Flexibility as an Enabler for Carbon Dioxide Reduction in a Global Supply Chain: a Case Study From the Semiconductor Industry

Abstract

Due to the significant rise in environmental awareness of companies and customers for the past few years, research on how to optimize business with respect to carbon dioxide (CO2) emission has gained more attention and importance. This paper investigates how flexibility can be an enabler for CO2 reduction over a global production network especially in a capital intensive and high volatile market like the semiconductor one. We tested this hypothesis with discrete-event simulation experiments based on a case study obtained from a semiconductor company. The study indicates that global supply chains (SCs), like those in the semiconductor industry, should be equipped with a certain level of flexibility to cope with demand volatility if the CO2 burden due to transportation is low compared to those due to manufacturing. This flexibility provides ecological benefits to companies in reducing the carbon footprint of their products. © 2018 IEEE