As we can learn from recent research that good reverse logistics management not only results in reduced costs, but it can also increase revenues; however, it is rather complicated and uncertain than the forward logistics processes and not easy to deal with. Because of the reason, it triggered off this research and we expect the research result can be contributed to this case company. In this chapter, we will mention the research motivation, our main objective, research processes and the limitation.
1.1 Research Motivation
First of all, it’s a complex case of real world problem of reverse logistics in a customer service department (CSD) of one of most famous EMS Company in China. The supply chain manager of the service division needs to deal with plenty of complex problems on reverse logistics activities due to the uncertain and unstructured situation of the problem. Under the wide problem scope, the situation has been defined as systematic problem instead of single and simple issues. The problems are main focusing on the management framework which included product return forecasting, repair and remanufacturing management, material management, logistic management, supplier management, purchasing management, etc. This study tried to solve the reverse logistics problems in the real world situation which will apply the system thinking of soft system methodology. The research result will able to help CSD to improve their current problem situation and get the better management performance.
Secondly, according to magazine of transportation and distribution, the reverse supply chain is one of the last places where there is still a lot of easy money to be saved. Most people view returns as a necessary evil; however, returns are really untapped profit potential by better asset recovery and efficient reverse logistics management. The total value of products returned by consumers in U.S. is enormous estimated at &100 Billion annually (J.Stock, T.
Speh, and Shear, 2002). There is a big room for the company to gain the remanufacture profit or reduce the operational cost from the optimal reverse supply chain management. However, there is only very few study which provided the applicable result for the reference of supply chain manager to deal with above situation in EMS industry. Because of this reason, this study is interested in this area to improve and practical solutions for CSD current operation environment.
Finally, if the reverse supply chain looked the same as and managed the easy as the forward supply chain, everyone could afford to be the masters of reverse logistics. Although reverse logistics has received a great deal of attention from operations managers and company executives; however, there is very limited research on China’s EMS industry for this area. The reverse logistics model is more complex and difficulty to deal with from most operation manager’s perspective. Therefore, this research will more focus on the real world problems from current practice experience. The research result will able to be implemented to one of the world famous and largest EMS Companies to verify the suggested solutions after this research.
1.2 Research Objective
Based on the description on previous section, this research will study the feasible solutions for reverse supply chain management from EMS manufacturer perspective through the soft system methodology.
Below are the main objectives of this research:
Deeply understand the key factors for successful implementation of reverse logistics from the existing literature and published case studies. Since there are so many difficult questions and messy problems need to be answered or solved on this case, this research should be able to define all the real world problems on this case and provide the according suggestion.
Since there is very limited research thesis of reverse logistics by SSM methodology, therefore, this study will verify if the SSM’s seven-stage approach really can be applied to this area of research, as well as to verify if this methodology can be apply to the case company and industry quickly and easily.
Apply and adapt soft system methodology on reverse supply chain management for this case to build the workable models and the systematic learning method for this EMS Company in terms of both technical and cultural enquiry. Compare models with reality to ensure the performance of the “change” by 3Es evaluation – Efficacy, Efficiency, and Effectiveness.
1.3 Research Process
Figure 1: Research Process Research Background and
Motivation
Research Objective and Scope Definition
Literature Review
Research Methodology and Framework
Real World Case Review SSM
7 Stages
Evaluation of Efficacy, Efficiency, Effectiveness
Implement Verification
Group discussion and debate
Conclusion and Suggestion
1.4 Research Scope and Limitation
This research is more focus on EMS manufacturer in consumer electronic industry in China. Since the different industry may have the differential business and service model, the research result may not able to adapt to all the industries.
Because of the limitation of time and resource, this study only able to choose one company as the research object. The research result may only suitable to apply in current case company. Additionally, due to the business confidential, the actual data of the case company has been modified or adjusted.
The research result can be debated and judged by senior managers and supervisors in this case, however, it need a plenty of time to take the implement actions and few years to evaluate the long-term effectiveness. Therefore, this research result cannot be proved at this moment due to the time limitation.
In this chapter, we have covered research motivation, objective, research process and research limitation. We are trying to analyze and solve reverse logistics issues by SSM although we cannot find many theses to support this research. Besides referring to literature of reverse logistics, we plan to start our SSM study from the book of “Soft Systems Methodology in Action” by Checkland, P. and Scholes, J. (2007) and find out more related information in chapter two. Additionally, because SSM is a new in reverse logistics and not easy to be descript in short, we will have a detailed research design in chapter three.