System Dynamics Simulation for Strategic Green Supply Chain Management

The design of appropriate green supply chains in the manufacturing sector is a crucial task. The present paper seeks to (i) identify suitable performance measures for green supply chains and to (ii) develop a dynamic simulation model to assist supply chain decision-makers in developing appropriate policies and strategies in green supply chain management. Based on the principles of the system dynamics methodology, causal linkages between internal and external factors affecting the development of green strategies are investigated. Green concepts are used to develop crucial environmental and eco-efficiency performance measures in regards to strategic green supply management. Results from what-if analysis indicate that proper implementation of green strategies produces significant improvements for environmental, economic/financial and operational performance. Further numerical experiments demonstrate that the model can provide sound managerial insights.

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