Closed-loop supply chain games with innovation-led lean programs and sustainability

Abstract

This paper studies the impact of some innovation-led lean programs in a Closed-loop Supply Chain (CLSC) setting. We use a game-theoretic approach to model a CLSC composed of one supplier and one manufacturer. The supplier sets the wholesale price of an intermediate product while the manufacturer sets the selling price of a nal product. Further, the manufacturer invests in innovation-led lean practices to entail both a strategic eect and a process innovation eect. The strategic eect consists of responsiveness involving the CLSC's capacity to properly respond to consumers' needs and leading to increase in sales. Further, the strategic eect enhances sustainability as consumers align their behavior to the CLSC's attitude of reducing the waste through lean, thus using their products for longer time period and entirely exhausting their residual value. Innovation-led lean practices also generate a process innovation eect, which consists of the marginal production cost abatement. Our ndings indicate that lean practices leading to both strategic and process innovation are protable for the manufacturer and sponsor sustainability. When only one of those can be presented, CLSCs should prefer the adoption of a strategic lean program. From its side, the supplier is much less sensitive to environmental benets, thus it focuses on sales and operational matters. Furthermore, in a centralized CLSC, the preferences for strategic vs. process innovation lean follow the same path of the decentralized CLSC. Nevertheless, we pinpoint that the manufacturer in the decentralized CLSC has a larger incentive to adopt a strategic lean program than in the centralized CLSC. Also, the supplier always obtains larger economic benets in the decentralized CLSC under any type of innovation-led lean program.

Impacts of Environmental Regulation on the Green Transformation and Upgrading of Manufacturing Enterprises

“…It is generally believed that advanced green innovation technologies can help companies increase productivity, enhance core competitiveness, and promote GTU [ 4 , 5 , 6 , 7 ]. However, Genc and De Giovanni [ 8 ] pointed out that green technology innovation may have two different effects for green production, namely compliance costs and innovation offsets. Therefore, the impact of green technology innovation on the GTU is uncertain.…”

Research on the Evolutionary Game of Construction and Demolition Waste (CDW) Recycling Units’ Green Behavior, Considering Remanufacturing Capability

“…In fact, companies can reduce costs by improving management practices or via technological innovation. Most of the existing research about the method to reduce the costs of remanufacturing aims to (1) improve the design of existing products by adopting innovation in the production process [45], such as by using advanced equipment [46], processes, and materials, or by using value engineering methods [47]; (2) solve the multiobjective optimization problems in the process planning stage by using genetic algorithms or other methods [37]; or (3) develop a proper remanufacturing quality strategy based on consumer preferences [48]. However, few studies focus on the level of leadership.…”

Achieving sustainability through innovation-led lean approaches to manufacturing supply chains

“…The outcomes of the article demonstrate the necessity of governmentbacked voluntary agreements to encourage investment in process innovation that supports lean approaches and sustainability in supply chains. Genc and De Giovanni (2019) in their article titled "Closed-loop supply chain games with innovation-led lean programs and sustainability" examines the impact of innovation-led lean programs within a Closed-loop Supply Chain (CLSC) using a game-theoretic approach. The research findings indicate that the lean practices leading to both strategic and process innovation give rise to sustainability and have favourable impacts on the manufacturing.…”

“…Dobson and Chakraborty (2019) propose to explore stochastic innovation, which provides a stronger need for collaboration on innovation effort, to allow variable proportions rather than fixed proportions technology in the assembly industry, and to consider innovation incentives across overlapping or competing supply chains. Genc and De Giovanni (2019) suggest to extend their proposed model by including multi-period strategic interactions facilitating a better understanding of long-term environmental impact of the innovation-led lean programmes, to examine competition in innovation-led lean programs, to extend the model allowing splitting the costs of lean operations in upstream and downstream operations, and to include other forms of non-strategic and strategic lean activities into an extended version of the model. Ghobadian et al (2019) propose to conduct an empirical research to examine how additive manufacturing can contribute to the economic and social aspects of sustainability and how its adoption can represent the frontier of lean manufacturing capabilities.…”