Contents

1.Introduction22.Lean Supply Chain23.Green Supply Chain43.1 Supply Chain Pollution Avoidance (SCPA)44.Tooling Lean for a Green Supply Chain45.Conclusion6Bibliography7

1. Introduction The report presents a comprehensive understanding of Lean & Green principles. It portrays a linkage of both the principles. Lean has been adopted by organizations to optimize performance. Today as environmental laws are becoming stringent the organizations are moving towards a Green Supply Chain. Lean principles are evident enabler of Green.2. Lean Supply ChainToday organizations compete on the basis of the value which they deliver to their customers. The competitive edge is achieved when this value is delivered in the least cost possible. In order to create a sustainable & profitable competitive advantage working on ones Supply Chain is the solution. The answer to sustainable and cost effective Supply Chain is Lean.Lean Supply Chain basically deals with the idea of removal of waste from a system and continuous improvement.Lean is based on four main principles (Liker, 2004) :

Figure 1: 4Ps of Lean (Liker, 2004).

These 4 Principles can be drilled down further to 14 principles of The Toyota Way (Liker, 2004).The waste can be classified in 7 ways:Figure 2: Classification of 7 Wastes

An eighth parameter which organizations are now taking into consideration as waste is Under Utilization of resources.Lean uses various methods and techniques to reduce these wastes such as Kaizen- Change for Best is a philosophy of continuous improvement.GEMBA This states that the original problem can only be detected at the place of Crime.5S- It is a methodology to organize a workplace so as to get most efficient results.And-On Cord Coming from Japanese work Jidoka, The main idea is to give authority to individuals to stop the manufacturing line if they find any error.Value Stream Mapping This helps in mapping each and every process with the flow of information and material with time. This allows the users to identify the area where there is a waste and an opportunity to optimize.All the above methods are useful if and only if they are implemented in an organized way. To do so the PDCA Cycle (Plan, Do, Check and Act) can be used. Apart from these four key rules the most important rule is Sustain. We should ensure sustainability of the improvements made by all the efforts of application of Lean Principles and using the PDCA cycle.

3. Green Supply ChainToday the world is facing environmental issues. Some of the major issues are Global Warming, Depletion of Ozone Layers, various types of pollution. As there is increase in awareness the consumer accounts himself for his own carbon footprint and is active in choosing a product or service that help reduction in this. This changing consumer behavior has made it mandatory for the firms to go green. The main idea of green is to reduce and minimize the negative environmental impact of our organization and usage of all the available resources efficiently. This is done by continuously seeking waste in the system and finding ways to eliminate them.

The Green Supply Chain management has 2 components (Burt, Dobler, & Starling, 2012). 1. The purchase of materials and items which are recyclable 2. The environmental and liability issues associated with the use and discharge of hazardous material anywhere in the chain.The US Environmental Protection Agency has defined a process which is the 4Rs.

Figure 3:4Rs for Green Supply Chain (Burt, Dobler, & Starling, 2012)

Using this process 4 basic methods which we need to consider are

Figure 4: Four basic methods for implementation of Green Supply Chain (Burt, Dobler, & Starling, 2012)

3.1 Supply Chain Pollution Avoidance (SCPA)SCPA is an approach which is the most used to protect the environment. In this approach we go back to the starting of supply chain and the attempt to reduce the generation of waste at the initiation of the chain. The generic approach of end of line has more cost implications than that of SCPA. If we can avoid the generation of waste at start of supply chain it is always less costly (Burt, Dobler, & Starling, 2012).4. Tooling Lean for a Green Supply ChainTo use lean practices for getting to a green supply chain we should look at the similarities between both the philosophies.The lean value stream mapping sees deep inside a system and a chain of process and tries to reduce waste from all the possible points. This is quiet similar to the Life cycle analysis of a product where we try to find the environmental impact of the product. Integration of lean and green helps companies to do processes more effectively and with a reduced cost (Bashkite & Karaulova, 2012).Both Lean as well as green have strong principles around waste reduction.Lean philosophy ensures that the resources in the supply chain are running on peak efficiency, this is one of the enablers of sustainability. (Friedman, 2008)Leading companies have already realized that Green not only improves brand perception but also saves money by reducing wastes and implementing efficient processes. The supply chains are being modified by managing five key inputs & outputs as shown (Deloitte, 2012).

Green Supply Chain can be achieved by implementing the Lean Principles. Some of the examples are EDI Implementation: enables data exchange between the supplier and the organization through a common network. Processes such as ASN helps reduce waiting time & increase labor productivity. It is a paperless process which also reduces obsolesce of inventory & helps save environment (Palevich, 2012). JIT & VMI: enables the reduction in the total inventory being shipped & stored. In case of JIT the inventory is not stored and hence save electricity costs in warehouses. Since the number of transportations is reduced by this system due to increased accuracy, the cost of fuel hence the fuel usage is reduced (Palevich, 2012). Reverse Logistics: Elimination of cardboard boxes and implementation of reverse logistics using pallets and plastic bins. Australian supermarket Target started cardboard recycling program. In the year 2004 they collected 362 million kgs of corrugated boxes for recycling and saved 4.8 MM trees. Transportation Planning: Choosing the cheapest mode of transportation i.e. seaways is a part of lean principles as it reduces the cost incurred. The same sea way is the least polluting method of transport. Warehousing: Proper warehousing with minimal wastage of space in warehouse, cardboard boxes and pallets is a Lean method. This in turn saves energy usage. Use of optimal order lots: Reevaluation of lot sizes since small order lots reduce obsolete wastes and electricity usage at distribution centers and manufacturing plants. Eliminate of excess packaging: Not stuffing papers in packaging of footwear is an example. It cannot be applicable in every industry since breakable items do require certain safe packaging, but can be eliminated wherever unnecessary.

5. ConclusionA Green Supply Chain is not just beneficial for the society & the planet but also for the bottom line of the organizations. The firms adapting these should highlight to the customers to increase brand image. Lean is the starting point of thinking in a Greener way. Every concept of Green can be implemented using Lean principles as a tool.

BibliographyBashkite, V., & Karaulova, T. (2012). INTEGRATION OF GREEN THINKING INTO LEAN FUNDAMENTALS BY THEORY. INTEGRATION OF GREEN THINKING INTO LEAN FUNDAMENTALS BY THEORY, 1-6.Burt, D. N., Dobler, D. W., & Starling, S. L. (2012). World Class Supply Management. New Delhi: Tata McGraw Hill.Deloitte. (2012). The evolving supply chain: Lean & Green. Deloitte Development LLC.Friedman, P. (2008, November 3). Leaning Toward Green: Green your supply chain with lean practices. Outsourced Logistics, pp. 16-17.Liker, J. (2004). The Toyota Way. Michigan: McGraw-Hill.Palevich, R. (2012). The Lean Sustainable Supply Chain. Pearson Education.