Impact of GSCM on industry
As a result of being ratified by a growing number of countries and organizations
worldwide, GSCM has impacted on several facets of the industry, not just on the tactics
and administrative aspects, but on the type and level of interactions between customer,
supplier, company and manufacturer.
Wang and Gupta explained that the potential impact of a product on the
environment throughout its life can be assessed using life-cycle assessment (LCA)
(2011). The main purpose of LCA is to help “identify the measures that ensure the
components and design of the product satisfy environmental standards” (Wang and
Gupta, 2011). This resulted in the collaboration of companies involved in the production
of various components of a product (e.g. motor vehicles) in creating international
standards, which must be met by each supplier in its value chain.
Silicon Valley, famous for its electrical and electronics industries has been
influenced to introduce standards specific to the “control of use of several hazardous
materials” (Wang and Gupta, 2011). However, standards which are made in the USA
tend to differ to those from the UK as well as Europe, etc. Hence, an international
technical standard, SS-00259, was developed by SONY so as to ascertain a fixed
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value was adhered to by all parties in the value chain, regardless of its country of
location. The industry itself has responded to GSCM practices by encouraging the
certification of suppliers who conform to regulations and standards.
GSCM has also left its mark on industrial administration. Internet technology plays
an increasingly immense part on the management of each system, regardless of it being
information management, process operating systems or verification of work, etc.
In order to better understand the customer’s needs and wants there is now increased
interaction between the customer and the supplier. This helps save cost and “provides
an opportunity for future product development” (Wang and Gupta, 2011). This has also
lead to an enhancement of innovative efforts, as well as collaboration between the
company and supplier responsible for creating the product to ensure that it conforms to
the environmental standards.
With increased environmentally friendly practices being implemented in
organizations, a body or agency which can conduct green audits to ensure standards
are being kept would need to be established.