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Learning starts as early as when the baby is still in its mothers womb in its fetus form. People learn differently, how each and every one absorbs information differently. Culture, religion, laws and other external environment factors affect a person's learning and differentiate that from another person. The same material can be taught to everyone but can be interpreted differently by different people. People changes as they grow, getting in touch with different surroundings, hanging around with people they go to pre school with, people they hang around in secondary school and later on when they go out to work, the colleagues that they hang out with, often meeting people from diverse cultures or nationalities. Concept and beliefs might change, as situations and experiences grows
Five psychometric tests were performed and the results will be discussed in this part of the project to have a better understanding of my learning styles and how I can further explore these findings to improve my competencies from my learning preferences and how that will implicate my career choice.
The five psychometric tests that I have taken are the VARK test that allows one to find out their preference of different learning styles, my personality test which is taken from the results of my MMDI test, the Honey and Mumfred test followed by My Preferred team Role which is from taken from the results of my Belbin test.
VARK learning style is a model designed by Dr Neil D. Fleming in 1987 (Vark website) and has since been popular for people with the interest to find out their learning preferences.
The VARK measures four perceptual preferences to learning in terms of Visual, Aural, Read/Write and Kinesthetic mode.
My VARK test results were 10 for Visual (V), 7 for Aural (A), 12 for Read/Write (R) and 8 for Kinesthetic (K). The VARK results also suggest that I have a multimodal learning preference, which falls into 60% of the population (Fleming, 2010).
The Visual (V) and Read/Write (R) came back with the 2 highest scores and that did not surprise me. The score difference between the two learning methods is only indicating that both of them are my learning preferences. I have always been a person who prefers to have both pictures and words to understand something better or to remember something better. When taking mathematics class, I will always prefer the teacher to explain using diagrams rather then just writing formulas on the board and explaining to the class, I find that it always comes to me easier if it was explained with a diagram. When I came out to work, I also realised that to understand a procedure, it is best for me to draw a flow chart to allow myself to understand and remember it unless I had the time to thoroughly read through the entire document. I remember I used to draw relevant pictures on my school textbooks beside the words in order to remember it better and true enough, during examination time, when I am required to think about the answer related to that particular topic, I would be able to recall the entire paragraph with the picture that I drew. E.g. explaining how the clouds are formed, I drew clouds near the passage and I could recall that passage.
Being multimodal, I guess we can be flexible in our choices of study / learning as a preference does not mean that we cannot learn from Aural and Kinesthetic. It is a preference and one can always alter their choices in order to suit the environment or device a study strategy in order to learn better.
There are study strategies suggested for people who have both visual and read/write preferences and I intend to look into it to improve my learning efficiency.
Myers Briggs Test Results
MMDI Test. The test results came back that I am an ISFP and these are interpreted to "I" being Introversion which prefers dealing with ideas and information more than people and things, "S' being Sensation which prefers to deal with more facts and tangible things than possibilities or intuition, "F" being Feeling which prefers to base my decisions on values rather then logic and lastly, "P" being Perception which prefers to go with the flow , life is flexible rather than having it organized and structured.
I agree with the test results as I do considered myself to be a little quiet and reversed unless to people I know well. I dislike dealing with theory and abstract ideas unless there is an absolute need to, i.e. for work. I would say that Feeling and Perception are linked; I feel that due to me choosing to live life in a flexible manner, most of the time, I do not really care about logic and just following my own set of values or gut feel, e.g. learning to ride a motorcycle, although there is no need and logic for me to learn to ride a motorcycle as firstly, my family members will not allow me to ride even if I've passed, secondly, I have no intention to buy a motorcycle if I passed, I still went ahead to take lessons just because I feel like it, I feel that we live for a short period of time and we need to do what we want. However, this is a general personality, in relation to work; I am very particular in thinking in a logical method and make sure things works in logical ways.
My results on ISFP was based on the breakdown of Extraversion of 42%, Introversion 58%, Sensing 53% and 47% Intuition, Thinking 48% and 52% Feeling and finally Judgement 49% and 51% for Perception.
It also came back with a full distribution of my percentage fit against each of the classic 16 personality types. ISFP at 66% being my highest match followed by ISFJ at the same score, however the results have matched me as closest to ISFP.
Looking at the breakdown in percentage what makes me an ISFP and how I am distributed among the 16 types, I would say that I do not have a strong pattern that I am completely identical with nor there is a pattern that I am completely alike.
1.3 Honey and Mumford Learning Style Questionnaire
1.4 Belbin Inventory Test Results
Belbin test. My most preferred team role is "Implementer" and "specialist" where implementer primarily gets things done, turning ideas into action and plans and are rather conservative, however disciplined people who works systematically and efficiently. The weakness of the Implementer may be inflexibility and resistant to change. The "specialist" are people with specialized knowledge that is needed to get the job done. They commit fully to their field of expertise and provide these skills to the team. The weakness of this role may limit their contribution and lead to a preoccupation with the technicalities at the expense of the bigger picture.
The Belbin test is divided into 3 groups; Action oriented, People oriented and thought oriented. This test allows me to identify that I do not like to choose roles that requires creation of new ideas and explore opportunities and reflects on the rigidity and conservative nature of the "Implementer" which may not be favourable working in a team. However, as this test is about our preferred and least preferred, preference does not equate to not being able to perform in such "Least preferred roles".
2. Personal Career Development
2.1 Lifelong Learning
Learning is a lifelong process.
There is significant change with learning notion in these past few years where learning does not narrowly come from formal education system but also through informal ways. Learning concepts transition happens due to globalisation pressure involving labour market deregulation, changing employment pattern, lack of job security, educational goal alteration become critical attention for both government and organisations worldwide (Ecclestone, Biesta & Hughes, 2010, p.3). Higher education degree completion does not necessarily mean that individual's learning stage is also stopped. However, education is important as it transmits knowledge of traditions, solidarities, and identities for mutual understanding in an increasingly plural society (Crick & Joldersma, 2007). Education as an early stage process assists in shaping individuals' personality and characteristic to be prepared entering broaden scope of life, such as working environment.
Lifelong learning is a demandable criterion as it is expected to train peoples tailoring their skills for every job change within their career path due to fast-changing labour market (Jongbloed, 2002). Companies realise that not all academic students would be good employees and not all good and not all good workers have a chance attaining education, particularly in today global recession. Jenkins (2006) suggests that need of lifelong learning in developing and regenerating human capital is crucial by organisations. Lifelong learning is an innovation tool to increase flexibility and quality of labour market (Lucio, et al, 2007). Lifelong learning concept, indirectly, enhances competition in working environment where we have opponents from both formal and non-formal education background.
Edwards, et al (2002, p.15) imply that the main concept of lifelong learning is personal development where individuals are at the core point. All human beings either conscious or unconsciously do learn new things all the time. Personal values, degrees of motivations, and social context learning takes place are influencing factors within lifelong learning approaches. Outer environment, such as family, friends, and society we belong impact on our perception pattern. Motivation difference is a result of individuals' antipathy which originates from scholarly experiences and early influence of home and neighbourhood (Lovell, 1980, p.113). I used to put education as first priority due to my family educated background; therefore, good mark achievement is my main driver at school. Encountering many people coming from different countries, diverse education system in the UK, and all my two and half years studying abroad widen my thinking. Education is not only about achieving good scores but also being able to adapt with different situations and ability to expand networks through socialising. Achieve a good mark does not necessarily guarantee future job employment, but it is just a selling tool to future employers.
As part of my lifelong learning process for my future career, I intend to get a certified Accountant as it leverages my competitive advantage. I plan to enter to one of the big four accounting companies as they provide a great scheme. Not only do I able to advance my career and professional qualification but also earning money. Working and studying at the same time is a valuable process as I am able to transfer theory to real-life application straightaway.
2.2 Transferable skills
Increasing numbers of populations along with limited job vacancies bring intense employment competition around the world. Farmer and Campbell (1997) suggest that job security challenges involving fulfilment of job expectation and need become increasingly formidable. Flexible and transferrable skills through working lives are the key competitive advantage to overcome this issue (Greenan, Humphreys & McIlven, 1997). Notion of transferrable skills is about in owned-aptitudes that can be applied to do more than one work where job switching is a quite common in real working world today. Cottrell (2008, p.339) suggests that rapid changes in knowledge, technology and society require maintaining both skills and expertise to seize possible opportunities.
Nabi and Bagley (1999) classify demandable graduate attributes into three main clusters, which are personal, communication, and problem-solving quality. These three features are derived through education, life, and working experiences of individuals. University life expands both my academic skills and my personal traits, such as critical thinking, duty prioritisation, time management, and being responsible person. Working experience is a valuable tool where I can transfer and enhance my aptitudes to real-world application. Owning a chance to work in different fields of job enhances flexibility to move from one job to another in the future. Capabilities to communicate and deal with pressure I gained from customer service occupation are applied to my auditor job. Being an auditor is a valuable working experience where I was trained being accurate, efficient, and profession in high competitive working environment.
Kati (2002) suggests that concrete working experiences through transferability skills give practitioners broader meanings. Abilities used explicitly give individuals factual sensation that grows awareness of the disparity between theory and reality. For example, an effective audit performance requires an active participation to gain deeper audit's conceptual groundwork understanding rather than stiff rules and procedures knowledge (Helliar, Monk & Stevenson, 2009). The process of achieving the answer is more valuable than the end result itself. This is because existed difficulties during the process unconsciously release our hidden potential. Both working and life experiences make me more aware of both my strengths and weaknesses.
Figure 220.127.116.11: Skills Required in Accounting and Finance Profession
Ability to Synthesize
Source: Career-in-Business (2011)
Comparison between my SWOT and requirement skills in chosen career shows several areas I need to improve. Analytical, innovative, and objective skills are my shortage now. However, making blogs for International accounting module every week aids in improving these skills. Reading a lot of news and getting up-to-date toward current situation worldwide is another useful skill toward future career.
2.3 Career Choice
According to Teamtechnology.co.uk, the traits of the ISFP are such presented in the following points and the top 10 career would fall in the inner career group for an ISFP would includes a career in the Arts, healthcare and academic.
Traits of the ISFP
Enjoys working alone
Thought before action
Deals with facts
Decides using values
According to the www.personalitypage.com, the traits of an ISFP coincides with the findings above and the possible career choices would also be either in the arts, entertainment or healthcare industry dealing with children and animals.
As a buyer in the Gaming industry (Casino), I support the Casino departments in procuring items needed for casino operations which requires to get things done almost instantly as the demand is always "Yesterday". An ideal candidate for the job will be someone who is open to ideas as the company revenue generating department - the Casino folks, are very prone to come up with creative ideas to get something special, something out of the norm, someone who likes to work within regimens so as to comply with local Casino Authority, someone who is careful with details in order to get correct items or communicating with authority, someone who is out-going (to deal with vendors), efficient and spontaneous (in order to get things turn around as fast as possible).
Am I in my preferred career choice? I would say according to both tests that I have taken from www.personalitypage.com and teamtechnology.co.uk, I would be in my wrong career choice. However there is no perfect match between a job and personality. Although most of my personality does not fit perfectly into this job, I do actually enjoy working in my present position as it allows me to work on my own as I am the only one handling the Casino in gaming equipments and my direct superior sits overseas, this also allows me to work in my own pace, sometimes living in the moment. This also corresponds to my preferred team role in the Belbin test, as the "Implementer", I prefer to be practical and getting things done systemically and efficiently without much supervision.
As according to teamtechnology, whilst there is some general validity in these methods of using personality to match with career, most do not take direct account whether the personality types actually enjoy the careers they end up with.
In conclusion, self-understanding of one's preference of own personality, learning style and preferred team role may be helpful for self improvement, however I feel that personality / preferences might alter in different stages of one's life due to life experiences. Preferences also does not mean that we will use these preferred behaviors at all times or we are not capable of performing those roles that are not preferred.
It might be good to review one's preference from time to time in order to improve on areas which one is interested in. Lastly, even if one lands a job that matches 90% of their personality, there is no guarantee that the person will enjoy their career due to other factors (working environment, people, stress)
This is the third year of my study time in the UK where I learned many things both academically and non-academically. The whole process of project completion is not really a new thing for me. This is because I had already done mini-dissertation during my second year in the college. Starting from composing project proposal, filling out psychometric test, writing reflective statement, and performing many researches to find enough information for the chosen topic are the similar steps I take to finish the paper. However, experience in the university is totally different from my first two year in the college. The levels of coursework and degree of task difficulty are not the same compare to the college. The university standard is higher than college as more in-depth information and reliable sources are required.
A year break before entering to the university apparently deteriorates my academic skills in term of receiving and circulating new materials received from lecturers and seminars. Therefore, I always read the materials and the recommended books before the class in order to have little bit understanding regarding the subjects. Be a university student makes me encounter more diversified backgrounds peoples and be more an active individual. There are many changes within myself that is presented by some changes in the psychometric test results. I was not an open-minded person who is not confident in dealing with new peoples and is reluctant to declare my opinions. Teaching styles in the UK that is totally different from my home country actually transforms my weaknesses into new strengths. Seminar discussions and group tasks improve my ability to interact with peoples, speak in front of publics, think critically, respond questions, and handle pressure situations. Each university module develops my understanding further not only in accounting and finance area, which is my specific chosen degree, but also in other business contexts, such as ethics and strategic management. I figure out that a balance is required among business divisions as they cannot work separately from the linkage between one module to others.
This project is divided into two parts; Part A and B. Part A critically analyses my learning style preferences linking to my career choice and in part B discusses a specific chosen business problem, drawing inferences and conclusions in relation to my career choice.
Psychometric tests like
Part A of this paper contains a number of psychometric tests' results to determine the learning style preference of the author. Besides those tests, opinions from relatives and pass experiences have important roles to provide better evaluation. Relationship between learning inclination and chosen career is also discussed to provide clearer guidance concerning future career implications. Giving more awareness in relation to transferrable skills from university to the real working environment and importance of life learning development is the mutual aim of this section.
Part B Purchasing is the most costly business activity which affects decision making in businesses. Green purchasing is one of the most effective and efficient approaches to achieving sustainable business. To achieve sustainability, it is very important to intergrate it into the business.
Literature review in the field of supply chain management (SCM), corporate sustainability (CS) and green purchasing lead to the understanding of purchasing in supply chain, main strategies and tools in greening purchasing, the difficulties of implementing CS and green purchasing.
Two case studies were reviewed and studied in this project; Toyota and Panasonic were studied of their policies and how they integrate green purchasing into their business.
Business values, as a base for corporations' activities, are not all origin from triple bottom line and CS requirements. Finding also identify corporations tendency on achieve sustainability by mere eco-efficiency. The missed link between CS measuring and green purchasing criteria is discussed as the gap that leads to all the disjoint in theory and practice. Finally, suggestions are made on theory development companies policies.
Key words: self-development, career, green procurement
Part 1 introduction
Background and reasons for choice of topic
Economic and environmental concerns such as global warming and waste management have contributed to mass production, mass consumption and mass waste. It has therefore created a rise in interest for green procurement to address these issues.
It is important not only to promote green procurement of eco-friendly goods, but also to integrate these initiatives into the business' value chain. This in turn will promote a ripple effect in the market which will benefit mankind by preserving earth's raw materials for longer and healthier living sustainability
1.2 Project Objectives
Given the background above, this project aims to find out the importance of practicing green procurement and how businesses are working to achieve sustainability through purchasing activities and the success of integrating sustainability into their business.
The research objective is to find out how businesses work on sustainability issues in supply chain management (SCM) through green purchasing activities. More concretely, the objectives of the research are to:
What is green procurement
Why is green procurement important;
Understand how businesses work with sustainability issues;
Understand businesses main strategies, policies and activities that they are using in green purchasing activities, find out how and why these strategies are used;
Understand how successful the business have integrated sustainability by locating the gap between greening purchasing theory and companies practices in reality
Provide recommendations to promote greening purchasing for future practices and conclusion
1.3 Project Outline
This part of the project is separated into 4 main sections.
Section one: Introduction - This chapter explains the background of the issue that is of concern and why there is a need to study this issue.
Section Two: Literature Review - This chapter is the main body of this paper where initial theories and discussion of Green Procurement are explained explicitly. There are three main parts in this section, mainly; Supply Chain Management which will include purchasing management; Sustainability which includes corporate sustainability and; Green Procurement. Study and discussions on these subject matter brings about the relationship it has with achieving sustainability or green procurement in businesses.
Section Three: Case Study - 2 companies were picked for this project to uynderstand their activities, how they have successfully integrated green procurement into their businesses. The companies are Panasonic and Toyota.
Section Four - Conclusion and Recommendations - This chapter will be the summary of this study. Suggestions and recommendations of further study from conclusion of this issue will be discussed.
Part 2: Literature Review
Literatures regarding sustainability issues in supply chain management (SCM) through green purchasing activities are reviewed in this section. The focus is on what green procurement is, why green procurement is important in businesses and how businesses successfully integrate sustainability strategies into their activities.
2.1 Supply Chain Management
Due to increasing globalization of technology in information and manufacturing, demands of the customers are increasing and the companies are facing the pressure to improve their business strategies in order to stay competitive or to gain competitive advantage over their competitors. Companies realized that they can no longer practice the traditional purchasing method using the lowest priced supplier and trying to increase their sales prices in order to gain increase in their revenue. Companies now acknowledge that integrating sustainability into their supply chain activities can help them achieve corporate competitive advantages (Porter, 1998).
(Christopher, 2005) defines SCM as the management of upstream and downstream relationships with suppliers and customers in order to deliver superior customer value at less cost to the supply chain as a whole.
"Supply chain management is defined as the systemic, strategic coordination of the traditional business functions and the tactics across these business functions within a particular company and across businesses within the supply chain, for the purposes of improving the long-term performance of the individual companies and the supply chain as a whole." (Mentzer et al., 2001, p.18)
"All of those activities associated with moving goods from raw materials through the end user: sourcing and procurement, production scheduling, order processing, inventory management, transportation, warehousing, and customer service. Importantly, it also embodies the information systems to monitor these activities." (Palevich, 1997 p. 1)
It is evident that the general concept of SCM involves the processes of moving goods from raw material stage to the end user, production, procurement, transportation and these are all linked up in chain activates and collaborates with one another to achieve competitive advantage.
Porter 1998 brought out the notion of Value Chain which refers to adding value to the supply chain activities of a company. Porter 1998 also points out that the total ultimate goal of a company is to make sure that total value of all its activities generated is greater than its cost. Supply chain links all the activities in a company, therefore it is very crucial and beneficial for companies to be adding value or integrating sustainability into these activities.
2.1.1 Purchasing Management
(Krause et. al. 2001) suggest that purchasing is a strategic contributor to the firm. The recognition of the strategic importance of purchasing in many organizations has increased in recent years (Narasimhan and Das, 1999).
Weele, 2002 suggests that in traditional purchasing, it refers to the basic scope of buying, supplier selection, condition specification, issuance of contracts and ensuring orders are delivered on time. Over time, Purchasing management and Supply chain management has developed; the focal point has been changed from goal of achieving lowest cost to procuring right quality from the right source, from the right place.
"Purchasing is obtaining from external sources all goods, services, capabilities and knowledge which are necessary for running, maintaining and managing the company's primary and support activities at the most favourable conditions (Weele, 2002, p. 14)."
Based on Weele 2002, purchasing function in companies includes the following activities:
1. Specification: the quantity and quantity of the goods or services that are to be bought
2. Selecting suppliers: select the most suitable suppliers based on all kinds of criteria
3. Contracting: preparing and negotiating with the suppliers to establish agreements
4. Ordering: placing order according to the agreements with selected suppliers
5. Expending and evaluation: monitoring and control of the order
6. Follow-up and evaluation: setting claims, keeping product and suppliers files up-to-date, suppliers rating and ranking
Weele's purchasing function model excludes activities for material requirements planning, scheduling, inventory management, incoming inspecting and quality control. However these activities are closely interrelated with purchasing function, therefore companies purchasing strategies and frameworks often include regulations on these activities.
Purchasing management is an important part in SCM on both cost reduction and product quality control. In this report, purchasing management refers to "all activities to manage supplier relationships" (Weele, 2002). Purchasing is fundamentally important in business success in both direct and indirect manner (Weele, 2002). Direct impact shows in cost saving while indirect impact shapes in better quality, logistic arrangements and innovation process. Indirect manner in practice is sometimes more substantial than direct saving on money. For example, an analysis of Philips in 1997 shows a 2 % saving on purchased materials and services leads to 12.1% return on net assets (RONA)8 improvement (Weele, 2002). Positive relationship between effective purchasing management and supply chain performance is also proved by previous research (Carr and Smeltzer, 1999). Effective purchasing management requires a cross-functional approach, involving not only purchasing department but also other business units such as engineering department. Engineers' involvement is comparatively higher in the early stages, mainly on design, construction and quality aspects of the purchase product (Weele, 2002).
Purchasing relates to sustainability issues closely because of the restrictions it posed on suppliers and its position along the value chain of linking companies with its suppliers. Green purchasing, namely integrate sustainability consideration in purchasing management, is a direct supplier management approach for companies.
Green purchasing, namely integrate sustainability consideration in purchasing management, is a direct supplier management approach for companies. Applied by more and more companies, Code of Conduct (CoC) for suppliers ensures less harm impact to environment and society, not only in the company themselves but also in their suppliers. By imposing requirements on their suppliers and requesting social and environmental information of the purchased goods from suppliers, companies are generally adopting a product life cycle perspective in business, that everything enters the manufacturing process eventually must leave it.
Why should we practice green procurement?
Reduce energy and water consumption (which can reduce costs)
Improve resource use efficiency
Reduce waste (which can reduce waste disposal costs)
Reduce environmental health impacts of products and services
Provide markets for new environmentally preferable product
"Close the loop" on recycling, improving the viability of recycling
Encourage industry to adopt cleaner technologies and produce products with lower environmental impacts
Provide markets for new environmentally preferable product
"Close the loop" on recycling, improving the viability of recycling
Encourage industry to adopt cleaner technologies and produce products with lower environmental impacts
Practicing green procurement can bring about cost reduction, better relationship with the suppliers and possibilities of a more holistic approach to decision making (Bowen F. et al. in Sarkis, 2006).
Many companies have now started to incorporate different kinds of sustainability strategies into their corporate system. Many companies' first attempt at sustainability strategies starts with trying to be more eco-friendly by starting with recycling and reusing while others try to start a complete product life cycle from procuring materials which have a small environmental load.
Sustainability has without a doubt become the most urgent prerequisite for human development in the world today. Sustainability has been defined in many ways, among which the most common quoted definition is from WCED9 in the report our common future10:
"development that meets the needs of current generations without compromising the ability of future generations to meet their needs and aspirations"
Sustainable development is a concept in development paradigm rather than pure environment protection because it is, essentially, an approach for development. However it focuses on not only economic growth and production but also human condition in this generation as well the future generation (Bell and Morse, 2003). WCED pointed out in our common future that sustainability cannot be realized only through governmental regulation and legislations. Achieving sustainability requires balanced, complex interactions involving cooperation and competition among all subsystems on the planet (Stead and Stead, 2004), including companies. Companies, especially
industrial corporations are considerate to play a significant role in sustainable development because of three reasons: Firstly, they are the ultimate engines for economic growth, secondly they are the partly cause of current unsustainable conditions and thirdly they have the resource to address the problems (Wilson, 2003). Many large corporations have committed to sustainable development and show concerns on sustainability issues. Corporate activates are labeled with green or eco, for example green supply chain, green purchasing and all kinds of eco products.
2.2.1 Corporate Sustainability
Corporate Sustainability (CS) can be seen as sustainable development on corporate level. This term was brought up to address the change of value system in companies driven by sustainability requirements (Welson, 2003; Salzman et al., 2005). Traditionally, companies operate under government's legislations to create economic values for its shareholders. Now most companies accepted CS as a precondition for their business activities (Dyllick and Horkerts, 2002) and seek to create value for multiple stakeholders, which include not only shareholders, but also employees, customers and communities. Taking the idea of sustainability development, CS means corporation "meet the needs of corporations direct and indirect stakeholders without compromising the ability to meet the needs of future stakeholders" (Dyllick and Horkerts, 2002).
2.3 Green Procurement
Green purchasing refers to a responsible purchasing process that accounts environmental and social consequences. It involves activities that reduce, reuse or recycle materials that express environmental preferences through the supply chain (Chien and Shin, 2007). Green purchasing seeks to provide high level of quality to ensure economic benefits while continuously decreasing destructive environment and social impacts. Purchasing function controls the goods and services entering the company, therefore it determines the items and amount of environmental and social capital consumed by business activities. "Reverse logistics" offer a new way of purchasing from reusing and recycling. Purchasing activities is also important in a sense of passing a focal company's own standards onto its suppliers. It is argued that CS can't be achieved if green purchasing is not integrated into it (Preuss, 2000). Many companies are using green purchasing management as an effective approach to implement CS.
There are different reasons and approaches for companies to green purchasing. Drumwright proposed two types of reasons for companies' engagement in green purchasing (Sarkis, 2006):
i. Green purchasing is applied as a deliberate outcome of articulated strategies of corporate socially responsible behavior. This means that if a company takes corporate social
responsibility, it normally starts green purchasing programs. This is because of the environmental and social performances of a company's suppliers can affect greatly its own performance and reputation (Bacallan, 2000). Also suppliers' information on environmental and social performances is necessary for a company to conduct a life cycle assessment.
ii. Green purchasing is motivated by business reasons. Companies either see green purchasing as opportune or out of external restraints. Studies show potential competitive advantage firms can create though the creation of a sustainable supply chain (Markley and Lenita, 2007).
Green purchasing ensures environmental and social friendly product and services in a focal company while affects its suppliers to work on more environmental and social friendly product and services. Green purchasing passes on sustainability requirements up to upstream companies to create a green supply chain from material extractions to end-users, towards the sustain environmental and social capital throughout a product life cycle.
Green purchasing strategies means purchasing policies, framework, systems or fundamental principles that lead purchasing activities towards sustainability. There are many green purchasing strategies applied by companies, summarized as following: (Sarkis, 2006):
a. Product content requirements: Buyers require products with desirable green attributes.
b. Product content restrictions: Buyers require products not contain environmentally undesirable attributes.
c. Product content labeling or disclosure: Buyers require disclosure of the environmental or safety attributes of product contents.
d. Supplier questionnaires: Buyers ask suppliers for information about environmental aspects.
e. Supplier environmental management system: Buyers require suppliers to have an EMS (Environmental Management System) that is certified or develop an EMS that conforms to recognized international standards (for example ISO14001).
f. Supplier compliance auditing: Buyers audit suppliers to determine their level of compliance with environmental requirements.
g. Supplier environmental management system auditing: Buyers audit suppliers on both compliance status and their EMSs.
h. Buyers set their own compliance standards: B
i. Product stewardship: Buyers take responsibility for managing environmental effects of products throughout the product life cycle.
j. Education and collaboration: Buyers educate suppliers about environmental issues and strategies and helps suppliers solve environmental problems.
k. Industrial Ecology: Buyers work with both suppliers and customers to develop fully integrated system for recycling and re-use of materials within an industrial ecology14 framework.
Among these strategies, desired levels of buyer effort and impact on supplier behavior are different. Figure 4 shows tradeoff between the desired effort from buyer and efforts on suppliers. This figure indicates the most effective strategy on suppliers is cooperation collaboration, which also demands the highest level of buyer effort. Product content restrictions and uncertified supplier EMS require the least efforts and the least effective strategies on buyers are product content restrictions and product content requirements.
On operational level, there are many key decisions to be made in different steps of purchasing activities. Originally, selection of suppliers are based on product's quality and cost, for example ISO 9000 regulations are widely used in companies purchasing process to assure product quality. Once companies achieve CS within triple bottom line, cost and quality of the environmental and society should be imbedded in the supplier management process. Green purchasing demands more criteria other than product's quality and cost to assess suppliers. During the purchasing process, decisions on vendor selection, vendor location, mode selection and carrier selection have great impact on environment and society (Wu & Dunn, 1995). Environment and society can be affected by purchasing function along transportation, supply, maintenance, control, contracting, requiring systematic thinking for solutions (Camm, 2001). Two common used management tools in green purchasing are explained in the following:
Codes of Conduct (CoC): CoC is defined by International Federation of Accountants (IFAC) as the "principles, values, standards, or rules of behavior" to guide an organization to contribute to "the welfare of its key stakeholders" and "respects the rights of all constituents
affected by its operations". It is also recognized as "codes of ethics". Many companies adopt codes of conduct as a symbol of taking social responsibility in its business practices since 1990s (Jenkins, 2001). Globalization makes it difficult in managing codes of conduct because of the distributed suppliers in uneven economic, legal, cultural and political status (Pedersen and Andersen, 2006). CoC is argued to be structural limited (Jenkins, 2001). Firstly they concentrate on items that affect greatest on their brand name and corporate image. Secondly codes tend to focus on particular issues regard as highly damaging. For example the Child labor is highlighted in company's CoC because of the emotive reaction in developed countries (Jenkins, 2001).
3. Case Study
3.1 Case Study 1 - Volvo
Volvo is a large vehicle manufacturer and service provider, whose market covers about 180 countries around the world. According to Volvo's Sustainability Report 2006, CS in Volvo lies in achievement of three values: quality, safety and environment. Quality management system is certified by ISO 9001 and operated decentralized. Safety includes not only driver's safety but also work condition and contribution to efficient transport. The most concerned environmental issue in Volvo is climate change and the biggest driver for sustainability considerations in Volvo is worldwide oil depletion. Thus the main focus of their practices is on fuel efficiency. For example, Volvo Car aims to reduce harmful particulates and NOx to zero by 201016.
Volvo Environmental Policy 2004 identified Volvo's environmental policies on four aspects17:
1. Based on complete life cycle perspective and prerequisite principle, work with suppliers, dealers and other business partners within its policies.
2. Integrate environmental activities into all operations with all employees involved
3. Work on technical solutions (e.g. low environmental impact solutions, reduction of products' fuel consumption, exhaust emissions, noise).
4. Focus on resource efficiency by minimizing the consumption of energy and raw materials, the production of waste and residual products.
3.1.1 Green Procurement Strategies
Green purchasing is an essential part of Volvo's Environmental management system, as it applies various green purchasing strategies. Volvo's website has a supplier portal that explains the selection process, supplier requirements documentations and supplier self-evaluation forms. According to its whitepaper to suppliers, Volvo tries to create long-term corporate relationship with its suppliers by integration of knowledge and understandings. The buyer-supplier relationship in Volvo is no long co-operation but integration. Based on the requirements documentations, Volvo's green purchasing polices are summarized into the following categories:
â€¢ Product content Restrictions: Chemicals or materials from suppliers must fulfill the requirements restricted by Volvo Black and Grey lists18.
â€¢ Supplier environmental management systems: ISO 14001 or EMAS (Eco-Management and Audit Scheme)19. 90 % Volvo's product material suppliers adapt ISO14001 certification by 200620.
â€¢ Product Content Labeling or Disclosure: suppliers are asked to report specified chemical and material content of component parts on requirements.
â€¢ Supplier questionnaires: Suppliers are asked to report on their environmental work and provide all kinds of environmental related data for Volvo to enable environmental assessments (for example Life Cycle Assessment).
â€¢ Supplier compliance auditing: Suppliers are required to comply with applicable environmental legal requirement; suppliers are responsible for planning and choosing packing materials, handle excess and rejected materials to minimize environmental impact as well as their respective sub-suppliers for deploying these requirements through their supply chain.
â€¢ Education and Collaboration: Training program which proved effective in promoting local
3.1.2 Green Procurement Practices
According to the supplier portal, Volvo's white papers on purchasing are specified into general requirements, quality requirements, production and engineering, cost management, environmental requirement, corporate social responsibility and logistic requirements. Based on these white papers, purchasing process in Volvo is summarized in Table 5
Volvo has a series of white papers specifically for logistic requirements. Volvo's supplier evaluation is based on a questionnaire regarding to suppliers EMS implementation status and other requirements. Each criterion has four level scores. Supplier's performance is based on its overall scores. CoC to monitor and evaluate suppliers contains:
â€¢ Environmental: Resource Efficiency, Precautionary principle, Environmental impacts;
â€¢ Social: Human Rights, non-discrimination, labor and work environment
3.2 Case Study 2 - Ikea
Electrolux is a world leading households' appliance company, whose market covers more than 150 countries. According to its whitepaper on business value, there are five values on Electrolux agenda to achieve in their business: cooperation, people development, environmental concern, professionalism and speed.
According to Electrolux white papers, the most concerned environmental issue in Electrolux is also climate change. They propose two options to address climate change: by reduce CO2 emission and by improve energy efficiency. The main goals for their environmental practices are to reduce CO2 emission, water pollution, and solid waste and to improve energy efficiency. They work on social aspects of human rights, health and safety. Electrolux have established a social responsibility committee as a management institution to control local communities related to their business activities. EMS in Electrolux is based on ISO 14000, ISO 9000 and their own-build ALFA (Awareness-Learning-Feedback-Assessment) management system with a life cycle consideration
According to Electrolux Sustainability Report 2006, Electrolux has more than 4000 suppliers with an increasing purchasing share from low-cost countries (for example China, Brazil and India). Due to poor local laws, they pay specific attentions on SCM to ensure environmental and social performance in these countries. Electrolux adopted CoC to improve local robust, transparent corporate governance system, health and safety conditions in manufacturing along the supply chain and quality of life. According to its Sustainability Report, their effort on China's suppliers can affect supplier's own supply chain on environmental and social performance, thus extent the effect to local community.21 Electrolux adopts four groups of CoC under different conditions: Codes of ethics, Workplace CoC, Policy on countering corruption and Bribery and environmental policy. Their CoC for suppliers covered following aspects:
â€¢ Environmental: environmental compliance.
â€¢ Social: Child labor, forced labor, health and safety, non-discrimination, harassment and abuse, working hours, compensation, freedom of association
3.2.1 Green Procurement Strategies
Two main strategies used are by Electrolux in green purchasing:
â€¢ Product content restrictions: They have restricted environmental list to restrict hazard chemicals of products and services from suppliers.
â€¢ Buyers set their own compliance standards: They built their own management system ALFA to communicate, support learning a nd assess suppliers' performance on workplace codes of conduct.
3.2.2 Green Procurement Practices
IKEA has its own system of CoC for purchasing home products, namely the IWAY (IKEA way on Purchasing Home Furnishing Products). IWAY standards describe the minimum requirements on social, working conditions and environmental demands at suppliers. According to IWAY standards, Green purchasing involves following purchasing functions:
â€¢ Monitoring and evaluation process is in charged by three groups of auditors: their own auditors, compliance and monitoring group who train auditors and third party auditors. It is conducted on a regular basis, both noticed and unnoticed.
â€¢ Follow up evaluations are for non-compliance suppliers. Long-term relationship with suppliers will be terminated due to several times non-compliance. Asia supplier CoC fulfillment rate has
dropped greatly from 80 % to 69 % in 2006, reflecting a strict judgment in Asia30. Criteria for IKEA's purchasing evaluation are illustrated in Table 8:
IKEA social and environmental responsibility report 2006 lists key indicators for sustainability in IKEA: renewable material used, waste recycled or reused, recovered or reused products, organic food, energy consumption in operation, renewable energy percentage, CO2 emissions per kilometer transportation, fulfillment of minimum, requirements by transport suppliers, customers traveling by public transportation and suppliers meet CoC requirement environmental.
To summer up the data, each case company has its own business value, management policy, supplier requirements and purchasing process: Volvo and Electrolux adopted a comprehensive purchasing process while IKEA has its IWAY standards. CoC are used as an effective tool in all case companies. Case companies CS indicator metrics are also distinguished from each other in both scope and contents.
4. Conclusion and Recommendation
This thesis work investigated on three Swedish large companies on green purchasing practices towards CS. This investigation shows efforts of large companies towards CS through various green purchasing approach. There appears a lack in a common green purchasing frameworks and implementation approaches. The most commonly used requirements - CoC, is questionable in many ways. Business values as a base for corporations' activities are not all origin from triple bottom line. Moreover, as labelled in some companies, companies are greening purchasing towards sustainability by achieving eco-efficiency, which is only one aspect of CS criteria in theory. The missed link between CS measuring and green purchasing criteria might be the reason of these gaps. A general framework to integrate six CS criteria with purchasing criteria is suggested.
Through literature review and case study, the research enhanced understandings of how companies working with sustainability issues, explored the current state-of-the-art knowledge in the field of green purchasing and CS in companies, analyzed main policies, strategies and how those strategies are implemented. By linking CS and green purchasing together, the gaps on understanding level and operational level is pointed out and discussed. The descriptions of the gap lead to recommendations and further researches to better implement green purchasing for companies to move towards CS.