Low carbon supply chain configuration for a new product – a goal programming approach

Abstract

Green supply chain management and product innovation both have become sources of competitive advantage for companies from different industries. However, research on the configuration of green supply chains for new products represents a comparably new trend. In this paper, a goal programming approach is suggested to optimise the supply chain (SC) configuration for a new consumer product under consideration of economic and environmental criteria. The approach is illustrated by the case example of a fast moving consumer goods manufacturer. In this context, trade-offs between the ecologic factor of carbon emission, on the one hand, and financial value creation and customer service level on the other hand, are assessed in the deterministic analyses. The influence of long-term demand uncertainties is modelled in a scenario approach. It is observed that decentralised SC configurations enable carbon emission reduction without deteriorating the economic SC performance. Furthermore, it is detected that a focused economic optimisation strongly amplifies negative environmental impacts of demand uncertainties.