Developing a Mathematical Model for Trade-off Analysis of New Green Products
In the near future, companies will be increasingly forced to shift their activities along a new road in order to decrease the harmful effects of their design, production and after-life on our environment. Products must meet environmental standards to not only prevent penalties but to consider the sustainability for future generations. However, the most important factor that companies will face is selecting a reasonable strategy to maximize their profit. Thus, companies need to have precise forecast from their profit after design stage through Trade-off analysis. This paper is an attempt to introduce a mathematical model that considers effective factors that impact the total profit when products are designed for resource and energy efficiency or recyclability. The modification is according to different strategies based on a Cost-Volume-Profit model. Here, the cost structure consists of Recycling cost, Development cost, Ramp-up cost, Production cost, and Pollution cost. Also, the model shows the effect of implementation of design for recyclable on revenue structure through revenue of used parts and revenue of recycled materials. A numerical example is used to evaluate the proposed model. Results show that fulfillment of Green Product Development not only can reduce the environmental impact of products but also it will increase profit of company in long term.
[1] Savale, T., Sharma, A., &Patil, P. (2012). Green Marketing: Opportunities and Challenges. IJCA Proceedings on International Conference in Computational Intelligence (ICCIA2012) (ICCIA - Number 4). New York: Foundation of Computer Science.
[2] Ulrich, K., &Eppinger, S. (2012). Product Design and Development. New York: McGraw-Hill.
[3] Industry Canada. (2009, January 8). Design for Environment: Innovating to Compete. Retrieved 01 19, 2014, from Government of Canada: http://www.ic.gc.ca/eic/site/dsib-dsib.nsf/eng/h_oq01764.html.
[4] Dowie, T. (1994). Green Design. World Class Design to Manufacture, 1(4), 32 – 38.
[5] Baumann, H., Boons, F., &Bragd, A. (2002). Mapping the green product development field: engineering, policy and business perspectives. Journal of Cleaner Production (10), 409–425.
[6] Boons, F. (2002). Greening products: a framework for product chain management. Journal of Cleaner Production, 10(5), 495–505.
[7] Albino, V., Balice, A., &Dangelico, R. (2009, February). Environmental Strategies and Green Product Development: an Overview on Sustainability-Driven Companies. Business Strategy and the Environment, 18(2), 83-96.
[8] Sharma, A., &Iyer, G. R. (2012). Resource-constrained product development: Implications for green marketing and green supply chains. Industrial Marketing Management, 41(4), 599–608.
[9] Chen, R., Navin-Chandra, D., &Prinz, F. (1994). A cost-benefit analysis model of product design for recyclability and its application. Components, Packaging, and Manufacturing Technology, Part A, IEEE Transactions on 17(4), 502-507.
[10] Tsai, W.-H., Lin, W.-R., Fan, Y.-W., Lee, P.-L., Lin, S.-J., & Hsu, J.-L. (2012). Applying a mathematical programming approach for a green product mix decision. International Journal of Production Research, 1171-1184.
[11] Kuo, T. C. (2013). Waste electronics and electrical equipment disassembly and recycling using Petri net analysis: Considering the economic value and environmental impacts. Computers & Industrial Engineering, 65(1), 54–64.
[12] Fiksel, J. (2009). Design for Environment: A Guide to Sustainable Product Development (Second Ed.). New York: McGraw-Hill.
[13] Niemann, J., Westk¨amper, E., &Tichkiewitch, S. (2009). Design of Sustainable Product Life Cycles. Verlag Berlin Heidelberg: Springer.
[14] Bajpai, P. (2014). Environmental Aspects of Recycling. Recycling and Deinking of Recovered Paper, 271-282.
[15] Morris, J. (1996). Recycling versus incineration: an energy conservation analysis. Journal of Hazardous Materials, 47, 277-293.
[16] Daniel, S. (2012). Developing a cost - volume - profit model in production decision. Procedia Economics and Finance, 3, 350-354.
[17] González, L. (2001, October 13). Multiproduct CVP analysis based on contribution rules. International Journal of Production Economics, 73(3), 273–284.
[18] Lambert, A., & Gupta, S. (2005). Disassembly modeling for assembly, maintenance reuse, and recycling. Boca Raton, London, New York, Washington, D.C.: CRC Press.
[19] Giudice, F., La Rosa, G., &Risitano, A. (2006). Product Design for the Environment, A Life Cycle Approach. New York: Taylor & Francis Group.
[20] Williams, P. T. (2005). Waste Treatment and Disposal (2nd Ed.). Chichester: John Wiley & Sons Ltd.
[21] Murthy, D., Rausand, M., &Østerås, T. (2008). Product Reliability : Specification and Performance. Dordrecht: Springer.
[22] Ottum, B. D. (2013). Market Analystics. In e. Kenneth B. Kahn, The PDMA handbook of new product development (pp. 244-264). Hoboken: John Wiley & Sons, INC.
[23] EPA. (2014, January 27). Overview of Greenhouse Gases (Carbon Dioxide Emissions). Retrieved March 19, 2014, from EPA United States Environmental Protection Agency: http://www.epa.gov/climatechange/ ghgemissions/gases/co2.html#Reducing.
[24] Pears, A. (2004). Energy efficiency–its potential: some perspectives and experiences. In Background paper for International Energy Agency Efficiency Workshop. Paris.
[1] Savale, T., Sharma, A., &Patil, P. (2012). Green Marketing: Opportunities and Challenges. IJCA Proceedings on International Conference in Computational Intelligence (ICCIA2012) (ICCIA - Number 4). New York: Foundation of Computer Science.
[2] Ulrich, K., &Eppinger, S. (2012). Product Design and Development. New York: McGraw-Hill.
[3] Industry Canada. (2009, January 8). Design for Environment: Innovating to Compete. Retrieved 01 19, 2014, from Government of Canada: http://www.ic.gc.ca/eic/site/dsib-dsib.nsf/eng/h_oq01764.html.
[4] Dowie, T. (1994). Green Design. World Class Design to Manufacture, 1(4), 32 – 38.
[5] Baumann, H., Boons, F., &Bragd, A. (2002). Mapping the green product development field: engineering, policy and business perspectives. Journal of Cleaner Production (10), 409–425.
[6] Boons, F. (2002). Greening products: a framework for product chain management. Journal of Cleaner Production, 10(5), 495–505.
[7] Albino, V., Balice, A., &Dangelico, R. (2009, February). Environmental Strategies and Green Product Development: an Overview on Sustainability-Driven Companies. Business Strategy and the Environment, 18(2), 83-96.
[8] Sharma, A., &Iyer, G. R. (2012). Resource-constrained product development: Implications for green marketing and green supply chains. Industrial Marketing Management, 41(4), 599–608.
[9] Chen, R., Navin-Chandra, D., &Prinz, F. (1994). A cost-benefit analysis model of product design for recyclability and its application. Components, Packaging, and Manufacturing Technology, Part A, IEEE Transactions on 17(4), 502-507.
[10] Tsai, W.-H., Lin, W.-R., Fan, Y.-W., Lee, P.-L., Lin, S.-J., & Hsu, J.-L. (2012). Applying a mathematical programming approach for a green product mix decision. International Journal of Production Research, 1171-1184.
[11] Kuo, T. C. (2013). Waste electronics and electrical equipment disassembly and recycling using Petri net analysis: Considering the economic value and environmental impacts. Computers & Industrial Engineering, 65(1), 54–64.
[12] Fiksel, J. (2009). Design for Environment: A Guide to Sustainable Product Development (Second Ed.). New York: McGraw-Hill.
[13] Niemann, J., Westk¨amper, E., &Tichkiewitch, S. (2009). Design of Sustainable Product Life Cycles. Verlag Berlin Heidelberg: Springer.
[14] Bajpai, P. (2014). Environmental Aspects of Recycling. Recycling and Deinking of Recovered Paper, 271-282.
[15] Morris, J. (1996). Recycling versus incineration: an energy conservation analysis. Journal of Hazardous Materials, 47, 277-293.
[16] Daniel, S. (2012). Developing a cost - volume - profit model in production decision. Procedia Economics and Finance, 3, 350-354.
[17] González, L. (2001, October 13). Multiproduct CVP analysis based on contribution rules. International Journal of Production Economics, 73(3), 273–284.
[18] Lambert, A., & Gupta, S. (2005). Disassembly modeling for assembly, maintenance reuse, and recycling. Boca Raton, London, New York, Washington, D.C.: CRC Press.
[19] Giudice, F., La Rosa, G., &Risitano, A. (2006). Product Design for the Environment, A Life Cycle Approach. New York: Taylor & Francis Group.
[20] Williams, P. T. (2005). Waste Treatment and Disposal (2nd Ed.). Chichester: John Wiley & Sons Ltd.
[21] Murthy, D., Rausand, M., &Østerås, T. (2008). Product Reliability : Specification and Performance. Dordrecht: Springer.
[22] Ottum, B. D. (2013). Market Analystics. In e. Kenneth B. Kahn, The PDMA handbook of new product development (pp. 244-264). Hoboken: John Wiley & Sons, INC.
[23] EPA. (2014, January 27). Overview of Greenhouse Gases (Carbon Dioxide Emissions). Retrieved March 19, 2014, from EPA United States Environmental Protection Agency: http://www.epa.gov/climatechange/ ghgemissions/gases/co2.html#Reducing.
[24] Pears, A. (2004). Energy efficiency–its potential: some perspectives and experiences. In Background paper for International Energy Agency Efficiency Workshop. Paris.
@article{"International Journal of Business, Human and Social Sciences:67554", author = "M. R. Gholizadeh and N. Bhuiyan and M. Salari", title = "Developing a Mathematical Model for Trade-off Analysis of New Green Products", abstract = "In the near future, companies will be increasingly forced to shift their activities along a new road in order to decrease the harmful effects of their design, production and after-life on our environment. Products must meet environmental standards to not only prevent penalties but to consider the sustainability for future generations. However, the most important factor that companies will face is selecting a reasonable strategy to maximize their profit. Thus, companies need to have precise forecast from their profit after design stage through Trade-off analysis. This paper is an attempt to introduce a mathematical model that considers effective factors that impact the total profit when products are designed for resource and energy efficiency or recyclability. The modification is according to different strategies based on a Cost-Volume-Profit model. Here, the cost structure consists of Recycling cost, Development cost, Ramp-up cost, Production cost, and Pollution cost. Also, the model shows the effect of implementation of design for recyclable on revenue structure through revenue of used parts and revenue of recycled materials. A numerical example is used to evaluate the proposed model. Results show that fulfillment of Green Product Development not only can reduce the environmental impact of products but also it will increase profit of company in long term.
", keywords = "Green Product, Design for Environment, C-V-P Model, Trade-off analysis. ", volume = "8", number = "6", pages = "1885-8", }
