NR 630 Managing outsourcing relationships in Logistics Assignment: Week 7 Term Project Paper

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Introduction The management at All-American Manufacturing Company realizes the value of integrating reverse logistics programs into the company’s operations. Reverse logistics, also referred to a... s the closed-loop supply chain, combines forward logistics with reverse logistics. The purpose of the closed-loop supply chain is to recover value from unused and spent products while creating minimal waste (Blumberg, 2004). The trend is that the previously discarded products offer value to an organization for repair, repurposing, or dismantling for parts and raw materials. Our company’s profits depend upon the ability to derive as much monetary value as possible from recycled products. Green product development is an excellent incentive for our organization in light of many environmental standards imposed by governments (Chen, 2001). Our company’s corporate image will receive a substantial boost from sustainable product manufacturing and recycling, and current regulations provide our business to embrace a sustainable reverse logistics program for more efficient and cost-effective operations. Reverse Logistics Proposal It is the intention for our company to cease outsourcing the recycling and disposal of our industrial battery product line. Moving forward, All-American Manufacturing Battery Manufacturing will invest in, develop and implement a reverse logistics program for recycling and repurposing of our lead-acid industrial battery products. The process for obtaining pure lead from the batteries, called, scrap lead procurement, will be the groundwork of our reverse logistics program (Jayant, Gupta, & Garg, 2013). Our upper management is interested in prioritizing this reverse logistics project based on multiple criteria. The criteria are: (1) Increased use of resource reduction (RR). (2) Increase of eco-efficiency (EE). (3) Development of green products (GP) (4) Cost of implementation of reverse logistics programs (IC) (Ravi, Shankar, & Tiwari, 2008). Lead Acid Industrial Batteries Typically, lead-acid industrial batteries consist of metal grids, electrode paste, sulphuric acid, connectors, lead alloy, and grid separators (Jayant et al., 2013). These types of batteries store electrical energy as chemical energy. During the discharge phase, the chemical energy converts to electrical energy. Lead-acid batteries, or accumulators, are secondary batteries since they are rechargeable. Industrial batteries provide a great deal of energy to operate electric vehicles, namely forklifts (Vest, 2002). Lead-acid batteries provide an excellent opportunity for a reverse logistics program since they have a lead content of ninety-five percent (Vest, 2002). These batteries also contain a significant amount of valuable metals, such as tin and selenium. Process for Recycling Lead-Acid Batteries The primary method for lead recovery from spent accumulators in industrial lead- acid batteries is for the components of acids, lead, and plastics to be separated and processed individually (Jayant et al., 2013). The necessary technical steps for lead-acid batteries to be processed for reverse logistics uses the following steps: 1. The batteries are emptied of their acid by hand; the acid collects in plastic 55-gallon barrels. Impurities from the acid will settle in the bottom of the barrels when the full barrels are kept motionless. The purified acid is then decanted and packed for sale (Vest, 2002). Using a small amount of lime will neutralize any remaining battery sludge. 2. A guillotine is used to shear off the top posts of the batteries. The battery grid packs are removed from battery casings, and placed into a grinding drum. The grinding process separates the grids from the separators and the past from the grids (Vest, 2002). Simultaneously, sediments are washed away by water; another treatment of lime is added to the water to neutralize the battery acid and prevent corrosion from accumulating in the drum. 3. Slurry, or water gel, is continuously pumped into sediment tanks for the solids to settle at the bottom of the tanks. The treated liquid is returned to grind; at the same time, sludge passes through a filter press to dry. The filter-dried cake is the main feed for the melting and reduction operation, which will produce almost pure lead (Vest, 2002). 4. The ground course materials from the battery grids and separators are hand sorted. The empty steel battery cases receive a thorough cleaning, then are passed through metallurgical processes for smelting. 5. The molten lead is treated with an aqueous chemical treatment to eliminate impurities; the molten lead is then poured into brick molds to cool (Vest, 2002). Once the bricks are cooled, technicians remove them from the molds, then transport them to industrial battery manufacturing facilities for processing. The lead bricks are then used to manufacture new lead-acid battery plates and other battery components. 6. The spent battery acid is treated and cleaned, then tested before releasing into sewer systems. This acid can also convert into sodium sulfate (Vest, 2002). Sodium sulfate is useful for the manufacturing of glass, textiles, and laundry detergents. Likewise, the refined acid can also provide useful raw material for manufacturing new battery products. The diagram below illustrates the process that we will use to recycle our lead-acid batteries: DISCUSSION This process for recycling our lead-acid batteries focuses primarily on reuse and recycling activities and, secondarily, on source reduction (Kopicki. Berg, Legg, Dasappa, Maggioni, 1993). The objective of this product recovery management venture is to recover as much economical and ecological value as possible, thereby reducing our waste stream (Thierry, Salomon, Nunen, & Wassenhove, 1995). Our organization benefits from two cogent and compelling reasons for undertaking this sustainability effort: competitive advantage and increasing profitability (Schmidheiny, 1992). Competitive Advantage with Reverse Logistics By becoming environmentally conscious in business, All-American Manufacturing’s competitive advantage will result in lower costs, increased productivity, and environmental compliance with regulatory agencies. This endeavor will help our organization realize the significance of spent industrial battery products as a valuable source of components and materials in the following ways: 1. Increased use of resource reduction (RR). The fact is, wasted resources equals lost profits. Industrial forklift batteries are composed of materials that are 99.9% recyclable (Vest, 2002). All-American Manufacturing’s resource reduction plan promotes the harvesting and re-use of battery components, primarily lead, steel for cell casings, sulfuric acid, and metals such as copper and tin. By recycling and repurposing batteries in-house, All-American Manufacturing improves operations by creating an organizational culture that values resource efficiency, thereby reducing both consumption and waste. 2. An increase in eco-efficiency (EE). Environmental sustainability is instrumental in developing a positive corporate image (Maletic, Maletic, & Gomiscek, 2010). Businesses around the globe are more environmentally conscious and seek innovative, eco-friendly products that offer a competitive advantage, as well as bolster company image. All-American Manufacturing will receive an enormous corporate image boost from recycling industrial forklift batteries in-house, rather than outsourcing. The reverse logistics program developed by All-American’s upper management is explicitly designed for illustration to key stakeholders that the program offers an eco-friendly, transparent blueprint that details battery recycling processes, products, and materials sourced for an enhanced public image. 3. Development of green products (GP). Environmentally conscious design (eco- design) is particularly important in manufacturing industry (Maletic et al., 2010). The implementation of an in-house reverse logistics program of recycling industrial batteries offers All-American Manufacturing a competitive advantage with improved production processes and recycling and rebuilding of used products. 4. Cost of implementation of reverse logistics programs (IC). Additional labor and equipment are the two initial up-front costs that All-American Manufacturing will incur for this project. Upper management has prepared to allocate $3.5 million for the initial funding for the project. These funds are for the addition of an initial workforce of twelve supplementary employees for processing spent batteries. The research conducted as far dictates the need for the following pieces of industrial battery process: • Battery crushing & hydro separation unit • Acid neutralization system • Smelting furnaces – rotary furnace & blast furnace • Complete pollution control equipment • Refining & alloying furnace • A fugitive emission control system • Ingot casting machine One very noteworthy consideration provided by this investment is the tremendous savings in transportation costs. The processing of recycling lead-acid industrial batteries in-house eliminates the need for the shipping of spent batteries to smelters for processing. Our production will no longer be dependent upon the delivery of recycled lead and battery components for manufacturing our battery line. Next week, all department leaders will attend a mandatory production meeting for the submission of bids for the purchase of the equipment. Once the equipment has been secured and operational, full in-house training of existing employees will be scheduled on a rotating basis. Once training for in-house employees is completed, the warehouse service manager will be responsible for securing temporary employees on a temp-to-hire basis to train with existing staff. Conclusion Quality, usability, and practicality are the most critical factors for All-American Manufacturing to develop and implement an in-house reverse logistics program (Maletic et al., 2010). All-American Manufacturing can expect a reduction in energy consumption, significantly reducing overall operating costs. Our organization could also expect significant tax credits with green product manufacturing, as well. Operations will realize a reduction in the production of hazardous materials, therefore, better aligning compliance with legislative requirements. Our customer satisfaction can increase from more efficient operations regarding product quality level from a more practical and technological production method. Company management anticipates that implementing this strategic reverse logistics program will offer our organization both reduced costs and increased customer value. References Blumberg, D. F. (2004). Introduction to management of reverse logistics and closed loop supply chain processes. Boca Raton, FL: CRC Press. Chen, C. (2001). Design for the environment: A quality-based model for green product development. Management Science, 47(2), 250-263. doi:10.1287/mnsc.47.2.250.9841 Jayant, A., Gupta, P., & Garg, S. K. (2013, October). Reverse logistics practices in lead acid battery recycling plant: A case study. Paper presented at International conference on Smart Technologies for Mechanical Engineering, Delhi, India. Retrieved from DOI: 10.13140/RG.2.1.2942.6644 Kopicki, R., Berg, M., Legg, L., Dasappa, V., & Maggioni, C. (1993). Reuse and recycling: reverse logistics opportunities. Oak Brook, IL: Council of Logistics Management. Maletic, M., Maletic, D., & Gomiscek, B. (2010). Green product development - customers and producers reflection. International Journal of Energy and Environment, 4(4), 139-152. Retrieved from https://ro.uow.edu.au/cgi/viewcontent.cgi? referer=https://www.bing.com/&httpsredir=1&article=1693&context=dubaipaper s Ravi, V., Shankar, R., & Tiwari, M. K. (2008). Selection of a reverse logistics project for end-of-life computers: ANP and goal programing approach. International Journal of Production Research, 46(17), 4849-4870. doi:10.1080/00207540601115989 Schmidheiny, S. (1992). The business logic of sustainable development. Columbia Journal of World Business, 27(3-4), 18-24. Retrieved from http://web.a.ebscohost.com.ezproxy2.apus.edu/ehost/pdfviewer/pdfviewer? vid=5&sid=0f11acb7-fa18-460f-9e1c-47b4bbbd74d3%40sdc-v-sessmgr01 Thierry, M., Salomon, M., Nunen, V. J., & Wassenhove, L. V. (1995). Strategic issues in product recovery management. California Management Review, 37(2), 114-135. Retrieved from http://web.a.ebscohost.com.ezproxy1.apus.edu/ehost/pdfviewer/pdfviewer? vid=5&sid=2c776d5a-703f-4db5-85ec-cc7e88ebe523%40sessionmgr4007 Vest, H. (2002). Fundamentals of the recycling of lead-acid batteries. Retrieved September 18, 2019, from https://energypedia- test.energypedia.info/images/7/78/Fundamentals_of_the_Recycling_of_Lead- Acid_Batteries.pdf Zajac, E.J., Kraatz, M.S. and Bresser, R.K.F. (2000) ‘Modeling the dynamics of strategic fit: a normative approach to strategic change’, Strategic Management Journal 21(4): 429 [Show More]

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