This is thanks largely to a shift towards closedloop supply chains. Sustainable operations and closed loop supply chains, second edition. While a traditional supply chain can be thought of a straight line leading to the consumer, a closedloop model incorporates the consumer as a component of a circular system. Formulation and analysis of horizontal merger for closed. The closed loop supply chain network prior to horizontal merger is integrated, as depicted in figure 3. Pdf strategic alliance in a closedloop supply chain, a. The acquisition of used telephones is central to the success of a remanufacturing firm. However, these products and their supply chains are not all the same with respect to a number of critical dimensions, including product acquisition, reverse. Dual channel closed loop supply chain coordination with a rewarddriven remanufacturing policy s. How mergers and acquisitions affect supply chains the.
It is associated with efforts like managing production residues byproducts and waste in such a way as to minimize. There are many facets to predicting the supply chain of 2030. The financial benefits of closed loop supply chains. Why you should aim for a closedloop supply chain articles. Research on collaborative management strategies of closed. A closedloop supply chain network includes two firms, who are involved in the manufacture and remanufacturing heterogeneous products. Purchasing and suppliers listing of major suppliers and. Information sharing in a closedloop supply chain with. Competition and integration in closedloop supply chain. The nature of product acquisitions is driven by what future. According to orsato 2009, if the environment is not.
Finally, cost is not the only element of a supply chains performance, as well discuss later. A genetic algorithm approach for solving a closed loop supply chain. Develop supply chain integration through mergers and acquisitions. Supply chain design technology enables companies to model their supply chains, evaluate alternatives, optimize the network structure, and simulate multiple scenarios in order to predict the resulting operational performance of the merged. Reverse logistics concerns the integration of used and obsolete products back into the supply chain as valuable resources. An introduction to creating a closedloop supply chain. This article investigates closedloop supply chain clsc as a process flow. Mar 22, 2017 before we understand the difference, let us understand the two systems. Supply risk sharing in a closed loop supply chain international journal of production economics, vol. Compare of the prices, performances of supply chain systems, etc. In the open loop supply chain, which is the traditional supply chain system, products do not return to the original producer. Contract research and coordination is another focus of closed loop supply chain.
Most mergers and acquisitions fail to live up to expectations. Modern firms that use closedloop supply chains as a competitive strategy receive many benefitsparticularly higher profitability. Various businesses have begun implementing sustainability initiatives as a way to reduce waste, but also gain profit from both the forward and reverse supply chains, business 2 community wrote last week. Dual channel closedloop supply chain coordination with a. When planning and operating a supply chain, not only the technical part has to be considered but also how to achieve efficiency and effectiveness of the supply chain, the regulatory setting, value proposition, profitability and supply. Closedloop supply chain models with product remanufacturing r. A closedloop supply chain essentially combines the traditional supply chain forward logistics with reverse logistics, considering the item after its served its original purpose.
The network comprises operation links to represent business activities. Other dimensions must be considered and balanced when designing the supply chain, including. The cases analysed involve actors at different supply chain levels, and. Unlike in the closed loop or reverse supply chain, here the products are either recovered by other parties willing and able to reuse the materials or products, or are disposed in landfills andel, 1997. In a forward loop supply chain, the customer is typically the end of the process. Liandzhang18investigateinformationsharing in the supply chain with a manufacturer and retailers. Consumer environmental awareness and coordination in closed. Strategic alliance in a closed loop supply chain, a case of manufacturer and econonprofit organization. Dells supply chain brings closedloop recycling advantage. Research on closed loop supply chain with reference price. Rl is assumed to be the nucleus of closed loop supply chain clsc. Complicating matters further is the fact that closing the loop cant be done quickly. Closedloop supply chains clsc are supply chain networks that include the returns processes and the manufacturer has the intent of capturing additional value and further integrating all supplychain activities guide et al.
A remarkable and significant trend has been the recognition of the strategic importance of reverse logistics and closed loop supply chain clsc as a consequence of the directive on waste of electrical and electronic equipment. This userfriendly guide includes details 25 leading practices for supply chain management operations, including related kpis and best practice benefits. For instance, supply chain managers point to procurement and supply chain expertise on the due diligence team, and the establishment of a comprehensive plan, as critical to successful merger. Apple aims for closedloop supply chain supply management. Pdf specifics od closed loop supply chain management in the. Pdf closed loop supply chain management and reverse. How can businesses improve their chances for successful mergers and acquisitions and reduce the inherent risk. We present the models prior to horizontal merger and post two firms merged.
The variational inequality formulations of the models are given. Overcoming the challenges of merging supply chains the bestplanned mergers and acquisitions can go awry when execution in the supply chain is not taken into account. Traditional supply chains are linear, said the report. Considering the reference price effect of consumers, this work constructs differential games among manufacturer, retailer and internet service platform under three business models of independent, collaborative production and collaborative. After each case, we summarize and discuss the distinguishing features of the supply chains. They proposed different design options for a closed loop supply chain concentrating on the handling the reverse material flows to reintegrate them into their genuine supply chains. This article explores best practices for ensuring that the supply chain can rise to the challenges and meet the promise presented by a merger or acquisition. Industrial engineering intern, swaraj combine division, india jan99june99. In this expert answer, learn how to achieve successful supply chain integration. May 28, 2014 dells supply chain brings closedloop recycling advantage.
Completing the supply chain loop cognizant 2020 insights executive summary traditionally, businesses have concentrated on improving the forward supply chain for their products e. It addresses how reverse supply chains differ from forward chains, what activities drive a reverse supply chain, and how a clsc coordinates the. This paper analyzes empirical evidence from a sample of 205 environmentally responsive smes operating in the fabricated metal products and electricelectronic products industries. Closed loop supply chain management clscm refers to all forward logistics in the chain like procurement of materials, production and distribution as well as the reverse logistics to collect.
Supply chain management is the integration of key business processes from end user through. Closedloop supply chain network redesigning model post the. Mergers and acquisitions have topped headlines in 2015. Sustainable operations and closed loop supply chains, second edition souza, gilvan on. What emerging technologies will have the most impact and in what way. Transitioning to a closed loop supply chain only translates into direct financial benefits to a company over the long term. Reviewed 382 scientific papers on reverse logistics and closed loop supply chain. Closed loop supply chains clsc are supply chain networks that include the returns processes and the manufacturer has the intent of capturing additional value and further integrating all supplychain activities guide et al. The resulting cir cular supply chain poses unique challenges and opportunities for supply chain professionals. Formulation and analysis of horizontal merger for closedloop. Supply chain agility is an operational strategy focused on inducing velocity and flexibility in the supply chain. Challenges in supply chain redesign for the circular economy. Supply chain management and closedloop supply chain management clscm.
A remarkable and significant trend has been the recognition of the strategic importance of reverse logistics and closedloop supply chain clsc as a consequence of the directive on waste of electrical and electronic equipment. Aug 27, 2014 this paper considers a closed loop supply chain with the manufacturer as the stackelberg leader. Reverse logistics quantitative models for closedloop supply. Provide a reasonable range for the sharing coefficient and agency fees. During the last decades, attention to the environment has grown substantially. Based on environmental, legal, social, and economic factors, reverse logistics and closed loop. Closed loop supply chain models with product remanufacturing r. Enhancing closedloop supply chain in global supply chain. Materials are mined, manufactured as products and often end up in landfills after use.
Hence, there is a need to model and analyze closed loop supply chains as a. New developments to improve the sustainability of business practices supply chain integration modeling, optimization and application ferguson, mark e. Closedloop supply chain models with product remanufacturing. Progress is slow since closedloop supply chains are rarely considered as valuecreating. Closed loop supply chain management and reverse logistics. What current trends will continue and which ones will become dominant. Based on the new definition, closedloop supply chain management is.
Demand and supply integration in the closed loop supply chain closed loop supply chains are the next stage in effective supply chain management, writes dr. Understanding your value chain, and how china fits into it, can lead to tremendous tax savings. Practitioners and educators need a common definition of supply chain management, and a shared understanding of the processes. A supply chain consists of the flow of products and services from. Nagurney department of electrical and computer engineering university of hartford june 29, 20. New developments to improve the sustainability of business practices supply chain integration modeling. Supply chain executives can play a pivotal role in delivering synergies that can help achieve deal objectives. The importance of remanufacturing used products into new ones has been widely recognized in the literature and in practice. How a closed loop supply chain can help reduce product.
Our view is that clsc are best managed from a business perspective where organizations seek to maximize value recov. This is thanks largely to a shift towards closed loop supply chains. In closedloop supply chains clscs there are reverse flows of used. Jan 01, 2016 read closed loop supply chain network redesigning model post the horizontal merger based on environmental responsibility, international journal of services technology and management on deepdyve, the largest online rental service for scholarly research with thousands of academic publications available at your fingertips.
Giannoccaro researched the coordination of threesechelon supply chains in decentralized decisionmaking. The concept of closed loop supply chain management is a very popular direction of research and companies activities. Perfect coordinate the closedloop supply chain of patented. Coordination in closedloop supply chains madoc universitat. Optimization modeling for the operation of closedloop supply chains. A closedloop supply chain is designed and managed in such a way as to combine both forward and reverse supply chains. From conceptual to an action oriented framework on core acquisition. In some cases, parts of the products such as automobiles, computers, cameras, mobile phones, washing machines, refrigerators, garments, footwear and empty glass bottles of beverages, etc.
Business value from closedloop supply chains citeseerx. But as the beer brewers linkup suggests, the supply chain function typically plays a crucial role in ensuring the success of any union of two or more companies. All suppliers are in play in a post merger worldthirdparty logistics providers, freight forwarders, parcel shippers and on and on. Managers who consider a closedloop supply chain just another environmental initiative need to update their thinking. The manufacturer faces three different reverse channels, i.
Reverse logistics quantitative models for closedloop. Sustainable operations and closed loop supply chains, second. Three ways to design your supply chain for successful. How quickly will companies assimilate new technology. Demand and supply integration in the closed loop supply chain. A coherent research model is developed which classifies the closed. There is the first layer node 1 which represents the integration of all firms in terms of their closed loop supply chain network with additional operation links connecting node 1 to the nodes of original firms. This chapter explains the overview of closedloop supply chain clsc. Apr 21, 2017 in its latest sustainability report apple said it was aiming for a closed loop supply chain that would eliminate the need for mining, though it has set no date for achieving this.
Jan 31, 2017 many leading companies are already using closed loop approaches and achieving cost savings from these efforts. Therefore, closed loop supply chains have traditional forward supply chain activities and a set of additional activities required for the reverse supply chain. Integrating such reverse supply chains with traditional forward supply chains, covering all processes and actors from raw material extraction to the final end customer, results in closed loop. Among all closed loop supply chain problems, the horizontal merger of oligopolistic. A three level framework for closedloop supply chain. Finally, we discuss the management of each of the different supply chain systems, and identify the key research. Closed loop supply chains can help companies reduce waste and maximize resources, which is why a growing number of businesses are combining traditional supply chains forward logistics with reverse logistics, business2community reports reverse logistics requires the manufacturer to encourage the products return either for repair or resale, or, if those scenarios arent viable, then. As shown, case study papers include application of the models in. We also noticed the lack of multidisciplined studies that combine. Gaps of related research is identified and future research opportunities are identified.
What are the benefits of a closed loop supply chain. The major difference between closedloop supply chains and traditional forward supply chains is for a forward supply chain the customer is at the end of the processes, and for a closedloop supply chain there is value to be recovered from the customer or enduser. Economic, marketing, and legislative drivers increasingly are leading companies to take back and recover their products after use. Closed loop supply chain management and reverse logistics a literature 159 manufacturing businesses to press environmental problems because these problems when dealt with correctly can create opportunities for innovation as well helping these businesses be competitive.
What it is, what its not and how it works the supply chain ecosystem is a complex one especially for multinational companies that work with suppliers all over the world. What is the difference between close loop supply chain and. Closed loop supply chain management is defined as the design, control and. Closedloop supply chain clsc integrates both forward and reverse supply chains and focuses on taking back products from customers and reco. The model also results in a fact that with the implication of the extended supply chain, a. Cocacola european partners, for example, is collaborating with recyclers, packaging manufacturers and other firms across the supply chain to cut costs and materials used. The study provides an in depth analysis of a proven closedloop supply chain that is replicable and taken two decades to get where it is for the dell corporation. Sustainable design of a closedloop locationrouting. Develop supply chain integration through mergers and. The health of a global supply chain isnt just measured by revenue and profit. In this paper, we address the problem of choosing the appropriate reverse channel structure for the collection of used products from customers. If we consider forward and reverse supply chains simultaneously, the result network will construct a closedloop supply chain. A similar system as described in the case study has been. Based on game theory, we discuss the reference price effect on the performances across.
Mergers and acquisitions have become an inseparable part of international business and a major means for companies to grow in size, go international. In this figure, the classical forward, and reverse supply chains are. In the recent years, several important reasons highlighted the need for reverse logistics and designing closed loop supply chains clscs, including economic aspects. Sustainable design of a closed loop locationroutinginventory supply chain network under mixed uncertainty author links open overlay panel m. We recommend the definition of supply chain management developed and used by the global supply chain forum. The traditional definition of supply chain management scm is a process of planning, implementing and controlling the operations from a supplier to a set of customers based on efficiency zahiri et al.
The arising product flows pose novel challenges for supply chain management. Closedloop supply chain coordination strategy for the. Closed loop supply chain is when you recover a product from a customer in exchange for value and recycle the product for profit and gain by putting it through quality check an. Clsc activities and reverse logistics outsourcing in global supply chain. The trend is to establish closedloop supply chains, where previously discarded products circle back into the value chain and minimize waste. The closedloop supply chain clsc is comprised of two distinct cycles. In truth, the benefits of a closed loop supply chain are indirect. This paper integrates the internet service platform with bigdata marketing into the dynamic closed loop supply chain system as an independent game subject. To meet synergy goals, executives should proactively identify potential supply chain sources of value during a transactions due diligence and. The key themes that came out of the literature are. The aim of this paper is to outline an analytical framework for closedloop supply chain management, placing it within 1 the political or societal environment, while linking it to 2 related supply chain partners and 3 single actor activities. Successfully building and managing such a system requires new and unconventional thinking. Closed loop supply chain management and reverse logistics a.
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