Modeling the Relationship Between Green Supply Chain Management (GSCM) Elements and Operational Cost Efficiency Improvement in Pharmaceutical Companies Based on Systems Dynamics: A Case Study of PT. XYZ
Kunta Mustaqim Abdul Somad1, Yudha Prambudia2, Iphov Kumala Sriwana3
1Kunta Mustaqim Abdul Somad, Department of Industrial Engineering, Telkom University, Bandung (West Java), Indonesia.
2Dr. Yudha Prambudia, Department of Industrial Engineering, Telkom University, Bandung (West Java), Indonesia.
3Dr. Iphov Kumala Sriwana, Department of Industrial Engineering, Telkom University, Bandung (West Java), Indonesia.
Manuscript received on 22 August 2024 | First Revised Manuscript received on 10 June 2025 | Second Revised Manuscript received on 19 June 2025 | Manuscript Accepted on 15 July 2025 | Manuscript published on 30 July 2025 | PP: 8-12 | Volume-12 Issue-7, July 2025 | Retrieval Number: 100.1/ijies.H109311090824 | DOI: 10.35940/ijies.H1093.12070725
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© The Authors. Blue Eyes Intelligence Engineering and Sciences Publication (BEIESP). This is an open access article under the CC-BY-NC-ND license (http://creativecommons.org/licenses/by-nc-nd/4.0/)
Abstract: PT. XYZ is a company operating in the pharmaceutical and biotechnology industries, with a focus on vaccine production and other biological products. In the current era of global competition, operational cost efficiency is a key factor in maintaining competitiveness through the implementation of Green Supply Chain Management (GSCM), as exemplified by PT. XYZ is expected to reduce operational costs through more efficient resource management, waste reduction, and improvements in process effectiveness. However, the relationship between GSCM elements and operational cost efficiency requires an in-depth and comprehensive understanding. This study aims to model the relationship between Green Supply Chain Management (GSCM) elements and operational cost efficiency improvement at PT. XYZ is using a systems dynamics approach. The GSCM elements analyzed include green product design, green innovation, green procurement, clean production, and green logistics. Through the design of a Causal Loop Diagram (CLD) and Stock Flow Diagram (SFD), 15 sub-variables that influence operational cost efficiency were identified. The simulation results indicate that the positive impact of GSCM elements on operational cost efficiency increases from the second year to the tenth year. This predictive model has an accuracy rate of 80.63%, which is considered a good prediction. Additionally, two alternative scenarios were developed to enhance efficiency further: a parameter scenario and a structural scenario. Clean production emerged as the most significant factor, with efficiency improvements reaching 110.05% and 110.94% in the 7th year.
Keywords: Cost Efficiency, System Dynamics, GSCM.
Scope of the Article: Mechanical Engineering and Applications