Evaluation of Green Supply Chain Performance based
2010 Seventh International Conference on Fuzzy Systems and Knowledge Discovery (FSKD 2010) Evaluation of Green Supply Chain Performance based on Fuzzy Method and Grey Incidence Analysis
Dianli Cao
College of Information and Management Science Henan Agricultural University
Zhengzhou，P. R. China
Zhen Chen
College of Information and Management Science Henan Agricultural University
Zhengzhou，P. R. China
Abstract—Based on the analysis on the factors affecting the performance of green supply chain, this paper establishes a normalized and operable evaluation system of green supply chain performance. Firstly, with fuzzy comprehensive evaluation, the green supply chain performance is evaluated as a whole and the gap is found. Then the evaluation results are analyzed by grey incidence analysis, which provides scientific evidences for improvement of the enterprise green supply chain.
Keywords- Green supply chain, performance, grey incidence analysis, fuzzy comprehensive evaluation.
I.I NTRODUCTION
For enterprises, green production can not only enhance the economic and social benefits, but also enhance the firm competitiveness; meantime, it eliminates the pollutant during production process, and makes the social cost of enterprises internalized. Therefore, introducing green supply chain concept and implementing green supply chain management has been a necessary road for the modern enterprise to challenge the environmental crisis, and improve competitiveness in the international market and expand the living space. To implement green supply chain management, green supply chain performance evaluation is a key issue. Through the performance evaluation we can know well the condition of the supply chain and the shortage, and obtains reliable evidence for the improvement of implement related process. On the basis of analyzing the influencing factors of the green supply chain performance, the paper builds an index system to evaluate the green supply chain performance, and evaluates the green supply chain performance with fuzzy comprehensive evaluation method, and then grey incidence analysis is used to find the performance gap between the assessments green supply chain and objectives supply chain.
II.THE F ACTORS I MPACTING ON THE G REEN S UPPLY
C HAIN P ERFORMANCE
Green supply chain performance is the operation effects of the green supply chain [1]. Pursuit of the traditional supply chain system is the maximize profits or lowest cost, while green supply chain management is that of overall performance of their supply chain in the premise of environmental protection. The factors impacting on the performance of green supply chain not only contain the traditional factors of supply chain, but also the green degrees of the green supply chain.
A.Customer Service
Customers concern on four categories: time, quality, performance, services and cost. The time required to meet customers’ demand for supply chain can be measured by the order cycle [2]. Customer loyalty is essential for the supply chain, and it is a lasting source of profit for the supply chain.
B.Degree of information sharing
With the network support, information can flow among suppliers, manufacturers, law enforcement and user, forming a two-way interaction, which can reduce the degree of information asymmetry, and is propitious to improve performance for the green supply chain enterprises.
C.Cost
Cost management can help the supply chain find the level of costs, thereby digging out the existing problems, providing certain evidences for solving the problems. According to the result of the cost calculation, it also can provide a scientific basis for the enterprise to manage the supply chain, adjust the supply chain activities and evaluate the supply chain performance. This paper increased R & D costs based on the general supply chain.
D.Business Process
Index of Business Process reflect the green supply chain performance within the manufacturing operations, including product flexibility, delivery flexibility, quantity flexibility, responsiveness, product production and marketing rate，etc.
E.Green environmental protection
Green environmental protection is an evaluation on the level of the implementation of green supply chain. The greening of supply chain demands that green manufacturing idea must be integrated into the entire supply chain process to achieve the goals of minimizing the negative impact on the environment in a life-cycle, maximizing the utility rate of resources and energy as well as optimizing optimal the overall benefit of the supply chain system.
This research is partly supported by the Foundation and Front Engineering Research of Henan (072300410480) ，and the Foundation of Henan Educational Committee (2008A110008)
III. E VALUATION S YSTEMS ON G REEN S UPPLY C HAIN
P ERFORMANCE Based on analyzing the factors impact on the supply chain performance evaluation, referring to the researches of home and abroad, according to the connotation of green supply chain and environmental management standards ISO 14000 series, considering the combination of the supply chain’s financial indexes and non-financial indexes, and in accordance with the scientific, comparable, economic, practical principles and so on, the paper sets up a green supply chain performance evaluation system[3] showed in Table I.
IV. F UZZY C OMPREHENSIVE E VALUATION M ETHOD ON
G REEN S UPPLY C HAIN P ERFORMANCE A. Determination of the factor set
According to the index system from table I, the first-level factor set and the second level factor set are constructed in the following:
{}12345,,,,,A A A A A A = {}11112131415,,,,,A a a a a a =
{}221222324,,,,A a a a a = {}331323334,,,,A a a a a =
{}44142434445,,,,,A a a a a a = {}55152535455,,,,.A a a a a a =
B. Determination of the weight of every factor
Supposing the weights of the second grade indexes ij a to
the first grade indexes i A （12345,,,,i =）is ij w , weight
matrixes are
{}11112131415,,,,W w w w w w =, {}221222324,,,W w w w w =,
{}331323334,,,,W w w w w = {}44142434445,,,,,W w w w w w = {}55152535455,,,,.W w w w w w =
C. Determination of the evaluation set Supposing the evaluation set
()()1234,,,Excellent,good, average, bad ,D d d d d ==
accordingly, the level evaluation matrix can be set as ()100,80,60,40. D. Evaluation
Firstly, determining the fuzzy evaluation matrix i R of i A . Considering the degree subordination of the second grade indexes to every evaluation separately, using expert scoring or fuzzy statistical method, we get the fuzzy evaluation matrix ()i ij R r =.
Secondly, from i i i C W R =? we can get first grade indexes’ fuzzy comprehensive evaluation
matrix ()1234,,,i i i i i C C C C C =; C is defined
TABLE I.
G REEN S UPPLY C HAIN P ERFORMANCE E VALUATION S YSTEM
Serial number
First grade indexes A i
Weight
i H
Serial number
Second grade indexes ij a Weight ij w Degree of membership r ij
good better average bad
1 Customer
Service
0.30 1 Customer satisfaction 0.25 0.60 0.25 0.15 0.00 2 Customer responsiveness 0.20 0.15 0.20 0.30 0.35
3 Quality 0.20 0.20 0.20 0.35 0.25
4 Performance and Service 0.1
5 0.45 0.25 0.15 0.15 5 Lead Time 0.20 0.50 0.30 0.20 0.00 2 Degree of
information sharing
0.20
1 Information sharing rate 0.30 0.20 0.35 0.25 0.20
2 Information flow rate 0.15 0.40 0.30 0.20 0.10
3 Information utilization 0.15 0.20 0.20 0.40 0.20
4 Information failure rate 0.40 0.1
5 0.35 0.25 0.25 3 Cost 0.15
1 Logistics costs 0.30 0.35 0.25 0.25 0.15
2 Cost of the asset 0.35 0.20 0.25 0.35 0.20
3 Information costs 0.20 0.40 0.35 0.20 0.05
4 R & D costs 0.1
5 0.30 0.25 0.20 0.25 4 Business
Process
0.10 1 Product Flexibility 0.20 0.30 0.45 0.25 0.00 2 Delivery Flexibility 0.15 0.35 0.30 0.30 0.05
3 Quantity flexibility 0.25 0.25 0.40 0.20 0.15
4 Response speed 0.2
5 0.30 0.20 0.30 0.20 5 Producting and sales rate 0.15 0.25 0.20 0.20 0.35
5 Green
environmental protection
0.25
1
Comprehensive utilization of
resources
0.30 0.40 0.40 0.20 0.00 2 Raw materials and energy re-utilization efficiency 0.20 0.45 0.30 0.25 0.00
3 Recycling Products yield 0.15 0.30 0.45 0.25 0.00
4 Waste emission targets 0.1
5 0.30 0.25 0.25 0.20 5 Environmental Efficiency ratio 0.20 0.40 0.25 0.25 0.10
as ()1234,,,C C C C C =.
Thirdly, according to fuzzy comprehensive evaluation set, we can get integrated matrix M of every subset of the system. M is defined as ()1234,,,M H C μμμμ=?=. Finally, standardizing M . Let i i
i
μμμ
′=∑, we
get ()1
2
3
4
,,,M μμμμ′′′′′=
.i
μ′ is corresponding to i
d .
From the probability perspective, the possibility that green supply chain performance belongs to strength i d is i μ′. E. Examples
Taking indexes and scores from table I as example, we can evaluate the green supply chain synthetically.
If according the expert scoring, the weight coefficient matrixes of the second grade indexes are
()10.25,0.20,0.20,0.15,0.20，
W =()20.30,0.15,0.15,0.40，W =()30.30,0.35,0.20,0.15，
W =()40.20,0.15,0.25,0.25,0.15，
W =()50.30,0.20,0.15,0.15,0.20.W =
The fuzzy evaluation matrixes are ()i ij R r =,1234,,,j = showed in Table I.
From i i i C W R =? ()1,2,3,4,5i =, we get
()10.3875,0.24,0.23,0.1425,C =
()20.21,0.32,0.265,0.205,C =
()30.30,0.27,0.2675,0.1625,
C =()40.2875,0.315,0.25,0.1475,
C =()50.38,0.335,0.235,0.05.C =
Further, we get the matrix
0.38750.24
0.230.14250.210.320.2650.205.0.300.270.26750.16250.28750.3150.250.14750.380.3350.2350.05C ????????=????????
Because ()0.30,0.20,0.15,0.10,0.25H =，so
()0.327,0.29175,0.245875,0.135375.M H C =?=
Because the sum of the four elements of M
is 1, so M doesn’t need to be normalized. Supposing the evaluation level matrix is ()100,80,60,40D =.
We can get the scores 76.2045T X M D =?=. That is to say, the evaluation score of the green supply chain performance is 76.2045. So we can say the result of the evaluation is up-middle.
V.
A NALYSIS ON THE RESULTS BY GREY INCIDENCE
ANALYSIS METHOD
A. Grey incidence analysis method
Incidence analysis of the Grey System Theory is the quantitative description and comparison for the characteristics of system development. Its basic object of study is the data sequence containing mother sequence and child sequence, which are usually called as reference sequence and comparison sequence separately [4]. Degree of grey incidence is an index that characterizes the similarity between two grey systems. Supposing we have two sequences, (){}i X t and (){}i X t , at
TABLE II.
V ALUE OF G OAL S UPPLY C HAIN AND V ALUE OF B ENCHMARKING
Factors of Evaluation
Goal SC
value Benchmarking SC value
Evaluation factors of Benchmarking
SC’ general evaluation
good better average Bad
Customer Service
1A
77.45 82 0.45 0.3 0.15 0.1 Degree of information sharing 2A
70.7
76
0.35 0.25 0.25 0.15
Cost
3A
74.15 78 0.4 0.25 0.20 0.15 Business Process
4A
74.85
78
0.35 0.3 0.25 0.1
Green environmental protection 5A
80.9 85 0.45 0.4 0.1 0.05 General evaluation
A
76.2045 80.45
the point of t k =, the degree of grey incidence is defined as ()1
1
,N
ij
ij
k r k N
ε==∑ （1）
()()m in m ax m ax
,
ij ij k k ρερΔ+Δ=
Δ+Δ （2）
()ij k Δ
is the absolute difference at k of the two sequences, that is
()()().ij i j k X k X k Δ=? （3）
max Δ，min Δ are the absolute difference in the Maximum and minimum values, respectively, generally min 0Δ=，()ij k εis the correlation coefficient ，N is the number of the data ，ρis
identification coefficient ，usually 0.5ρ= [5] .
B. Result Analysis
Analyzing the degree of grey incidence of two different supply chains Using grey incidence analysis method can reflect the operation of green supply chain scientifically and objectively, and it can evaluate the green supply chain performance scientifically. By analyzing the degree of grey incidence of the goal enterprises and the benchmarking enterprises, we can find the performance gap between them, and then, we can shorten the gap by optimizing business
processes and distributing resources reasonably from the whole
supply chain. The value of the goal supply chain in Table and the value of the benchmarking supply chain are showed in
Table II, now ,we will carry out incidence analysis. With formula (1) and formula (2) we can calculate degree of grey incidence of the evaluation factors as well as the
comprehensive evaluation of goal supply chain and benchmarking supply chain and sort them. Here, the
distinguish coefficient 0.5ρ=. The results are showed in table
III. From Table III we can see, in general, the degree of grey incidence of goal supply chain and Benchmarking supply chain performance achieved a high level. Seeing from the evaluation factors, customer service get the highest degree of grey incidence, indicating that the customer service is good and have been widely recognized by customers which makes the supply chain very competitive in the marketplace. The degree of grey incidence of the costs of supply chain management as well as the degree of information sharing locate at the second and the third place respectively, these show enterprise does better on cost control and information sharing, and in these two areas the enterprise have stronger competitive advantage. Relationship between node enterprise as well as Green environmental protection have low degree of grey incidence, so they are the key factors for further improving the level of performance.
VI. C ONCLUSION
Green Supply Chain Performance Evaluation is an important manner for enterprises to realize their green supply chain performance, and it is also an effective means for enterprises to obtain social and economic benefits. Knowing their own level of supply chain performance and its main affecting factors, so Enterprises can do better on the following
things, distributing resources more reasonably, paring down the
consumption to a bare minimum, reducing costs and improving the utilization rate of resources. The ideas and methods offered in this study provided profitable thoughts and means for enterprises to optimize their green supply chain. In specific operations, enterprises can adjust the indexes according to their own need to make them more operable [6]. R EFERENCE
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TABLE Ⅲ. D EGREE OF G REY INCIDENCE OF G OAL S UPPLY C HAIN AND B ENCHMARKING S UPPLY C HAIN Evaluation factors
Distinguish coefficient ρ
Degree of grey incidence
Sort Rank
Customer Service
1A
0.5 0.8293 ① Degree of information sharing 2A
0.5 0.6729 ③ Cost
3A
0.5 0.7104 ②
Business Process 4A
0.5 0.6015 ④ Green environmental protection 5A
0.5 0.5834 ⑤
General evaluation
A
0.5 0.8573