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Technology advancements in the era of Industry 4.0 are proposed to shift away from a centralized instance of decision making to a more decentralized one. Critical to the growth of Industry 4.0 is the coordination among supply chain entities, in particular when Industry 4.0 is proposed to improve sustainability efforts. Studies in green supply chain literature have often considered the market expansion effects of greening efforts. However, a number of other factors influence greening efforts, a critical one being the price premium effect driven by the brand building strategy of firms. A principal issue then arises as to which strategy should firms adopt and when does each greening effect benefit firms and supply chains more. We generate several insights into this important issue by developing models considering dyadic settings, competition, and cost-sharing contract. We examine strategic decisions in these channel structures and compare and contrast our results with the market expansion based models. We identify a number of counter-intuitive results, for example, a dyadic channel with high price-sensitive consumers would benefit more from the price premium effect and cost-sharing (when it focusses on building brand) than market expansion. We also conduct intra-channel and inter-channel comparison of outcomes to understand the effect of competition. Among other results, we find that in the presence of a dominant retailer and competing manufacturers, the retailer shares more greening cost with the manufacturer than the corresponding decentralized channel. © 2020 Elsevier B.V.

World University root node

School of Management & Entrepreneurship

Resources, Conservation and Recycling

Strategic decisions, competition and cost-sharing contract under industry 4.0 and environmental considerations

This paper studies a manufacturer-retailer channel selling complementary green products under the cap-and-trade policy and analyzes strategic decisions in these settings. While the manufacturer faces government mandated cap-and-trade norm, the retailer invests in corporate social responsibility through selling of green products. In this study, we conduct a comparative analysis of the players’ decisions under centralized and decentralized scenarios and explore the role of cap-and-trade policy in influencing decision outcomes. Further, three contracts are proposed to improve channel performance, namely, the two-part tariff, corporate social responsibility (CSR) effort sharing, and green cost sharing contracts. The results show that collaboration among the supply chain players through contracts supports green initiatives vis-à-vis the decentralized channel. However, given a choice of contracts, the channel prefers those contracts from which the manufacturer accrues direct benefits because he incurs greening costs. The results further demonstrate that carbon markets play an important role in influencing green initiatives, particularly, under high trading prices, where manufacturers are incentivized to improve their product offerings. Further, the cap-and-trade policy influences retailers to work toward building higher reputation and brand value through investments in higher CSR effort. From a retail price perspective, we find that consumers benefit under higher trading prices because the benefits of carbon surplus and higher revenues of the supply chain players result in lowering the prices for consumers. However, it is in contrast to studies on the decentralized channel outcomes or environmental taxation because in both the scenarios, greening or CSR costs get transferred to the consumers in the form of higher prices. © 2019 Elsevier B.V.

International Journal of Production Economics

Do cap-and-trade policies drive environmental and social goals in supply chains: Strategic decisions, collaboration, and contract choices

Stochastic precedence order is a natural type of comparison for random variables in numerous engineering applications (e.g., for the stress-strength modeling). In this note, we show that, for a k-out-of-n system, redundancy at the component level is superior to that at the system level with respect to the stochastic precedence order. Cases of active and cold redundancy are considered. Similar results for other stochastic orders were previously discussed in the literature. © 2020 Taylor &amp; Francis Group, LLC.

Department of Mathematics

Communications in Statistics - Theory and Methods

A note on the stochastic precedence order between component redundancy and system redundancy for k-out-of-n systems

In this paper, we examine a supply chain consisting of a manufacturer and retailer where the manufacturer undertakes greening efforts in terms of pack-size reduction and transportation cost reduction. The retailer decides on shelf-space allocation for the product. Both the players benefit from the greening efforts of the manufacturer. In such a setting, we examine strategic decisions of the players and compare and contrast the performance of the decentralised supply chain with the centralised supply chain. We also examine the effect of collaborative mechanisms by modelling two contracts in which the retailer offers a transportation cost reduction effort based contract and a two-part tariff contract. We find that the decentralised supply chain leads to lower greening efforts and shelf-space allocation decisions. We also find that the contracts improve pack-size reduction effort, transportation cost reduction effort and shelf-space allocation, while also improving the profitability of individual players. The findings demonstrate a scope for supply chain collaboration between manufacturer–retailer pairs in this setting. The paper uniquely combines three critical elements in supply chains, namely, product design, transportation and retailing decisions, and aims to provide insights into the decision making of players considering environmental waste and pollution. The paper also reflects consumer behavior and trade-offs that the supply chain players face. © 2019, © 2019 Informa UK Limited, trading as Taylor & Francis Group.

International Journal of Production Research

Integrated product design, shelf-space allocation and transportation decisions in green supply chains

We consider the location-scale family of distributions, which contains many standard lifetime distributions. We give conditions under which the largest order statistic of a set of random variables with different/the same location as well as different/the same scale parameters dominates that of another set of random variables with respect to various stochastic orders. Along with general results, we consider important special cases, namely, the Feller–Pareto, generalized Pareto, Burr, exponentiated Weibull, Power generalized Weibull, generalized gamma, Half-normal and Fréchet distributions. © 2017 Elsevier Inc.