Abstract for: Production and Inventory Control System Dynamics under Emission Feedback

Green Supply Chain Management focuses on SCM's environmental (emission) aspect. Efforts by introducing technological innovation, capital investment, and capacity expansion to reduce emission impact for the supply chain are existing options in the prevailing literature. However, operational inefficiencies cause short-term environmental havoc to which corrective measures like adjustments can reduce impact. This paper proposes extension of the production inventory control system (APIOBPCS) where production emissions are explicitly modeled. The order releases are determined using emission information from the system via two pathways, either based on perceived emissions or the actual stock of net emissions. Simulation results under pulse/step change in demand and emission are performed to understand the dynamic behavior of such a system. The study's key insights include a clear tradeoff between emission reduction and system service level. A system with Perceived Emission feedback provides a higher fulfilled orders rate than a system with Net Emission feedback, but no significant reduction in net emission is observed. On the contrary, a system with Net Emission feedback as a zero-level target causes significant emission reduction to the system at a cost of unfilled demand. An environmental module with both Perceived Emission Feedback and Net Emission Feedback can contribute towards determining a balance between emission reduction and order fulfill rate tradeoff.