The Supply Chain

A supply chain simply describes the flow of material and products through the different process steps. The process starts with raw material, eventually reaching an end customer or user, and ends with final deposition. This is illustrated in the image below. It uses the supply chain for carbide inserts (used for metal cutting operations such as drilling, milling and turning of metal components) as an example.

The upper part of of the image illustrates the traditional view of a supply chain. This is sometimes called linear economy thinking. The lower part of the image illustrates a circular supply chain, or a circular economy thinking.

In a circular economy, we do not depose products at the end of their “life”. Instead we try to bring them back into the supply chain. With our example of carbide inserts, these can be recycled. We can, for example, melt the metals and use them for new products. All this is sometimes referred to as closing the loop – the material we use should never be wasted by out back into the chain, creating a loop.

There are of course challenges associated with this. But we think the effort is worth it in the end. The end customer will get economical advantages in the circular approach. In our example, we the end customers are payed for the returned inserts. The supplier can become more sustainability, get better access to raw material, and experience economic advantages.

How this can be done in practice can been seen in the video “Recycling of solid carbides” from Sandvik Coromant.

Think back to the examples of baking bread. How does this process look like in linear economy thinking? Now, think about how this process would look like with circular economy thinking. How can we close the loop of bread baking?

Please share your answer in the comment section, and discuss with other learners.