Environmental Education

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Green Supply Chain Strategy To Restore Your Competitive Advantage

There is an increased demand from government regulations on the climate control and renewable energy.  Manufacturing community has to react timely and positively in order to survive the new measure against the raw materials and products requirement to ban the use of hazard components.  The concept is not only applied in the component level, but also includes the packaging materials and the flow of supply chain elements.  To use re-cycle of raw materials, to reduce the overall logistics distance (from suppliers to customers), to reduce the overall weight of the shipment, to adopt more green suppliers, to tightly control the pipe-line inventory (reduce the risk of obsolete when demand drop) are those elements which request the immediate attention of manufacturers to cope with the green policy. 

The green initiatives also help company to maintain and enlarge customer base (since green policy is one of a marketing scheme).  Environmental concern and social responsibility are the selling point of your product to your customers which will make your company to sustain your competitive advantage.  As a matter of fact, your competitors are under same market force to change their direction and priority toward more green initiative.  Therefore, your company should exceed the effort your rival competitors will do.  In addition, more countries will enforce importers to import green products to their nations with tax incentives.  This will trigger your chance of selling in these nations.    

For example, nowadays, new product development will not be only the responsibility of product design and engineering department; it also includes the fully team-work among marketing, engineering, procurement, logistics, and materials operations.  Questions like: how to ship your products to customer effectively?  What green components can be purchased?  What is the optimal packaging size and re-cycle materials to pack your product?  How the import country will tax your product besides country of origin?  Company has to consider the new product development process as part of the green supply chain strategy.    

Manufacturer has to design their process in a green way as well.  Indirect supplies should not include any toxin materials.  Process will not generate hazardous wastes and emissions to the environment.  There are some cope of conducts to govern such requirements in different industries; like, automobile, telecommunication, electronics, and medical.  In fact, majority of large MNC (Multi-national Corporation) already have their own manual regarding world-wide green supply chain implementation and policy.     

The development and implementation of green supply strategy is not only to fulfill the customer needs; but also to meet general public's expectation for manufacturer to improve and enhance the role in social responsibility and environmental concerns.  In exchange, the company will gain sustainable competitive advantage in the industry. 

About the Author

Clifford C.Y. Kwong is a working professional with more than 15 years of supply chain and management experience. He attained a master degree in business and is working on his doctoral degree in advance management discipline. You can visit http://www.ckmc.com.hk and http://www.supplychainresearch.net for more details.

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