Strategic Elements of Sustainable Supply Chain Management

Introduction

In business environment, the sustainability is mainly defined as a capability to have and hold a continuous competitiveness. After introducing its concept into the industries in the mid-90s, companies have adopted sustainability of supply chain management (SSCM) as their core business paradigm over the entire corporate management. Consequently, diverse strategies and frameworks have been developed to establish the sustainability on their supply chain. However, while it has been adopted by only a few leading companies, most of those, specifically small and medium-sized businesses, are merely concerned with it (Baporikar, 2022). Particularly, some of them adopted it institutionally by government-initiated policies with respect to the sociological, economic, and environmental aspect. Although there is much attention towards the adoption of SSCM, there is little research or guideline to understand how to adopt SSCM along with what kind of procedure. The strategy is usually divided into following three perspectives a strategy to correspond to the external factors of supply chain with respect to the social and environmental aspects; a strategy to correspond to the internal factors of supply chain with respect to the variations of participations and their collaborations and a strategy to implement the framework of SSCM to operate the process management system so as to perform the internal and external business processes more flexibly (Baporikar, 2023b).

SSC by considering the related definitions presented in the literature consists of two key terms, namely, “supply chain” and “sustainability”. According to Mentzer, DeWitt, Keebler, Min, Nix, Smith, & Zacharia, [16, pp. 4], a supply chain can be defined as follows: “a set of three or more entities (organizations or individuals) directly involved in the upstream and downstream flows of products, services, finances, and/or information from a source to a customer.” This definition of a supply chain refers to the forward supply chain. For the second key term—sustainability—the definition provided by Carter and Rogers [17, pp. 364] for “organizational sustainability” states that “organizational sustainability consists of three components: the natural environment, society, and economic performance and at the intersection of these triple bottom of line, there are activities that organizations can engage in which not only positively affect the natural environment and society, but which also result in long-term economic benefits and competitive advantage for the firm.”

In the initial period in which the concept of sustainable development was first introduced, most studies were dedicated to integrating environmentally friendly issues into the supply chain management. Thus, terms such as green supply chain (GSC), reverse logistics (RL), and closed loop supply chain were in common use. Considering the definitions of these terms would help to better understand the concept of a SSC. The following paragraphs present the definitions for these three main key terms. Adding the term “green” to supply chain management seeks to incorporate environmentally conscious thinking in all processes in the supply chain including green purchasing, green manufacturing, green material management, green distribution, green marketing, and reverse logistics. It also considers waste reduction in all stages of the supply chain and involves cradle-to-grave product management in supply chain management. Product recovery and end-of-life product management have been highlighted in the literature of reverse supply chains and closed loop supply chains. A reverse supply chain involves backward flows of product returns from customer to source. These product returns can be recovered and re-entered in the forward supply chain. The term closed loop supply chain is applied to a chain that consists of both reverse and forward supply chains. Based on the literature review conducted for this research, the term sustainability entered the supply chain literature after 2001. To date, apart from a few exceptions, the contents of publications are still limited to environmentally conscious issues. However, some authors have tried to define the term sustainable supply chain management (SSCM).They have integrated the definition of supply chain management with the triple bottom line of sustainability that consists of environmental, social, and economic performance.

For example, Seuring and Müller, [28, pp. 1700] defined SSCM as “the management of material, information and capital flows as well as cooperation among companies along the supply chain while taking goals from all three dimensions of sustainable development, that is, economic, environmental and social, into account which are derived from customer and stakeholder requirements.”