Profitability and Sustainable Supply Chains

An article in Bloomberg Businessweek (April 4,2011, pg 25) describes efforts at Pepsico’s Walker potato chip plant in England to condense the 80 % of water that escapes as steam, reuse it to wash potatoes and water herbs, and save over $ 1 million per year. It also lists WalMart’s Seiyu chain in Japan as using corn based packaging that cut weight by 25 %, costs by 13 % and saved around $ 200 K per year.  Such efforts suggest that sustainability initiatives could be justified as profitability enhancing, even while reducing the environmental footprint.  Should engineers and designers be required to evaluate “green” design alternatives ? How should supply chain participants be incentivized to generate such solutions when ownership of the chain is fragmented ? How important is the “decision impact horizon” to justify the mix of capital investments vs cost reductions to evaluate sustainability analysis ?

About aviyer2010

Professor
This entry was posted in Operations Management, Supply Chain Issues, Sustainability and tagged , , , . Bookmark the permalink.

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