Lenovo Purchasing and Supply report Essay
Reverse logistics is mainly concerned with ‘ the role of logistics in product returns, source reduction, recycling, materials, substituting reuse of materials, waste disposals and refurbishing, repair and remanufacturing (Carter and Ellram (1998), and Rogers and Tibbenlembke (2001) Reverse supply chain or closed loop supply emphasize that the management of returns cannot be limited to single entity in the supply chain, but has to encompass the entire supply chain from end- customers and back to the original suppliers of raw material. (referencing case)
The leading IT Lenovo has joined hands with Green Dust, an online shopping site which sells unused, branded factory seconds, surplus, overstock and refurbished products. This collaboration will help the Lenovo company to set high standards for the customer looking for refurbished products. (referencing link) UPS partnering with Lenovo help in maintaining repair depots globally. The production in end-life cycle helps Lenovo to maintain its product life cycle. The people managing the supply chain have to guard the risk of product failure so the responsibility is shared throughout the supply chain.
By developing the reverse logistics, Lenovo can be benefited from the secondary market by reducing the overall cost of manufacturing the product, improve customer service and the revenue
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Greening initiatives include proactive ” design for disassembly”, design for remanufacturing, use of recoverable energy resources, sustainable raw materials, environmental friendly transport system. (referencing case) Lenovo has a well-earned industry reputation for delivering superior quality products. Lenovo’s global Quality Management System, which received ISO 9001 (International Organization for Standardization) certification, ensures the continual delivery of design improvements into Lenovo’s current and future products.
Lenovo embraces the values of customer service, innovative and entrepreneurial spirit, and integrity. They seek to integrate these core values into every aspect of our business and into policies and procedures in areas of quality and safety for products, employee welfare, managing a global supply chain, ethical corporate behavior, social investments and environmental affairs. (referencing link) Lenovo’s global supply chain and corporate social responsibility
Large part of the global trade is conducted through systems of governance. The pressure is exerted on the multinational companies from both internal and external stakeholders such as customers, employees, shareholders which makes it difficult for the company to hide unethical practices such as use of child labor, violation of union rights and dangerous working conditions. (referencing case) The most viable element in the approach of multinational company is the employment of code of conduct.
Lenovo is consistently working to improve its business while contributing to the development of society by being socially responsible. The company embraces the values of customer satisfaction, innovation, operational excellence and trustworthiness. Lenovo is focusing on the employee welfare by providing them safety and healthy working environment. They are focusing on the production process and control to prevent work hazards, injury or illnesses. (referencing link)
However despite many efforts of the company in engaging in the corporate social responsibility, there is often a gap between the ethical standards expressed and the actual conditions at the suppliers. The contingency factors can influence the CSR in the supply chain. These factors involves four mechanism; knowledge controlling mechanism, knowledge enhancing mechanism, firm’s specific asset and corporate history. (referencing case Elaboration needed) Vast companies such as Lenovo treat their reputation and image deeds with an utmost importance and delicacy.
The company has to make sure that both customers and employees are willing to engage with the company, without stepping out of their comfort zone and that it delivers valuable experience, therefore the organization has to concentrate on aspects of Corporate Social Responsibility. Corporate social responsibility (CSR) can be defined as “…a duty of every corporate body to protect the interest of the society at large. Even though the main motive of business is to earn profit, corporates should take initiative for welfare of the society and should perform its activities within the framework of environmental norms. ”