Supplier Selection in Green Supply Chain Management Under Fuzzy Environment

DISSERTATION
ON
SUPPLIER SELECTION IN GREEN SUPPLY CHAIN MANAGEMENT

UNDER FUZZY ENVIRONMENT
THESIS SUBMITTED IN PARTIAL FULFILLMENT OF THE REQUIREMENTS FOR AWARD OF

THE DEGREE OF
Master of Engineering
In
Production Engineering
(In the faculty of Engineering and Technology)
By
SOBHAN SARKAR
(B.E. in Production Engineering, 2009
From
Jadavpur University, Kolkata, India)
Examination Roll Number: M4PRD14-01

Under the guidance
Of
Prof. Bijan Sarkar

DEPARTMENT OF PRODUCTION ENGINEERING
JADAVPUR UNIVERSITY,
UNIVERSITY, KOLKATAKOLKATA- 700032, INDIA
MAY, 2014
Page | I
JADAVPUR UNIVERSITY
(IN THE FACULTY OF ENGINEERING AND TECHNOLOGY)
KOLKATA 700032, INDIA
Certificate of Recommendation
I/ WE HERE BY RECOMMEND THAT THE THESIS ENTITLED SUPPLIER SELECTION IN
GREEN SUPPLY CHAIN MANAGEMENT UNDER FUZZY ENVIRONMENT CARRIED

OUT UNDER MY/ OUR SUPERVISION AND GUIDANCE, BY MR. SOBHAN SARKAR BEARING
EXAMINATION ROLL NO. M4PRD14M4PRD14-01 MAY BE ACCEPTED FOR THE PARTIAL FULFILLMENT
OF THE REQUIREMENTS FOR THE AWARD OF THE DEGREE OF MASTER OF ENGINEERING IN
PRODUCTION ENGINEERING AT JADAVPUR UNIVERSITY, KOLKATA 700032.
Professor Bijan Sarkar

Department of Production
Engineering
Jadavpur University
THESIS ADVISOR
DEPARTMENT OF
PRODUCTION ENGINEERING
JADAVPUR UNIVERSITY
KOLKATA 700032.
Kolkata 700032.
HEAD, Department of Production

Engineering
Jadavpur University
DEAN
Faculty Council of Engineering &
Technolo
Technology, Jadavpur University
Kolkata 700032.
Page | II
JADAVPUR UNIVERSITY
Certificate of Approval*
The forgoing thesis is hereby approved as a creditable study of Master of Engineering in

Production Engineering Department and presented in a manner satisfactory to warrant its
acceptance as a prerequisite to the degree for which it has been submitted. It is understood that
by this approval the undersigned do not necessarily endorse or approve any statement made,
opinion expressed or conclusion therein but approve this thesis only for the purpose for which
it is submitted.
COMMITTEE ON FINAL
EXAMINATION FOR
.
EVALUATION OF THE
THESIS
Signatures of the Examiners
* Only in case the thesis is approved
Page | III
JADAVPUR UNIVERSITY
Declaration of Originality and Compliance of Academic Ethics
I hereby declare that this thesis contains literature survey and original research work by the
undersigned candidate, as part of his Master of Engineering in Production Engineering
Department.
All information in this document has been obtained and presented in accordance with academic
rules and ethical conduct.
I also declare that, as required by this rules and conduct, I have fully cited and given references
of all material and results that are not original to this work.
Name (Block Letters):

Examination Roll No.: M4PRD14-01
Thesis Title: SUPPLIER SELECTION IN GREEN SUPPLY CHAIN MANAGEMENT
UNDER FUZZY ENVIRONMENT.
Signature with date:
Page | IV
ACKNOWLEDGEMENT
In the journey of this research work, I got had the privilege to receive help and support
from many people. These sources of assistance contributed in many distinct ways to keep me
on the right track and to make this academic challenge an enjoyable and unforgettable
experience. In particular, I am grateful to the following persons.
I want to express my sincere gratitude to my supervisor, Prof. Bijan Sarkar, Department

of the Production Engineering, Jadavpur University, Kolkata, for their relentless help and
constant guidance else it would not have been possible for me to complete this thesis work. I
had the chance to learn from his broad range of experience, and I particularly appreciated his
enthusiasm and communicative interest in research. I also appreciated the trust and freedom
he gave me. He also encouraged me to explore my own ideas, so that I could get benefit from
each new corner of experience. Finally, I will always remember the entertaining open
discussions that we shared and that often lead us very far from the actual topic of this work. I
enjoyed these greatly, and I am grateful for all the time he dedicated to me. Prof. Bijan Sarkar
is an icon of my inspiration and constant encouragement in fulfilling my task. I owe a deep debt
of gratitude to him. He has helped me travelling from prologue to epilogue of my work, from
less light to more light of knowledge and lead me on my inward journey towards perfection. So,
I really remain ever grateful to him.
I would also like to convey my deep regards to Prof. Soumaya Sarkar, Head, Production
Engineering Department, Jadavpur University, Kolkata.
Page | V
I greatly convey my unfeigned thanks to my friends and Mrs. Tuli Bakshi (PhD Scholar)
at Jadavpur University and all those who have rendered me valuable support in the completion
of my thesis work.
For direct and indirect assistance, I would like to thank the staff members at Jadavpur
University for their support, without which it would have been difficult to carry out the project
successfully.
Above all, I would like to convey my sincere regard to my respected parents and their
elders in my family, without their blessings, moral support and enrichment I could not have
landed with such consequence. This thesis is dedicated to my parents.
Date: .
Sobhan Sarkar
Registration Number: 92970 of 2005-06
Examination Roll Number: M4PRD14-01
Page | VI
Dedicated to my parents
Page | VII
CONTENTS
Page No.
Title sheet ..
Certificate of recommendation ...
II
Certificate of Approval ...
III
Declaration .
IV
Acknowledgement .
Contents .
VIII
List of Figures .
XI
List of Tables.......................................................................................................................
XII
Abbreviations used ..
XIII
Thesis outline ..
XIV
Abstract
01
1. Introduction
02
1.1 Supply Chain Management (SCM) .....
03
1.1.1 Participants in SCM ....
06
1.1.2 Function of SCM .........
08
1.1.3 Supply Chain Coordination Models ....
10
1.1.4 Distribution Strategy in Supply Chain ..........
14
1.1.5 Evolving Structure of Supply Chain
16
...........
Page | VIII
1.1.6 Lean Supply Management ...
19
1.1.6.1 Drivers for Lean Supply Chain....
20
1.1.7 Agile Supply Management ......
20
1.1.7.1 Agile Supply Chain Framework
22
1.1.7.2 Validation of Agile Supply Chain ......
23
1.2 Green Supply Chain Management (GSCM)
.......
25
1.2.1 Globalization and Greening the Supply Chain ...
25
1.2.2 Green Purchasing ........
26
1.2.3 Green Manufacturing ......
28
1.2.4 Lean Manufacturing ....
31
1.2.5 Green Marketing .....
32
1.2.6 Reverse Logistics.....
33
1.2.7 Basic Steps in GSCM ......
34
1.2.8 Process Involved in GSCM .....
35
1.2.9 Pathways for EHS to create Value...
35
1.2.10 Main Benefits of GSCM ....
39
2. Literature Survey
41
2.1 Green Supply Chain Management ....
41
2.2 Green Supplier Selection ......
45
2.3 Aims, Objectives and Scope of the Study
51
3. Methodology
52
3.1 Methods to Green Supplier Selection ...
52
3.1.1 DEMATEL .....
52
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3.1.2 Analytic Network Process (ANP) ...
56
3.1.3 Fuzzy TOPSIS (FTOPSIS) .....
60
4. Application of the Proposed Model to a Case Study
66
4.1 Background and Problem Elaboration ...
66
4.2 Data Acquisition ...
69
4.3 Calculation Relationships among Dimensions and Criteria by DEMATEL .
69
4.4 Computing the Weights of each Criterion by DANP technique
71
4.5 Using FTOPSIS model to Calculate the Performance Values of the

Suppliers and Ranking them ...
71
5. Results and Discussions
89
6. Conclusion
91
7. Future Scope
93
8. References
94
Page | X
LIST OF FIGURES
Sl. No.
Fig. 1.1
Fig. 1.2
Fig. 1.3
Fig. 1.4
Fig. 1.5
Fig. 1.6
Fig. 1.7
Fig. 1.8
Fig. 1.9
Fig. 1.10
Fig. 1.11
Fig. 1.11.1
Fig. 1.12
Fig. 1.13
Fig. 1.14
Fig. 1.15
Fig. 1.16
Fig. 3.1
Fig. 3.2
Fig. 3.3
Fig. 3.4
Fig. 4.1
Fig. 4.2
Fig. 4.3
Fig. 4.4
Fig. 4.5
Fig. 4.6
Fig. 4.7
Fig. 4.8
Fig. 4.9
Fig. 4.10
Fig. 4.11
List of Figures
Page No.
Supply Chain Procedure

Five Major drivers in supply Chain
Simple, extended and Example of Extended supply chain
Function of Supply Chain
Old Vs New Supply Chain
Lean Supply Chain Source
Volume and variety Observation
Demand characteristic Observation
Agile supply chain framework
Supply chain Order Decoupling Point
Postponement Strategy
Lean, Agile and Leagile Supply chain
An overview of Green Supply Chain Management (GSCM)
practices
The integrated environmental impact on Supply Chain
Steps in implementing a Green Supply Chain
Process involved in green supply chain management
The three pathways to business value
An example of Influence or Impact Map
The NRM of the system
Triangular fuzzy number a~
Flowchart of a hybrid MCDM model combined DANP and
FTOPSIS
The hierarchy of Supplier selection
Network relationship map of the dimensions based on the
threshold value, =0.20
The Causal diagram of the criteria based on the threshold
value, =0.20
The network relationship map for C1 and C2 under D1
Relative position of the alternate suppliers with CCj values
Relative Rankings of the alternatives based on 11 cases
3
6
7
10
18
19
21
21
22
23
24
24
27
31
34
36
37
53
56
62
65
70
75
76
77
78
78
79
79
80
86
88
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LIST OF TABLES
Sl. No.
Table 1.1
Table 1.2
Table 2.1
Table 2.2
Table 2.3
Table 3.1
Table 4.1
Table 4.2
Table 4.3
Table 4.4
Table 4.4.1
Table 4.4.2
Table 4.4.3
Table 4.4.4
Table 4.4.5
Table 4.4.6
Table 4.4.7
Table 4.5
List of Tables
Page No.
Comparison of Lean Manufacturing with Green Manufacturing

Examples where EHS makes contribution
Top 10 cited works in green supply chain management
The probable GSCM practices used in industry
Ten cited articles in green supplier selection
Linguistic values and fuzzy numbers
The Initial Influence Matrix A for criteria
The normalized direct-influence matrix D for criteria
The Total Influence Matrix TC for criteria
The influences given/ received for criteria
The influences given/ received for Dimensions
C1 and C2 values for network relationship map under
dimension D1
dimension D2
dimension D3
dimension D4
dimension D5
dimension D6
The Total Influence Matrix TD and Influences
30
40
42
43
46
63
72
73
73
74
74
given/received for dimensions
Table 4.11
The new matrix TC obtained by normalizing matrix TC in

criteria
The Unweighted Super matrix W
The new matrix a TD obtained by normalizing matrix TD in
dimension
Normalization of matrix TD
Weighting the Unweighted Super-matrix based on totalinfluence normalized matrix a W
The Stable Matrix of ANP when power lim (W ) g
Table 4.12
Table 4.13
Table 4.14
Table 4.15
Table 4.16
Average Fuzzy evaluation matrix for the alternative suppliers

Weighted evaluations for the alternative suppliers
Fuzzy TOPSIS result of final ranking of the suppliers
Comparison between the rankings of the alternate suppliers
Sensitivity Analysis by swapping the weights of the criteria
Table 4.6
Table 4.7
Table 4.8
Table 4.9
Table 4.10
77
77
78
78
79
79
80
81
81
82
82
83
83
84
85
87
87
88
Page | XII
LIST OF ABBREVIATIONS
Abbreviated Form
Full Form
GSCM
ECMPRO
SCM
MCDM
DANP
DEMATEL
ANP
FTOPSIS
NRM
SCMS
MP
GP
GA
ELECTRE
MOORA
MOOSRA
SKU
SP
CPFR
IMVP
MIT
ODP
GSCM
EPP
IGPN
GPNI
GPP
GSC
JIT
EPI
EHS
EVA
HP
SSCM
EMS
ANN
DEA
TFN
ESAB
Green Supply Chain Management

Environmentally Conscious Manufacturing and Product Recovery
Supply Chain Management
Multi-criteria Decision Making
DEMATEL based ANP
Decision Making Trial and Evaluation Laboratory
Analytic. Network Process
Fuzzy Technique for Order of Preference by Similarity to Ideal Solution
Network Relationship Map
Supply Chain Management Strategy
Mathematical Programming
Goal Programming
Genetic Algorithm
Elimination Et Choix Traduisant la REalit
Multi-Objective Optimization on the basis of Ratio Analysis.
Multi-Objective Optimization on the basis of Ratio Analysis.
Stock Keeping Unit
Service Provider
Collaborative Planning, Forecasting, and Replenishment
International Motor Vehicle Programme
Massachusetts Institute of technology
Order Decoupling Point
Green Supply Chain Management
Environmentally Preferable Purchasing
International Green Purchasing Network
Green Purchasing Network India
Green Purchasing and Procurement
Greening Supply Chains
Just In Time
Environmental Performance Index
Environmental, Health & Safety
Economic Value Added
Hewlett-Packard
Sustainable Supply Chain Management
Environmental Management System
Artificial Neural Network
Data Envelopment Analysis
Triangular Fuzzy Number
Elektriska Svetsnings Aktie Bolaget
Page | XIII
THESIS OUTLINE
The central idea and contribution of this dissertation is the study of the green supply chain
management and selection of the supplier in the supply chain of a case Company in fuzzy
environment using hybrid multi-criteria decision making (MCDM) process (i.e., DANP with fuzzy
TOPSIS) based on the definite time frame.
Here, in this research paper, I have also attempted to write and illustrate many concepts with
flow charts, coloured diagrams and graphs in such a manner that is hopefully make it accessible to a
broad range of readers.
Here, there are brief illustrations of the Sections made in this thesis paper. They are as
follows:
Section 1: In this section, Introduction of supply chain management (SCM) is illustrated.
There are two sub-parts in this section, first is Supply Chain Management (SCM) and second
is Green Supply Chain Management (GSCM). In the first sub-part, there are seven more subparts. They are (i) Participants of SCM; (ii) Function of SCM; (iii) Supply chain coordination model; (iv) Distribution strategy of SCM; (v) Evolving structure of SCM; (vi)
Lean Supply Management and (vii) Agile supply management. Under GSCM, there are ten
more sub parts. They are- (i) Globalization and greening the supply chain; (ii) Green
Purchasing; (iii) Green Manufacturing; (iv) Lean Manufacturing; (v) Green Marketing; (vi)
Reverse Logistics; (vii) Basic steps in GSCM; (viii) Process involved in GSCM; (ix)
Pathways for EHS to create value and (x) Main benefits of GSCM.
Section 2: This section illustrates the in-depth literature surveys with three important subsections, one is GSCM, next one is Green Supplier Selection and the last one is Aims,
Objectives and Scope of the research study.
Section 3: This part of section describes the methodology used. This section contains only
one sub-section i.e., Methods to Green supplier selection. Under this, there are more three
sub-sections which illustrate the main process used. They are (i) DEMATEL; (ii) ANP and
(iii) Fuzzy TOPSIS.
Section 4: It illustrates the application of the proposed hybrid model to a case study. Under
this, there are five sub-sections. They are (i) Background and problem elaboration; (ii) Data
acquisition; (iii) Calculating relationship among dimensions and criteria by DEMATEL; (iv)
Page | XIV
Computing the weights of each criterion by DANP technique; (v) Using FTOPSIS model to
calculate the performance values of the suppliers and ranking them for the case Company.
Section 5: This section describes the Results and Discussions.
Section 6: This section illustrates the conclusion part of this research study.
Section 7: This section shows the future study of the research work that can ride wave to
make inroads into new aspects of future work in this related field.
Section 8: This section presents all the related References of this research work.
Page | XV
ABSTRACT
Supplier selection has been a big issue in Green Supply Chain Management (GSCM) now-adays. Todays concept in manufacturing area has not limited in not only more production with least
time but also more and more cleaner production. It implies that production inclined to
environmental collaboration with sustainable and le-agile concept should be universally accepted of
late. Environmentally conscious manufacturing and product recovery (ECMPRO) has become an
obligation of manufacturers in supply chain management (SCM) and it has been extended to be the
policy as well as strategy for the business. Reusing the recycled products is one of the optimal
strategies. Supplier selection is one of the multi-criteria decision making (MCDM) problems in
strategic supply chain management. The main purpose of this thesis paper is to propose a hybrid
MCDM model to get the best selection of the suppliers to conduct the reuse of recycled materials
through environmentally healthy condition to enhance and increase the efficiency of using resources
in the manufacturing process. Therefore, a case Company, ESAB India Limited, Kolkata, India was
selected as an empirical model to study the best supplier selection among ten of them and also their
relative ranking based on six dimensions and twelve criteria available. A hybrid MCDM model
combining DEMATEL based on ANP (DANP) with fuzzy TOPSIS (FTOPSIS) is used in selection
process of green suppliers. A number of direct and indirect relationships are also found among the
dimensions as well as criteria and are explored as network relationship map (NRM) or digraphs.
Last of all, sensitivity analysis and validation of the model are also presented. Insights into the real
world application of this hybrid model and results from both research and managerial perspective
are cited for future study.
KEYWORDS:
SCM, GSCM, DEMATEL, ANP, FTOPSIS, NRM, Digraph, Sensitivity

Analysis, Spearman correlation co-efficient.
Page 1
1. Introduction
Nowadays, competition in market is extremely increasing. Firms need to maintain their
competitive edge and make a decent profit. More specifically, require reorganizing their supply
chain management strategy (SCMS) to harmonize with the external environments by integrating the
organizational resources, information, and activities (Tseng, M.- L., et al, [1]).
In previous decades, supplier selection problem has been noticed as an important problem in
both industry and science. It can result in better and more efficient services/products due to
cooperating with suppliers. Therefore, outsourcing has become the valuable procedure in business
(McCarthy et al,[2]). Lin and Chen [3] did a comprehensive review of literature and identified 183
decision attributes for evaluating candidate supply chain alliances for general industries.
Supplier selection process has been considered as a multiple criteria decision making
(MCDM) problem which contains both tangible and intangible factors. If process is done correctly,
a higher quality and longer lasting relationship is more attainable (Lee, [4]). In other word, selection
of wrong supplier could be enough to upset the companys financial and operational position.
However, selecting the right suppliers significantly reduces purchasing cost, improves
competitiveness in market and enhances end user satisfaction (nt et al, [5]).
Besides all of the published articles about criteria of selecting the best supplier, many papers
have presented various methods and procedures. Most of them are MCDM methods as instance
mathematical programming (MP), goal programming (GP), heuristic algorithms such as genetic
algorithm (GA), Analytic Network Process (ANP), Technique for Order of Preference by Similarity
to Ideal Solution (TOPSIS), VIKOR, DEMATEL, fuzzy logic etc, which all making efforts in order
to simplifies the process with more accuracy and also seek some objectives such as the order
quantity, capacity, etc. In this presented research work, by considering literature, DEcision MAking
Trial and Evaluation Laboratory (DEMATEL) and Analytic Network Process (ANP) are applied
and then Fuzzy TOPSIS is utilized to get the ranking of the suppliers. The other sections of this
article are as follows:
Page 2
1.1 Supply Chain Management (SCM):

In a well organized supply chain, the coordination of layers in supply chain is an important
issue. If the cooperation of these parts cannot be managed in the best way it can result in wasting
time and energy so the supply chain will encounter too much cost in order that deliver the product
to customers. Supply chain management strategy (SCMS) is used to explain the planning and
control of materials/information flows and logistics activities, not only internally within a firm but
also externally between firms (Cooper et al [6]; Seo, [7]). The key concept is that the channel is
viewed as an integrated whole, with the goal of understanding the channel as an application system.
Each firm in the channel affects, directly or indirectly, all the other channel members, as well as the
ultimate, overall channel performance (Beamon, [8]; Handfield & Nichols, [9]; Tan, Kannan, &
Handfield, [10]). The term supply chain management arose in the late 1980s and came into
widespread use in the 1990s.Prior to that time, businesses used terms such as logistics and
operations management instead. Some definitions of a supply chain are offered below:
A supply chain is the alignment of firms that bring products or services to market. as is
said by Lambert et al. [11].
A supply chain consists of all stages involved, directly or indirectly, in fulfilling a
customer request. The supply chain not only includes the manufacturer and suppliers, but
also transporters, warehouses, retailers, and customers themselves.as is expounded by
Chopra and Meindl [12].
A supply chain is a network of facilities and distribution options that performs the
functions of procurement of materials, transformation of these materials into intermediate
and finished products, and the distribution of these finished products to customers.as is
derived from the study of Ganeshan and Harrison [13].
Fig. 1.1:
Supply Chain
Procedure
Page 3
So, it can be said Supply chain management is the coordination of production, inventory,
location, and transportation among the participants in a supply chain to achieve the best mix of
responsiveness and efficiency for the market being served.
There is a basic pattern to the practice of supply chain management. Each supply chain has its
own unique set of market demands and operating challenges and yet the issues remain essentially
the same in every case. Companies in any supply chain must make decisions individually and
collectively regarding their actions in five areas (Fig. 1.2). They are:
ProductionWhat products does the market want? How much of which products should be
produced and by when? This activity includes the creation of master production schedules that take
into account plant capacities, workload balancing, quality control, and equipment maintenance.
Factories can be built on the basis of any of the following 2 approaches.
I.
Product focus: Performs the range of different operations required to make a given
product line from fabrication of different product parts to assembly of these parts.
II.
Functional focus: concentrates on performing some operations such as only making a select
group of parts or only doing assembly.
b) Inventory What inventory should be stocked at each stage in a supply chain? How much
inventory should be held as raw materials, semi finished, or finished goods? The primary
purpose of inventory is to act as a buffer against uncertainty in the supply chain. However,
holding inventory can be expensive, so what are the optimal inventory levels and reorder points?
There are 3 main approaches in warehousing. They are:
a. Stock keeping unit (SKU) storage In this traditional approach, all of a given type of product is
stored together. This is an efficient and easy to understand way to store products.
b. Job lot storageIn this approach, all the different products related to the needs of a certain type
of customer or related to the needs of a particular job are stored together. This allows for an
efficient picking and packing operation but usually requires more storage space than the
traditional SKU storage approach.
Page 4
c. Cross dockingAn approach that was pioneered by Wal-Mart in its drive to
increase
efficiencies in its supply chain. In this approach, product is not actually warehoused in the
facility. Instead the facility is used to house a process where trucks from suppliers arrive and
unload large quantities of different products.
c) Location Where should facilities for production and inventory storage be located? Where are
the most cost efficient locations for production and for storage of inventory? Should existing
facilities be used or new ones built? Once these decisions are made they determine the possible
paths available for product to flow through for delivery to the final or end consumer.
d) TransportationHow should inventory be moved from one supply chain location to another?
Air freight and truck delivery are generally fast and reliable but they are expensive. Shipping by
sea or rails much less expensive but usually involves longer transit times and more uncertainty.
This uncertainty must be compensated for by stocking higher levels of inventory. When is it
better to use which mode of transportation?
There are six basic modes of transport that a company can choose from:
1. Ship; 2. Rail; 3. Pipelines; 4. Trucks; 5. Airplanes; 6. Electronic Transport.
Here, pipeline mode is restricted to commodities that are liquids or gases such as water, oil and
natural gas.
e)
InformationHow much data should be collected and how much information should be
shared? Timely and accurate information holds the promise of better coordination and better
decision making. With good information, people can make effective decisions about what to
produce and how much, about where to locate inventory and how best to transport it.
Information is used for two purposes in any supply chain:

i.
Coordinating daily activities
ii.
Forecasting and planning
Page 5
Fig. 1.2: Five Major drivers in supply Chain

(Source: http://catalogimages.wiley.com/images/db/pdf/R0471235172.01.pdf)
1.1.1 Participants in Supply Chain:

There are mainly four participants in supply chain. They are:
i) Producers They produce the goods or services for sale.
ii) Distributers This can be defined as an entity that buys noncompeting products or product
lines, warehouses them, and resells them to retailers or direct to the end users or customers [14].
Most distributors provide strong manpower and cash support to the supplier or manufacturer's
promotional efforts. They usually also provide a range of services (such as product information,
estimates, technical support, after-sales services, credit) to their customers.
iii) Retailers- One who sells goods or commodities directly to consumers. These items are
purchased from the manufacturer or wholesaler and sold to the end user at a marked up price. They
are also known as merchant. As an example, Wal-Mart is a large chain retailer.
iv) Consumers - A consumer is a person (or group) who pays to consume the goods and/or
services produced by a seller (i.e., company, organization).
v) Service providers - A service provider (SP) is a company that provides organizations with
consulting, legal, real estate, education, communications, storage, processing, and many other
Page 6
services. Although the term service provider can refer to organizational sub-units, it is more
generally used to refer to third party or outsourced suppliers.
Fig. 1.3: Simple, extended and Example of Extended supply chain

(Source: http://catalogimages.wiley.com/images/db/pdf/R0471235172.01.pdf)
In Fig. 1.3, simple, extended and an example of extended supply chain are shown. They are briefly
described as follows:
(a) Simple or Traditional Supply chain
In a traditional supply chain, a company buys products from a wholesale supplier. Then it
sells them in its retail store, or a manufacturer buys parts from a part supplier, then uses them to
make a product. Each of those suppliers has suppliers of its own, and companies can save money
and avoid problems by finding out more about this extended supply chain [15].
Page 7
(b) Extended Supply chain

A store owner who sells a particular brand of hat in her store may not know very much
about who originally made the hat, where it was made, how it was transported to the wholesaler's
warehouse or what the warehouse is like. All the people involved in creating, storing or transporting
the hat are members of the extended supply chain, including those whom the store owner would
never expect to deal with directly. Traditionally, companies manage their supply chain issues by
selecting and negotiating with their direct suppliers. Managing the extended supply chain requires
research and collaboration [15].
1.1.2 Function Of Supply Chain:
In this section, the main functions of the supply chain are discussed. There are main four
phases of activity of supply chain management (Fig. 1.4). Along with delivery phase, return phase
can also be included. They are as follows:
a) PLAN Phase
i.
Plan to minimize energy consumption and hazardous material usage
ii.
Plan the handling and storage of hazardous materials
iii.
Plan for the disposal of ordinary and hazardous waste
iv.
Plan compliance of all supply chain activities

Processes used to aid environmental decision-making in this phase:

a. Environmental Cost Accounting
b. Environmental life cycle analysis
c. Design for environment
b) SOURCE Phase
i. Select suppliers with positive environmental records
ii. Select materials with environmentally friendly content
iii. Specify packaging requirements
iv. Specify delivery requirements to minimize transportation and handling requirements
Page 8

a. Environmental Auditing
b. Environmental Certification
c) MAKE Phase
i.
Schedule production to minimize energy consumption
ii.
Manage waste generated during the Make process
iii.
Manage emissions (air and water) from the Make process

a. Pollution prevention techniques like substitution, product modification, improved
maintenance, and recycling.
b. Environmental management systems like guidance for employees in environmental
health and safety procedures and facilitation of tools for continual improvement of
environmental performance.
d) DELIVER Phase
i.
Minimize use of packaging materials
ii.
Schedule shipments to minimize fuel consumption

a. Green Logistics Approach: Considers the impact of procurement, transport,
inventory control, and distribution activities to minimized environmental costs.
With the delivery phase, RETURN Phase can also be included. The main feature of it as follows:
a. Schedule transportation and aggregate shipments to minimize fuel consumption;
prepare returns to prevent spills of hazardous materials (oils, fuels, etc.) from
damaged products
Page 9

i. Reverse Logistics
ii. Remanufacturing
iii. Recycling.
Fig. 1.4: Function of Supply Chain (Source: http://www.alfasolutions.in/supplyChainManagement.php)

1.1.3 Supply chain Coordination models:
Supply contracts :
Relationship between suppliers and buyers can take many forms, both formal and informal,
but often to ensure adequate supplies and timely deliveries, buyers and suppliers typically
agree on supply contracts.
In a typical supply contract, the buyers and suppliers agree on:
Pricing and volume discounts
Minimum and maximum purchase quantities
Delivery lead times
Product or material quality

Page 10
Product return policies
Consider a typical two-stage supply chain consisting of a buyer and a supplier. The sequence of
events in such supply chain is as follows.
The buyer starts by generating a forecast, determines how many units to order from the
supplier, places an order to the supplier so as to optimize his own profit; the supplier reacts to the
order placed by the buyer. Thus the supplier has a make-to-order supply chain while the buyer is
purchasing items prior to knowing customer demand, based on forecast. This sequence of events
represents a sequential decision making process and thus the supply chain is referred to as a
sequential supply chain. The types of supply contracts are:
a. Buy-Back contracts: The seller agrees to buy back unsold goods from the buyer for some
agreed-upon price higher than the salvage value.
b. Revenue-Sharing Contracts: The buyer shares some of its revenue with the seller, in return
for a discount on the wholesale price.
c. Quantity-Flexibility Contracts: Here the supplier provides full refund for returned (unsold)
items as long as the number of returns is no larger than a certain quantity.
d. Sales bate Contracts: It provides a direct incentive to the retailer to increase sales by means
of a rebate paid by the supplier for any item sold above a certain quantity.
b.
Contracts for make-to-stock / make-to-order supply chains

a.
Pay-Back Contract: The buyer agrees to pay some agreed-upon price for any unit produced
by the manufacturer but not purchased by the distributor.

b. Cost-Sharing Contracts: The buyer shares some of the production cost with the
manufacturer, in return for a discount on the wholesale price.
c.
Contract with asymmetric information

a. Capacity reservation contracts: Manufacturer pays to reserve a certain level of capacity with
the supplier. The reservation price is a menu of prices designed by the supplier to motivate
the manufacturer to reveal its true forecast.
Page 11
b. Advance purchase contracts: Supplier charges the advance purchase price for firms orders
placed prior to building capacity and a different price for any additional order placed when
demand is realized. Again, the initial form of commitment made by the manufacturer
provides the suppliers information about the manufacturers true forecasts.
d.
Contacts for non-strategic components

a. Long-term Contracts: Fixed commitment made in advance
b. Flexible or option Contract: Prepay for the option to purchase
c. Spot market: Immediate purchase
d. Portfolio: Combine the first three contract options strategically
Supply Chain Performance Measure
Purposes of a performance measurement system are:
1.
Satisfying customer needs
2.
Success identification
3.
Minimize waste
4.
Improve decision making process
5.
Studying progress of an organization
6.
Bottleneck identification
7.
Understanding the system as a whole
8.
More collaboration and cooperation
9.
Better communication
Measurement based on logistics performance:

a) Service measure
i)
Order cycle time
ii)
Fill rate
iii)
Damage rate
iv)
Error rate in picking orders

Page 12
v)
Achievement of perfect order
b) Cost measure
i)
Ordering cost
ii)
Logistics cost
iii)
Storage cost
iv)
Holding cost
c) Return of assets measure

i)
Return on investment
ii)
Net earning.
Supply Chain performance can be measured through 1) total cost, 2) total inventory, 3) bullwhip
effect, 4) service level.
The Bullwhip Effect:

Bullwhip effect refers to the phenomenon of increasing variance of orders as they
proceed through the supply chain. It can lead to stock-outs, large and expensive capacity
utilization, lower quality products, lower productivity and considerable production/transport
on-costs as deliveries are ramped up and down at the whim of the supply chain. The
researches on bullwhip effect can be categorized mainly into three types. Researches have
been conducted to study the effect of demand forecast, lead time, order batching, shortage
gaming and price fluctuation on the bullwhip effect. The second type of research studies has
exerted efforts to reduce this effect. The third category of researches has quantified bullwhip
effect.
To quantify the increase in variability for a simple supply chain, consider a two-stage
supply chain with a retailer who observes customer demand and places an order to a
manufacturer. Suppose that the retailer faces a fixed lead time, so that an order placed by the
retailer at the end of period t is received at the start of the period t +L. Also, suppose the
retailer follows a simple periodic review policy in which the retailer reviews inventory every
Page 13
period and places an order to bring its inventory level up to a target value. Thus in this case
the review period is one.
The base stock level is calculated by:
L * AVG + z * STD * L
Where AVG and STD are average and standard deviation of the daily customer demand
based on its observed customer demand. The constant z is the safety factor and is chosen
from the statistical tables to ensure that the probability of no stock-outs during lead time is
equal to the specified level of service.
To implement this inventory policy, the retailer must estimate the average and standard
deviation of demand based on its observed customer demand. Thus in practice, the order-upto-point may change from day to day according to changes in the current estimate of the
average and standard deviation.
The order-up-to-point is estimated from the observed demand as:
Yt = tL + z*(LSt)
Where t and St are the estimated average and standard deviation of daily customer demand
at time t. Now we can calculate the variability faced by the manufacturer and compare it to
the variability faced by the retailer. If the variance of customer demand as seen by the retailer
is var(D), where D is the customer demand, then the variance of the orders placed by that
retailer to the manufacturer, var (Q), relative to the variance of customer demand satisfies:
Var(Q) / Var(D) >= 1 + 2L / p + 2L2 / p2
Where, p is the number of observations

of the customer demand.
1.1.4 Distribution Strategies in Supply Chain :

1. Direct shipment distribution strategy: Manufacturer or supplier delivers goods directly
to retail stores.
Page 14
Advantages:
a. The retailer avoids the expenses of operating a distribution center.
b. Lead times are reduced
Disadvantages:
a. There is no central warehouse
b. The manufacturer and distributor transportation costs increase because it must send smaller
trucks to more locations.
2. Intermediate Inventory storage point strategy:
Inventory is stored at an intermediate point.
a. Traditional warehousing
b. Cross-Docking
c. Inventory pooling
Strategic Alliance: third party logistics(3PL)
In strategic alliance there are three parties: Manufacturer, Supplier, Third party (performing all part
of the firms materials management and product distribution functions).
Advantages:
a. Firms can focus on core strengths
b. The better 3PL providers constantly update their information technology and equipments.
c. 3PL also may provide greater flexibility to a company in terms of geographic locations,
since suppliers may require paid replenishment, which in turn, may require regional
warehousing.
Collaborative Planning, Forecasting, and Replenishment (CPFR)
The CPFR process is divided into the three activities of planning, forecasting, and replenishment.
Within each activity there are several steps:
Page 15
Collaborative Planning
Negotiate a front-end agreement that defines the responsibilities of the companies that will
collaborate with each other.
Build a joint business plan that shows how the companies will work together to meet demand.
Collaborative Forecasting
Create sales forecasts for all the collaborating companies
Identify any exceptions or differences between companies
Resolve the exceptions to provide a common sales forecast
Collaborative Replenishment
Create order forecasts for all the collaborating companies.
Identify exceptions between companies.
Resolve the exceptions to provide an efficient production and delivery schedule.
Generate actual orders to meet customer demand.
1.1.5 The Evolving Structure of Supply Chains:

The participants in a supply chain are continuously making decisions that affect how they
manage the five supply chain drivers. Each organization tries to maximize its performance in
dealing with these drivers through a combination of outsourcing, partnering and in-house expertise.
In the fast-moving markets of our present economy a company usually will focus on what it
considers to be its core competencies in supply chain management and outsource the rest. This was
not always the case though. In the slower moving mass markets of the industrial age it was common
for successful companies to attempt to own much of their supply chain. That was known as vertical
integration. The aim of vertical integration was to gain maximum efficiency through economies of
Page 16
scale (see Fig. 1.5). In the first half of the 1900s Ford Motor Company owned much of what it
needed to feed its car factories. It owned and operated iron mines that extracted iron ore, steel mills
that turned the ore into steel products, plants that made component car parts and assembly plants
that turned out finished cars. In addition, they owned farms where they grew flax to make into linen
car tops and forests that they logged and sawmills where they cut the timber into lumber for making
wooden car parts. Fords famous River Rouge Plant was a monument to vertical integrationiron
ore went in at one end and cars came out at the other end. Henry Ford in his 1926 autobiography,
Today and Tomorrow, boasted that his company could take in iron ore from the mine and put out a
car 81 hours later (Ford, Henry, 1926, Today and Tomorrow, Portland, OR: Productivity Press,
Inc.).
This was a profitable way of doing business in the more predictable, one-size-fits-all
industrial economy that existed in the early 1900s. Ford and other businesses churned out mass
amounts of basic products. But as the markets grew and customers became more particular about
the kind of products they wanted, this model began to break down. It could not be responsive
enough or produce the variety of products that were being demanded. For instance, when Henry
Ford was asked about the number of different colors a customer could request, he said, they can
have any color they want as long as its black. In the 1920s Fords market share was over 50
percent but by the 1940s it had fallen to below 20 percent. Focusing on efficiency at the expense of
being responsive to customer desires was no longer a successful business model.
Globalization, highly competitive markets, and the rapid pace of technological change are
now driving the development of supply chains where multiple companies work together, each
company focusing on the activities that it does best. Mining companies focus on mining, timber
companies focus on logging and making lumber, and manufacturing companies focus on different
types of manufacturing from making component parts to doing final assembly. This way people in
each company can keep up with rapid rates of change and keep learning the new skills needed to
compete in their particular business.
Page 17
Fig. 1.5: Old Vs New Supply Chain

(Source:http://catalogimages.wiley.com/images/db/pdf/R0471235172.01.pdf)
Page 18
1.1.6 Lean Supply Management

The term lean was first coined in a large scale research programme namely IMVP
(International Motor Vehicle Programme) which was initiated by MIT (Massachusetts Institute of
technology). The primary target of this programme was the strong competitive advantages of
Japanese automotive industry over the Americans and Europeans. The results have been published
in many books and articles. One of the best seller books is The Machine that Changed the World
in which the word lean was first identified.
Lean manufacturing is a production management system developed in Toyota originally but
gradually refined and improved by many scholars or writers. There are two prime differences
between lean manufacturing and mass production. Firstly, increased efficiency through the
reduction of waste and error and secondly, reduced carrying cost of inventories achieved by
manufacturing in small batches. The main concept is doing more with less a philosophy for
removing waste across the business activity or it can be said also that it is adding value for the
customers and for the business and it is customer driven.
Fig. 1.6: Lean Supply Chain structure (Source: Dr. Dawei Lu [16])
Page 19
Over the years, the Japanese developed a set of different practices the lean supply system
(Fig. 1.6). These can be summarized as follows (Dawei Lu [16]):
i.
Supply from a smaller first tier supply base.
ii.
Develop close partnership.
iii.
Supplier selection based on performance.
iv.
Single or dual sourcing only.
v.
Market price minus rather than Supplier cost plus.
vi.
Early and close engagement with suppliers for NPI.
vii.
Synchronized flexible capacity.
viii.
Just-in-time delivery.
ix.
Incentive and reward alignment.
x.
Willingness to share a major part of its proprietary information.
1.1.6.1 Drivers for Lean Supply Chain

There are six key drivers that can make a lean supply chain. They are as follows (Dawei Lu [16]):
i.
Waste reduction.
ii.
Demand Management.
iii.
Process Standardization.
iv.
Engaging people.
v.
Collaboration.
vi.
Continuous improvement.
1.1.7 Agile Supply Management

The word agility means the flexibility. An agile supply chain is a chain of supply that is
capable of responding to changing needs in a manner that expedites delivery of ordered goods to
customers. In general, supply chain agility is a trait that many companies look for when selecting
suppliers, since a retail supply chain that is flexible and able to quickly respond to emergency needs
can in turn help the business respond more efficiently to its customers. Along with flexibility, speed
and accuracy are also hallmarks of this type of supply chain [17].
Page 20
With an agile supply chain, vendors are capable to react to shifts in customer needs with
relatively little time required. For example, if an order of a client has already placed but finds that
the items are needed a week before the scheduled delivery date, a supplier having a truly agile
supply chain
Lean works best in high volume,

low variety and predictable
environment.
Agility is required in less
predictable environment where the
demand for variety is high.
Fig.1.7: Volume and variety
observation (Source: Dawei Lu [16])
Fig.1.8: Demand characteristic

Observation (Source: Dawei Lu
[16])
Page 21
facility will be able to accommodate that change in the customers circumstances, at least in part.
Working together, the supplier and the customer develop a strategy to allow the delivery of as much
of the order as possible within the new time frame required. So, we can see in the Fig.1.7 that lean
system works best for high volume, low variety and predictable environment whereas agility is
needed in less predictable environment where demand for variety and choice is a prime feature.
Also, in the Fig.1.8 it can be easily observed that in the case of long supply lead time with
predictable customer demand, the plan and execution style of lean model performs the best whereas
in the case of short supply lead time having unpredictable demand, the agility works the best (Dawei
Lu [16]).
1.1.7.1 Agile Supply Chain Framework

According to Prof. Alan Harrison [18] of Cranfield University, he proposed a framework for
agile supply chain which was perhaps the earliest theoretical attempt to the framework. There are
four key components of this framework which is interpreted as follows (Fig. 1.9):
Fig.1.9: Agile supply chain framework (Source: Harrison [18])
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1.1.7.2 Validation of the agile supply chain

The market place is assumed to be much more volatile and fast changing in nature. The top
measure of fitness of a supply chain is Responsiveness. So, to create the structured supply chain
responsiveness may strategies are followed. Among them, the most common strategy is
Postponement or delayed configuration. This requires supply chain to configure in such a way
which may or may not be so obvious at first sight. To illustrate the concept of postponement, we
have to first understand the concept of Order Decoupling Point (ODP).
Fig.1.10: Supply chain Order Decoupling Point (Source: Dawei Lu [16])

As it can be observed from above Fig. 1.10 that the ODP determines how far the customer orders
would enter into the supply chain. This is the point (marked by inverted triangle in this Fig. 1.10)
beyond which the customer specific order is no longer visible to the supply chain. As there are
different designs for different supply chains for where the ODP exists. For a supply chain which is
mainly ship-to-stock, the ODP tends to be very much at the downstream end of the supply chain;
while for the supply chain which is make-to-order type, the ODP is at the manufacturing stage in
the middle part of the supply chain. It is evident that on the downstream side of the ODP, the supply
Page 23
chain model is customer pull responding to the demand changes. On the other hand, it is seen
that, on the upstream side of the ODP, the supply chain is operating in a push mode. Here, the
postponement strategy (in Fig.1.11) is so designed to achieve market responsiveness in terms of
producing the right variety and right product portfolio at the right quantity with a mass production
price rate. To achieve this, The ODP is postponed to a later or as later as possible stage close to
product delivery. The resultant supply chain would have its most part of operation under scheduled
generic components manufacturing based on the aggregated demand. In a volume production mode,
it leads to low cost with higher efficiency. So. it is clear that before the ODP, the supply is lean.
Then at the lean section, there will be a stockpile of the inventory of those generic components
called Strategic Inventory. From this strategic inventory, the customer orders are visible and the
supply chain operations are focused on configuring the products to satisfy the demand level as it is
driven by the demand and this part is primarily agile. In Fig. 1.11.1, Leagile supply chain is shown.
Fig. 1.11: Postponement Strategy

(Source: Christopher [19])
Fig. 1.11.1 Lean, Agile and Leagile Supply chain

(Source:http://www.emeraldinsight.com/content_image
s/fig/2370020106001.png)
Page 24
1.2 Green Supply Chain Management (GSCM):

Green supply refers to the way in which innovations in supply chain management and
industrial purchasing may be considered in the context of the environment [20]. Environmental
supply chain management consists of the purchasing functions involvement in activities that
include reduction, recycling, reuse and the substitution of materials [21] in the context of
sustainability in the practice of monitoring and improving environmental performance in the supply
chain [22]. Integrating environmental thinking into a supply chain management, including product
design, material resourcing and selection, manufacturing processes, delivery of the final product to
the consumer as well as end-of-life management of the product after its useful life [23] is pivotal
factors. From four concepts given above, the purpose on green supply chains and their management
are perceived. The lack of consensus and inclination in practice and definition of green supply chain
is not surprising, since its foundational elements of corporate environmental management and
supply chain management are both relatively new areas of study and practice.
Kogg [24] used the definition of GSCM given by Zsidisin and Siferd [25]: the set of supply
chain management policies held, actions taken and relationships formed in response to concerns
related to the natural environment with regard to the design, acquisition, production, distribution,
use, re-use and disposal of the firms goods and services. Srivastava [26] defined GSCM as
integrating environmental thinking into supply chain management, including product design,
material sourcing and selection, manufacturing processes, delivery of the final products to the
consumers, and end-of-life management of the product after its useful life. The activity of green
supply chain management (GSCM) can be tabulated as in Fig. 1.12.
1.2.1 Globalization and Greening the Supply Chain

Todays Globalization augments the opportunities for buyers. As buyers increase their focus on
environment improvement, which increases the environmental performance and efficiency of the
suppliers. It is true for organizations that regard environmental improvement as a social goal, not
just an issue of cost, risk and public image. Manufacturers should work with their suppliers of raw
material and component, in order to produce environment friendly products. By using their
purchasing power, the industries can set up environment criteria for their suppliers upstream in
supply chain. Ultimately it can result in the greening of the supply chain. Here, we can explain that
Page 25
GSCM = Green purchasing + Green manufacturing/materials management + Green Distribution /

marketing + Reverse logistics.
1.2.2 Green Purchasing

Environmental part has been much more important part of business today while there are
environmental regulations with high demand of environmental friendly goods from buyers, the
environmental issues are becoming non-tariff barriers or obstacles for export through Europe and
Japan are shifting to eco-friendly products but there is a limited market for eco products, there are
definite sign that this would grow big way. Environmentally preferable purchasing (EPP) or green
purchasing is process of selection and acquisition of product and services which minimize negative
impact over the life cycle of manufacturing, transportation, use and recycling [27].
International Green Purchasing Network (IGPN): IGPN is located in Tokyo, Japan. It globally
promotes the spread of environmentally friendly product and service development and green
purchasing activities. It shares information and know-how internationally on green purchasing and
environmentally friendly products and services. It can harmonize the efforts of green purchasing
and the development of environmentally friendly products and services from a global perspective.
Outline of Activities:
i. Collect and deliver information on global green purchasing activities, the best examples and
recent trends. ii. Hold workshops in each region. iii. Hold regular international conferences on a
global scale. iv. Cooperate to develop tools that can be used internationally (mid-to- long term
activity objective). v. Other activities like market research, promoting green purchasing [28].
Green Purchasing Network India (GPNI): GPNI is an evolving network of professionals
interested and active in the general area of sustainable consumption and production- more
specifically: green purchasing and public procurement. It is currently a loose informal network of
professionals primarily operating as an internet based electronic forum.
Page 26
Fig. 1.12: An overview of Green Supply Chain Management (GSCM) practices

(Source: Srivastava [35])
Page 27
The objectives of the GPNI are: i. To create awareness amongst Indian industry and other
stakeholders about green purchasing and procurement (GPP). ii. To encourage and facilitate
implementation of GPP and greening supply chains (GSC) projects to enhance the competitiveness
of the Indian industries [29].
Green Purchasing Strategies and Impact on Suppliers:
There is a range of green purchasing strategies available to MNCs. Different strategies have
different impacts on the environmental behavior of suppliers. The strategies can be grouped into
three major categories: (i) product standards, (ii) behaviour standards, and (iii) collaboration. The
effect of the various strategies on supplier environmental performance tends to follow a continuum
from low (product standards) to high (collaboration). For example, specifying product standards is
not likely to change a suppliers behavior since the supplier only has to change the mix of
ingredients. At the other end of the continuum, it is seen that collaborating with suppliers on
environmental issues is almost certain to change the suppliers attitude. This also requires much
more effort as well as influence from the buyers end. In general, more effort by buyers is needed to
increase the environmental performance of suppliers. Thus buyers must make a cost-benefit analysis
regarding how much they can lead their suppliers to improve.
1.2.3 Green Manufacturing

Green manufacturing has become the newest item in the mission statement and objective of
several manufacturing industries of late. The controversy between manufacturing companies and
global warming tends to often dominate conversations between manufacturing companies and
environmentalists. Several manufacturing companies have begun going green in order to reduce
waste level to make it lean. In Green manufacturing, equipment is made to be fast, reliable, and
energy efficient. One of the examples is the energy-efficient light bulb. These bulbs use almost half
the energy as a standard light bulb and yet they still produce a good amount of light. Manufacturing
companies are utilizing this example and re-designing their machines. Green manufacturing can
benefit manufacturing company in many ways. Not only it will benefit the environment, but it will
impact consumer, the shareholders, and the company perception in the market. The some of the
benefits are as follows:
Page 28
(1)
The first and foremost benefit of the green manufacturing is the environmental impact.
Insurance companies are actually giving better rates to manufacturing companies that are going
green. The government is also offering tax breaks for green manufacturers.
(2)
The second important benefit of the green manufacturing is the money it will save.
Manufacturers can look for machinery that is earth friendly with eco-design. Wind and solar energy
can save your company thousands of rupees. The reality is that if you can save money on energy,
your product costs can go down and customers will not need to pay as much. In addition company
can always maintain the same costs and turn a great profit on its products, helping out its
shareholders.
(3) The third benefit of the green manufacturing is the help it will provide to the community at
large. Renewable energy sources are considered to be one of the fastest growing job markets. New
manufacturing plants that are opening with renewable energy sources are offering and spreading
many more job opportunities to their communities, giving them a larger respect in their market.
Studies show that manufacturing companies that have gone green are expected to employ almost 70
percent of the new jobs in the future.
(4) Going green can also produces a better air quality for the employees and the community. Better
air quality may be one of the biggest benefits of going green. With the public awareness of
surrounding going green, it is also important to go green to keep manufacturing company
competitive. Some customers have begun making purchasing decisions based on products that are
manufactured at facilities that have gone green and they boycott the other companies that do not
have green manufacturing plants. Comparison Table 1.1 is constructed based upon the very useful
and meaningful factors is shown below. The current damage to the earth has many concerned about
global warming and the air quality. Going green is not only important for employees and our
community, but can be better for the bottom line.
Page 29
Table 1.1: Comparison of Lean Manufacturing with Green Manufacturing

Lean Manufacturing
Just In Time
Factors
(JIT)
Six Sigma
Green
ISO 9000 and
Manufacturing
14000
Improve Efficiency
Quality Improvement
Customer satisfaction
Reduction of Cost
Defects Elimination
Quality Standards
Reduced
resource
consumption
Recycling
programs
for
Reusable
component parts
Remanufacturing
Programs
Recycling
programs
for Raw Materials

Reducing
CO2
emissions
in
manufacturing
process.
Page 30
1.2.4 Lean Manufacturing

Lean manufacturing, which is simply known as Lean, because it is a competitive practice
that reduces costs, improves environment and quality, and improves the bottom line. This concept is
aimed at the elimination of waste in every area of manufacturing. Here any expenditure that does
not create a value for the customer is a waste and must be reduced. This could include activities
from various processes such as customer relations, product design, and supplier networks to factory
management. Its main aim is to incorporate less human effort, less inventory, less time to develop
products, and less space whilst being highly responsive and inclined to customer demand and at the
same time, producing top quality products in the most efficient, environmentally responsible, and
economical manner possible. Lean manufacturing is closely associated with green manufacturing as
there is an overlap between the goals and drivers for both processes (Fig. 1.13). A key component
of Lean principles is just-in-time (JIT) inventory strategy. It concentrates on reducing inventory and
provides material, energy, and space saving facility.
Fig. 1.13: The integrated environmental impact on Supply Chain

(Source: http://valuestream2009.wordpress.com/2010/12/16/lean-green-manufacturing-and-its-role-in-sustainablesupply-chain-management/)
JIT Manufacturing: Purpose of JIT is reduction of cost and quality improvement.

ISO 9000 AND ISO 14000: Purpose of ISO 9000 and 14000 are to recognize quality standards and
are followed by the companies and change the motivation.
Page 31
Zero Emission Strategy: The objective of zero emission strategy is to environmentally damaging
production products should be reduced. 16% of companies are actively following zero emission.
85% of companies are following reduced emission strategies.
Six Sigma: Six Sigma is another facet of management methodology which becomes very popular. It
supports green production by primarily eliminating defects from manufacturing processes and,
hence, cutting waste. Through exercising greater care and management control minor investment
defects are caught as early as possible through the process. As a result, significant savings can be
made by reducing the number of defects, rework, and spending time on defective pieces.
1.2.5 Green Marketing

Green marketing can be considered as adherence to ethical and social responsibility
requirements in marketing perspective. This approach emerged as a response to increased
environmental challenges in recent years. This marketing approach has emerged in response to a
global increase in concern about protecting consumer rights, and a concurrent growth of organized
movements to address environmental trends in such a way that people will be protected, secured
and assured a clean and safe environment in which to live.
The antecedents of green marketing were developed through many stages since the 1960s. These
movements paved the way for the emergence of green concept in marketing in the late 1980s. Green
marketing involves a commitment and dedication from the organization to deal with
environmentally friendly or eco-friendly products (i.e., products that do not harm society and the
environment) and to conduct marketing activities in such a way that reflects the organizations
commitment to environmental responsibility through adherence to specific controls to ensure the
protection of the natural environment [30].
Most definitions of green marketing deal with this dimension. For example, green
marketing is defined by researcher as any marketing activity of an organization that has a goal to
create a positive effect or reduce a negative effect of a particular product on the environment. Pride
and Ferrell define green marketing as any developing, pricing and promoting process for a product
which does not cause any damage to the natural environment [31]. After this, researchers clearly
indicate that adoption of a green marketing concept achieves many benefits for organizations and
may place an organization at the top of the competitive pyramid. It can provide them with market
leadership, especially in the context of increasing environmental awareness in the market [32].
Page 32
Adopting a green marketing philosophy or idea brings an organization close to its clients,
particularly those clients who have other environmental concerns besides protecting the
environment and rationalizing the use of natural resources. So, the study by researcher indicates a
number of advantages resulting from green marketing practices, as follows:
(i) Owners satisfaction: The green marketing approach is likely to open new horizons and good
opportunities for organizations that maintain green marketing. This, in turn, is likely to provide
organizations with the ability to avoid traditional competition and to thereby achieve competitive
leadership in the market. This competitive situation will incur more profits in addition to promoting
a good reputation, image and meeting the owners needs.
(ii) Attaining security in the introduction of products in operations management: An emphasis
or stress on producing safe, secure and environmentally friendly goods will push organizations to
raise their production efficiency, effectiveness to reduce the pollution level and other harmful
effects caused by the production process. That will help them to avoid legal sanctions, obligations to
pay compensation to injured parties, and the revocation of the membership of environmental or
consumer protection associations.
(iii) Organization social acceptance issues: Organizations obtaining a green marketing philosophy
will gain strong and enough support in the community because of their goal to benefit all society
through their commitment, dedication and determination to the environmental factors. This support
will help the organization to consolidate its relationships with current customers, suppliers and to
gain new ones in the future.
(iv) Sustainability in activities: Green organizations, which avoid legal problems and have strong
support in the community, will obtain general positive acceptance for their goals. This support for
their operations and business activities will help them to continue to provide the market with ecofriendly products.
1.2.6 Reverse Logistics

Reverse logistics has been defined as the term most often used to refer to the role of
logistics in product returns, source reduction, recycling, materials substitution, reuse of materials,
waste disposal, and refurbishing, repair and remanufacturing [33].
Page 33
Environmental Performance Index (EPI)

It measures the effectiveness of national environmental protection efforts in 132 countries.
EPI indicators focus on measurable outcomes such as emissions or deforestation rates rather than
policy inputs, such as program budget expenditures. Each indicator can be attached to well establish
policy targets. The 2012 EPI ranks 132 countries on 22 performance Indicators that capture the best
worldwide environmental data available on a country scale. India Ranks at 125 of 2012
Environmental Performance Index, which is the worst rank [34].
1.2.7 Basic Steps in GSCM

The U.S. Environmental Protection Agency (2000) provided four basic steps to
implementing a green supply chain, as shown in Fig. 1.14.
Fig. 1.14: Steps in implementing a Green Supply Chain

(Source:http://www.pomsmeetings.org/ConfProceedings/002/POMS_CD/Browse%20
This%20CD/PAPERS/002-0290.pdf)
Page 34
These are:
Identify Costs.
Determine opportunities.
Calculate benefits.
Decide, implement and monitor.
1.2.8 Process involved in GSCM

According to Srivastava [35], GSCM covers activities such as green design, green
sourcing/procurement, green operations or green manufacturing, green distribution, logistics/
marketing and reverse logistics. According to Walker et al. [36], the green supply chain concept
covers all phases of a products life cycle i.e., from the extraction of raw materials through the
design, production, and distribution phases, to the use of the product by consumers or end users and
its disposal at the end of the products life cycle. Hervani et al.[37] discuss the various processes
that are involved in GSCM. These processes are illustrated in Fig. 1.15.
1.2.9 Pathways for EHS to create Value

Many a year ago, leading manufacturers such as HP began adding environmental criteria to
their supplier scorecards, encouraging practices such as recycling and energy conservation. But
most supply chain managers considered those measures as more of an obstaclean appeasement
tactic for the environmental lobby [38]. Now-a-days, the approach taken by leading companies is
moving beyond the greening of the supply chain to a realization that environmental, health, and
safety (EHS) factors can significantly bolster business value. EHS managers are participating
cross-functional supply chain management (SCM) teams and are contributing to customer retention,
revenue generation, cost reduction, and asset utilization. As a result, they are confirming the
synergies between environmental excellence and supply chain excellence.
Page 35
Fig. 1.15: Process involved in green supply chain management

(Source: Hervani et al.[37])
Page 36
To better understand the available pathways for environmental, health, and safety value
creation, it helps to refer to a common financial metric: economic value added (EVA) [39]. EVA
is defined as the difference between after-tax operating profit and the opportunity cost of capital
employed. A company that can generate a flow of profits greater than its cost of capital is adding
shareholder value, while a firm that has a cost of capital that exceeds its profits is destroying
Fig. 1.16: The

three pathways to
business value
(Source:
http://www.economics.com/images/EExcellence_Supply_Ch
ain_Edge.pdf)
shareholder value. EVA can be utilized as a tool to measure the supply chain performance and to
develop a business case for EHS-related initiatives. There are three prime pathways for EHS to
contribute to EVA by adding value to the supply chain concept [38]. These pathways are explained
in Fig. 1.16.
Pathway 1: These are tangible value contributions. EHS capabilities often contribute directly to
financial performance. As example, they generate revenues from waste materials or cut the costs of
site remediation. Along with this, EHS makes the following important indirect contributions:
Page 37
(i) Profitability: It enables revenue growth by supporting expansion into new markets and reduces
costs by helping to increase efficiency and minimize hidden EHS-related expenditures (such as the
cost of specialized equipment and training process for handling hazardous waste).
(ii) Asset utilization: It conserves capital by helping to prolong asset life, recover and re-use assets.
It minimizes waste and obsolescence and reduces downtime due to unplanned activities.
(iii) Service Level: It can satisfy customers by providing timely information and technical help,
reducing cost of ownership, and avoiding interruptions in order fulfillment.
Pathway 2: These are basically direct, intangible value contributions. While EVA is a financial
metric, there are many intangible factors that are important leading to indicators of financial
performance, even though they do not appear on financial statements [40]. EHS capabilities
contribute directly to improvements in key intangible value drivers that influence shareholder value.
Here are a few examples:
(i) Customer Relationships: It includes supporting customers in the safe and effective use of
products or goods and improving the quality of products and services by addressing the EHS-related
requirements of customers.
(ii) Brand Equity and Reputation: Establishing an image of corporate responsibility, integrity and
transparency to increase the belief and satisfaction of both employees and external stakeholders.
(iii) Business Continuity: Decreasing risks of business interruption by helping to monitor suppliers,
by assuring product and process safety, by intervening rapidly and effectively when incidents occur,
and by maintaining the companys license to operate.
(iv) Alliances: It implies that the helping to establish mutually beneficial supply chain partnerships,
and engaging with external stakeholders that may have concerns about the impacts of supply chain
operations.
(v) Technology: It incorporates EHS skills and specialized knowledge into supply chain
technologies and business processes, such as reverse logistics.
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Pathway 3: This pathway indicates indirect, intangible value contributions. EHS capabilities
enhance intangible value drivers by creating value for external stakeholders. Commitment,
dedication and determination to environmental and societal responsibility implies responsiveness to
the needs of our society, which also includes employees, communities, public interest groups, and
regulatory agencies. Because a companys supply chain extends outward beyond the company
boundaries, both organizationally and geographically, it is crucial that supply chain managers
should understand the needs and expectations of the many stakeholders affected by their operations.
Improving EHS performance indirectly benefits shareholders, because the perceptions of key
stakeholders can profoundly influence many of the above intangible value drivers, including
customer relationships, brand equity and reputation, and business continuity. In particular,
companies need to consider EHS-related opportunities for reciprocal value creation in the context of
alliances with suppliers and customers. For example:
By exchanging intelligence and know-how about EHS regulatory activities and emerging
technologies, suppliers and customers can strengthen each others performance.
By incorporating EHS benefits into their products and servicesfor instance, reducing the
customers cost of ownershipsuppliers can differentiate themselves and increase customer
loyalty than others in the perspective of EHS.
By collaborating, customer-supplier teams can address EHS-related technical challenges that
impact overall supply chain profitability and performance.
There are plenty of instances of EHS initiatives in action across the supply chain (in Table
1.12). As a burning example, a compelling story is an initiative at Motorola. This initiative was
originally motivated by EHS concerns and then evolved into a broad supply chain improvement
project leveraging all of the above pathways to value.
1.2.10 Main benefits of Green Supply Chain

1.
Improves Agility Green SCM help mitigate risks and speed innovations
2.
Increases Adaptability- Green supply chain analysis often lead to innovative processes and
continuous improvements.
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3.
Promotes Alignment Green SCM involves negotiating policies with suppliers and customers,
which results in better alignment of business processes and principles
Table: 1.2 Examples where EHS makes contribution
Real world Examples of where EHS makes a contribution

Assure compliance of products and business
processes with laws and industry standards.
Maintain health and well being for both

employees and local communities by
management.
Texas Instruments responded to the need of

customers by systematic process with assuring
compliance with demand regarding banned and
restricted products.
Abbott Laboratories reduced contractor
safety incidents to below the industry average
value by incorporating safety protocols into its
automated contractor performance
management system.
Reduce risk and maintain business continuity

by assuring product and process safety through
supply chain.
Dow Chemical has obtained the behaviorbased approach towards transportation safety
that cuts accidental rates.
Raise productivity with material conservation,

energy efficiency and conservation of waste
into by-products.
Intel has saved lots of money by developing

the lighter weight plastic trays used to move
the microprocessor units through fabrication
process and then deliver to customers.
Save the environment including health, natural

resources through waste elimination, pollution
prevention.
FedEx Express has redesigned its overnight

letter packaging to use 100% recycled fiber
strengthening its environmental leadership.
Support innovation in products, services and

technologies that raises customer satisfaction.
Kodak uses design for EHS principles that

cut the weight of camera.
Enable growth by acquisition and sales

expansion by performing well and supporting
access to new markets.
Further relation with customers, suppliers and
others who are the responsible to influence the
supply chain operations.
Anheuser-Busch redesigns its supply chain

system to handle the complexity of their
products including efficiency and
environmental collaboration.
Eastern Kodak, Hewlett-Packard (HP) and
Motorola have unveiled their expectations for
suppliers EHS performance with sustainable
business practices
(Source: GEMI, Forging New Links: Enhancing Supply Chain Value through Environmental Excellence.)
Page 40
2. Literature Survey:
2.1 Green Supply Chain Management:
Green supply chain management is not a concept on which all researchers agree as
expressed by Ahi et al. [41]. However, the most of authors state that it emerges from the concept
that companies have to become greener as expounded by Marcus & Fremeth [42], must try to reach
a winwin perspective as said by Hart & Dowell [43] and must link the supply chains and
sustainable development as it is expressed by Seuring [44]. Ageron et al. [45] formulated the
concepts of GSCM emerged from the realization that isolated implementations of environmental
practices by companies are not as effective as collective actions that can make the entire supply
chain greener. Linton et al. [46] said this broader systematic perspective of environmental
management dispersed among all players in a supply chain has been called GSCM. This concept is
a part of the broad effort to align operations management with the goal of improving the quality of
life in society as expressed by Sarkis [47].
Seuring & Muller [48] said that GSCM is, therefore, a part of the environmental
dimension of the Sustainable Supply Chain Management (SSCM) concept. According to them,
SSCM can be defined as the management of materials, the distribution of information, the flow of
capital, and cooperation among companies in a supply chain as they strive to improve their
economic, environmental, and social performances while simultaneously considering the
expectations of other stakeholders. The interest of the scientific community in this subject is
increasing quickly. A summary of the state-of-the art, most influential works on GSCM can be
found in Table 2.1. Using the keywords green supply chain, green supply chain management,
and environmental supply chain management, a search in the ISI Web of Knowledge database
produced the 10 most cited works in this field of knowledge; they are depicted in Table 2.1. From
this literature review, several definitions of GSCM deserve attention to pay:
1. According to Vachon & Klassen [57] GSCM encompasses a set of environmental practices that
encourage improvements to the environmental practices of two or more organizations within the
same supply chain.
Page 41
2. Srivastava [58] said that GSCM is the process of incorporating environmental concerns into
supply chain management including product design, material sourcing and selection, manufacturing,
delivery of final products, and the management of products end-of-life.
3. As per Min & Kims [59] concept GSCM can be achieved by considering environmental issues at
the purchasing, product design and development, production, transportation, packaging, storage,
disposal, and end of product life cycle management stages.
4. Sarkis et al. [60] said that GSCM is the integration of environmental concerns in the interorganizational practices of supply chain management.
Table 2.1: Top 10 cited works in green supply chain management
Authors
Srivastava [49]
Purpose/ Findings
Classified the available literature on GSCM into categories such as problem

context; methodology/approach; and tools and techniques. Presented a
comprehensive review of the literature on green supply chain
Zhu and Sarkis [50]
They used empirical results from more than 180 respondents on GSCM
practices in Chinese manufacturing firms to examine or test the relationships
between GSCM practices and environmental and economic performances.
Sarkis [51]
He presented a decision framework that considers green management factors,

designed to facilitate improvements in green supply chain management
decision making
Seuring and Muller
They reviewed and classified the literature on sustainable supply chain

management, including green issues, and presented an overview of state of
[48]
Rao and Holt [52]
the art literature

They tested linkages between green supply chain management as an initiative
for environmental enhancement, economic performance and competitiveness
among a sample of ISO 14001-certified companies in Southeast Asia with a
positive relationships as an outcome in the studied model.
Page 42
Authors
Purpose / Findings
Kleindorfer et al.[53]
They reviewed various themes on sustainability (including green supply

chain management). Covered Production and Operations Management
journal. They gave stressed on future research challenges in sustainable
operations management.
Linton et al. [46]
They presented a special issue on sustainable supply chain management.

They also reinforced the argument that the focus on environmental
management and operations has now moved from local optimization of
environmental factors to consideration of the entire supply chain.
Zhu et al.[54]
Based on 314 complete questionnaires, authors concluded that more

awareness on environmental issues has not yet been translated into strong
GSCM practice adoption.
Vachon and Klassen They conceptualized and empirically tested green supply chain practices, and
[55]
considered both upstream and downstream interactions in chain.
Sheu et al.[56]
They presented an optimization-based model to deal with integrated logistics

operational problems of green-supply chain management.
Companies can implement the GSCM practices in the following manner depicted in the Table 2.2:
Table 2.2: The probable GSCM practices used in industry
Code
GSCM 1
Nature of the practice

Commitment
of
Explanation
senior The support of senior management is crucial in
management to GSCM
GSCM adoption, as there will be an eventual need

for process adjustments or cultural changes.
GSCM 2
Inter-functional
co-operation Inter-functional cooperation (e.g., purchases and
for environmental betterment.
sustainability,
research
and
development
in
sustainability, or marketing and stability, etc.) is

important in implementing changes in the day-to-
Page 43
day activities of the functional areas. This type of

cooperation can therefore promote environmental
requirements externally via upstream suppliers, or
internally via consumer demand.
GSCM 3
Action
with
environmental
and
GSCM 4
legal Addressing environmental legal requirements and
requirements auditing programs illustrates that the company is
periodical
auditing trying to meet environmental regulation for their
programs
sector internally.
ISO 14001 Certification
The
company
has
an
ISO
14001
certified
Environmental Management System (EMS)

GSCM 5
Selection of suppliers includes The selection process for suppliers considers

environmental criteria
environmental variables (e.g., ISO 14001) in

addition to traditional criteria (e.g., cost, quality,
reliability, etc.)
GSCM 6
Work with suppliers to meet Suppliers are asked to hold up initiatives and
environmental goals
measures within their company to improve the

environment
GSCM 7
Determination of the internal Inspections of supplier installations provide a way to

environmental management of check the environmental performance of the supplier
suppliers
and ensure that they can meet the environmental

management standards
GSCM 8
Evaluation
of
the Suppliers who give basic raw materials are also
environmental management of
monitored to extend environmental concern beyond

the direct relationship
2nd-tier suppliers
GSCM 9
Work with clients for eco- Using the close relationships that traditional supply
design
chain management allows, companies seek to

develop product together with clients to improve the
products environmental effect.
GSCM 10
Work with clients to make Utilizing the close relationships that traditional
cleaner production.
supply chain management allows, companies are

Page 44
keen
to
manufacture
cleaner
products
with
cooperation from the client.

GSCM 11
Work with clients to use eco- Using the close relationships that traditional supply
friendly packaging.
chain management allows, companies try to

use
environmentally
friendly
packaging
with
cooperation from clients.

GSCM 12
Adoption
of
the
cleanest The company purchases equipment that allows it to
technologies by the company

GSCM 13
Product designs that reduce, The

reuse,
recycle,
materials,
or
company
observes
policies
on
material
reclaim reduction, parts reuse, recycling of the product after
components,
energy
GSCM 14
make products as cleanly as possible.
or use and recuperation of materials, components, or

energy throughout the products life
Product designs that avoid or In developing products, the company incorporates

reduce toxic or hazardous ways to avoid or reduce the use of dangerous or
material use
GSCM 15
Sale
of
toxic products
excess
stock
materials.
GSCM 16
Sale
of
materials
its investment
scrap
i.e.
and
it
used The company seeks to sell waste and used materials
promotes (i.e., materials that do not have value in the
reusing them.
GSCM 17
or The company seeks to sell obsolete stock to recover
production line) to recuperate its investment
Sale of used equipment (after The company sells used equipment to recuperate its
buying new equipment)
investment.
2.2 Green Supplier selection

According to Gunasekaran et al. [61], the increased collaboration of environmental
consideration in operations management and supply chain has turned out to be the strong trend of
late. Dekker et al. [62] has explored in their research study that the important GSCM practices
include the environmental factors in supplier selection, maintenance and development. For Kumar
et al. [63] the supplier selection process shows a set of activities such as identifying, analyzing, and
Page 45
choosing suppliers to become a tier of the supply chain. Suppliers who adopt GSCM practices can
make the environmental performances of companies stronger throughout the supply chain. As per
Akamp & Mullers [64] research, there are much more difficulties to introduce and implement the
GSCM practices in the industry in developing countries like India.
Supplier selection based on the environmental considerations has been a important topic
now-a-days. Many a researchers have conducted various works on this topic. Here, a summary of
the most cited articles in the ISI Web of Science Journal are selected and listed in Table 2.3.
Table 2.3 Ten cited articles in green supplier selection
Author(s)
Min and
Purpose of the
Supplier selection
paper
criteria
It checks the factors
(1)
that influence the
Cost.
Galle [65]
adopt green
purchasing strategy
Statistics DEA, TOPSIS,
(Hypothesis
testing
(2)
suppliers
environmental
Issues not
addressed
Environmental (1)
complacency of the
buyer companies to
Method used
factor
ELECTRE
and could
be
applied.
analysis)
commitment.
(3)
Environmental
liability and penalty
Page 46
Lee et al. [66]
Model is proposed
(1)
Quality,
(2) Fuzzy AHP
to evaluate the green Technology
DEMATEL
suppliers and a
Capability,
hierarchy study to
Pollution Control, (4)
evaluate the
Environmental
importance of
Management,
criteria for selecting
Green Product, (6)
green suppliers.
Green Competencies.
Purpose
Checking
if of
thethe
Supplier
selection
(1)
Cost, (2)
Quality, Case studies.
Brazilian companies
(3) Innovation, (4)
are adopting
Delivery,
and environmental
requirements based
Jabbour [67]
Jabbour
Restriction
use
of
(3)
on
chemical
14001.
With the help of
(1) Quality
artificial neural
Kuo et al. [68]
applied.
the
suppliers.
analysis (DEA) and
be
(5)
components, (6) ISO
Data envelopment
could
(5)
selection of
network (ANN),
Fuzzy ANP or
ANN,
and ANP.
(2) Service
(3) Corporate social
DEA DEMATEL,
fuzzy
AHP
could
be
applied.
responsibility.
analytic network
process (ANP), a
(4) Delivery
model of selection
of green suppliers is
developed.
(5) Cost
(6) Environment.
Page 47
Analyze whether
(1) Cost
Case studies
environmental
issues are part of the
criteria for selection
Wolf
and of logistics service
providers
Seuring [69]
(2) Lead time

(3) Reliability
(4) Variety
(5) Quality
(6) Environment
Identify a model
(1) Organization
based on principles
of sustainability to
select suppliers for
Buyukozkan
supply chains
Fuzzy ANP
Fuzzy
AHP,
fuzzy TOPSIS,
(2) Financial
performance
(3) Quality
fuzzy
DEMATEL
could also be
applied.
and Cifci [70]

(4) Technology
(5) Corporative
social and
environmental
Page 48
They developed a
(1) Organization
model of
evaluation of the
selection of the
suppliers for
Buyukozkan
and Cifci [71]
(2) Financial
Fuzzy
Fuzzy
AHP,
DEMATEL,
fuzzy
VIKOR,
Fuzzy ANP,
fuzzy
performance
PROMETHEE
Fuzzy TOPSIS
(3) Quality
qualitative and
quantitative
could also be
applied.
(4) Technology
factors
(5) Corporative
social and
environmental
A model is
(1) Capability
developed for
optimal planning of
mathematics to
Yeh and
select green
Chuang [72]
partners.
Genetic
Ant-Bee-
algorithm
Colony
(2) Productivity
(3) Cost
algorithm,
or
DEA,
or
Evolutionary
algorithm
(4) Quality
or
stochastic
(5) ISO 14000
optimization
could also be
applied.
Their model
18 criteria, among
Fuzzy,
Superiority and
illustrates a case
which:
MCDM, Grey
Inferiority
theory
ranking
company that
targets to select the
(1) Delivery, (2)

Financial performance,
method,
Tseng and
green suppliers to
Chiu [73]
meet the GSCM
Quality, (5) Price, (6)
could also be
practices.
Green design, (7) ISO
applied.
(3) Relationship, (4)
ELECTRE-III
14000, (8) Green

purchasing, (9) Cleaner
production.
Page 49
Considering the
(1) Cost
Carbon emission an
integrative model is
Shaw et al.[74]
developed to select
(2) Quality
(3) Delivery
the suppliers in
SCM system.
(4) Emissions of
Fuzzy-AHP,
Fuzzy
ANP,
Fuzzy multi
genetic
objective
algorithm,
linear
programming
greenhouse gases
There are many others studies that show the green supplier selection. As an example,
Large and Thomsen [75] collected data from more than 100 German companies and had shown that
the degree of green supplier evaluation and the level of green collaboration influences directly the
companys environmental performance. Many of other researchers like Sarkis [76], Dekker et al.
[77] stressed on the environmental sustainability with GSCM practices. According to the study by
Baskaran et al. [78], it showed that the inclusion of the socio-environmental sustainability criteria in
the Indian textile industry. This study indicated that the criterion of long working hours plays an
important role in evaluating suppliers of garment manufacturers and ancillary suppliers. Govindan
et al. [79] described the sustainable supply chain initiatives and gave a model of fuzzy multi criteria
approach for supplier selection based on triple bottom line (TBL) approach (i.e., economic,
environmental and social considerations). Hsu and Hu [80] had shown Analytic Network Process
(ANP) to include the Hazardous Substance Management (HSM) into the supplier selection. A
hybrid model combining DEMATEL and ANP (abbreviated as DANP) has been widely applied to
solve a variety of applications such as e-learning evaluations by Tzeng et al. [81], airline safety
measurements by Liou et al. [82]. By Hsu et al. [83] study, a beautiful carbon management model
using DEMATEL for supplier selection in GSCM has been evolved. Hsua et al. [84] explored the
new technique for best vendor or supplier selection for conducting the recycling material based on
hybrid MCDM model combing DANP and VIKOR. Doraid Dalalah et al. [85] presented a fuzzy
multi criteria decision making model for supplier selection using DEMATEL and TOPSIS.
Page 50
2.3 Aims, Objectives and Scope of the Study

Aims
The main aims of this research work are as follows:
a. To understand the green supply chain management and implement it in this case Company
over conventional supply chain system to incorporate greener and cleaner production
through environmental friendly activities maintaining health and safety factors.
b. To find out the relative ranking of green suppliers from the set of alternate suppliers of a
case Company based on their performances to encourage in activities in green supply chain
management protecting the environment from industrial hazardous products maintaining the
EHS (Environment, Health and Safety) norms.
Objectives
The objectives of this research work are as follows:
a.
To find out the relative weights of the criteria and the corresponding relationship among the
six dimensions and twelve criteria through the network relationship map by hybrid
DEMATEL - ANP (DANP) process.
b. To figure out the relative ranking of the suppliers of this case Company with the help of
fuzzy TOPSIS MCDM method.
c. To validate the proposed hybrid model with the present available resource, experts
comments based on given time frame.
d. To investigate the sensitivity of the model through sensitivity analysis by swapping mutually
the weights of the criteria.
Scope of the Study, Place and Time of The Research

The scope of this research work is entirely based on the case study of the Indian engineering
firm or industry namely, ESAB India Limited. All the data were obtained from the experts of this
industry between March - April, 2014. There were six dimensions and twelve criteria based on
which performance, all the ten alternative suppliers were evaluated for ranking and the impact or
influence relationships among dimensions as well as criteria were mapped out as Network
Relationship Map.
Page 51
3. Methodology Used:
3.1 Methods to green supplier selection
Supplier selection is a multi-criteria decision problem for which the related literature has
proposed several supplier selection methodologies like Akarte et al. [86], Liaoa and Rittscherb,
[87], Huang and Keskar [88] . Some familiar examples of systematic analysis for supplier selection
include analytic hierarchy process (AHP) by Chan [89], fuzzy analytic hierarchy process (FAHP)
by Chan and Kumar [90], fuzzy QFD by Bevilacqua et al.[91], analytic network process (ANP) by
Hsu and Hu [92], case based reasoning (CBR) systems by Choy et al. [93], and multiple objective
programming Feng et al. [94], Zhu, 2004 [95]. However, those approaches to supplier selection in
the supply chain require additional data and scarcely consider the relationship between criteria. The
DEMATEL technique does not need large amounts of data and is capable of revealing the
relationship among these factors influencing other factors in the supplier selection as is explored by
Chang et al. [96]. DEMATEL modeling thus better fits the problem examined in this study, and
offers the advantage of providing a systematic approach to supplier selection for GSCM practice.
Then ANP is used to find out the weights of criteria and fuzzy TOPSIS is executed to get the final
ranking of the suppliers. This total process is shown as a flow chart in Fig. 3.4.
3.1.1 DEMATEL
Wu and Lee [97] had shown that DEMATEL is a comprehensive tool for building and
analyzing a structural model involving causal relationships between complex factors. It was
developed by the Science and Human Affairs Program of the Battelle Memorial Institute of Geneva
between 1972 and 1976 and DEMATEL has been used to research on and solve a group of
complicated and intertwined problems. DEMATEL was developed in the belief that pioneering and
appropriate use of scientific research methods could improve understanding of the specific
problematic cluster of intertwined problems, thereby contributing to the identification of workable
solutions by a hierarchical structure. The methodology, according to the concrete characteristics of
objective affairs, can confirm the interdependence among the variables/attributes, and restrict the
relationship reflecting the characteristic with an essential system and development trend. The
product of the DEMATEL process is a visual representation (i.e., an individual map of the mind)
that the respondent uses to organize his or her own actions.
Page 52
The DEMATEL process can be summarized as follows:

Step 1: First, calculate the average matrix. In this case, say, we have H experts in our study and n
factors are considered. Each of the respondent is asked to express the degree to which he or she
believes a factor, i, affects factor, j. These pair wise comparisons between any two factors are
k
denoted by xij and are given an integer score of 0-4, representing No influence (0), Low
influence (1), Medium influence (2), High influence (3) and very high influence (4)
respectively (Gabus and Fontela [98]). Each respondent will provide the score and this score will
[ ]
k
provide, in turn, an n x n non-negative answer matrix X k = xij , with k = 1, 2,, H. Thus X1,
[ ]
X2,,XH are the answer matrices for each of the H experts and each element of X k = xij
nXn
is an
integer expressed by xij . In each answer matrix, the diagonal elements are all set to 0. The average
matrix A (n x n) can be computed by averaging the scores of H experts as follows:
a ij =
1
H
k
ij
.. (Eq.3.1)
k =1
The average matrix A is also called the Original Average Matrix or Initial Influence Matrix. A
implies the initial direct effects that a factor exerts on and receives from other factors. Then, the
causal effect between each pair of factors in a system can be figured out by drawing an influence
map. An example of influence map is shown in Fig. 3.1. Each letter represents a factor in the
system. An arrow from c tod shows the influence or effect that c has on d and the strength of
this effect is 4. Our DEMATEL model can convert the structural relations among the factors of a
system into an intelligible map of the system.
Fig. 3.1: An example of

Influence or Impact Map
(Source: Yang et al. [100])
Page 53
Step 2: Calculate the normalized direct Influence Matrix.

The normalized initial direct-relation matrix D is obtained by normalizing the average matrix A
in the following Eq. 2
n
n
s1= max max aij , max aij

1 j n i =1
1in j =1
So, D = A/s1;
. (Eq.3.2)
.. (Eq.3.3)
As the sum of the each row j of the matrix A represents the direct effects that factor exerts on
n
max a
other factors,
ij
1i n
represents the factor of the highest direct influence on other factors.
j =1
Similarly, since the sum of each column i of matrix A represents the direct effects received by
n
factor, i,
maxa
ij
1 j n
represents the factor which is the most influenced factor by other factors. The
i =1
positive scalar s1 is equal to the bigger of two extreme sums. The matrix D is obtained by dividing
each element of A by the scalar. Note that each element dij of matrix D is between 0 and 1.
Step 3: Compute the total relation matrix (TC)
Indirect effects between factors are measured by powers of D. A continuous decrease of the
indirect effects of factors along the powers of matrix D, namely, D2, D3,, D guarantees
convergent solutions to the matrix inversion similar to an absorbing Markov chain matrix.
Here,
lim D
= [ 0] nxn and
lim ( I + D + D
+ D 3 + ... + D m ) = ( I D ) 1 , where 0 is the n x n null
matrix and I be the n x n identity matrix. The Total Relation Matrix or total influence matrix, TC is
an n x n matrix and it is defined as follows:
TC = [t ij ] = D i = D ( I D ) 1 ; Where, i and j = 1,2,,n, as lim D k = [0]n x n .. (Eq. 3.4)

i =1
Page 54
Here, D = [ d ij ] n x n , 0 d ij < 1 and 0 (i d ij , j d ij ) < 1 and at least one column sum

row sum
d
i
ij
d
j
ij
or one
equals to 1.
Here, r and s vectors are the n x 1 vectors representing the sum of the rows and sum of the
columns of the matrix T. They are as follows:
n
r = [ri ]n x1 = tij (Eq.3.5)
j =1 n x1
s = [s j ]1 x n = t ij 1 x n (Eq.3.6)[Here superscript implies it to be the Transposition]

i =1
Let, ri be the sum of the i-th row in T matrix. So, ri expresses the total effect/ influence, both direct
and indirect exerted by the i-th factor on thers. Let, sj be the summation of the j-th column in matrix
T. sj value shows the total effects, both direct and indirect, received by factor j from other factors.
Here, the sum (ri+si) gives an index (the position) representing the total effects both given and
received by the i-th factor. In another way, we can say that (ri+si) shows the degree of importance
that the i-th factor plays in this system. In addition the difference (ri-si) is called the relation and that
shows the net effect, the i-th factor contributes to the system. When (ri-si) is positive, the i-th factor
is the net causer and when (ri-si) is negative, the i-th factor is the net receiver (Tzeng et al.[99]).
Step 3: Set the threshold value and obtain the Network Relationship Map (NRM)
As per Yang and Tzeng [100], to explain the structural relation between the criteria and keep
the complexity of the system to a manageable level at the same time, decision maker must set a
threshold value p to filter out some negligible effects in matrix T. Only some criteria, whose effect
in the matrix T is greater than the threshold value, should be chosen and shown in a NRM for
influence. After the threshold value is decided, the final influence result of criteria can be shown in
a NRM.
In this thesis work, the threshold value has been decided by experts through discussion.
Once this value is set, then the network relationship among the criteria or among the
Page 55
dimensions can easily be mapped out. To visualize the mapping of NRM, one simple example
is given below.
Say, a system comprises of three criteria C1, C2 and C3. The total influence matrix TC can be
derived by running from step 1 to step 3. Now, based on the threshold value p set by the
experts, minor effects can be filtered in the matrix TC. The values in this matrix TC are set zero
if their values less than p i.e., there are lower influences with the other criteria when their
values are less than p. Thus a new total influence matrix Tp can be derived and the NRM can
also be shown as Fig. 3.2 below.
Tp =
C1
C2
C3
C1
C2
C3
0
t 21p
0
p
12
t13p
t 23p
t 33p
t
0
0
Fig. 3.2: The NRM of the system (Source: Yang et

al. [100])
3.1.2 Analytic Network Process (ANP)

Saaty (1999) published Analytic Network Process. The main objective was to solve the
problems of interdependence and response or feedback between criteria and alternatives in
real world scenario. This mathematical process can overcome all types of dependencies. The
initial step is to compare the criteria in the total system and form an unweighted supermatrix
by pairwise comparisons. Then weighted supermatrix is derived by transforming each column
to sum exactly to unity (1.00). Each element in a column is divided by the number of clusters
and thus each column will sum to unity. Here, DEMATEL technique is utilized to determine the
degrees of impact of these criteria and it is applied to normalize the unweighted supermatrix
in the ANP to mimic the real world situation. This process can be renamed as improved ANP
or DANP. This DANP can be explained as follows:
Page 56
Step 1: Develop an unweighted supermatrix:

From DEMATEL, the total-influenced matrix (TC) is obtained. Then each column will sum
[]
to get the normalized one. Here, TC = tij
nxn
[ ]
is obtained by criteria and TD = tij
mxm
is
obtained by dimensions (here, clusters) from TC. Then, normalization of TC is performed to

get the ANP weights for dimensions or clusters by utilizing TD. Then, each column will sum in
order to get the normalized form.
. Eq. 3.7
A new matrix TC is derived by normalizing TC by dimensions (clusters).
. Eq. 3.8
Page 57
Here, an explanation for the normalization is described by the following equations Eq. 3.93.10.
m1
11
d = t cij
, i = 1,2,..., m1
11
ci
. Eq. 3.9
j =1
. Eq. 3.10
Let, the total-influence matrix matches and fills into the interdependence clusters. Then it can
be said as Unweighted Supermatrix. This matrix is shown in Eq. 3.11 which is based on
transposing the normalized influence matrix TC by clusters. Here, W = (TC ) .
. Eq. 3.11
Page 58
If the matrix W 11 is blank or null or 0 as shown in Eq.3.12, it implies that the matrix between
the clusters or criteria is completely independent i.e., with no interdependence and the other
W nn values are as follows:
. Eq. 3.12
Step 2: Calculation of the Weighted Supermatrix

To derive the weighted supermatrix, each column will sum for normalization as shown in Eq.
3.13.
. Eq. 3.13
Now, the total influence matrix TD is normalized and a new matrix TD is obtained and this is
. Eq. 3.14
Page 59
ij
shown in Eq. 3.14, Where, t D ij = t D .

di
Now, let the normalized total influence matrix TD fill into the unweighted supermatrix to get
the weighted supermatrix (in Eq. 3.15).
. Eq. 3.15
Step 3: Limit the weighted supermatrix

Now, the power of the weighted supermatrix is raised by sufficiently large power k, until
the supermatrix gets converged and become a long term stable supermatrix to get the global
priority vectors. These are called DANP (DEMATEL based ANP) weights or influential weights.
Here, Lim (W ) g where, g = any number of power.
g
As a result, the overall weights are calculated by using the above steps to obtain the
limiting stable supermatrix. So, a newly developed hybrid model combining the DEMATEL
method with ANP is generated that is well capable to handle the problems of interdependence
and feedback.
3.1.3 The Fuzzy TOPSIS Method

The TOPSIS is very much useful MCDM tool for ranking problem in real world scenario.
But, due to the inability to adequately handle the inherent uncertainty or probability of
occurrence and imprecision attached with the mapping of the conception of decision maker to
crisp values. However, in many cases, it is seen that human preference model is uncertain and
respondents might be reluctant to assign crisp values to the comparison matrix of judgment
(Chan et al. [101]). But actually crisp evaluation process is a problematic point. One of the
Page 60
main reasons is that decision maker find this more confident to give the interval judgments
than to express in just a single numeric value. Another main reason is that the mathematical
models are based on the crisp values. These processes can not deal with decision makers
uncertainties, ambiguities and vagueness which are not handled by crisp values. According to
Zadeh [102], the utilization of the fuzzy set theory helps the decision makers to incorporate
incomplete, unquantifiable and non-obtainable information and partially ignorant facts into
decision model (Kulak et al. [103]). This results the development of fuzzy TOPSIS and its
extension to solve ranking and justification problems (Yong [104], Yang & Hung [105]).
This research paper uses triangular fuzzy number for fuzzy TOPSIS. The reason behind this
use is that it is very much helpful as well as easy for the decision makers to use and calculate.
In practice, the triangular form of the membership function is utilized frequently to represent
the fuzzy numbers (Ding & Liang [106], Kahraman et al. [107], Xu & Chen [108]). In the
following paragraph, some basic and important definitions of fuzzy sets are given (Chen [109],
Wang & Chang [110])
Definition 1: In a universe of discourse X, a fuzzy set A is characterized by a membership

function A~ ( x ) associating with each element x in X a real number in the interval of range 0 to
1. The value of the function A~ ( x ) is said as the grade of the membership of X in A .
~ can be described by a triplet (a , a , a )

Definition 2: A triangular fuzzy number (TFN) a
1
2
3
shown in Fig. 3.3. The membership function a~ ( x) is defined as follows:
0,
when x < a1
( x a1 ) (a 2 a1 ), when a1 x a 2
a~ =
( x a3 ) (a 2 a3 ), when a 2 x a3
0,
. Eq. 3.16
when x > a3
Page 61
Fig. 3.3: Triangular

~
fuzzy number a
~
Let, the two triangular fuzzy numbers are a~ and b . They are defined by the triplet
(a1 , a2 , a3 ) and (b1 , b2 , b3 ) respectively. Now, the operational laws of these TFNs are as follows:
~
a~(+)b = (a1 , a 2 , a3 ) (+ ) (b1 , b2 , b3 ) = (a1 + b1 , a 2 + b2 , a3 + b3 ),
~
a~()b = (a1 , a 2 , a3 ) () (b1 , b2 , b3 ) = (a1 b3 , a 2 b2 , a3 b1 ),
~
a~( X )b = (a1 , a 2 , a3 ) ( X ) (b1 , b2 , b3 ) = (a1 .b1 , a 2 .b2 , a3 .b3 ),
~
a~(/)b = (a , a , a ) (/) (b , b , b ) = (a / b , a / b , a / b ),
1
. Eq. 3.17
a~ = (ka1 , ka 2 , ka3 ).
Definition 3: A linguistic variable is a variable values which are linguistic terms (Chen [111],
Zadeh [112]). The very concept of this linguistic variable is too much helpful in dealing with
very complex situations or which are too ill-defined to be reasonably described in
conventional quantitative expression. If an example is taken like weight as a linguistic
variable then its values may be very low, low, medium, high and very high, etc. These linguistic
values are also represented by fuzzy numbers.
~
Definition 4: Let, the two triangular fuzzy numbers are a~ and b . Here, a~ = (a1 , a2 , a3 ) and
~
b = (b1 , b2 , b3 ) . Now, the vertex method can be defined to calculate the distance between them,
~
1
d (a~, b ) = [(a1 b1 ) 2 + (a2 b2 ) 2 + (a3 b3 ) 2 ].
3
. Eq. 3.18
Page 62
Definition 5: Here, for each criterion, the weighted normalized fuzzy decision matrix is
constructed as follows:
~
V = [v~ij ]nxJ , wherei = 1,2,..., n; and j = 1,2,..., J .
. Eq. 3.19
Where,
v~ij = ~
x ij x w i .
~
X = {~
xij , i = 1,2,..., n, j = a,2,..., J . = Performance rating set of Aj(j=1,2,,J) w.r.t. criteria Ci
(i=1,2,,n).
Here, wi= A set of importance weights of each criterion, here I = 1,2,,n
According to the theory of Onut & Soner [113] Fuzzy TOPSIS can be illustrated as follows:
Step 1: Choosing of Linguistic Values
Choosing the appropriate linguistic values ( ~x ij ) for alternatives with respect to criteria is
done. The property of the fuzzy linguistic rating ( ~x ij ) defines the ranges of normalized
triangular fuzzy numbers from 0 to 1. Thus, there is no need for normalization. Here i= 1,2,,n
& j= 1,2,,J.
Table 3.1 Linguistic values and fuzzy numbers
Linguistic Values
Fuzzy numbers
Very low (VL)
(0.0.0.2)
Low (L)
(0,0.2,0.4)
Medium (M)
(0.2,0.4,0.6)
High (H)
(0.4,0.6,0.8)
Very high (VH)
(0.6,0.8,1.0)
Excellent (E)
(0.8, 1.0,1.0)
Page 63
Step 2: Computation of the weighted normalized fuzzy decision matrix

The weighted normalized value v~ij can be calculated as follows:
~
V = [v~ij ]nxJ , wherei = 1,2,..., n; and j = 1,2,..., J .
. Eq. 3.20
Where,
~ ~
v~ij = ~
x ij x w i . and X = {xij , i = 1,2,..., n, j = a,2,..., J . = Performance rating set of Aj(j=1,2,,J) w.r.t.
criteria Ci (i=1,2,,n) and wi= A set of importance weights of each criterion, here I = 1,2,,n
Step 3: Identification of FPIS and FNIS
The fuzzy positive ideal solution and fuzzy negative ideal solution can be calculated as follows:
A* = {v~1* , v~2* , v~3* ,..., v~i* } = {( max vij i I ), x(min vij i I )}, i = 1,2,..., n & j = 1,2,..., J .
j
A = {v~1 , v~2 , v~3 ,..., v~i } = {(min vij i I ), x(max vij i I )}, i = 1,2,..., n & j = 1,2,..., J . . Eq. 3.21
j
Where, I and I are associated with benefit and non-benefit criteria respectively.
Step 4: Computation of distance
Here, the distance of each alternative from A* and A- is calculated by the following equations:
n
D *j = d (v~ij , v~i* ) where, j = 1,2,..., J .

j =1
n
D j = d (v~ij , v~i ) where, j = 1,2,..., J .
. Eq. 3.22
j =1
Step 5: Calculation of the Relative Closeness values

Last of all, Relative Closeness (CCj) is calculated by the following formula.
Page 64
CC j =
D j
*
j
D +D
where, j = 1,2,..., J .
. Eq. 3.23
Step 6: Rank the alternatives

The alternative with maximum CCj is ranked first and then chooses the other alternatives as
second, third, etc. as per the descending order of CCj.
Fig. 3.4: Flowchart of a hybrid MCDM model combined DANP and FTOPSIS
Page 65
4. Application of the proposed model to a case study

In this section, a realistic case study of a India based company namely ESAB India Limited is
displayed to illustrate the application of the proposed model to evaluate and find out the ranking of
the suppliers related to the company for conducting the recycled materials in real world case.
4.1 Background and problem elaboration

Background:
The ESAB Group
In our example case study, ESAB India Limited is a world leader in many areas of the welding
and cutting industry and is often benchmarked by its competitors for innovation, product quality and
service. In 1904, Oscar Kjellberg, a Swedish engineer was working on ships and boilers in
Gothenburg, Sweden [114]. He was not satisfied with the quality of repair jobs. His quest for a
better technology led to the invention of the world's first covered electrode. And thus, Elektriska
Svetsnings Aktie Bolaget (ESAB) was born. Today, ESAB employs around 6,700 people of which
more than 600 are engaged in Research and Development at centers in Sweden, Holland, UK,
Germany, USA, Brazil and India. The ESAB Group is owned by Colfax Corporation.
ESAB India Limited
ESAB India Limited started its operations in 1987 by acquiring the welding business of Peico
Electronics & Electricals Limited (now Philips India Limited). The Company extended its business
in the Indian market with the purchase of Indian Oxygen Limited's welding business in 1991 and
Flotech Welding & Cutting Systems Limited in 1992, followed by the merger of Maharashtra
Weldaids Limited in 1994.
ESAB India Limited is owned 73.72% by the ESAB Group. The remainder of its shares are held
widely. Today, ESAB India has established and marked itself as one of the supreme suppliers of
welding and cutting products in Indian territory. ESAB products are now an integral part of
industries like Shipbuilding, Petrochemical, Construction, Transport, Offshore, Energy and Repair
and Maintenance.
Page 66
As this company is so much concerned about their sustainable development as well as

environmental friendly applications throughout, we can look through their main Environmental,
health and safety policy as cited below [116]:
i.
They are continuously improving Environmental, Health & Safety (EHS) performance by conserving
natural resources, preventing pollution and providing safe workplaces and products.
ii.
They use a life cycle approach in their efforts to minimize the EHS impact of our products and
services, from the extraction of raw materials to product end of life.
iii.
They openly communicate their EHS performance and participate in external initiatives along with
contractors, suppliers and consultants that improve their knowledge and performance.
From the sustainability point of view, ESAB is a company that:

i.
Has an impact on the environment that does not contribute to biosphere deterioration.
ii.
Contributes to local and global economy development.
iii.
Makes flawless products, needed by society and safe to use
From an environmental point of view, ESAB is a company with vision where:

i.
Welding equipment is designed for refurbishing or reuse.
ii.
Our raw materials and components are made of recycled materials.
iii.
Our production and processes only use renewable energy and closed water circulation
systems
iv.
All production waste is reused, recycled or used as raw materials in other processes
For this reason, this particular Company ESAB India Limited is selected as case Company in
this research paper to evaluate the ranking of the green suppliers who can meet the environmental
factors as well.
Problem illustration: To minimize the cost of its products and to work environment-friendly,
ESAB India Limited have been trying to change its production line process to reuse recycled
materials instead of just mere raw materials. As recycled material suppliers could not control the
quality of products and delivery being delayed, they are trying to figure out some potential
Page 67
suppliers from existing many of them who are trying to maintain the environmental issues and
giving their good quality of service as well as products to this Company. So, from the Companys
perspective they are ranked based on some criteria based on this recent time frame. So, in my study,
ten suppliers of this Company are selected for evaluation and they are subjected to be ranked based
on twelve existing criteria (within six different dimensions) which they maintain. The very concept
of these criteria or dimension is partially taken from the paper of Hsu et al. [115]. In this paper, ten
alternative suppliers are taken as A1, A2, A3, ., A9, A10 and twelve criteria are taken as C1, C2,
C3,, C11,C12. The main six dimensions are taken as D1, D2,., D6. Then the ranking of the
green suppliers is performed by the MCDM model combining DEMATEL-ANP (DANP) with
fuzzy TOPSIS (FTOPSIS) method. The ten suppliers as alternatives, six main dimensions and
twelve criteria are cited as follows:
Page 68
Here, Quality level (D1), Service level (D5), Environmental collaboration (D6) are the beneficial
characteristics i.e., higher the better and Delivery schedule (D2), Risk factor (D3), Cost (D4) are the
non-beneficial characteristics i.e., lower the better. Similarly, C1, C2, C9, C10, C11 and C12 are the
beneficial characteristics and C3, C4, C5, C6, C7 and C8 are the non-beneficial characteristics.
4.2 Data acquisition

To determine the inter-influence or inter-impact of supplier selection criteria for DEMATEL
calculation, a questionnaire was designed to collect data from the experts in this case Company
(ESAB India Limited). These experts were production manager & EMR-EHS, deputy manager of
purchase, factory manager, deputy manager of production and deputy manager of quality assurance
(QA) cell. During my research work, there were only five experts whom I met and I was able to
collect the valuable data from them whereas it was planned to collect a lot more data from many of
the personnel or experts in this related field dealing directly or indirectly dealt with suppliers. But
due to time boundedness and unavailability of the experts or some or other reasons only five
experienced, adroit professional or experts or respondent could give their response.
4.3 Calculation Relationships among Dimensions and Criteria by DEMATEL

In this research paper, DEMATEL was adopted and 6 dimensions of 12 criteria as well as the
impact of mutual relationships were analyzed. The experts of ESAB India Limited were asked to
evaluate the influential importance of the relationships among the dimensions and criteria. The
average initial direct-relationship 12x12 matrix A (Table 4.1) was obtained by pair-wise
comparisons in terms of influences and directions between criteria by Eq. 3.1. From the matrix A,
the normalized matrix D is then calculated by Eq.3.2 and Eq.3.3. Then the total influence TC (Table
4.3) and TD (Table 4.5) were derived by Eq. 3.4. Then network relationship map (NRM) was
mapped out by the both r and s values and this is shown in Table 4.3. The influences given or
received for criteria are given by (r+s) and (r-s) values and are
Page 69
.. Goal
(Level 3)
Best Supplier Selection
Level
of
Quality
(D1)
Ingredient
consistency
(C1)
Process
Capability
(C2)
Delivery
(D2)
Shortest
Lead time
(C3)
Delivery
On time
rate
(C4)
Factor
of Risk
(D3)
Geographic
Location
(C5)
Equipment
Capacity
change (C6)
Supplier1
(A1)
Supplier2
(A2)
A.T.Metal
P.C.Metal
Cost
Factor
(D4)
Service
Level
(D5)
Material
(recycled)
price (C7)
Response
to demand
(C9)
Process
lost cost
(C8)
Supplier3
(A3)
GBM
Industries
Service
level after
sale
(C10)
Environmental
Collaboration
(D6)
Dimensions
(Level 2)
Technology
for recycling
product and
process
(C11)
Criteria
(Level 1)
Green
manufacturing
policy
(C12)
Supplier10
(A10)
Progressive
Rubber Works
Alternatives
(Level 0)
Fig. 4.1 The hierarchy of Supplier selection.
Page 70
shown in Table 4.4. The Network relationship Maps (NRM) are also shown for dimensions and
criteria in Fig. 4.2 to Fig. 4.9.
4.4 Computing the weights of each criterion by DANP Technique

In this research paper, DEMATEL method was well combined with ANP process to solve the
supplier selection problem. Here, this very combination was utilized to get the normalized matrix
TC. Firstly, total influence matrix T was normalized. Then, lim (W ) g was applied until a steady
g
state condition was achieved (Table 4.6 to Table 4.11).

Using the DEMATEL process, the dynamic relationships between the construction of an
important degree of impact or influence unweighted supermatrix (Table 4.7) were derived and in
according to the impact of various criteria, a weighted supermatrix was obtained (Table 4.10). As
the sum of each column is not equal to 1.0, so here normalization is needed to make the sum of each
column equals to 1.0 and it was done so in Table 4.9 by normalization (by dividing each element of
the matrix with the sum of the respective column). Finally, the limit of the wighted supermatrix was
raised to a higher value so that it could be converged and stable. Last of all, we derived the weights
of the criteria from the stable form of the supermatrix (Table 4.11).
From Table 4.6 to Table 4.11, DANP method was used to get the weights of the criteria of the
empirical case of ESAB India Ltd.
4.5 Using FTOPSIS model to calculate the performance values of the suppliers and ranking
them for the case Company
Assumption:
i.
All the suppliers selected for this study produce some common items or products based on
which the model was applied.
In ESAB India Ltd. there are more than five hundred suppliers among which only ten
suppliers are selected for this study. According to the aforementioned 6 dimensions and 12
criteria, the performance of each of all ten suppliers was evaluated based on the response or
opinion of five experts in this case Company. In this paper, the performance of each supplier for
Page 71
each criterion was evaluated by the linguistic values like very low (VL), low (L), medium (M),
high (H), very high (VH) and excellent (E). These were collected by the five experts. All these
linguistic values have different numbers. They are given in the Table 3.1.
In this fuzzy TOPSIS method, at first average fuzzy evaluation matrix for the all ten
alternative suppliers were obtained and is shown in Table 4.12. This was normally done just
by getting the average response values from the experts. In Table 4.13, weighted evaluations
for the suppliers were derived by multiplying the average evaluation matrix with the weights
obtained from the DANP technique. From this table fuzzy positive ideal solution and fuzzy
negative ideal solution were derived. Last of all, fuzzy TOPSIS result is shown in Table 4.14
where all the ten suppliers are ranked based on their overall performance in each criterion.
The higher value of CCj indicates the better supplier than other. In Fig. 4.10, a graph is also
given showing the relative position based on the performance values (CCj).
Table 4.1 The Initial Influence Matrix A for criteria
Page 72
Table 4.2 The normalized direct-influence matrix D for criteria
Table 4.3 The Total Influence Matrix TC for criteria
Page 73
Table 4.4 The influences given/ received for criteria

Criteria
(r + s)
(r - s)
C1
6.639
-0.303
C2
6.784
-0.027
C3
7.855
-0.503
C4
7.950
-0.301
C5
5.753
0.066
C6
6.115
0.045
C7
3.950
0.354
C8
6.471
-0.025
C9
6.884
0.113
C10
6.126
0.264
C11
4.412
-0.164
C12
5.066
0.484
Table 4.4.1 The influences given/ received for Dimensions
Dimension
(r + s)
(r - s)
D1
1.637
1.719
3.356
-0.082
D2
1.875
2.076
3.951
-0.201
D3
1.497
1.470
2.967
0.027
D4
1.344
1.262
2.606
0.082
D5
1.673
1.579
3.252
0.094
D6
1.225
1.145
2.370
0.080
Page 74
Fig. 4.2 Network relationship map of the dimensions based on the threshold value, =0.20
Page 75
Fig. 4.3 The Causal diagram of the criteria based on the threshold value, =0.20
Page 76
Table 4.4.2 C1 and C2 values for network relationship map under dimension D1
r
r+s
r-s
C1
3.168
3.471
6.639
-0.303
C2
3.378
3.406
6.784
-0.028
Fig. 4.4: The network relationship map for C1 and C2 under D1

r
r+s
r-s
C3
3.676
4.179
7.855
-0.503
C4
3.824
4.126
7.95
-0.302
Page 77
Fig: 4.5 The network relationship map for C3 and C4 under D2

r
r+s
r-s
C5
2.91
2.843
5.753
0.067
C6
3.08
3.035
6.115
0.045
Fig. 4.6 The network relationship map for C5 and C6 under D3

r
r+s
r-s
C7
2.152
1.798
3.95
0.354
C8
3.223
3.248
6.471
-0.025
Page 78

r
r+s
r-s
C9
3.498
3.386
6.884
0.112
C10
3.195
2.931
6.126
0.264
Fig.4.8 The network relationship map for C9 and C10 under D5

r
r+s
r-s
C11
2.124
2.288
4.412
-0.164
C12
2.775
2.291
5.066
0.484
Page 79
Table 4.5 The Total Influence Matrix TD and Influences given/ received for dimensions
Dimension
D1
D2
D3
D4
D5
D1
0.296
0.388
0.267
0.235
0.266
D2
0.366
0.397
0.322
0.247
D3
0.269
0.366
0.209
D4
0.263
0.286
D5
0.303
D6
s
D6
r+s
r-s
0.184 1.637
3.356
-0.083
0.336
0.208 1.875
3.951
-0.201
0.202
0.271
0.181 1.497
2.967
0.028
0.199
0.167
0.225
0.204 1.344
2.605
0.082
0.391
0.276
0.227
0.266
0.210 1.673
3.252
0.094
0.223
0.248
0.197
0.184
0.215
0.158 1.225
2.369
0.080
1.719
2.076
1.470
1.262
1.579
1.145
Page 80
Table 4.6 The new matrix TC obtained by normalizing matrix TC in criteria
Table 4.7 The Unweighted Super matrix W.
Note: W = (TC )
Page 81
Table 4.8 The new matrix TD obtained by normalizing matrix TD in dimension
Dimension
D1
D2
D3
D4
D5
D6
D1
0.181
0.237
0.163
0.144
0.162
0.112
D2
0.195
0.212
0.172
0.132
0.179
0.111
D3
0.180
0.244
0.140
0.135
0.181
0.121
D4
0.196
0.213
0.148
0.124
0.167
0.152
D5
0.181
0.234
0.165
0.136
0.159
0.125
D6
0.182
0.202
0.161
0.150
0.176
0.129
sum =
1.115
1.342
0.949
0.821
1.024
0.750
Table 4.9 Normalization of matrix TD
Dimension
D1
D2
D3
D4
D5
D6
D1
0.162
0.177
0.172
0.175
0.158
0.149
D2
0.175
0.158
0.181
0.161
0.175
0.148
D3
0.161
0.182
0.148
0.164
0.177
0.161
D4
0.176
0.159
0.156
0.151
0.163
0.203
D5
0.162
0.174
0.174
0.166
0.155
0.167
D6
0.163
0.151
0.170
0.183
0.172
0.172
sum =
1.000
1.000
1.000
1.000
1.000
1.000
Page 82
Table 4.10 Weighting the Unweighted Super-matrix based on total-influence normalized
matrix W
Table 4.11 The Stable Matrix of ANP when power
lim (W
)g
Page 83
Table 4.12 Average Fuzzy evaluation matrix for the alternative suppliers
Alternatives
A1
C1
C2
C3
C4
(.24,.4
(.24,.4
(.24,.4
(.4,.6,.
4, .64)
4,.64)
4,.64)
8)
C5
C6
(.68,
(.2, .4,
.88,
.6)
.92)
A2
A3
A4
A5
A9
Weight
(.2, .4,
.6)
.28,
.24,
.48)
.44)
C11
C12
(.12,
(.16,
(.24,
.32,
.24,
.44,
.52)
.44)
.64)
(.24,
(.28,
(.68,
(.16,
(.08,
(.12,
(.2, .4,
(.12,
(.16,
(.24,
.44,
.44,
.48,
.88,
.36,
.28,
.32,
.6)
.32,
.24,
.44,
.52)
.44)
.64)
(.12,
(.16,
(.24,
.64)
.64)
.64)
.68)
.92)
.56)
.48)
.52)
(.24,
(.28,
(.24,
(.28,
(.68,
(.12,
(.08,
(.04,
(.2, .4,
.6)
.44,
.48,
.44,
.48,
.88,
.32,
.28,
.24,
.64)
.68)
.64)
.68)
.92)
.52)
.48)
.44)
(.24,
(.32,
(.52,
(.16,
(.32,
(.2, .4,
(.12,
(.16,
.6)
(.36,
.32,
.24,
.44,
.52)
.44)
.64)
(.12,
(.16,
(.08,
.44,
.52,
.72,
.36,
.52,
.64)
.72)
.84)
.56)
.68)
(.36,
(.4, .6,
(.28,
(.28,
(.44,
.56,
.8)
.48,
.48,
.64,
.68)
.68)
.76)
.56)
.48)
.64)
.72)
.52)
.44)
.76)
(.28,
(.2, .4,
(.08,
(.56,
(.28,
(.08,
(0, .2,
(.48,
(.12,
(.16,
(.36,
.48,
.6)
.4)
(.4, .6,
(.32,
(.24,
(.52,
.32,
.36,
.56,
.32,
.24,
.28,
.52)
.56)
.76)
.52)
.44)
.48)
(.16,
(.08,
(.24,
(.32,
(.12,
(.16,
(.36,
.36,
.28,
.44,
.52,
.32,
.24,
.56,
.28,
.76,
.48,
.28,
.48)
.84)
.68)
.48)
(.52,
(.68,
(.32,
(.12,
(.16,
.68,
.32,
.24,
.56,
.88)
.52)
.44)
.76)
(.28,
(.08,
(.08,
(.28,
.52,
.44,
.72,
.72,
.88,
.52,
.32,
.36,
.48,
.28,
.16,
.48,
.68)
.64)
.80)
.80)
.92)
.72)
.52)
.56)
.68)
.48)
.36)
.68)
(.32,
(.24,
(.6, .8,
(.6, .8,
(.68,
(.12,
(.12,
(.28,
(.36,
(.08,
(.08,
(.28,
.52,
.44,
.88)
.88)
.88,
.32,
.32,
.48,
.56,
.28,
.16,
.48,
.92)
.52)
.52)
.68)
.76)
.48)
.36)
68)
(.16,
(.2, .4,
(.44,
(.2, .4,
(.12,
(.16,
(.24,
(.08,
(.08,
(.2, .4,
.36,
.6)
.64,
.6)
.6)
.68)
.64)
(.2, .4,
(.2, .4,
.6)
.6)
.56)
A10
(.04,
C10
(.24,
.68)
A8
C9
.44,
.8)
A7
(.08,
C8
(.24,
.76)
A6
C7
(.04,
.76)
(.16,
(.6, .8,
(.6, .8,
.88)
.88)
(.44,
(.6, .8,
.64,
.88)
.24,
.36,
.44)
.56)
.083
.082
.083
.083
.080
.32,
.36,
.44,
.28,
.16,
.52)
.56)
.64)
.48)
.36)
(.12,
(.04,
(.36,
(.08,
(.08,
(.28,
.32,
.24,
.56,
.28,
.16,
.48,
.52)
.44)
.76)
.48)
.36)
.68)
.086
.060
.107
.089
.077
.083
.085
.76)
Page 84
Table 4.13 Weighted evaluations for the alternative suppliers

Alternative
C1
C2
C3
C4
C5
C6
C7
C8
C9
C10
C11
C12
(+)
(+)
(-)
(-)
(-)
(-)
(-)
(-)
(+)
(+)
(+)
(+)
(.020
(.020
(.033
(.055
(.017
(.005
(.004
(.018
(.009,
(.013,
(.020,
.036,
.037,
.050,
.071,
.034,
.017,
.026,
.036,
.025,
.020,
.038,
.053)
.054)
.066)
.074)
.052)
.029)
.047)
.054)
.040)
.037)
.055)
(.020
(.020
(.023
(.055
(.014
(.005
(.013
(.018
(.009,
(.013,
(.020,
.036,
.037,
.040,
.071,
.031,
.017,
.034,
.036,
.025,
.020,
.038,
.053)
.054)
.056)
.074)
.048)
.029)
.056)
.054)
.040)
.037)
.055)
(.023
(.020
(.023
(.055
(.010
(.005
(.004
(.018
(.009,
(.013,
(.020,
.040,
.037,
.040,
.071,
.028,
.017,
.026,
.036,
.025,
.020,
.038,
.056)
.054)
.056)
.074)
.045)
.029)
.047)
.054)
.040)
.037)
.055)
(.026
(.044
(.013
(.026
(.017
(.007
(.017
(.032
(.009,
(.013,
(.007,
.043,
.060,
.030,
.042,
.034,
.019,
.039,
.050,
.025,
.020,
.024,
.059)
.070)
.046)
.055)
.052)
.032)
.060)
.068)
.040)
.037)
.041)
(.02,
A1
.037,
.054)
(.02,
A2
.037,
.054)
(.02,
A3
.037,
.054)
(.02,
A4
.037,
.054)
(.031,
(.03,
A5
.047,
.064)
(.034,
A6
.050,
.067)
(.027,
A7
.044,
.057)
A8
(.027,
(.033
(.023
(.023
(.035
(.014
(.005
(.026
(.029
.049,
.040,
.040,
.051,
.031,
.017,
.047,
.046,
.066)
.057)
.056)
.061)
.048)
.029)
.069)
.064)
(.023
(.017
(.007
(.045
(.024
(.005
.040,
.034,
.023,
.061,
.041,
.017,
.056)
.050)
.040)
.067)
.058)
.029)
(.020
(.044
(.043
(.055
(.028
(.007
(.017
(.025
.036,
.060,
.060,
.071,
.045,
.019,
.039,
.043,
.053)
.067)
.066)
.074)
.062)
.032)
.060)
.061)
(.020
(.050
(.050
(.055
(.010
(.007
(.030
(.032
(0,
.022,
.043)
(.043
,
.061,
.079)
.048,
(.009,
(.013,
.025,
.020,
.040)
.037)
(.009,
(.013,
(.031,
.025,
.020,
.048,
.040)
.037)
.065)
(.006,
(.007,
(.024,
.022,
.013,
.041,
.037)
.030)
.058)
(.006,
(.007,
(.024,
.065)
Page 85
.044,
.022,
.013,
.041,
.057)
.036,
.067,
.066,
.071,
.028,
.019,
.052,
.050,
.037)
.030)
.058)
.053)
.074)
.073)
.074)
.045)
.032)
.073)
.068)
(.016
(.013
(.017
(.035
(.017
(.007
(.017
(.021
(.006,
(.007,
(.017,
.033,
.030,
.033,
.051,
.034,
.019,
.039,
.039,
.022,
.013,
.034,
.049)
.047)
.050)
.061)
.052)
.032)
.060)
.057)
.037)
.030)
.051)
(.013
(.050
(.050
(.035
(.052
(.007
(.004
(.032
(.006,
(.007,
(.024,
.030,
.067,
.066,
.051,
.069,
.019,
.026,
.050,
.022,
.013,
.041,
.046)
.074)
.073)
.061)
.073)
.032)
.047)
.068)
.037)
.030)
.058)
(1, 1,
(1, 1,
(0, 0,
(0, 0,
(0, 0,
(0, 0,
(0, 0,
(0, 0,
(1, 1,
(1, 1,
(1, 1,
1)
1)
0)
0)
0)
0)
0)
0)
1)
1)
1)
(0, 0,
(0, 0,
(1, 1,
(1, 1,
(1, 1,
(1, 1,
(1, 1,
(1, 1,
(0, 0,
(0, 0,
(0, 0,
0)
0)
1)
1)
1)
1)
1)
1)
0)
0)
0)
(.017,
A9
.034,
.050)
(.003,
A10
.020,
.037)
A*
A
(1, 1, 1)
(0, 0, 0)
Fig. 4.10 Relative position of the alternate suppliers with CCj values
Page 86
Table 4.14 Fuzzy TOPSIS result of final ranking of the suppliers

*
CC j
Ranking
5.98018
0.49702
6.04658
5.98496
0.49744
A3
6.03276
6.00012
0.49864
A4
6.03460
5.99649
0.49842
A5
6.00089
6.02775
0.50112
A6
5.96673
6.06557
0.50411
A7
6.09284
5.93370
0.49338
A8
6.09493
5.93144
0.49320
A9
6.04310
5.99048
0.49781
A10
6.11926
5.91055
0.49133
10
Alternatives
Dj
A1
6.05184
A2
Dj
Table 4.15 Comparison between the rankings of the alternate suppliers

Alternative
Ranking from DANP-
Ranking obtained
Suppliers
A1
A2
A3
A4
FTOPSIS
from Company
9
8
1
A5
A6
A7
2
1
8
A8
A9
A10
9
5
10
7
6
3
4
2
4
3
5
6
7
10
Page 87
Table 4.16 Sensitivity Analysis by swapping the weights of the criteria
Fig. 4.11: Relative Rankings of the alternatives based on 11 cases
Page 88
5. Results and Discussions

In section 4, the empirical study of our case Company could provide the more relevant results or
outcomes by this hybrid MCDM model (DANP with FTOPSIS method). As a result, the
interdependence and feedback relationships of 6 main dimensions and 12 criteria
of supplier
selection can be utilized as the performance of green suppliers. Here, another facet of this result is
that it can be used to obtain the information for the relative ranking of the suppliers based on their
performance that can help the suppliers to improve in related criterion in future. There are some
findings given as follows:
i.
From the DEMATEL model it is clear that the interrelationships and interdependence
among the dimensions which is shown in Fig. 4.2. Depending upon the threshold value =
0.2 (decided by experts) the relationships among the dimensions or the criteria are evaluated
in Fig. 4.2 to Fig. 4.9. In Fig. 4.3 the causal diagram of the criteria is given based on the
threshold value = 0.2. From Table 4.4.1 the importance of the six dimensions can be
prioritized as D2 (3.951) > D1 (3.356) > D5 (3.252) > D3 (2.967) > D4 (2.606) > D6 (2.370)
based on (r+s) values where D2 i.e., the delivery schedule is the most important dimension
with the value of 3.951, while D6 i.e., environmental collaboration is the least important
dimension with the value 2.370. So, the Company needs much more attachment with the
environ-friendly activities that can help the suppliers to get inclined to the importance of
environmental factors. In contrast to the importance, D3, D4, D5 and D6 these dimensions
are the net causes and D1 and D2 are the net receivers based on (r-s) values. Specifically,
D1 affects all other dimensions including itself, except D6. This effect or impact or
influence is shown by arrowhead. Similarly, D2 affects all the dimensions including itself.
D3 affects all including itself, except D6. D4 affects all except D3 and D4 itself. D5 affects
all including itself. Last of all, D6 affects all except D3, D4 and D6 (itself). Similarly, in
Table 4.4.2, C1 and C2 values under D1 are given and their network relationship map
(NRM) is mapped out in Fig. 4.4. Here, C1 and C2 are mutually influenced and also either
C1 or C2 is affected by itself. Similarly, from Fig. 4.5 to Fig. 4.9 shows the NRMs of the left
ten criteria (C3 to C12).
Page 89
ii.
From the results of DANP and FTOPSIS model, we found that the relative closeness rating
of the ten suppliers. The higher value of CCj (Closeness rating) indicates the better supplier
over others. Thats why, A6 is ranked first and A10 is ranked as tenth. If they are arranged
in descending order then we found that (from Table 4.14): A6 (0.50411)>A5 (0.50112) > A3
(0.49864) > A4 (0.49842) > A9 (0.49781) > A2 (0.49744) > A1 (0.49702) > A7 (0.49338) > A8
(0.49320) > A10 (0.49133). From Fig. 4.10, it is clear that A6 supplier is the best among all
ten suppliers maintaining more environmental issues i.e., EHS and promoting the idea of
reusing and recycling of materials related to cleaner as well as green production based on the
criteria or dimensions mentioned in this paper. Moreover, it is also observed that A4 and A3
have very close performance index (i.e., relative closeness) just like A7 and A8. From this
Table 4.14, it is evident that A10 supplier needs to work hard on its principle to maintain the
green level in supply chain by obeying EHS norms set up by ESAB India Limited.
iii.
From the Table 4.15, this model can be validated. The ranking process of the green suppliers
of the Company is solely confidential and it was obtained from the meeting with experts.
This ranking was completely based on time frame and experts preferences. Based on this
same time frame, our hybrid model explored also a ranking. Both ranking (in Table 4.15)
give us the opportunity to find out the validation of this proposed model (DANP-FTOPSIS)
by Spearman correlation co-efficient (R) value (where -1 R +1). After computations, the
R-value is found to be 0.721212 i.e., our proposed hybrid model has a strong relationship
(as R lies between 0.60 to 0.79) with the ranking list produced by the expert in this
Company and this model is valid 72.12 % based on this expert preference and definite time
frame.
iv.
From the sensitivity analysis (Table 4.16), the weights of all criteria are mutually
interchanged to see the effect on result of ranking of the alternatives. This Table 4.16 has
only shown the interchange process with C1 to each of other left eleven criteria. All the
outcomes are same except Sl. No. 7, where after interchanging the weights of C1 and C8 the
ranking
was
changed
(marked
by
yellow
colour)
i.e.,
it
became
A6>A5>A3>A4>A9>A2>A1>A8>A7>A10. Only the position of A7 and A8 got changed.

In Fig. 4.11, the relative rankings of all the alternatives are displayed for eleven cases
(Shown in Table 4.16).
Page 90
6. Conclusion
Now-a-days, supplier selection is a predominant issue in green supply chain management. This
selection process is very intricate as various criteria are uncertain, unpredictable and may vary
across the different product categories and purchase conditions. In this research paper, 6 dimensions
and 12 criteria were adopted that align with the collaboration of environment for the ESAB India
Limited in Kolkata, India. Here, an empirical study was carried out to demonstrate the application
of a hybrid MCDM model combining DEMATEL-ANP (DANP) with FTOPSIS. By this model,
best supplier is selected based on the criteria or dimensions as well as the ultimate, final ranking of
all ten suppliers is obtained by FTOPSIS method that helps us to visualize the relative ranking of
these suppliers based on their relative performance index. Therefore, this study can contribute to
enhance and escalate the efficiency and effectiveness of using resources and acquire the objective of
environmentally conscious manufacturing for any type of industry.
Like other research study, this study does not get rid of some limitations. One of the main
limitations or problems is that the survey conducted was only expert evaluation exercise rather than
a complete industrial survey. Only the response of five experts was collected. Due to unavailability,
time limitation and companys others issues, response of many other personnel could not be
obtained. Whereas it is strongly recommended that the scale of the surveyed sample should be large
enough. In addition to this present realistic problem, resources like documents are limited in most
cases or are not easily available or sometimes the response from experts should put into further
consideration. The sensitivity analysis could be done more deeply i.e., the interchange of weights of
all criteria should be performed to understand the interchange of the relative positions of the
alternatives. This sensitivity analysis would demand a long calculation of 66 rows in total for
interchange of weights between alternatives.
However, this research paper points out the need for more complete studies with the integration
of the issues of sustainability and supply chain management and also pointing out the best possible
green supplier selection in order to maintain the environmental issues. GSCM can reduce the
environmental impact of industrial phenomena without sacrificing quality, cost, reliability,
performance or efficiency of energy use. The green concept launches a number of challenges for
managers, academics and researchers. GSCM involves a paradigm shift in which the issue of
Page 91
sustainability is no longer seen as a source of costs, representing a potential source of competitive

advantage for companies (GUIDE et al. [117]; VAN HOEK [118]).
This expanded perspective raises both strategic and operational issues and, therefore,
opportunities for research. Such issues are also obstacles to the consolidation of the literature and
practice of sustainability in the supply chain. Among them are: (1) the uncertainty regarding the
quality, quantity and time of return of goods, containers, pallets and packages; (2) the costs to
collect and transport them; (3) the existence of potential profit for companies wishing to develop
skills in GSCM and reverse supply chains; (4) the value recovery in the return flows of products; (5)
the influence of governmental regulators in competitiveness; (6) and the uncertainties that influence
the relationships within the GSCM. Moreover, the inherent complexity of the environmental issue its multiple stakeholders, uncertain implications for competitiveness and international importance present significant challenges for researchers. Research is very important to support the
development of business in order to turn the entire supply chain green as well as to expand the
green concept throughout the chain including suppliers specially. Another point to be more fully
explained is that GSCM research so far can be considered ad hoc, fragmented and partial.
Therefore, more integrative contributions are needed in the long term, including dissemination of
best practices, transfer of green technology and measure environmental performance within and
between manufacturing companies or suppliers along the chain.
Page 92
7. Future Scope
In this section, this paper deals with the future scope or opportunity. This research work can
pave the way to future research path for the days to come in supply chain management and also in
green supplier selection process that can be emerged as the noble hybrid method. In this hybrid
model, DANP and FTOPSIS are used that give us the ranking of the suppliers in green supply chain
management. VIKOR technique can be applied in this model after DANP to reduce the gaps of the
aspired level for optimal or suitable areas or the MCDM model with dominance based rough set
approach can be investigated or multi-objective optimization on the basis of ratio analysis
(MOORA) or multi-objective optimization on the basis of ratio analysis (MOOSRA) or ELimination
Et Choix Traduisant la REalit (ELECTRE) or any other new approach can be used to investigate as
the future research works.
Page 93
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DISSERTATION

SUPPLIER SELECTION IN GREEN SUPPLY CHAIN MANAGEMENT

THESIS SUBMITTED IN PARTIAL FULFILLMENT OF THE REQUIREMENTS FOR AWARD OF

Examination Roll Number: M4PRD14-01

Prof. Bijan Sarkar

KOLKATA 700032, INDIA

I/ WE HERE BY RECOMMEND THAT THE THESIS ENTITLED SUPPLIER SELECTION IN

GREEN SUPPLY CHAIN MANAGEMENT UNDER FUZZY ENVIRONMENT CARRIED

Professor Bijan Sarkar

HEAD, Department of Production

KOLKATA 700032, INDIA

The forgoing thesis is hereby approved as a creditable study of Master of Engineering in

Signatures of the Examiners

* Only in case the thesis is approved

KOLKATA 700032, INDIA

Declaration of Originality and Compliance of Academic Ethics

Name (Block Letters):

Signature with date:

I want to express my sincere gratitude to my supervisor, Prof. Bijan Sarkar, Department

Certificate of recommendation ...

Certificate of Approval ...

1.1 Supply Chain Management (SCM) .....

1.1.1 Participants in SCM ....

1.1.2 Function of SCM .........

1.1.3 Supply Chain Coordination Models ....

1.1.4 Distribution Strategy in Supply Chain ..........

1.1.5 Evolving Structure of Supply Chain

1.1.6 Lean Supply Management ...

1.1.6.1 Drivers for Lean Supply Chain....

1.1.7 Agile Supply Management ......

1.1.7.1 Agile Supply Chain Framework

1.1.7.2 Validation of Agile Supply Chain ......

1.2 Green Supply Chain Management (GSCM)

1.2.1 Globalization and Greening the Supply Chain ...

1.2.2 Green Purchasing ........

1.2.3 Green Manufacturing ......

1.2.4 Lean Manufacturing ....

1.2.5 Green Marketing .....

1.2.6 Reverse Logistics.....

1.2.7 Basic Steps in GSCM ......

1.2.8 Process Involved in GSCM .....

1.2.9 Pathways for EHS to create Value...

1.2.10 Main Benefits of GSCM ....

2.1 Green Supply Chain Management ....

2.2 Green Supplier Selection ......

2.3 Aims, Objectives and Scope of the Study

3.1 Methods to Green Supplier Selection ...

3.1.1 DEMATEL .....

3.1.2 Analytic Network Process (ANP) ...

3.1.3 Fuzzy TOPSIS (FTOPSIS) .....

4. Application of the Proposed Model to a Case Study

4.1 Background and Problem Elaboration ...

4.2 Data Acquisition ...

4.3 Calculation Relationships among Dimensions and Criteria by DEMATEL .

4.4 Computing the Weights of each Criterion by DANP technique

4.5 Using FTOPSIS model to Calculate the Performance Values of the

5. Results and Discussions

Supply Chain Procedure

Comparison of Lean Manufacturing with Green Manufacturing

given/received for dimensions

The new matrix TC obtained by normalizing matrix TC in

Average Fuzzy evaluation matrix for the alternative suppliers

Green Supply Chain Management

SCM, GSCM, DEMATEL, ANP, FTOPSIS, NRM, Digraph, Sensitivity