Development and Simulation of a Balanced Scorecard for Sustainable Supply Chain Management - A System Dynamics Approach

The objective of this article is to develop a Balanced Scorecard (BSC) for Sustainable Supply Chain Management (SSCM). The BSC provides a framework for simulation experiments which serve to evaluate benefits of sustainability investments for the partners within a recycling supply chain. A system dynamics approach was employed to perform the simulation experiments. First, the simulations help to identify the preconditions that must be met before environmental and social measures can lead to a long-term profit increase for all network partners. Second, they demonstrate how limitations of the traditional BSC can be overcome, especially regarding multi-causal relationships between key performance indicators. The model is based on the results of a literature review and information gathered in expert interviews. The limits of the analysis lie in the fact that the simulation experiments are partly based on hypothetical assumptions. However, where possible, the authors have drawn on expert knowledge and existing surveys.