Cost-benefit Analysis under Uncertainty in a Closed-loop Supply Chain - The Case of Cellular Phones
Date Issued
2008
Date
2008
Author(s)
Chien, Sheng-Chieh
Abstract
With the eco-awareness, the European Union has issued several regulations, such as Restriction of the Use of Certain Hazardous Substance in Electrical and Electronic Equipment (RoHS), Waste Electrical and Electronic Equipment (WEEE) and Energy-using Products (EuP). Japan and Korea have also issued similar regulations in order to impose responsibilities of environmental protection on manufacturers in their supply chains. These regulations enforce indirectly enterprises to emphasize green supply chain management. When companies are engaged in the production, delivery or recycling, they have to consider how to restrict usages of hazardous material in manufacturing and carry out recycling programs. However, the green supply chain management is more complicated and involves in more uncertainties than those of the traditional supply chain management. These uncertainties are primarily caused by customers who, in turn, are suppliers in reverse supply chains. It is difficult to evaluate the quality of the returned products and to know when the customers will discard their products. For this reason, companies usually pay a little attention to recycling programs. To overcome this difficulty and help mobile phone manufacturers to evaluate whether recycling programs are beneficial to their companies, a cost-benefit model in consideration of various uncertainties in the reverse supply chain is proposed in this study. Monte Carlo Method is employed to reflect uncertainties and simulate quality and quantities of the returned products in the reverse supply chain. Numerical case studies indicate that managers of mobile phone manufacturers can make appropriate decisions on whether to carry out their recycling programs based on the proposed model.
Subjects
Reverse Supply Chain
Monte Carlo Method
Cost-Benefit Analysis
Uncertainty
Type
thesis
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