Supply chain management has traditionally been viewed as a process where in raw materials are converted into final

products, and then delivered to the end-consumer. [4] This process involves extraction and exploitation of the natural resources. It is important to note however that we live in a decade where environmental sustainability has been an important issue to business practice. The waste and emissions caused by the supply chain have become one of the main sources of serious environmental problems including global warming and acid rain. In terms of sustainability and the international green initiatives, focus is given to the three major issuesdematerialization, detoxification, and decarbonizationwhich lead to the 4Rs (reduction, redesign, reuse, and remanufacture) in practice. Most industries strive for dematerialization to reduce theamountof materials or time needed to produce and deliver products and services required by the customers. The production of poisonous materials can be the best example of people who suffer from their own actions because they ignore the potentially global effects of such systems such as oil spill or some other poisonous material spill. Green supply chain policies are desirable since reactive regulatory, to proactive strategic and competitive advantages. Greening supply chains aims to balance marketing performance with environmental issues. To meet with challenges such as energy conservation and pollution abatement, enterprises have tried to green their supply chains, that is, to create networks of suppliers to purchase environmentally superior products or to build common approaches to waste reduction and operational efficiencies. Greening the supply chain is increasingly a concern for many business enterprises and a challenge for logistics management in the 21st century. Of particular concern is how to arouse organizational environmental awareness and put environmental activities into practice in the logistics activities of their supply chains. Confronted with global resource exhaustion and increasing environmental deterioration, enterprises cannot ignore environmental issues in todays business. Economic globalization and pressure from the public, laws, and environmental standards are forcing and driving enterprises to improve their environmental performance as well. Green SCM is getting more attention as a sustainable development mode for modern enterprises and is increasingly a part of Corporate Social Responsibility (CSR) initiatives. In recent times, Green Supply Chain Management (Green SCM) is gaining significance among manufacturers due to the following reasons: a) Diminishing raw materials b) Deterioration of environment c) Overflowing waste lands

d) Increasing levels of pollution One of the key aspects to green supply chains is to improve both economic and environmental performance simultaneously throughout the chains by establishing long-term buyersupplier relationships. Enterprises have developed a diverse set of

initiatives for greening SCM, including screening suppliers for environmental performance, providing training to build supplier environmental management capacity, and developing reverse logistics systems to recover products and packaging for re-use and remanufacture. Green SCM can not only generate environmental benefits, but also business benefits. Green Supply chain management Patrick Penfield of the Whiteman School of Management defines Green Supply Chain Management GSCM) as "the process of using environmentally friendly inputs and transforming these inputs into outputs that can be reclaimed and re-used at the end of their lifecycle thus, 1 creating a sustainable supply chain . Why a Green Supply Chain Matters? Government regulations and customer demands are making environmental responsibility an increasingly important factor in everything from materials procurement to distribution. Many companies share the current widespread concerns for the health of the planet. Hardly few of them, unfortunately, have successfully translated those concerns into action by adopting environmentally sustainable, green supply chain practices. Businesses worldwide continue to use toxic chemicals, wasteful packaging, and transportation practices that produce clouds of gases that may contribute to global warming. However, from materials acquisition and manufacturing to packaging, logistics, and distribution, every stage of the supply chain offers opportunities to reduce waste and pollution.
The explosion of GSCM activity in the practical realm has led to an increasing body of empirical work regarding both external infl uences leading to the uptake of green supply chain management practices, and their impact on fi rm performance. Investigation in this area has generally fallen into four main categories:

Use of compliance-based strategies that support the cascading of basic environmental requirements generically across all suppliers Aligning supply chain goals for both efficiency and pollution-reduction Transfer of environmentally specific innovations or technologies from customers to suppliers Collaboration or competition between firms to develop re-manufacturing or closed-loop recycling systems

In this framework the key to extracting business value lies in establishing a long-term green supply chain strategy that is aligned with corporate strategy and approached top-down with strong sponsorship. It also requires a strong business case for the green supply chain that highlights a prioritised list of targeted opportunities and a phased adoption roadmap. Finally, the initiatives need to be integrated with other companywide projects to ensure that one does not compromise another. GSCM integrates ecological factors with supply chain management principles to address how an organization's supply chain processes impact the environment.
With Increasing customer awareness and regulatory norms, organizations with greener supply chain management practices will have a competitive advantage over companies that are reluctant to embrace GSCM.

a) Dell saves over $20mn annually as a result of supply 12 chain and packaging improvements . In fact, this market leader achieved its goal of becoming carbon 4 neutral by 2008 . b) Texas Instruments saves $8mn each year by reducing its transit packaging budget for its semiconductor business through source reduction, recycling, and use of reusable packaging systems 4 (20% annual savings) . c) Pepsi-Cola saved $44mn by switching from corrugated to reusable plastic shipping containers for one liter and 20-ounce bottles, conserving 4 196mn pounds of corrugated material .

Green initiatives, if properly managed, can enable organizations to be responsible corporate citizens and also deliver higher profitability and competitive advantage. With experience in providing end-to-end supply chain solutions aligned with industry trends, Cognizant proposes the following steps organizations can adapt while implementing green supply chain initiatives: a) Use industry standard frameworks like SCOR version 9 to identify potential areas for green b) initiatives in the supply chain. With GreenSCOR incorporated in SCOR version 9, the chances of success in any green initiatives increases. c) Align green initiatives with the strategic objectives of the company. d) Adopt GSCM best practices when implementing green initiatives. e) Use technology solutions to facilitate GSCM initiatives with a special focus on the need and importance f) of end-to-end supply chain analysis and network design. g) Focus efforts to reduce packaging and in-transit damage when shipping. h) Pay special attention to reducing inventory and identifying optimal distribution solutions. i) Perform lifecycle analysis for choosing products/solutions to minimize environmental impact. Evolution

Drivers of green supply chain management Being green and ethical is no longer an option; it is a necessity for all participants in supply chain management. Those companies that have adopted green supply chain management are convinced that being environmentally conscious is a win-win for the business and environment. Some of the key drivers of green supply chain management are: 1) Market Demand: Consumer demand of environment friendly products is increasing. As mentioned in the survey results, 73% of the customers consider it important that companies have good environmental records. 66% customers feel that companies should offer green products and these customers are ready to pay a premium of 5% or more for green products. A recent article written by Dr. David Suzuki and Dr. Faisal Moola indicates that, protecting our planet is no longer seen as a fringe activity. Most people now consider themselves to be environmentally aware and are taking steps to help. 2) Regulatory pressure: New government policies are prohibiting products made from environmentally destructive materials and polluting processes. In this era of globalization, it has become important for the companies to comply with the regulations of the concerned countries. China with its export led growth, has taken significant green initiatives. It is noticeable that Walmart procures from over 10000

Chinese suppliers and it depends on its suppliers to achieve its target of emission reduction. Similarly Europe has restricted the products containing environmental hazardous substances like lead, mercury, cadmium and hexavalent chromium (except few product categories). Leading U.S. Investors recently announced that they have filed a record 95 climate change-related shareholder resolutions with 82 U.S. and Canadian companies that face far-reaching business challenges from climate change, says Ceres, a leading coalition of investors, environmental groups and other public interest groups. This 40% increase in resolutions over previous year is a sign of the growing pressure on companies to disclose climate risks. Supply chain carbon emissions will increasingly be regulated through a variety of legal standards as numerous policy developments are underway. By December 2009, the 192 member countries of the United Nations Framework Convention on Climate Change have agreed to launch a mechanism to achieve deep cuts in emissions. 3) Economic competitiveness: Adoption of green principles and best practices like recycling, reducing energy consumption etc can significantly reduce the cost and improve operational efficiency. Rising cost and increasing demand of fuel is further acting like a stimulus for implementation of green supply chain management.

The main activities in the Green Supply Chain a) Green design - Green design is an approach which seeks to improve a product's ecological quality, by reducing its negative impact on the environment throughout its life cycle. It involves taking account of the environment during a product's design or improvement phase. Essentially, green design is about choosing less polluting materials and manufacturing procedures b) Green sourcing - the concept of green sourcing embraces everything sourced from suppliers, subcontractors, service providers and so on, which incorporates environmental criteria. These environmental criteria can be applied to all the phases of a sourcing process, but they mainly come into play when defining needs. c) Green manufacturing For the purposes of green manufacturing, lessening environmental impact per se involves two different approaches: Better consumption: reducing harmful emissions, the consumption of toxic products and the production of waste (concept: less polluting production). Lower consumption: reducing consumption of energy and raw materials, reducing waste (consumables).

d) Transport

Optimization of transport: overhauling the organization of logistics The use of less polluting modes of transport

e) Reverse logistics The purpose of the reverse logistics process is to ensure that products/materials are returned from the user to the producer in order to be recycled, reused or reconditionned. Reverse logistics therefore denotes a set of planning, execution and flow control measures for raw materials and finished products, with the aim of recovering and recycling those products or materials.

Supply chain management facilitates interaction among the supplier, the shipping industry, the customer, the retail merchant, the qualitycontroller, and the manager of the final product. This interaction may change from the upstream or the downstream side depending on the influence of the enterprise on the supply chain. The enterprise can enhance the relationship within the supply chain through effective communication to avoid misunderstanding. Thus, the enterprise serves as the linkage that facilitates interaction in the supply chain. With increasing interest and development in the areas of green procurement, technology, and product development, local enterprises have already adopted some initial measures. The challenge, however, is how to effectively implement and manage this initiative in order to achieve significant results. The below figure shows an implementation procedure for extending the supply chain that includes activities focusing on operations analysis, measurement, and continuous improvement.

Green SCM: Compliance to Value Creation Though regulations increasingly make environmental responsibility mandatory, compliance can provide a competitive advantage. Careful planning and self-evaluation should be the starting points of any green supply chain initiative. Implement green supply chain reforms internally before asking suppliers to comply as well. Benefits to Industry
The business benefits of environmental improvement are getting progressively clearer. The more businesses and consumers take environmental issues seriously, the greater the gains to be made. There are two main types of business benefits. First, there are potential cost reductions. Environmental change often boils down to increased resource efficiency, which in turn leads to improvements to the bottom line. Secondly, benefit relates to customer preferences and enhancing corporate reputation. More and more businesses and consumers are using environmental issues as a criterion in their purchasing decisions, so progress in this area can lead to increased sales and marketing activities.

Strategies of Green Supply Chain Management

Risk-based Strategies The simplest strategy of GSCM with regard to inter-organizational investment resource development is one of risk minimization. Firms adopting this strategy are proposed to do so in response ostensibly to stakeholder requirements. Such a strategy is ideal for the organization that retains minimal internal environmental management resources or has only recently begun to consider the introduction of a supply chain greening program. It is based on minimal inter-organizational engagement. Such efforts might involve the inclusion of basic clauses in purchasing contracts for suppliers to meet all relevant regulatory requirements. Most frequently used with this approach is the cascading of an established international standard such as ISO 14001. The use of an existing performance standard, an approach used initially by the Ford Motor Company with its suppliers and now more frequently by other organizations for their supply chains, offers: (a) established environmental performance benefits (b) third party or arms-length management of performance, and (c) a system recognized globally by other organizations. This third aspect improves the effi cacy of uptake by suppliers because the system is recognized by the market and other industry members, reducing the ambiguity of desired performance levels and minimizing the need for customer involvement. From the perspective of competitive advantage, however, the benefi ts are limited because of the ease of implementation, a lack of uniqueness, and a growing use by other supply chains. A similar approach to basic certification schemes is the use of broad statements within purchasing guidance or principles to include supplier activities among the organizations environmental responsibilities. Such systems based on risk minimization only and managed in a climate of low relational investment only guarantee supply chain compliance with local or national regulations. The end result being that risk can be minimized and reputation enhancement is possible, but no additional innovation or complementaryeconomic benefits are likely. Efficiency-based Strategies A more complex and developing strategy in recent years has been the eco-efficiency or lean-andgreen approach to GSCM. This type of strategy derives environmental performance benefits for the supply chain beyond mere regulatory compliance through the requirement for suppliers to meet operations-based efficiency targets. Much of the environmental performance benefi t arises from specific manufacturing practices that have been found to provide secondary environmental performance benefits. The point of departure for the efficiency based strategy from the risk-based strategy is the availability of dual economic and environmental performance benefits to the supply chain and the requirement for higher levels of engagement between customers and suppliers. The efficiency-

based strategy ties environmental performance to operational processes in the supply chain, and this strategy allows the extension of performance equirements into the supply chain that maximize economic performance and provide secondary environmental performance benefits through waste and resource use reductions. It requires more comprehensive and supply chain specifi c performance specifi cations than the simpler risk-based strategy. It also requires a higher level of involvement between supply chain partners arising from the use of more complex inter-firm performance requirements. Using this strategy to facilitate greater efficiency in the supply chain does not require the development of co-specialized resources specific to environmental performance. The necessity for collaboration on efficiency, however, provides a facilitating role for context-specific, complex problems such as waste reduction and recycling. The strategy can provide a cost-reduction advantage to the supply chain and readily fits with preexisting organizational goals of optimization. But the efficiency-based supply chain strategy does not allow for more knowledge-intensive environmental management activities such as product design, material substitution, or innovation. Product recalls because of a poor choice of low-cost but hazardous materials represent the inherent risk in focusing only on effi ciency in the supply chain. The efficiency-based strategy is considered technically weak but more socially complex than the riskbased strategy. Innovation-based Strategies The innovation-based green supply chain management strategy is distinct from the efficiencybased approach because of its use of a supply chain environmental performance strategy that is more environmentally specific. Organizations are increasingly aware of the potential for narrow purchasing policies to in-source components or services from suppliers that may be legally noncompliant with environmental regulations or who themselves procure goods in an environmentally irresponsible way. Some organizations have begun to guarantee more comprehensive product lifecycle considerations for consumers of their products. Once a supply chain begins to consider specialized processes, technologies, or complex performance standards for suppliers such as chemical avoidance, the level of knowledge exchange and relational investment begins to change. Moving from an effi ciency-based GSCM strategy to a greater level of innovation or integration of environmental performance in supply chain and product design requires specialized environmental resources (Lenox & King, 2004). Keeping up-to-date with environmental legislation changes and training suppliers in environmentally relevant process changes requires more dedicated environmental resources, specialized personnel, and design. The development of such resources provides the conditions for an organization to shift from an effi ciency-based to an innovation-based GSCM strategy. For products, the resources developed could be used to incorporate innovative environmental planning into specifi c product designs, characteristics, functionality, or life-cycle related activities (e.g., service, repair, and recycling). At the process level they could be deployed to develop environmentally robust methods and systems for the production, distribution, and use of products. Closed-loop Strategies Closed-loop strategies are a more recent type of GSCM strategy and represent the most complex and collaborative form of this type of activity. Often referred to in its simplest form as reverse logistics, closing the loop involves the capture and recovery of materials for either re-manufacture (high-value) or recycling. These materials can arise during production, as returned goods, post-use, and at end-of life. The closedloop strategy ties or integrates environmental performance to the whole supply chain. Very few examples of coordinated recycling or closed-loop activity in the supply chain currently exist however. Prominent examples include Kodaks return and re-manufacture of its disposable cameras, Hewlett Packards retrieval of used printer cartridges, and BMWs end-of-life vehicle requirements for suppliers (Guide et al, 2002). The motivation for a closed-loop strategy remains low for basic reasons of poor and distributed control over the reverse supply chain, lack of available infrastructure, and the inability of supply chains to believe that such activity is economically viable. Designing and successfully using a closed-loop strategy presents one of the most complex endeavours for a single organization to undertake within its supply chain (Richey et al, 2005). In its simplest form, closing the loop may involve

product take-back and reverse logistics implemented only in the retail portion of the supply chain. In more complex closed-loop systems, used or obsolete products and waste are taken back by the producer and remanufactured or recycled rather than being disposed of to landfi ll. The closed-loop strategy, however, represents an approach that seamlessly integrates issues of economic, operational, and environmental performance. Organizations considering implementation of a closed loop supply chain require high levels of control over the capture and return of used materials. Goods need to be managed for quality considerations and aggregation of collection and sorting activities allows for the creation of economies of scale. Such a high level of integration, coordination across partners, and socially complex knowledge requires years of development effort. Socially complex, collaborative relationships provide the basic foundation for a closed-loop supply chain strategy.

Five stages towards sustainability

Supply chain executives understand the benefits of better managing collaboration and sustainability in the value chain now they just have to make it happen. Companies today can be classified in one of five stages of green supply chain maturity. Those stages are: Not started and/or defensive companies are either wholly ignoring sustainability by not taking action to address it or, at best, are taking action solely to the low hanging fruit of sustainability by disclosing their exposure to environmental and social risks to their suite of stakeholders. Problem solving companies are going one step further - these companies have been gathering information, do not have a corporate sustainability statement or report, but have initiatives in progress. Compliant companies are adhering to current and emerging regulation to ensure that they avoid regulatory fines and the related damage to their reputation that such fines could cause. Eco-efficient companies are coordinating their sustainability efforts, across their functions, units and locations, at the enterprise level. They are wholly transparent to the market - even if it means shedding light on the areas in which they need to improve. These companies see sustainability as an opportunity for growth; to capture this growth, these companies are reframing existing products and introducing new products to appeal to the sustainability conscious consumer. Sustainable companies have gone one step further they have redesigned their corporate vision to be based on sustainability and are actively re-engineering their processes and supply chains to eliminate energy, water and waste inefficiencies while adhering to the strictest ethical and moral standards possible.

Green Purchasing Principles

a) The most important principle is looking at the Total Cost Of Ownership (TCO) throughout the acquisition. The things we pay attention to from a principle perspective are price, geographic source, service level and also the specific solution. b) Supply Partners John looks for his partners to participate in some type of carbon footprint reduction strategy, or water optimization strategy. He and his team look for those folks to be part of that thought process. c) Supply chain partners should develop a strategy for renewable energy long term. In the short term it is not realistic in most cases. They look for the supply base to participate long term in the renewable energy market.
IT Enables Green Initiatives

In most new initiatives adopted by organizations, IT has played a pivotal role. Likewise, for the success of green initiatives, it can play a large role in ensuring the chances of success and reaping the expected benefits. Contributions of IT in GSCM can be viewed from two different perspectives. From the hardware perspective, IT can make the supply chain greener by optimizing the resources required to support the business. Technology providers are innovating and developing energy efficient solutions that have a more favorable impact on the environment. From a software perspective, IT can enable more effective supply chain planning, execution and collaboration, thereby reducing resource requirements.

Challenges in implementation of Green Supply Chain Model In a recent survey by Wipro and outsourcing center 65% of the respondents indicated that prioritization was an important barrier in implementation of green supply chain management. 62% of the respondents cited cost/budget constraints as challenge to GrSCM. With Green Supply Chain Management a collection of many opportunities, it is difficult to decide which potential opportunities to consider and in what order. One way is to evaluate the ROI in each case of each activity. However ROI in case of all activities may not appear positive but net result of all the activities put together is definitely significant both in terms of ROI and intangible benefits. Initial investments may look as a challenge but sustainability reports of many companies have proved that the financial gains are also significant and NPV is significantly positive. Conclusion Most of the time, greening the operations is related to corporate social responsibility or emotional aspect of business towards the environment. However for sustainability of the green initiatives, it is important that we look this opportunity from business point of view. Its high time to focus on the tangible or intangible benefits associated with these green initiatives. Sustainability reports of many companies indicate that greening the supply chain has helped them to reduce their operating cost with increased sustainability of business. The result of a survey done by McKinsey shows that green supply chain has got maximum attention of companies [7]. Only 3% respondents felt that it was important in past while 16% respondents felt that it is going to be very important over next 5 years and have

placed it in top 2 goals of companies in supply chain management. Now its not an option but a necessity for the companies to proactively invest in economically attractive opportunities in supply chain management that address environmental impact in the near or medium term and increases the overall sustainability of business