Reverse logistics systems for end-of-life computers in Sydney – Computer Engineering Research Paper

Reverse logistics systems for end-of-life computers in Sydney – Computer Engineering Research Paper
Computers, with dramatically increased number and even shorter product life cycle, have become a serious problem in modern society. According to a report by the National Safety Council (Hamilton, Anita, 2001), some 500 million PCs will be rendered obsolete by 2007 in the U.S. alone, which have been abandoned by users who have

upgraded to faster and sexier machines. The disposal of EOL computers incur much attention mainly because they contain many hazardous materials which will do damage to environment if not properly treated. Other concerns include legislation pressure, availability of landfill, company competence, pressure from consumers and profit pursuit. The recycling of the EOL computers, which requires a comprehensive reverse logistics system to support it, is proposed as the best available way now to solve this problem. A recent study by Murphy and Poist (2000) revealed that recycling materials, reducing consumption, and reusing materials are the three most commonly utilized green logistics strategies. Therefore, it incurs a need to develop a reverse logistics system to collect and then either refurbish or recycle the computers.

The aim of this proposed research is trying to utilize qualitative methodology to examine the current reverse logistics system of Sydney to recycle and/or refurbish end-of-life computers that are deemed no longer useful by their owners, and then provide suggestions for further improvement. The research will concentrate on solving problems in Sydney, which has different situation with U.S.A., Europe and Asia. The main issues included in the proposed research are as follows:
How the current reverse logistics system for computer recycling works in Sydney?
How many parties are involved in this system?
Who affords the logistics cost?
What is the relationship between public system and private system?
What are the impediments of this system?
How we can learn the best practices or draw lessens from other countries?
How we can improve the system?

Some literatures have done research about reverse logistics system for EOL computer recycling. Some are conceptual models, which derived from the literature review. Others are developed from the real-world practice in certain country or area. Within them, two are mentioned here as an introduction.

The first one is a conceptual model designed by A.Michael Knemeyer etc., which Integrates the factors impacting the design and implementation of a reverse logistics system specifically for EOL computers. This model pays particular attention to the specific activities needed to handle EOL computers and considers how the internal and external factors may impact the economic viability of the system.

Shown in figure 1, he model outlines both external and internal factors that can affect the reverse logistics process in general and for EOL computers in particular. Consistent with Carter and Ellram, the proposed model incorporates both competitive and regulatory factors affecting the external environment. It goes on to examine other factors affecting the success of the operation from a self-contained perspective as well. These internal factors include identification and acquisition of product supply (EOL computers) from various entities including both the private and commercial sector as well as residential sector. The model then looks at the inbound processing aspect of reverse logistics. In this case, a decision whether the products should be recycled, (dismantled) or refurbished needs to be made. The processed output can then be sold to targeted customer segments or disposed of as waste. A key premise of the proposed process model is the ability of the system to aggregate the necessary supply of recyclable EOL, transport that material in a cost-effective and efficient manner to a central point for processing and then sell the output of this process to targeted markets where demand exists.
Figure 1: Proposed model of reverse logistics system for EOL computers

The second one describes the current scrap computer recycling system in Taiwan. Ching-Hwa Lee etc (2000) developed a flowchart to show the current the current scrap computer recycling system in Taiwan. This chart focuses on the relationship among the participants of EOL recycling rather than the detailed processing approach. It also mentioned the scrap computer processing fees.
It is estimated that approximately 300,000 scrap personal computers are generated each year in Taiwan (S.-L.Chang, 1998). The disposal of such a huge number of scrap computers presents a difficult task for the island due to the scarcity of landfills and incineration facilities available locally. Therefore, the EPA of Taiwan declared scrap personal computers the producer’s recycling responsibility as of July 1997.

As shown in the flowchart (see figure 2), several participants are involved in the process of EOL recycling, which can be divided into four categories:
Government: EPA and SCM Foundation
Public and consumers
Computer manufacturers and importers
Service providers: financial organization, collection point and storage yard management service providers, third-party auditors.
Computer manufacturers and importers will afford the fees while SCM Foundation is the organizer. Consumers are rewarded money to bring their unwanted computers to designated collection points. Currently, the SCM Foundation plays an essential role in the scrap computer recycling system in Taiwan. On January 23, 1998, the Scrap Computer Management (SCM) Foundation was formally established by EPA in order to manage and implement the recycling of scrap computers in Taiwan. This foundation is a semi-official organization directly under the control of the EPA.

Potential Outcome
The potential outcome of the proposed research is an improved model designed for EOL computer recycling in Sydney, which is based on a comprehensive investigation of the current system. A flowchart will be drawn to describe the current system, attached with a detailed report to explain the flowchart. Impediments are pointed out and the new improved model will be established. The new model will integrate three basic elements: government, industry and consumers. The new model will also incorporate some best practices and lessons from other countries and areas. However, with particular situation in Sydney, the new model will try to adapt those initiatives to the specific environment of Sydney.

The value of the model lies in that an effective an efficient reverse logistics system is the critical factor in solving the problem of EOL computer recycling.

A qualitative research approach utilizing literature research, customer visit program and market research will be employed to carry out the proposed research.
Step 1: The first half-year will be dedicated to literature research, which will help to learn more about computer recycling and reverse logistics. The related books, journals, websites are collected. The best practices world wide are studied and compared with Sydney. The first half-year will serve as knowledge preparation for the whole research.
Step 2: The second half-year is assigned to do the preparation for the visit program and market research. During this period, the focus of the research will be diverted to Sydney. A plan is made to guide the visit program and market research. The potential visit objects, such as certain government departments, non-governmental associates, PC manufacturers, dealers, recycling company, reverse logistics company, second market, retailers, are specified. The research tries to hear voices from different perspectives. The visit program procedures and feasibility are considered carefully. The second half-year is a bridge leading to the substantial research.
Step 3: The whole second year is allocated to do the visit program and market research. Different parties involved in the reverse logistics system will be visited in person. If personal visit is not available, postal questionnaire is accepted too. The design of the questionnaire is critically important, which decides if the visit program could extract useful information from the interviewees. It needs great patience and communication skills to finish the visit program. If possible, a market research will be done to learn more about the opinions from consumers who play an important role in the reverse logistics system. Without the active participation of consumers, all the recycling initiatives of EOL computers are difficult to realize.
Step 4: The third year is used to synthesize and analyze the results of the visit programs and market research. A diagram is drawn to illustrate the flowchart of the current reverse logistics system. According to the bottleneck of the system, the research tries to work out some possible solutions or improvements to make the whole system more efficient and effective. A new model with new initiatives is designed specially for Sydney. The report will be finalized during this period.

In sum, the proposed research will contribute to the computer recycling through designing a reverse logistics system to support it. The result of the research may help the computer industry and government regulators in the decision-making of how to implement environmental strategies.

Hamilton, Anita, 2001, How do you junk your computer, Time, 02/12/2001, Vol.157, Issue6, pp70
Murphy, P. and Poist R, 2000, Green logistics strategies: an analysis of usage patterns, Transportation Journal, Vol.40, No.2, pp5-17
Michael Knemeyer, Thomas G.Ponzurick and CyrilM.Logar, 2002, A qualitative examination of factors affecting reverse logistics systems for end-of-life computers, International Journal of Physical Distribution & Logistics Management, Vol.32, No.6, pp455-479
Craig R.Carter and Lis M.Ellram, 1998, Reverse logistics: a review of the literature and framework for future investigation, Journal of business logistics, Vol.19, No.1, pp85-102
Ching-Hwa Lee, Ssu-Li Chang, King-Min Wang, Lih-Chyi Wen, 2000, Management of scrap computer recycling in Taiwan, Journal of Hazardous Materials A73 (2000), pp209-220