheless, the benefits are worth the effort. Taking the right approach can yield rewards on both sides of the inventory equation—better customer service with less inventory.

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We examine the procurement process selection problem of a large industrial buyer who employs reverse auctions for awarding procurement contracts. We contrast two classes of commonly used strategies under multiple sourcing; namely, single-stage reverse auctions, and two-stage processes where price-quantity adjustments between the buyer and the suppliers follow a first-stage reverse auction and present insights on the conditions under which each class is preferable for the buyer.

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Senior management teams across many industries are increasingly realizing how strategic their supply chain is to business: that it is, in fact, one of the critical success factors—for profitability as well as productivity. Yet configuring a supply chain strategy that aligns with the business strategy, and organizing both people and process around that strategy, are no easy matters.

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In 2008, Germany-based business software giant SAP defined the company’s social sustainability priority as connecting global value chains to the base of the economic pyramid, reinforcing the company's strategic commitment to alleviate poverty by accelerating economic development in previously excluded markets. To support this priority, SAP is investing technology, expertise, and cash to connect underserved markets to the global value chain. This case study explores a collaboration in Ghana between SAP and Paris-based microfinance development organization PlaNet Finance. The Shea Value Chain Reinforcement Initiative uses microfinance, education, and technology to improve the incomes and living conditions of women who pick shea nuts and women who process nuts into shea butter.

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This paper explores the impact confidence has on supply chain performance and its related costs. Businesses tend to concentrate on the traditional tangible elements of the supply chain, and fail to recognize the damaging effect that the lack of trust by its users and members can have. Although difficult to precisely quantify, the confidence factor can have significant impact on inventory levels and operating costs. One of the main drivers to increasing confidence is timely accurate information giving stakeholders true visibility along the supply chain.

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Global sourcing and supply has become a central part of many companies' operations strategies and proved essential to increasing gross and net margin. Global sourcing implies long distance supply chains with extended lead times that have major implications for security of supply and for demand responsiveness and freshness of the offer. This paper describes the nature of these risks and how they do not fall equally across a corporation's portfolio of sources, products and customers. It identifies the strategic and operational capabilities that can be used to counter the risks, concluding that risk mitigation in the trend to global sourcing is entirely feasible and that companies should audit their sourcing strategies and associated operating methods to ensure that their drive to increase margin does not substantially increase risk 'at the margin'.

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As consumers become more discriminating and diverse, the "long tail — the large number of low-volume products at the end of the demand curve—is the next great opportunity for many consumer products companies. In a market where customers determine segmentation, the key to profitability lies in customer involvement, modular product design, and supply chain flexibility.

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Teams staffed by members who represent different functions and business units have become a popular form of organization in contemporary companies. The activities of such teams, which are installed for accomplishing complex tasks, cross-departmental and business borders. However, after a promising start these teams often appear to quickly lose momentum. What conditions should be in place in order to make such teams successful? And how to secure that these teams actually contribute to company performance? Eindhoven University of Technology PhD student Boudewijn Driedonks investigated over 100 sourcing teams from 20 large companies. This article, based on his study’s outcomes, provides practical insight into effective managerial actions for 1) composing a team, 2) stimulating effective collaboration among team members, and 3) managing teams’ external contacts.

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Building a strong supply chain is essential for business success. But when it comes to improving their supply chains, few companies take the right approach. Many businesses work to make their chains faster or more cost effective, assuming that those steps are the keys to competitive advantage. To the contrary: Supply chains that focus on speed and costs tend to deteriorate over time. The author has spent 15 years studying more than 60 companies to gain insight into this and other supply chain dilemmas. His conclusion: Only companies that build supply chains that are agile, adaptable, and aligned get ahead of their rivals. All three components are essential; without any one of them, supply chains break down.

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Demand-Based Management is critical to an enterprise in managing its supply chain, product development, technology strategy, service support, and organization design. Managing to demand involves carefully selecting marketing instruments and working closely with customers so that the overall incoming demand for the enterprise and the supply chain will give rise to maximum values for all parties. Ideally, all these instruments will eventually lead to higher consumer satisfaction. While supply chain management deals with the buy-side of the enterprise, demand based management addresses the sell-side of the enterprise. Tackling one independently of the other leads to suboptimal solutions.

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As the U.S. military enters the 21st century, the Department of Defense is recrafting its approach to warfare. It’s creating a new blueprint called the Force-centric Logistics Enterprise (FLE), which will take the best practices of business and integrate them with the best practices of the military, creating a more vital partnership than ever for more agile supply chain performance.

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Most companies have more freedom than they imagine to organize their supply chains for maximum efficiency. By rethinking inventory control in terms of who owns the inventory at any point, where it should be located, and who controls it, managers can develop supply chains that ensure much stronger alignment between their companies and their trading partners.

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