Managing residual disposition: Achieving economy, environmental responsibility, and competitive advantage using the supply chain framework

Regulations have limited the options and increased the cost of disposing of unwanted materials, products, and equipment. This has increased the pressure on purchasers to develop innovative approaches to managing residual disposition. Good management requires not only a clearer understanding of the origins of these items and the options available, but an understanding of how costs are incurred and how they may be reduced across the supply chain. Based on several in-depth case studies at firms in the furniture, commercial printing, electronics, and pharmaceutical industries, this research discovered that firms generate residuals at multiple functional points preceding manufacturing and that their disposition decisionmaking is affected by one or a combination of three drivers: intrinsic value, overwhelming volume of material, and regulatory compliance. Moreover, most organizations neither consider nor track disposal costs, thereby obscuring both the issue as well as potential solutions.