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 43 Green supply chain management 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.