Chapter
15
Supply Chain Sustainability
DISCUSSION QUESTIONS
1. Supply chains aimed at disaster relief evolve over time. Early on, during response
operations, supplies must be “pushed” to the disaster location because actual needs
are not known with precision. Nonetheless, supply chains must be responsive and
flexible because of all the unknown elements. Lead times must be short. Fast
2. Focusing on energy efficiency typically reduces energy costs and may improve
delivery performance if distance traveled is a factor. Both of these are competitive
priorities and can enhance the financial performance of a firm. Nonetheless, making
decisions on the basis of energy efficiency can pose ethical dilemmas if such
3. There are several financial implications involved with developing a reverse logistics
supply chain. First, reverse logistics supply chains are costly to own and operate,
typically much more than forward flow supply chains. Second, there is the fear that
⚫ PART 3 ⚫ Managing Supply Chains
15-2
4. As more firms undertake steps to build sustainability in their supply chains, the
relationship between buyer and supplier is changing to be more aware of ethical
issues. Using programs such as SA8000:2014, firms are selecting suppliers that have
PROBLEMS
Energy Efficiency
1. Vampire Van.
a. The original route (A-B-C-D-E-A) requires a total travel distance of 24.6 miles
(3.0+6.1+4.2+7.2+4.1)
2. Royal Seafood
a. Starting in Corvallis [A], the Nearest Neighbor techniques provides the following
route: A-B-C-F-D-E-A with a total of (93+116+117+106+223+219=) 874 Miles
b. The alternative Nearest Neighbor routes are:
Starting City Route Total Distance
B B-A-C-F-D-E-B 93+102+117+106+223+167=808 Miles
C C-A-B-E-F-D-C 102+93+167+118+106+181=767 Miles
Supply Chain Sustainability ⚫ CHAPTER 15 ⚫
15-3
3. Traxis Consolidated
a. The total time required by the company’s current route is:
Route: A-F-G-D-E-H-B-C-A : ( 33+27+30+25+44+73+53+38) = 323 minutes or
5.38 hours
4.15 hours
c. The NN procedure starting from each customer site provides the following routes:
Starting Route Driving Time Calculation
location
B: B-A-D-E-H-G-F-C-B (26+31+25+44+21+27+68+53) =
296 minutes or 4.93 hours
C: C-A-B-F-G-H-D-E-C (38+26+35+27+21+32+25+45) =
249 minutes or 4.15 hours
4. Big Jim
a. First, the Euclidean distances between each location must be calculated. This
22 )()( jiji YYXX −+−
between (0,0) and (10,40)
2.41)400()100( 22 =−+−
A
B
C
D
E
F
To/From
0
10
22
35
40
50
0
40
20
37
25
40
A
0
0.0
41.2
29.7
50.9
47.2
64.0
B
40
41.2
0.0
23.3
25.2
33.5
40.0
C
20
29.7
23.3
0.0
21.4
18.7
34.4
D
37
50.9
25.2
21.4
0.0
13.0
15.3
E
25
47.2
33.5
18.7
13.0
0.0
18.0
F
40
64.0
40.0
34.4
15.3
18.0
0.0
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15-4
Next, use these distances and the NN procedure to form routes.
Starting Route Distance Calculation
location
A (0,0) A-C-E-D-F-B-A (29.7+18.7+13.0+15.3+40.0+41.2) = 157.9 * BEST
b. First, the rectilinear distances between each location must be calculated. This
A
B
C
D
E
F
To/From
0
10
22
35
40
50
0
40
20
37
25
40
A
0
0
0.0
50.0
42.0
72.0
65.0
90.0
B
10
40
50.0
0.0
32.0
28.0
45.0
40.0
C
22
20
42.0
32.0
0.0
30.0
23.0
48.0
D
35
37
72.0
28.0
30.0
0.0
17.0
18.0
E
40
25
65.0
45.0
23.0
17.0
0.0
25.0
F
50
40
90.0
40.0
48.0
18.0
25.0
0.0
Next, use these distances and the NN procedure to form routes.
Starting Route Distance Calculation
location
A (0,0) A-C-E-D-F-B-A 42+23+17+18+40+50 = 190 * Best
B(10,40) B-D-E-C-A-F-B 28+17+23+42+90+40 = 240
5. Helping Harvest
The current path: Depot-A-B-C-D-E-Depot requires (10+34+48+15+12+26) = 145
miles of travel
a. Using the NN heuristic six new routes may be evaluated:
Depot-A-B-E-D-C-Depot requires (10+34+15+12+15+60) = 146 miles
Supply Chain Sustainability ⚫ CHAPTER 15 ⚫
15-5
b. The new constraint will not alter the “best” solution as several calculated routes
link the Depot and Store B
6. Helping Harvest revisited
This problem requires splitting the to-from distance matrix into two pieces and using
the NN heuristic to calculate the shortest route through both.
Route 1: since there are only three locations, there is only one possible route
Route 2: there are 4 possible NN routes (don’t forget that the Depot must be
considered in both routes)
7. Professor Gaffney
Shipping 800 pounds at freight classification 85
Using table 15.2, the breakeven weight = 10(36.70)/42.86 = 8.56 or 856 pounds,
thus the Dr. Gaffney does not qualify for the lower rate.
8. Sampson Industries
Currently the company ships 1,500 pounds per day
At a freight classification of 60, using table 15.2, the breakeven weight =
20(26.60)/27.99 = 19.01 or 1901 pounds, thus the company does not qualify for
the lower rate.
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15-6
At a freight classification of 60, using table 15.2, the breakeven weight =
100(19.08)/20.29 = 94.04 or 9404 pounds, thus the company does not qualify for
the lower rate.
9. Arts N Crafts
a. Currently the company ships (400 units) x(8 pounds)= 3,200 pounds per week
• At a freight classification of 85, using table 15.2, the breakeven weight =
50(26.6)/34.87 = 38.14 or 3814 pounds, thus the company does not qualify
for the lower rate.
b. If demand increases the company will ship (500 units) x(8 pounds) = 4,000 pounds
per week
• At a freight classification of 85, using table 15.2, the breakeven weight =
50(26.6)/34.87 = 38.14 or 3814 pounds, thus the company now qualifies
for the lower rate.
10. Microtech Incorporated
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15-7
Currently the company ships (10,000 units) x (1.2 pounds) = 12,000 pounds per
month.
• At a freight classification of 55, using table 15.2, the breakeven weight =
200(11.58)/17.41 = 133.03 or 13,303 pounds, thus the company does not
qualify for the lower rate.
• Total weekly shipping cost = 120(17.41) = $2,089.20