Contribution of Emerging IT Solutions to Sustainable Logistics and Supply Chain Management – a...

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1315 June 2013 Celje, Slovenia 164 The International Conference on Logistics & Sustainable Transport 2013, website: http://iclst.fl.uni-mb.si/ Contribution of Emerging IT Solutions to Sustai- nable Logistics and Supply Chain Management a Theoretical Framework Analysis Iris HAUSLADEN 1 , Alexander HAAS 1 and Andrej LICHTENBERG 1 1 HHL Leipzig Graduate School of Management, Heinz Nixdorf Chair of IT-based Logistics, Leipzig, Germany AbstractEmerging IT solutions like cloud computing or service-oriented architecture (SOA) are beginning to spread in all industries nowadays. Especially in the area of logistics and supply chain management, these so- lutions enhance business by using common data formats, modular and flexible IT tools, real-time tracking as well as real-time reaction. Previous literature contributions investigate the usage of these technologies mostly from a technical or cost-oriented perspective to analyze the possibility of usage or to explore cost advan- tages. An investigation that integrates an environmental or social perspective has, however, not been done before, although research on sustainable logistics and supply chain management is in strong demand today. In this paper, we want to develop an analysis framework to map selected logistics and supply chain processes (LSCP) with corresponding emerging IT solutions to create a better understanding of their role in sustainable logistics and supply chain management. Initially, these LSCP are systemized with the aid of the main SCOR processes Source, Make, Deliver and Return. Subsequently, the SCOR-aligned LSCP are selected concerning their IT- and sustainability potential through a two-step portfolio approach under application of predefined cri- teria derived from the triple bottom line (TBL). After this procedure, TBL-aligned requirements for a sustainable LSCP are mapped with emerging IT solutions to elaborate their contribution to sustainability. The aim of this framework is to achieve an overview about if and how a certain emerging IT solution can increase the sustain- ability of a logistics or supply chain process. At first, contribution to literature is made by a systematic selection of the LSCP using the SCOR model and the TBL as established standards. Furthermore, an analysis approach to investigate the role of emerging IT solutions for sustainable LSCP is presented and could be used as a compo- nent to research a holistic IT support in logistics and supply chain management. Key wordsanalysis framework, IT solutions, logistics and supply chain management, sustainability. I. INTRODUCTION Sustainability considerations in logistics and supply chain management (SCM) are confronted with an increasing attractiveness among researchers for the last years [1]. Furthermore, since logis- tics and supply chain processes (LSCP) and IT resources are interconnected nowadays [2], the awareness of green IT and the contribution of IT solutions to sustainable logistics and SCM is moving more into the focus of scholars. Nevertheless, in the perception of practitioners, environmental is- sues and social responsibility are less important than traditional criteria like quality or price [1]. The interrelationship between logistics and supply chain management is still heavily discussed among researchers and practitioners nowadays. Logistics is widely understood as the management of procurement, movement and storage activities of materials as well as finished and unfinished goods [3] and therefore commonly follows an operational focus. In contrast, supply chain management (SCM) covers a broader scope than logistics and inte- grates coordination and cooperation mechanisms among all partners within an end-to-end supply chain [4], [1]. This perspective is supported by the Unionist view which implies that logistics is an in- tegrative part of SCM, whereas SCM is the more comprehensive and superordinate concept [5]. To capture the whole perception of strategic and operational processes, we decided to integrate logistics as well as supply chain processes. Every single organization with its different logistics functions spanning procurement, production, warehouse management and distribution (among others) as well as its sub-functions only represents one element within the supply chain. Also, the 8R’s of logistics can be transferred to SCM compri s- ing all relevant issues associated with satisfying customer’s demand, i.e. delivering a product to the right customer, at the right time, in the right condition, etc. [6]. These aspects can effectively be addressed by efficiently coordinating the entire supply chain. Based upon this perspective, the SCOR model allows to effectively draw a link between logistics and SCM providing a set of stan- dardized processes and metrics as well as common language. These characteristics help to make

Transcript of Contribution of Emerging IT Solutions to Sustainable Logistics and Supply Chain Management – a...

13–15 June 2013 Celje, Slovenia

164 The International Conference on Logistics & Sustainable Transport 2013, website: http://iclst.fl.uni-mb.si/

Contribution of Emerging IT Solutions to Sustai-

nable Logistics and Supply Chain Management –

a Theoretical Framework Analysis Iris HAUSLADEN1, Alexander HAAS1 and Andrej LICHTENBERG1

1 HHL Leipzig Graduate School of Management, Heinz Nixdorf Chair of IT-based Logistics, Leipzig,

Germany

Abstract—Emerging IT solutions like cloud computing or service-oriented architecture (SOA) are beginning to

spread in all industries nowadays. Especially in the area of logistics and supply chain management, these so-

lutions enhance business by using common data formats, modular and flexible IT tools, real-time tracking as

well as real-time reaction. Previous literature contributions investigate the usage of these technologies mostly

from a technical or cost-oriented perspective to analyze the possibility of usage or to explore cost advan-

tages. An investigation that integrates an environmental or social perspective has, however, not been done

before, although research on sustainable logistics and supply chain management is in strong demand today.

In this paper, we want to develop an analysis framework to map selected logistics and supply chain processes

(LSCP) with corresponding emerging IT solutions to create a better understanding of their role in sustainable

logistics and supply chain management. Initially, these LSCP are systemized with the aid of the main SCOR

processes Source, Make, Deliver and Return. Subsequently, the SCOR-aligned LSCP are selected concerning

their IT- and sustainability potential through a two-step portfolio approach under application of predefined cri-

teria derived from the triple bottom line (TBL). After this procedure, TBL-aligned requirements for a sustainable

LSCP are mapped with emerging IT solutions to elaborate their contribution to sustainability. The aim of this

framework is to achieve an overview about if and how a certain emerging IT solution can increase the sustain-

ability of a logistics or supply chain process. At first, contribution to literature is made by a systematic selection

of the LSCP using the SCOR model and the TBL as established standards. Furthermore, an analysis approach to

investigate the role of emerging IT solutions for sustainable LSCP is presented and could be used as a compo-

nent to research a holistic IT support in logistics and supply chain management.

Key words—analysis framework, IT solutions, logistics and supply chain management, sustainability.

I. INTRODUCTION

Sustainability considerations in logistics and supply chain management (SCM) are confronted with an increasing attractiveness among researchers for the last years [1]. Furthermore, since logis-tics and supply chain processes (LSCP) and IT resources are interconnected nowadays [2], the awareness of green IT and the contribution of IT solutions to sustainable logistics and SCM is moving more into the focus of scholars. Nevertheless, in the perception of practitioners, environmental is-sues and social responsibility are less important than traditional criteria like quality or price [1].

The interrelationship between logistics and supply chain management is still heavily discussed among researchers and practitioners nowadays. Logistics is widely understood as the management of procurement, movement and storage activities of materials as well as finished and unfinished goods [3] and therefore commonly follows an operational focus.

In contrast, supply chain management (SCM) covers a broader scope than logistics and inte-grates coordination and cooperation mechanisms among all partners within an end-to-end supply chain [4], [1]. This perspective is supported by the Unionist view which implies that logistics is an in-tegrative part of SCM, whereas SCM is the more comprehensive and superordinate concept [5]. To capture the whole perception of strategic and operational processes, we decided to integrate logistics as well as supply chain processes.

Every single organization with its different logistics functions spanning procurement, production, warehouse management and distribution (among others) as well as its sub-functions only represents one element within the supply chain. Also, the 8R’s of logistics can be transferred to SCM compris-ing all relevant issues associated with satisfying customer’s demand, i.e. delivering a product to the right customer, at the right time, in the right condition, etc. [6]. These aspects can effectively be addressed by efficiently coordinating the entire supply chain. Based upon this perspective, the SCOR model allows to effectively draw a link between logistics and SCM providing a set of stan-dardized processes and metrics as well as common language. These characteristics help to make

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the communication between supply chain partners more efficient and to make use of optimization opportunities relevant for the customer [7].

Our decision to focus only on emerging IT solutions was motivated by the intent to create a framework approach to build a systematic guideline for exploring the eligibility of emerging IT solu-tions concerning sustainable logistics and supply chain processes. Notwithstanding, the framework can be used for established information systems in logistics and SCM as well.

The leading research question is asking on the one hand which are the requirements for a sus-tainable logistics and supply chain process within the triple bottom line (TBL), which investigates sus-tainability on a holistic level, and on the other hand how can they be supported by emerging IT solutions. To develop the analysis framework, sustainability, emerging IT solutions and the SCOR model are presented theoretically in the first part. Subsequently, the analysis framework is devel-oped, which contains in detail the investigation on sustainable LSCP, the selection procedure and the contribution of emerging IT solutions to sustainability. Finally, the elaborated framework is ap-plied in a fictitious example (see Fig. 1).

Theoretical

foundation

Sustainability

SCOREmerging IT solutions

Analysis

framework

Sustainable LSCPSelection procedure

Contribution of

emerging IT solutions

II

III

ABC

AB

C

Application example D

ConclusionIV

IntroductionI

Fig. 1: Structure of the proceeding

II. THEORETICAL FOUNDATION

A. Sustainability in general and its implementation in logistics/ SCM and information technology

The term sustainable development originates from the Brundtland Report that defines sustaina-ble development as the “development that meets the needs of the present without compromising the ability of future generations to meet their own needs” [8]. Even though it is often used synony-mously for environmentally sustainable development, it is a broader concept including an ecologi-cal or environmental, an economic and a social component.

The focus of the ecological component lies on the impact of an organization’s activities on nat-ural systems, mainly the consumption of all natural resources. The economic component aims for the creation of long-term profitability and tries to evoke alternative financial measures like intellec-tual capital. Furthermore, the social component represents all influences of the enterprise on the social system and therefore contains all social-related aspects like social justice, preferences of stakeholders or labor rights [9]. The triple bottom line is often used to describe this triad. Among the drivers for sustainability are legal requirements, economic and ecological restrictions, social respon-sibility and the need for cost reduction and efficiencies.

With regard to sustainable logistics, the TBL captures an expanded spectrum of values and crite-ria for measuring organizational success, taking into account ecological and social performance in addition to economic performance [10].

The three components depend on each other and the idea of this concept is to establish a bal-ance between the needs of the people, the planet and the company’s profits for a long-term val-ue. The aim of sustainable logistics is to “answer, how society intends to provide means of oppor-tunity to meet economic, environmental and social needs efficiently and equitably, while minimiz-ing avoidable or unnecessary adverse impacts and their associated costs, over relevant space and time scales” [11].

Sustainable SCM is regarded as an evolving topic in logistics and supply chain management and was firstly considered especially in purchasing and transport [12]. Mainly social and environ-mental issues are discussed within the concept of sustainable SCM. During its evolvement, sustain-

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able SCM emerged from a “standalone” approach which set the focus on projects without a holis-tic viewpoint to an integrated approach which involves concepts of corporate social responsibility (CSR) and the TBL [13]. Nowadays, sustainable supply chain management is considered as an es-tablished topic both for practitioners and researchers, which is stressed through focal strategies like sustainable supplier management which should integrate all components of the TBL when evaluat-ing suppliers and a SCM for sustainable products to ensure a sustainable product lifecycle [3].

First research approaches on sustainable IT were conducted under the keywords of green IT and green information systems (IS). Green IT and IS aim to reduce the carbon footprint and therefore the environmental pollution caused by installed hardware systems [14].

Notwithstanding, the investigation on the impact of IT and IS on sustainability in enterprises is viewed as relatively novel, and recent research focuses on the ecological sustainability in particular [14], [15], [16].

A categorization approach of IT resources is proposed by [14], in which IT resources are distin-guished into four categories with regard to their contribution to ecological sustainability. IT re-sources are separated into automation, information, transformation and infrastructure to increase business performance sustainably [14].

Moreover, a parallel integration process of logistics/ SCM and IT functions is expected to be promising [17]. For that reason, a parallel consideration of sustainability concerning requirements for LSCP and the contribution of emerging IT solutions seems an adequate approach for an analysis framework.

B. Representation of emerging IT solutions

To focus only on emerging IT solutions, we have to define what emerging IT solutions are and how they can be distinguished from established IT support in logistics and SCM. Established IT sup-port in logistics and SCM can be subsumed under logistics information systems, which contain all kinds of support systems for the supply chain. In particular, these systems are warehouse and transport management systems (WMS/ TMS) as well as enterprise resource planning systems (ERP) that reflect mostly the transactional part of logistics support [4].

In contrast, emerging IT solutions in logistics and SCM can be seen as the next layer of IT support. In this category, advanced and new technologies to improve the overall quality of processes in logistics and SCM are described [18].

To systematize the following investigation, emerging IT solutions are clustered into three areas. At first, architecture concepts try to build a basis for designing the whole IT landscape of logistics and SCM applications. Secondly, overarching technology paradigms attempt to map all formerly used applications into one single platform. The third cluster summarizes efforts to design strong analytical systems within logistics and SCM and focuses on the efficient usage of large chunks of data which are produced during material flow through the supply chain.

Enterprise application integration (EAI), service-oriented architecture (SOA) and event-driven architecture (EDA) represent the most promising types of architecture concepts in logistics and SCM [19], [20]. EAI offers the technical opportunity to integrate several heterogeneous applications such as own developments, standard software or legacy systems, which is commonly realized through a middleware implementation [4], [18]. To enhance the concept of EAI, the paradigm of SOA merges business processes and application landscapes. The goal is to break these systems modularly down into services which can be individually combined to support numerous kinds of lo-gistics and supply chain processes [21]. Real-time information exchange, enhanced interoperability through the usage of web services and the individual composition of services can be identified as the major benefits of SOA in logistics and SCM [20], [22]. EDA is regarded as an architecture style, “… in which components are event driven and communicate by means of events” [23]. EDA oper-ates complementary to SOA since EDA is more real-time-oriented and the usage of SOA is concen-trated on transactional processes [21].

Cloud computing and ubiquitous computing represent types of technology paradigms. Cloud computing offers the ability to deliver software, development platforms and infrastructure as ser-vices and enables a payment via pay-per-use [24], [25]. Due to this aspect, holistic solutions can be offered using an internet connection without provisioning the whole infrastructure which is needed when on-premise systems are operating. Ubiquitous computing describes the phenomenon of in-terconnecting the physical world with information systems. To reach the status of the “internet of things”, several physical units can be connected with the aid of automatic identification technolo-gies like RFID along with localization technologies and sensor technologies, e.g. temperature measurement [26].

Business intelligence solutions to overcome arising big data problems as well as simulation tech-niques represent the analytical cluster of the displayed emerging IT solutions. The “data deluge” results of collecting large amounts of data from several sources like transponders and barcodes

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from stock keeping units or trailer loads as well as information from social networks and leads to new technologies to analyze these chunks of data [27]. Business intelligence solutions are de-scribing attempts to gather, analyze and display data in order to generate decision support, ideally in real-time [28]. Moreover, gathered data can be used as input for simulation of logistics and SCM systems. Especially in production or transport logistics, simulations are necessary to create a better understanding of the planned system. Nevertheless, simulation is very cost- and time-consuming, therefore generic simulation approaches are suggested in research [29].

C. Introduction to SCOR as a SCM framework

Based on the view of logistics vs. SCM pictured in the introduction part, the SCOR model pro-vides appropriate tools to be integrated in the analysis framework in chapter 3.

The supply chain operations reference model is a business process reference model which was developed in 1996 by the Supply Chain Council and has become a state-of-the-art, standardized supply chain management approach regardless of the industry type using it [30]. The SCOR model has a comprehensive framework which is constantly being extended and enhanced, with SCOR 11 representing the most recently introduced version. By linking business processes, metrics, best prac-tices and technology features, SCOR provides a unique framework and a unified structure to the supply chain (SC) partners [7]. Six primary management processes form the basis of SCOR 11: PLAN, SOURCE, MAKE, DELIVER, RETURN and ENABLE [31]. Furthermore, the model includes three levels of process detail. The top level defines the content and scope for SCOR. At the 2nd level (configura-tion level), the three core process categories listed below are introduced. The decomposed proc-esses of the configuration level are represented by level 3 (process element level). On the 2nd and the 3rd level, three already mentioned process categories are distinguished referring to the product type: Make-to-Stock, Make-to-Order and Engineer-to-Order.

The processes which are analyzed using the framework presented in chapter 3 need to undergo a SCOR-alignment in order to ensure the applicability for any kind of process or company. The au-thors strongly favour the third SCOR level for usage in the suggested framework presented in chap-ter 3 as it is the most detailed standardized SCOR level and thus allows for a deeper LSCP analysis.

III. DEVELOPMENT OF THE ANALYSIS FRAMEWORK

A. Sustainable logistics and supply chain processes

Sustainable logistics or SCM processes are mostly regarded solely from an ecological or environ-mental perspective [3], [32], [33]. A holistic application of the TBL is widely neglected in the re-search landscape, although recent investigations began to integrate the environmental and social dimension within the concept of corporate social responsibility [13]. Nevertheless, empiric research shows that the economic dimension is seen as the most crucial one in the perception of practitio-ners and scholars [34] and can be regarded as involved in all sustainability investigations within lo-gistics and supply chain management literature [3].

As mentioned in the introduction, the first part of the leading research question aims to explore under which requirements LSCP are sustainable. In the second part, the contribution of the pre-sented emerging IT solutions to sustainability is analyzed. Therefore, a set of measurement criteria which reflect the TBL approach is introduced. Taking the ecological perspective into account, sev-eral actions were identified empirically by [1]. In order of importance, there are inter alia the reduc-tion of waste in general, the certification of the 14 001 ISO environment management system, sav-ings from optimal packaging, lean management and eco-design approaches, green transporta-tion channels as well as whole concepts, in particular product lifecycle management (PLM) and reverse logistics [1].

Even if the economic dimension is considered as involved in most sustainable activities [3], there have to be certain requirements to regard LSCP as economically sustainable. First of all, a long-term orientation of profitability must be postulated [33]. Furthermore, this profitability can be sustainably measured through the amendment of alternative methods of financial accounting and manage-ment of capital. There has to be a holistic consideration of accounting and management of finan-cial (e.g., equity), tangible (e.g., fleet) and intangible capital (e.g. staff or know how) [35].

To complete the TBL approach, sustainable requirements of the social component need to be identified. Four relevant indicators of social sustainability were proposed by [36]. Labor equity scru-tinizes the relationship of the hourly rate of a worker’s labor costs and the hourly rate of a com-pany’s highest paid employee [36]. The closer the ratio is to one, the more socially equal the pay-ment mechanism is. Healthcare represents the expenses of the enterprise for health maintenance or wellness of its employees [36]. Especially in the logistics segment, safety issues in the working envi-ronment play a huge role. To quantify safety issues, the ratio of average days not injured through industrial accidents to the total days worked for every employee is suggested by [36]. Moreover,

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the measure philanthropy covers all activities not related to the core business of an enterprise and presents a meta view of its general contribution to arts, science and society [36]. This measure will not be considered though, since logistics and supply chain processes are intended to be analyzed, and not whole organizational systems.

B. Elaboration of the selection procedure

For the selection of LSCP we make use of the portfolio method. The selection is a two-step ap-proach. First, the processes’ potential with reference to the usage of emerging IT is assessed, follow-ing by a sustainability assessment in the second step. We decided to put the emerging IT in front, as there are some criteria for exclusion for the application of emerging IT within a process. In case at least one of these criteria applies for the process in question, the sustainability assessment would be unnecessary.

For the selection with reference to emerging IT, the emerging IT-related portfolio is introduced which represents the relationship between the current usage within the process (X-axis) and the potential level of emerging IT support (Y-axis). The potential usage represents the highest usage of emerging IT solutions possible for one particular process. In contrast, the current usage shows the actual usage of emerging IT solutions (X-axis intercept) in relation to the potential usage (Y-axis in-tercept). To select a process which could be of further importance for investigation, the current support of the process should be assessed as low, whereas potential usage of emerging IT is esti-mated as high, this constellation is represented by the red area in Fig. 2.

As mentioned before, there are certain criteria for exclusion which make a further investigation obsolete. These criteria are systematized into a technical, an economic and an organizational category and should cover all individual enterprise-related constraints that lead to the abortion of the selection procedure. Technical aspects include integration issues of the aspired IT solution within the existing IT landscape, hardware limitations as well as security constraints. Economic aspects are expressed through implementation and maintenance costs. Organizational aspects contain the limitations of the implementation time of the solution, barriers within the group of future users and an incongruity with the business process which shall be supported [37], [38].

Fig. 2: Selection related to emerging IT

The second step helps to identify processes with the highest need for action from the sustainabil-

ity perspective. Here, we again make use of the portfolio method with a subsequent evaluation of the portfolio outcome by means of a frequency matrix. We composed three portfolios – one for each sustainability dimension (see Fig. 4). The annotation for the X-axis is “Implementation time and cost” whereas the Y-axis is labelled “degree of fulfillment” for each of the three portfolios. The SCOR-aligned LSCP are allocated according to their respective specification in these two attrib-utes. Please note that the mapping is achieved based on a thorough understanding of the enter-prise-specific processes. To map a process, we suggest an approach based on a sustainability re-quirement catalogue composed from the relevant literature (see Fig. 4).

To determine a degree of fulfillment of a process, every particular criterion in the sustainability re-quirements table is checked. As a next step, the implementation time and cost required to close the gap between the status quo and the requirement are defined (see Fig 3).

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Fig. 3: Sustainability-related selection (Illustration by the authors following [15], p. 39)

In the resulting portfolios, the most relevant processes with relation to the aim of this portfolio

analysis we will find within the red area. In the frequency matrix, we record the number of red area occurrences of a process in the column labelled “Ratio red”. The same applies for the yellow area. Thus, all three dimensions are weighted equally.

Table 1: Frequency matrix for sustainability-related process selection

Process Ratio “yellow” Ratio “red”

Process 1

Process …

Process i

We suggest to focus on processes having 50% or more, i.e. corresponding to at least 7 red area

occurrences (see Fig. 4) as it is obvious that these processes offer the highest scope for improve-ment related to sustainability requirements. However, in case the suggested ratio is not fulfilled, the decision-making organizational unit should have a critical look at the company-specific require-ment allocation to decide whether a process is relevant in terms of sustainability-related need for action.

C. Contribution of emerging IT solutions to sustainability

In this final step, we want to consolidate the priorly presented parts into one single analysis framework. At the beginning, there are solely logistics and supply chain processes that have to be analyzed. To create a better standardization and higher comparability of the processes, LSCP need to be aligned within the presented SCOR framework. Because of capacity restrictions or since only processes are relevant which are showing strong potential concerning IT support and implementa-tion of sustainability requirements, the processes are selected through a two-step selection proce-dure.

Afterwards, the already employed measurement criteria with regard to the holistic representation of the TBL approach are used again to develop the mapping process with the emerging IT solu-tions. These criteria are considered as requirements to enhance the sustainability of the LSCP. At this point, the generic level of the analysis framework is left for the benefit of the individual level of the enterprise. Nonetheless, emerging IT solutions can be viewed as important instruments for enhanc-ing sustainability among a set of other instruments. The aspired aim in the context of the analysis framework is to lever the sustainability of the selected LSCP and move the process out of the red area alongside the Y-axis as displayed in Fig. 3. Moreover, it has to be noted that the selected processes are viewed as sustainable as a result of the two-step selection procedure. Therefore, the potential contribution to increase sustainability and to close the gap between the as-is status and the to-be status of sustainability is focussed. If the presented requirements are met, the process can be viewed as sustainable. The ultimate step in the analysis framework covers the matching process between the selected LSCP and the contribution to its sustainability through a presented emerging IT solution. In this step, all measures are checked as to whether a contribution to sustainability is pos-sible or not to investigate the eligibility of the chosen emerging IT solution. All steps of the analysis framework are summarized in Fig. 4.

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SCOR alignment

Selection process

SCOR aligned

LSCP

LSCP

Selected LSCP

concerning TBL

Ecological

Economic

Social

Waste reduction

ISO 14 001

Optimal packaging

Lean management

Eco design

Green transportationPLM

Waste reduction

Reverse logistics

Long-term

profitabilityHolistic capital

management

Labor equity

Healthcare

Safety

Standardization and

selection of LSCP

Sustainability requirements for

LSCP & its selection procedure

Eligibility check for

emerging IT solution

1

2

3

4

5

67

8

11

12

13

9

10

Fig. 4: Analysis framework for the contribution of sustainability of emerging IT solutions

Nonetheless, the suggested procedure underlies a certain set of conditions and requirements. An unavoidable but mentionable aspect concerns the energy consumption of IT solutions. It should be taken into account that a potential negative effect of energy consumption through the increased usage of IT solutions would be compensated by savings which the IT solution is responsible for [16]. Furthermore, an interdisciplinary consideration is necessary, i.e. not only IT experts, process owners or logistics/ SCM managers are involved in the selection and assessment procedure but a cross sec-tional group of affected stakeholders. In addition, the motivation among these stakeholders and the group of future users is expected as high enough to enable an application of the analysis framework.

D. Application of the analysis framework within a fictitious example

To make the framework clearer to the reader and user, we introduce an application example of a fictitious saw mill with sawn timber as a product.

The saw mill’s logistics function of interest shall be all activities associated with Make-to-Stock DELIVER process category in SCOR. All activities involved are standardized with SCOR and repre-sented as level 3 SCOR processes for DELIVER (see Fig. 5).

Fig. 5: Level 3 stocked product DELIVER processes in SCOR. Illustration by the authors following [39]

Now, the standardized processes can be evaluated following the selection framework presented in the previous chapter.

In this application example, we will assess the contribution of emerging IT solutions to sustainability of the SCOR-aligned logistics process D1.3. In the saw mill’s fictitious reality, this process is supposed to comprise the activities “Reservation of sawn timber of required quantity and quality” and “De-termination of delivery date in coordination with the customer”.

The selected LSCP complies with all requirements lined up in the process selection framework as shown below. In case of the IT-related selection, the potential IT usage and the current state of IT usage have been assessed as can be seen in Fig. 6. There were not any IT-related criteria for exclu-sion which could be identified for D1.3 in the fictitious saw mill.

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Fig. 6: Example-based IT-related selection.

With regard to the sustainability-related selection, the degree of fulfillment and the implementa-

tion time and cost have been mapped as shown in Fig. 7. The criteria numbered #1 through #8 are mapped in the ecological dimension portfolio, #9 and #10 in the economic dimension portfolio, and the rest in the social dimension portfolio (see Fig. 4 for the numbered criteria). Again, the result-ing arrangement of the sustainability criteria is based on the company’s assessment.

Fig. 7: Example-based sustainability-related selection.

In the last LSCP selection step, the numbers of red-area as well as yellow-area occurrences are

charted in the frequency matrix (see Table 2). In our example, the saw mill’s D1.3 process has 7 oc-currences and hereby more than 50 % of the sustainability-related criteria mapped within the red area of the three portfolios. Consequently, it is rated as relevant with regard to sustainability-related space for improvement.

Table 2: Frequency matrix for sustainability-related process selection

Process Ratio “yellow” Ratio “red”

D1.3 46,15 % 53,85 %

To investigate the contribution of an emerging IT solution for the selected process, the usage of

cloud computing is suggested for D1.3. The central aim of the analysis is to close the identified gap between the as-is status and the to-be status of sustainability. For each proposed criteria that de-termines the three components of the TBL, the requirements which enhance the sustainability of the process are inspected together with a potential contribution of a cloud computing solution (see Table 3).

Table 3: Example analysis for the contribution of an emerging IT solution to sustainability

Criteria Sustainability requirements Contribution of cloud computing

Ec

o-

log

ica

l

Waste reduc-tion

Efficient pallet allocation for custom-ers to avoid pallet and foil waste.

Integration of load planning applica-tion into cloud landscape.

ISO 14001 Alignment of D1.3 with norm specifi-cations.

Difficult mapping of ISO requirements within a standardized cloud applica-

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tion. Optimal packaging

Optimal planning and allocation concerning the optimization of load-ing space and route planning.

Integration of tools to optimize load-ing space and route planning, which can be provided to operational workers.

Lean man-agement

Short and clear activities, no long waiting times, quick answer and re-sponse mechanisms.

Provision of an integrated workflow mechanism to enhance lean man-agement.

Eco-design No application possible since no construction process is applied. Green trans-portation

Planning of compensation actions for CO2 emission during D1.3, e.g. through planting trees.

Integration of analytical applications and interfaces connected with envi-ronmental organizations.

PLM Combined analysis with reverse logistics. Reverse lo-gistics

Consideration of returnable goods (e.g., non-sellable wood) during D1.3 to cover a closed-loop process.

Provision of applications/interfaces on the customer side to record re-turnable products.

Ec

on

om

ic Long-term

profitability Regarding all customer correspon-dences with a long-term focus.

Integration of standardized CRM applications and interface to cus-tomer databases for planning staff.

Holistic capi-tal manage-ment

Holistic consideration of financial, tangible and intangible capital is applied.

Applications to gather knowledge and ideas, e.g. for improvement, on the spot.

So

cia

l

Labor equity All employees engaged in the proc-ess are paid equally and in accept-able relation to the highest position.

Integration of data gathering appli-cations to control payment mecha-nism status.

Healthcare Health maintenance is adhered to, i.e. maintain working hours, provide ergonomic work places.

Integration of reporting applications to control health conditions through employees.

Safety Modern safety conditions are fulfilled on all working places.

Integration of reporting applications to control safety conditions through employees.

As mentioned before, D1.3 has, on the one hand, a strong focus on customer communication

and on the other hand an interconnection with the wood production. Cloud computing solutions can enhance the sustainability of the process in many ways, but after analysis the strongest contri-bution is made through the provision of applications in which all stakeholders, mainly employees and customers, are involved. Furthermore, through the enhancement of mobile data gathering and usage it is possible to control certain sustainable conditions as well as to generate an input for the information system in real-time. In summary, the contribution of a cloud computing solution to the sustainability of the selected process can be estimated as high.

IV. CONCLUSION AND OUTLOOK

The aim of this elaboration was to create an analysis framework that integrates the holistic con-sideration of the triple bottom line for logistics and supply chain processes and the contribution of emerging IT solutions to sustainability. To achieve this, LSCP are standardized within the SCOR model processes, subjected to the suggested selection procedure and then mapped with sustainability requirements and an emerging IT solution.

The academic result of this investigation is firstly the integration of all three components of the TBL within the analysis framework and secondly the elaboration of an analysis approach to explore the role and impact of emerging IT solutions for sustainable logistics and supply chain processes.

Implications for future research may lie in a quantifiability of the proposed measures to capture all components of sustainability in an operational manner. Hence, balanced and weighted meas-ures as well as equilibrium of all measures within the TBL are suggested as an avenue for further re-search. In the end, an explicit application of the analysis framework with the aid of practical case studies is seen as the next logical step for deeper future research activities.

V. ACKNOWLEDGMENTS

The authors thank Vera Götz for her constructive support.

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173 The International Conference on Logistics & Sustainable Transport 2013, website: http://iclst.fl.uni-mb.si/

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AUTHORS

Prof. Dr. Iris Hausladen is chairholder of the Heinz Nixdorf Chair of IT-based Logistics, HHL Leipzig Graduate School of Management, 04109 Leipzig, Germany (e-mail: [email protected]).

Alexander Haas is research associate at the Heinz Nixdorf Chair of IT-based Logistics, HHL Leipzig Graduate School of Management, 04109 Leipzig, Germany (e-mail: [email protected]).

Andrej Lichtenberg is research associate at the Heinz Nixdorf Chair of IT-based Logistics, HHL Leip-zig Graduate School of Management, 04109 Leipzig, Germany (e-mail: [email protected]).

Published as submitted by the authors.