Opportunities of Combining Sustainable Supply Chain Management Practices for Performance Improvement

Abstract

Considerable efforts for research on sustainable supply chain management have become evident in the past years. Besides conceptual studies and quantitative models, empirical research on corporate practices has been contributing to promote reductions of impacts on the environment and society. The systematic combination of practices is, however, not yet approached in literature. Therefore, this chapter presents results derived from a systematic literature review based on a recently developed framework for managing sustainable supply chain practices. Through contingency analysis on the selected publications, correlations between the framework dimensions and categories enable the identification of dominating and underrepresented initiatives. Lastly, corporate reports published by five German automotive manufacturers are examined. Results show that both sustainable procurement and waste management practices are strongly correlated with a firm’s production management practices. Moreover, general issues of waste management are most often discussed in concert with distributional and customer relationship practices. In contrast, corporate governance and supplier relationship practices are implemented isolated from other initiatives. The apparent lack of integration between these practices motivated a second round of analysis, which considers 21 more specific categories. The findings are further compared to sustainability leaders’ examples to offer managerial insights and opportunities to enhance sustainable supply chain performance. This chapter focuses specifically on sustainable supply chain practices and introduces the concept of “initiative combination rent,” contributing nonetheless to further the understanding of how companies can improve supply chain and sustainability performance.

Appendices

Appendices

1.1 Appendix 1: Descriptions of Dimensions and Categories of SSC Practices

Dimensions/categories	Description
1. Supplier development	Implement practices related to suppliers’ selection, assessment, and collaboration to improve company’s and suppliers’ performance on environmental and social outcomes
1.1. Selection	Include sustainability criteria during the supplier selection process (certifications, management systems, compliance with guidelines, code of conduct), prefer using specific group of suppliers that are more social-environmental responsible
1.2. Assessment	Communicate expectations, monitor suppliers’ performance, and ensure they meet the required objectives, using questionnaires/inspections. Evaluate indirect suppliers and penalize them in case of lack of compliance
1.3. Supplier collaboration	Collaborate with suppliers to increase SC sustainability, promote integration and information sharing, financial support for sustainability
2. Governance	Implement sustainability policies and management systems, align business operations with sustainability matters, and establish a good relationship with stakeholders
2.1. Company’s policies	Implement policies to motivate quality improvements combined with reduction of the impact on the environment and people. May include supply chain-specific policies and compliance with current regulations
2.2. Business alignment	Promote alignment between company’s strategies and sustainability issues, create formal departments/functions to manage this topic, stimulate internal communication and education
2.3. Sustainability control	Implement management systems and internal KPIs related to sustainability, manage company’s certifications and risk-safety-related issues
2.4. External relationship	Manage relationship with external stakeholders and publicize sustainability efforts
3. Procurement	Improve sustainability through changes in the procurement process, materials, and services (including packaging) that are purchased
3.1. Process	Implement improvements on the procurement process, including on contracts, in order to make it more social-environmental responsible
3.2. Materials and services	Purchase sustainable materials, components, products, and services, including those that are certified (e.g., eco-label)
3.3. Packaging	Use or design innovations on packaging in order to make them more sustainable
4. Production management	Implement practices related to the development of new solutions and management of resources
4.1. Solutions development	Design more sustainable products, processes, and services, considering the product life cycle and resource consumption
4.2. Resources	Manage resources (materials, energy, water) and invest in renewable sources
5. Distribution	Improve sustainability through adjustments in structure, network, modes of transport, new vehicles and equipment’s technologies and distribution processes
5.1. Structure and network	Implement adjustments during construction phase, facilities management, network structure, and specific distribution strategies
5.2. Modes of transport	Improve sustainability through switches on modes of transport
5.3. Equipment and vehicles	Improve sustainability through adjustments on logistics equipment and vehicles (fuel, rolling resistance, body type, maintenance, others)
5.4. Distribution processes	Implement changes in the distribution process such as inventory management (particular attention to hazardous materials) and transport optimization, improve driving skills, and use low speed driving
6. Waste management	Manage waste and pollution in order to decrease environmental, economic, and social impact
6.1. Reuse and recycle	Encourage reuse practices, including remanufacture and recycling
6.2. Waste disposal	Implement practices for disposing (not selling) waste in a correct way
6.3. Pollution control	Control, minimize, and compensate pollution
7. Customer relationship	Manage customer relationship identifying their demands and engaging them on sustainability issues
7.1. Demands	Collect information about customer demands/habits and react according to their necessities
7.2. Engagement	Engage customers actively on sustainability issues and encourage behavior changes

1.2 Appendix 2: Significant Correlations Between SSC Practices

Acronyms	Category combination	Phi coeff.
Supplier relationship
SC*GBA	Supplier Collaboration (1.3)*Business alignment (2.2)	0.329***
SC*PmS	Supplier collaboration (1.3)*Solutions development (4.1)	0.354***
Governance
GBA*GE	Business alignment (2.2)*External relationship (2.4)	0.371***
GE*DE	External relationship (2.4)*Equipment and vehicles (5.3)	0.311***
Procurement
PP*PMC	Procurement process (3.1)*Materials/services (3.2)	0.900***
PP*WPR	Procurement process (3.1)*Reuse and recycle (6.1)	0.306***
PMC*WPR	Materials/services (3.2)*Reuse and recycle (6.1)	0.302***
PPL*PMC	Packaging (3.3)*Materials/services (3.2)	0.368***
PPL*PMS	Packaging (3.3)*Solutions development (4.1)	0.368***
PPL*PME	Packaging (3.3)*Resources (4.2)	0.352***
PPL*DM	Packaging (3.3)*Transport modes (5.2)	0.338***
Production management
PmS*CE	Solutions development (4.1)*Customer engagement (7.2)	0.309***
PmE*WPR	Resources (4.2)*Reuse and recycle (6.1)	0.338***
PmE*WPW	Resources (4.2)*Waste disposal (6.2)	0.375***
PmE*WPP	Resources (4.2)* Pollution control (6.3)	0.447*
Distribution (subcategories included under “Supplier Relationship” and “Governance”)
Waste management
WPR*WPW	Reuse and recycle (6.1)*Waste disposal (6.2)	0.306***
WPP*CE	Pollution control (6.3)*Customer engagement (7.2)	0.315***
Customer relationship (subcategories included under “Production Management” and “Waste Management”)

1. * p < = 0.050, ** p < = 0.015, and *** p < = 0.005