Sustainable development of global supply chains—part 1: sustainability optimization framework

Abstract

In global industry supply chains, environmental sustainability optimization addresses the overall consumption of resources and energy, the reduction of carbon emissions and generated waste to name a few. In this paper, we propose a holistic sustainability optimization framework for strategic network design of industry supply chains under consideration of economic, social as well as ecologic objectives. The framework is flexible to incorporate multiple sustainability indicators, alternative sustainability optimization strategies as well as a variety of internal and external industry-specific factors which impact the sustainability of the entire industry supply chain in the long-term. The core of the framework is an end-to-end closed-loop value chain model consisting of process, transport and product-in-use modules. For the first time, the product-in-use impact (“use” vs. “make”) is integrated in one network design approach. In addition, the model fully closes the loop from sourcing of raw materials via manufacturing towards reverse value chain steps such as disposal and recycling. Finally, we propose the minimize-time-to-sustainability approach as new optimization strategy for long-term network design problems focusing on minimizing the time, industry supply chain structures need to transform into sustainability steady states for all defined sustainability indicators such as CO₂e emissions, costs or social indicators based on defined target values. In part 2 of this paper the application of the optimization framework to the European automotive industry is shown.