Development of Reverse Logistics – Adaptability and Transferability

Development of Reverse Logistics – Adaptability and Transferability MBA. Nguyen Thi Van Ha Technische Universität Darmstadt – Germany Section Supply Chain and Network Management Department of Laws and Economics D17 Development of Reverse Logistics - Adaptability and Transferability MBA. Nguyen Thi Van Ha born in Hanoi, Vietnam Supervisor: Prof. Dr. Dr. h.c. Hans-Christian Pfohl Co-Supervisor: Assistant-Prof. Dr. Alexander Bode Submission date: 25.09.2012 Examination date: 29.11.2012 Technische Universität Darmstadt Section Supply Chain and Network Management Darmstadt, Germany D17 Entwicklung der Entsorgungslogistik – Anpassungsfähigkeit und Transferierbarkeit Vom Fachbereich Rechts- und Wirtschaftswissenschaften der Technischen Universität Darmstadt genehmigte Dissertation zur Erlangung des akademischen Grades Doctor rerum politicarum (Dr. rer. pol.) vorgelegt von MBA. Nguyen Thi Van Ha aus Hanoi, Vietnam Referent: Prof. Dr. Dr. h.c. Hans-Christian Pfohl Korreferent: Jun-Prof. Dr. Alexander Bode Einreichungstermin: 25.09.2012 Prüfungstermin: 29.11.2012 Darmstadt 2012 D17 Acknowledgments This dissertation is the results of my research work as a PhD candidate in the Faculty of Laws and Econom- ics at Darmstadt University of Technology, Germany from October 2009 to October 2012. Many works were conducted over the last three years with the instructions and supports of many people around me. I greatly appreciate the contributions of these influential people and take the opportunity to thank them. First, I would like to express my heartfelt gratitude to my supervisor, Professor Dr. Dr. h.c. Hans-Christian Pfohl. During a long time of studying and working with my Doktorvater, I was inspired to this new research orientation and enthusiastically supported with many documents and scientific instructions. I also owe him further thanks for his patience with my academic explanations in German and his encouraging me to learn his native tongue. It is also my great pleasure to send my sincere thanks to my co-supervisor, Assistant Professor Dr. Alexander Bode, for the pleasant discussions I had with him during the entirety of my research work. For the fulfillment of this dissertation, I am very grateful to him for giving me precious recommenda- tions. I am also very happy to have the opportunity to work alongside and be supported by my colleagues in the section of Supply Chain and Network Management. I would like to thank Dr. Carsten Röth, Dr. Robert Schönberger, Dr. Xin Shen, Dipl.-Ing David Thomas, Dipl.-Ing Christian Zuber, M.Sc Xue Yida and M.Sc Yanqiang Ma for their help and advice during the time I did my research work in Germany. Furthermore, I would like to express my gratitude to the German Foreign Academic Exchange (DAAD) and the Ministry of Education and Training of Vietnam (MOET) for supporting me by means of both a scholar- ship and administrative procedures during my study in Germany. I also owe thanks to the co-operation between University of Transport and Communications (UTC) in Hanoi and Darmstadt University of Tech- nology (TUD). Thanks to the close co-operation, I had opportunities to obtain the support to complete this study. I am deeply grateful to Mrs. Ulla Nothnagel for her first hospitality upon my arrival at TU Darmstadt. I am very grateful to the support of governmental officials in the Institute of Strategy and Policy on Natural Resources and Environment (ISPONRE) for their discussions and their provision of related documents. I would like to thank managers of the companies I visited during my field trip for their insightful comments and willingness to discuss reverse logistics management in Vietnam. I am also thankful to my colleagues in the University of Transport and Communication in Hanoi. I would like to thank Dr. Nguyen Xuan Hoan and Associate Professor Dr. Nguyen Hong Thai for their encourage- ment and advice towards my research work. Special thanks to Dr. Khuat Viet Hung, Dr. Le Thu Huyen, Dr. Tran Ngoc Linh, M.Sc Nguyen Hieu Cuong, M.Sc Nguyen Van Nam, M.Sc Trinh Quang Vinh, and M.Sc Nguyen Truong Giang for their continuous help and sharing their experiences in both research and life. I am grateful to my wonderful friends: Mr. Ehard Weller, Solomon Worku, Chen Ximeng, Xoce Ignacio, Natara- jan Perumal, and Shane Sabine, all of whom I met in Germany. Their friendship, support, and encourage- ment motivated me to complete my research. I am greatly indebted to my family and especially my parents, Mr. Nguyen Huy Vien and Mrs. Nguyen Thi Dung, for their endless sacrifices and love. Finally, I am extremely thankful to my daughter and my husband for their patience and selflessness regarding to my research work. My love for my daughter has brought me much motivation towards my studying and the fulfillment of my professional goals. With the deepest gratitude from my heart, I wish all of you health and happiness. Nguyen Thi Van Ha Darmstadt, August 25, 2012 i Abstract The increasing enforcement of take-back laws and the changing requirements of external environments, e.g. shorter lifecycle products, increasing customer demands, and growing electronic retailing and catalogues, have made both producers and distributors in the European industry face the challenges of managing re- turned and discarded products that relate to reverse logistics. In particular, manufacturers of electrical and electronic equipment have to perform the completely new tasks of collecting their products put on the market at the end-of-life and providing an appropriate recovery program at no charge. The return of products goes beyond the usual forward logistics and has some differences with logistical processes of supply chain management. The uncertainties regarding the quantity, quality, and timing of return flows present the complexi- ties of reverse logistics management. Furthermore, there are many actors participating in the complicated processes of collecting, sorting, transporting, and recovering. Therefore, firms in the European electronics industry have adjusted their existing supply chain and adapted to reverse logistics to comply with the laws, satisfy customers, and minimize costs. Previous studies on the topic the development of reverse logistics under strategic considerations have been limited and lacked theory-based answers. Therefore, this study attempts to trace the gap in the topic of reverse logistics development under strategic considerations and supply chain perspective with two main objectives: 1. investigating the adaptability to reverse logistics of firms in the European electronics industry and 2. analyzing the transferability of reverse logistics management models from European countries to other economies, especially in the case of the SR Vietnam. This study investigates the adaptability to reverse logistics in the European electronics industry at firm and network level. Exploring the adaptability at firm level emphasizes the response of organizational related factors inside a firm to the changing requirements of external environments in the implementation of reverse logistics. Analyzing the adaptability at network level highlights the response of firms in coordination with supply chain partners for the implementation of reverse logistics. The empirical results show that both the external factor and the internal factor are significantly associated with performance of reverse logistics. They interactively promote the development of reverse logistics. The changes of resource commitments, strategy formulation, and internal capabilities of reverse logistics have significantly substantial effect on performance of reverse logistics. The strategic roles of firms in coordinating and governing network relationships, and developing network capabilities have also led to the cost-effectiveness and competitive advantages of the whole network in reverse logistics implementation. The analysis of the transferability of reverse logistics demonstrates that returns management is being trans- ferred to Vietnam to some extent. The globalization, the economic development, and the supports of infor- mation technology have made reverse logistics management models being borrowed and learned more quickly before they are acknowledged. In case of Vietnam, the external factors, e.g. the shortage of specific regulations, the lack of infrastructure and technology, the lower income, and the low public awareness have partly hindered firms from clarifying the status and roles of reverse logistics as well as developing a formal reverse logistics program. This study makes some academic contributions towards enriching the applications of the organizational theories in the specialized field of reverse supply chain management. Moreover, this study also contributes to some managerial implications for producers, distributors, service providers, and policy makers to improve reverse logistics performance at both firm and network level. ii Zusammenfassung Die zunehmenden Regelungen bezüglich der Rücknahme von Altprodukten und die sich rasch ändernden Einflüsse aus der Umwelt des Unternehmens, wie z.B. kürzere Produktlebenszyklen, steigende Kundennach- fragen und wachsender elektronischer Handel, stellen hohe Anforderungen an Hersteller und Händler in der europäischen Industrie hinsichtlich des Managements der Rückflüsse und der damit verbundenen Entsor- gungslogistik. Insbesondere stehen die Hersteller von Elektro- und Elektronikgeräten damit vor ganz neuen Aufgaben, die Produkte am Ende der Nutzungsdauer kostenlos zurückzunehmen und einer angemessenen

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