UNIVERSITY OF GLAMORGAN BUSSINESS SCHOOL
Globalization of Logistics and Supply Chain: Selection Of Global Supplier Over Local Impacts On Sustainability of Supply Chain
| Key words : Sustainable Supply Chain, Multi- modal/Intra-modal Transport, Transport modes, Logistics, Operations, Sustainability, Triple bottom line
This paper is conceptualizing on combination of transport modes organisation use to maintain sustainability in their supply chain by keeping the carbon foot print to minimum, this paper utilizes desk research to evaluate the impact of this approach on the organisations who prefer global suppliers over local evaluating the trade-offs these organisations need to make in order to maintain an equilibrium of sustainability in their supply chain concluding on the fact that dependent on an organisational willingness to be environmentally sustainable future most practices don’t need a choice of cost over environment but some need sacrifice of at least one to maintain sustainability.
This research paper is aimed to critically evaluate and answer the research question of: how selection of global over local suppliers affects organisation’s sustainable supply chain strategy while considering the impact of ‘‘multi-modal’/‘intramodal’ choice’ and what trade-offs does these organisations need do in order to achieve this? To answer this research question it is essential to address two wide areas in business literature, gaining an understand of what these areas actually mean to an organisational operational strategy: first being identification of different intramodal/multimodal transport choice used in local and global supply chains; whereas the second to critically evaluate why priority is given by different organisations to select global suppliers over local, while achieving reasoning from prospective of different Industries and organisations within those industries for the trades-off they are willing to do in order to implement selected means in to practice, while maintaining the sustainability of their supply chain. This paper divided into four interlinked parts will use desk search to grasp understanding on wide topics of present transportation modes, multi-modal/intramodal transportation system, and sustainability of supply chain (focusing on logistics and operation function) and Impacts of selecting global supply chain; dividing each part by sub-research questions asked to the reader at end of each part; While concluding the paper on the notion that selection of the mode depends on trade-offs an organisations is willing to make between being ecological sustainable to cost and service. Transportation modes at present
In the past decades the transportation system has been regarded as a separate function and an additional cost to the organisations supply chain (Huge-Brodin, 2013); which has also often been likened with the objective of cost minimisation rather than a value adding factor (Cunningham, 1982). However, this long-established concept has been critiqued to be a value added activity in the supply chain from literature of twenty first century (E.Bø and Hammervoll, 2010; Freight best practice, 2013; Huge-Brodin, 2013) based on the emerging demand for advanced logistics services and the globalization trends, demand in cutting of lead period, short product life cycles, and increased technology use and outsourcing trends (Anthony D. Ross, 2012). This notion has lead organisations consider flexible and effective freight flow which can match and fulfil organisation needs dependent on their market and environment (Cunningham, 1982; Murphy and Farris, 1993; Huge-Brodin, 2013).In order to understand how to use the right transportation mode freight movement it is eminent to know different transportation methods used by organisations at present and critically evaluate the advantages and disadvantages of each of them (see Appendix A & B). (Appendix A&B)...
Cited: Andrew, D.T. (2013) Globalisation Lecture, 8 January, [Online], Available: http://blackboard.glam.ac.uk/bbcswebdav/courses/PS4S34_2012_v1/Andrew%20Thomas%20-%20Globalisation%20Lecture.pdf [20 January 2013].
Anthony D. Ross, H.P.a.C.D. (2012) 'Sustainability and supply chain infrastructure development ', Management Decision, vol. 50, no. 10, pp. 1891-1910.
Carter, C.R. and Rogers, D.S. (2008) 'A framework of sustainable supply chain management:moving towards new theory ', International Journal of Physical Distribution & Logistics Management, vol. 38, no. 5, pp. 360-87.
Cunningham, W.H.J. (1982) 'Freight Modal Choice and Competition in Transportation: A Critique and Categorization of Analysis Techniques ', TRANSPORTATION JOURNAL (American Society of Transportation & Logistics Inc), vol. 21, no. 4, Summer, pp. 66-75.
E.Bø and Hammervoll, T. (2010) 'Cost-based pricing of transportation services in a wholesaler-carrier relationship: an MS Excel spreadsheet decision tool ', International Journal of Logistics: Research and Applications, vol. 13., no. 3, pp. 197-210.
Elkington, J. (1994) ' Towards the sustainable corporation: Win-win-win business strategies for sustainable development ', California Management Review , vol. 36, no. 2, pp. 90-100.
Euromonitor International (2011) FOCUS: Zara grows in Brazil while Gap and H&M dither, 7 october, [Online], Available: http://www.just-style.com/analysis/zara-grows-in-brazil-while-gap-and-hm-dither_id112354.aspx [12 February 2013].
Fawcett, S.E. and Mangan, G.M. (2002) 'The rhetoric and reality of supply chain integration ', International Journal of Physical Distribution & Logistics Management, vol. 32, no. 3, pp. 39-61.
Feo-valero, M., Menendez, l.G. and hidalgo, R.G. (2011) 'Valuing Freight Transport Time using Transport Demand Modelling: A Bibliographical Review ', Transport Reviews, vol. 31, no. 5, September, p. 625–651.
Freight best practice, (2013) Choosing and Developing a Multi-modal Transport Solution, [Online], Available: freightbestpractice.org.uk/categories/3589_586_dulliau-amlfoddol--multi-modal-.aspx [1 March 2013].
Friedman, M. (1970) 'The Social Responsibility of Business Is to Increase Profits ', New York Times Magazine, vol. 13, no. 32.
Gerry Johnson, K.S.W. (2008) Exploring Corporate Strategy, 8th edition, London: Pearson Education.
Handfield, R.B. and Nichols, J..E.L. (2002) Supply Chain Redesign: Transforming Supply Chains into Integrated Value systems, 1st edition, United States of America: FT Press.
Huge-Brodin, K.I.a.M. (2013) 'Understanding efficiencies behind logistics service providers’ green offerings ', Management Research Review, vol. 36, no. 3, pp. 216-238.
IBM (2008) Mastering carbon management:Balancing trade-offs to optimize supply chain efficiencies, [Online], Available: -05.ibm.com/de/automotive/downloads/mastering-carbon-management.pdf [1 April 2013].
Ilan Oshri, J.K.W.R.L.W. (2009) 'Global sourcing: recent trends and issues ', Information Technology & People, vol. 22, no. 3, pp. 192-200.
Jensen, M.C. (2002) 'Value Maximization, Stakeholder Theory, and the Corporate Objective Function ', Business Ethics Quarterly , vol. 12, no. 2, pp. 235-56.
Logistcs Cluster (2011) Logistics Operational Guide, May, [Online], Available: http://log.logcluster.org/response/transport/ [2 March 2013].
Mason, R., Lalwani, C. and Boughton, R. (2007) 'Combining vertical and horizontal collaboration for transport optimisation ', Supply Chain Management: An International Journal, vol. 12, no. 3, p. 187–199.
Meixell, J.M. and Mario, N. (2008) 'A review of the transportation mode choice and carrier selection literature ', The International Journal of Logistics, vol. 19, no. 2, pp. 183-211.
Murphy, G.R.L.a.P.E. (2012) 'Stakeholder Theory and Marketing: Moving from a Firm-Centric to a Societal Perspective ', Journal of Public Policy & Marketing, vol. 31, no. 2, Fall, p. 284–292.
Murphy, D.J. and Farris, M.T. (1993) 'Time-based strategy and carrier selection ', Journal of Business Logistics, vol. 14, no. 2, pp. 25-40.
Pettit, S., Liu, Y. and Beresford, A. (2011) 'Multimodal supply chains: iron ore from Australia to China ', Supply Chain Management: An International Journal, vol. 16, no. 1, pp. 32-42.
Porter, M.E. (1990) The Competitive Advantage of Nations, New York: The Free Press.
Poter.M.E (1985,1996) 'The Value Chain ', What is strategy?Harvard Business Review, November-December, pp. 61-78.
PWC (2013) Download Global Supplychain Survey 2013, [Online], Available: http://www.pwc.com/gx/en/consulting-services/supply-chain/global-supply-chain-survey/assets/pwc-next-generation-supply-chains-pdf.pdf [20 January 2013].
R.E.Freeman (1984) Strategic Management: A Stakeholder Approach, Boston: Pitman Publising.
Rogers, D.S. and Carter, C.R. (2008) 'A framework of sustainable supply chain management: moving toward new theory ', International Journal of Physical Distribution & Logistics Management, vol. 38, no. 5, pp. 360-387.
Scotland governoment Publications (2002) cited from National Atmospheric Emissions Inventory, Netcen , [Online], Available: http://www.scotland.gov.uk/Publications/2006/05/16112258/3 [6 April 2013].
Seuring, S. and Müller, M. (2008) '“From a literature review to a conceptual framework for sustainable supply chain management”, ', Journal of Cleaner Production, vol. 16, no. 15, pp. 699-710.
Sony Global (2012) Reducing the Environmental Impact of Logistics:Reducing the Environmental Impact of Logistics through Improvement of Package Design, [Online], Available: sony.net/SonyInfo/csr_report/environment/logistics/index3.html [2 April 2013].
Sony Global B (2012) Promoting Modal Shift, [Online], Available: sony.net/SonyInfo/csr_report/environment/logistics/index5.html [3 April 2013].
Talbot, S., Lefebvre, E. and Lefebvre, L. (2007) 'Closed-loop supply chain activities and derived benefits in manufacturing SMEs ', Journal of Manufacturing Technology Managment, vol. 18, no. 6, pp. 627-658.
Wagner, M. (2005) 'How to reconcile environmental and economic performance to improve corporate sustainability: corporate environmental strategies in the European paper industry ', Journal of Environmental Management, vol. 76, no. 2, pp. 105-18.
Walley, N. and Whitehead, B. (1994) 'It’s not easy being green ', Harvard Business Review, vol. 72, no. 3, pp. 46-52.
Worthington, I. and Britton, C. (2006) The Business Environment, 5th edition, London: Pearson Education Limited.
Wu, H.-J. and Dunn, S.C. (1995) 'Environmentally responsible logistics systems ', International Journal of Physical Distribution & Logistics Management, vol. 25, no. 2, pp. 20-38.
Yip, G.S. (1989) 'Global Strategy. In A World Of Nations? ', Sloan Managemant Review, vol. 31, no. 1, p. 29.
Figure [ 1 ]Modes of transport [ (Logistcs Cluster, 2011) ]
Figure [ 2 ] Carbon Dioxide emissions (grams per passenger-kilometre 2002) (Scotland governoment Publications, 2002)
Figure [ 3 ] Improved Triple bottom line model by [ (Carter and Rogers, 2008) ]
Figure [ 4 ] Comparison of Shipment consolidation VS sustainability [ (IBM, 2008) ]
Figure [ 5 ] Modal shifts for a sustainable supply chain by Sony (Sony Global B, 2012)
“For VAIO notebook PCs, Sony has shifted to ocean transportation for approximately 30% of total shipments
For numerous finished goods shipped from Shanghai, China to Japan, Sony changed from air transportation to a combination of sea and rail transportation or sea and truck transportation” (Sony Global B, 2012)
Please join StudyMode to read the full document