Sustainable Supply Chain Management in Manufacture
Nurhayati Sembiring*, Mangara M. Tambunan, Elizabeth Ginting, Intan Sari Dewi
Department of Industrial Engineering, Faculty of Engineering, Universitas Sumatera Utara,
Jalan Almamater Kampus USU, Medan, Indonesia 20155
Keywords: Manufacturing industry, Sustainable Supply Chain Management, SSCM.
Abstract: This paper introduces sustainable supply chains in the manufacturing industry, which include environmental,
social and financial aspects and several variables that influence them. This paper contains a review of several
studies on sustainable supply chains that have been carried out previously from 2005 to 2018. This paper
begins with an introduction to sustainable supply chains and exposure to problems underlying the ongoing
supply chain. Then the methodology and steps are explained. This paper objective is to afford a simple review
of sustainable supply chain management (SSCM). The manufacturing industry is always related to chemical
processes at the stages of the production process. This also always influences the environment. That is why
the sustainable topic becomes an important thing to study and to find the solutions. In addition, conclusions
and suggestions can be given to the supply chain of the manufacturing industry in the future.
1 INTRODUCTION
Sustainable development is an important problem
and is very rapidly developing in the industrial world.
This is indicated by the existence of several issues
regarding sustainable performance. The existence of
sustainable concepts in the company shows the
direction of developing economic aspects, and many
companies also involve social and economic aspects.
However, the implementation of the concept of
sustainable development requires a new strategy to
enable the integration of various aspects that are
considered separate (Kot, 2018).
The researchers that interested in sustainable
supply chain (SSCM) field, and also business
practitioners in manufacturing industries and supply
chain are growing fast. Due to solve problems in labor
conditions, geopolitics, climate change and also
pressure from company managers and supply chain
partners to encouragement the performance of
environmental, economic and social (Castillo,
Mollenkopf, Bell, & Bozdogan, 2018). The concept
of sustainability has been emphasized in many
manufacturing industries with government pressure
and increasing customer demand. sustainability
organization management involves good cooperation
between the government and the company (Orji,
2019).
This paper objective is to afford a simple review
of sustainable supply chain management (SSCM).
The manufacturing industry is always related to
chemical processes at the stages of the production
process. This also always influences the environment.
That is why the sustainable topic becomes an
important thing to study and to find the solutions. In
addition, this paper introduces sustainable supply
chains in the manufacturing industry, which include
environmental, social and financial aspects and
several variables that affect them.
2 LITERATURE REVIEW
The issue of sustainability is a very big problem in the
business world today, which is wider than the
community. For example, to bring up alternative
energy sources at a magazine kiosk needs some
assistance. This can be overcome by several factors
from aspects of sustainability such as energy
consumption related to climate change and involving
environmental problems. To do this. There are several
factors that influence the improvement of
sustainability, including supply and demand, and
improvements related to the environment (Carter,
Easton, & Carter, 2011).
SSCM as a new thing aims to advance the
performance of social and environmental related with
74
Sembiring, N., Tambunan, M., Ginting, E. and Sari Dewi, I.
Sustainable Supply Chain Management in Manufacture.
DOI: 10.5220/0008854300740078
In Proceedings of the 1st International Conference on Chemical Science and Technology Innovation (ICOCSTI 2019), pages 74-78
ISBN: 978-989-758-415-2
Copyright
c
2020 by SCITEPRESS – Science and Technology Publications, Lda. All rights reserved
the supply chain area and also increase demand for
company needs and increase profits and minimize
competitiveness (Rentizelas, de Sousa Jabbour, Al
Balushi, & Tuni, 2018). Environmental performance
discussion focuses on the manufacturing industry in
the fields of chemistry, mining and industry that
produce toxic gases. In recent years, many companies
have not prioritized the impact on the environment,
but are only concerned with the company's profits
(Handfield, 2005). The impact of globalization shows
that outsourcing shows the importance of supply
chain networks from upstream to downstream, which
causes selection strategies for suppliers to be
considered to minimize competitiveness (Rentizelas
et al., 2018). Some studies show that the lack of
management level of the company can harm the
company itself in the financial aspect (Rentizelas et
al., 2018).
Table 1: Previous literature about SSCM
No
Author
Findings
1
Cantor et al, 2012
• Company provision
and environmental
activities influenced
by environmental
training.
• There is a variability in
employee involvement
2
Carter et al, 2011
• The environmental and
social area are studied
in the field of SSCM.
• Corporate social
responsibility is an
interesting object to be
studied.
3
Castilo et al, 2018
• As a future research,
SCI could explore the
interdependence of the
SSCM.
• SCI help firms to
construct and develop
sustainable supply
chain.
4
Esfahbodi et al,
2016
• The cost and
environmental
performance involved
by SSCM adoption on
within two emerging
markets.
• Performance levels of
the environmental
become higher after
implementing SSCM.
5
Taylor et al
• Only green and social
behavior are affected
by Sustainable
supplier co-ordination.
• There is no positive
impact on cost
reduction related with
Social practices.
6
Hsu & Tan, 2012
Company’s initiatives in
reverse logistics, design-
for-environment and
green purchasing are
drivers in green supply
chain implementation.
7
Lin et al, 2018
Approximate fuzzy
arithmetic applied for
analysed cause and effect
relationships.
8
Linton et al, 2007
Business models,
government policy, and
production operations
could be affect by
Sustainable development.
9
Zhu et al, 2013
The economic
performance could be
improved by GSCM
practices.
10
Barbosa, 2017
By assessing
environmental, and
economic aspects, the
sustainability has been
mainly attempted,
desertion the social
aspects.
3 METHOD
The steps to design a sustainable supply chain
continue by doing a research question as follows:
• What factors need to be considered before SSCM
is adopted?
• What is the impact of SSCM related with
environmental performance?
• What is the impact of SSCM related with
economic performance?
• What is the impact of SSCM related with social
performance?
By conducting research in the supply chain
through the questions above, there will be found a
causal relationship that continues to involve the
economic, environmental and social performance of
the company. The results of research through
questions can make it easier for companies to know
the factors that affect the company's continued
achievement (Esfahbodi et al., 2016). Figure 1 shows
an overview of the literature review methodology.
Sustainable Supply Chain Management in Manufacture
75
Figure 1: Steps to overview a literature
• Step 1, select the period: choosing a period of
time is considered to have enough to represent
the thought that is developing science.
• Step 2, select the journal: the selection of
journals aims to determine journals relating to
sustainable supply chains
• Step 3, select the article: choosing an article is
the purpose to be included in the analysis is a
clear relationship of the contents of the article to
the text framework that was previously set.
• Step 4 - carry out the analysis: the analysis was
carried out to find out the differences between
several studies so that development can be found
for further research.
4 RESULTS AND DISCUSSION
In this paper, a review of the supply chain
management's sustainability literature is to determine
several factors that influence aspects of sustainability.
From discussion and analysis could be seen that there
are several opportunities that allow the SSCM topic
to be applied in the company. Analysis shows that
pressure from government, consumers and company
managers is very influential in SSCM. For this
reason, companies need to improve supplier
performance in order to carry out the right sustainable
supply chain strategy. Please note that the concept of
sustainability is not something that guarantees the
running of a company's business in the twenty-first
century (Carter & Rogers, 2004).
This study uses a type of deductive research,
which develops concepts from previous research.
Following this approach, the model of causal
relations is conceptualized by a comprehensive study
of contemporary literature around the phenomenon of
research. In Table 2, we can see the important factors
of SSCM obtained from previous studies.
Table 2: The important factor of SSCM
No.
Important factor
1
Establishment of
environmental requirements
on purchases of goods
2
ISO14001 Certification of
Suppliers
3
Risk Management system
for SSCM
4
A good relationship
platform within the
company and with suppliers
5
Environmental Audits for
Suppliers
6
The whole integration
7
Environmental Policy for
SSCM
8
Environmental Education
and Training
9
The involvement of the
workforce
10
Information Systems
11
Quality Environment
Management
12
TOP Management
Commitment & Support
13
Set Up Database
Lingallows product
14
Environmental Compliance
Agreement
15
Buy Eco-Friendly
16
Selection and evaluation of
suppliers
17
ISO 14001 Certification
18
Commitment use less
energy during the
distribution of products
19
Renewable energy as
prioritized in packaging
products
20
Renewable energy as
prioritized in distribute
products
21
Collaboration with clients
for green packaging
22
Product designed for
reducing the consumption
of energy or materials
23
Dangerous materials is not
used for product design
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24
Product designed for
reusing and recycling.
Hsu et al, 2013
25
Application of LCA to
perform environmental
reporting
Chunga and
Wee, 2011
26
Collaboration with clients
design and clean production
environment
Green et al,
2012a
27
Product Test Reports
Zhu et al, 2007
28
Surplus materials or
supplies will be sale
Green et al,
2012a
29
Waste and materials or
products will be sale
Zhu and
Sarkis, 2007
Based on such important factors compiled
research variables yangdiring cabinets in the Table 3.
Table 3: Important factor related dimension and SSCM
Variable
Important Factors
Sustainable Procurement
(Zhu et al., 2008A)
Establishment of
environmental
requirements for the
purchase of goods
Set the database
environmental product
Environmental
Compliance Statement
Buy Eco-Friendly
The character Bill of
Materials (BOM)
Selection and evaluation
of suppliers
ISO14001 Certification
of Suppliers
Environmental Audits for
Suppliers
Sustainable spread
(Green et al., 2012b)
Using renewable energy
in transport products
Collaboration with
clients for Green
Packaging
Cooperation with clients
to use less energy during
the transport of the
product
Using renewable energy
in the process of
packaging Product
Sivoice information
Using renewable energy
in transport products
Sustainable Design
(Zhu et al. 2008A)
Product designed to
reduce the consumption
of materials and energy
Product design to avoid
or reduce the use of
dangerous materials
Product designed for
reusing, recycling,
recovery of materials or
parts
Apply the report
environment to carry out
the LCA (Life cycle
management)
Follow the development
of reference
Establish the
environmental risk
management system for
SSCM
Generate Manual
Meeting
Product Test Reports
The involvement of the
workforce
Cooperation with clients
to design Green &
production
Investment Recovery
(Zhu et al., 2008A)
Sale of surplus materials
or supplies
Sales of used materials
and waste or byproducts
Excess Capital
Equipment Sales
Cooperation products
with Recycling the same
industry sector
Cooperation products
with Recycling the same
industry sector
Environmental
Management
Organization
(Hsu et al., 2013)
Support and commitment
of top management
ISO 14001 Certification
Environmental Education
and Training
Total Quality
Environmental
Management
Integration of some field
Environmental Criteria
Intensive communication
between suppliers and the
company
Environmental sustainability and minimization of
pollution levels are things that greatly affect the
manufacturing industry. This has triggered the
company to implement a new strategy in the
manufacturing industry in carrying out environmental
sustainability. Sustainable supply chains are an
important topic in the manufacturing industry now,
because there are several factors that influence supply
chain systems from various aspects such as the
existence of social pressure from the government or
Sustainable Supply Chain Management in Manufacture
77
consumers, increasing customer demand, corporate
image, tighter government regulations, scarcity of
resources natural power and so on.
5 CONCLUSIONS
The results of the study by conducting research
through several questions indicate that the practice of
SSCM shows that the implementation of SSCM
results in a different level of environmental
performance but perhaps have no affect to the
economic performance or costs of companies in
developing countries. From the results of question
research, it can be seen what factors influence
environmental, economic and social performance that
influence sustainable supply chain adoption. The cost
aspect must cover the total costs used for resources
and handling waste.
ACKNOWLEDGEMENTS
This research was already accepted with the number
of research contract 375/UN5.2.3.1/PPM/KP-
TALENTAUSU/2019, on 2 April 2019 and funded
by Directorate of Research and Community Service,
Directorate General for Research and Development at
the Ministry of Research, Technology and Higher
Education of Indonesia.
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