Novetex, one of the world's largest single-site spinners, was celebrating the opening of its new spinning mill in 2018. The Hong Kong-based company had spent four decades expanding its operations, and its main factory was in Zhuhai, in southern China. But this new facility would be in Hong Kong, and would produce yarn from waste material in Hong Kong's textile and apparel industry. This case looks at Novetex's commitment to environmental sustainability, and efforts to become a leader in developing cleaner solutions by focusing on circular economy solutions within the global textile and apparel industry. Global clothing production had doubled within two decades, reflecting the rise of the middle class consumer in countries like China, and increasing sales in affordable fast fashion in mature economies. But the apparel industry was a top industrial polluter, accounting for 10 percent of global carbon emissions; the polyester and nylon textile industry, moreover, released about a half-million tonnes of plastic microfibers into the oceans each year. This case study looks at the evolution and risks of "upcycling" technologies within the textile industry, and the science and partnerships behind the new Novetex Upcycling Factory in Hong Kong, which aimed to demonstrate the profitability and environmental sustainability of circular economy practices.

Mhuri Enterprise had beaten the odds, and figured out a way to cut production costs to bring its pigs to market and make a profit. Small-scale enterprises faced a large number of financial, regulatory, and business barriers in Zimbabwe, a country where 70 percent of the population relied on agriculture as a source of income. Land reforms in 1998 had led to an increase in the number of small-to-medium enterprise farmers, but the lack of scale meant low productivity. This case study examines how Mhuri Enterprise, a cooperative pig farm that started with 30 families, restructured the value chain to cut production costs and established its own slaughterhouse facilities to circumvent monopolistic processing fees. The case offers a close look at the full range of fees and costs associated with a livestock ventures-including costs not unique to the situation in Zimbabwe.

In June 2009, Greenpeace accused the cattle industry of contributing to deforestation in the Brazilian Amazon. Big brands that bought beef and leather were named as silent partners to the practice. Pressure from Greenpeace and the Brazilian government led to major changes. Meatpackers Bertin, JBS, Marfrig, and Minerva, responsible for one-third of exports, agreed to stop purchasing directly and indirectly from ranches that cleared more forest than legally permitted, and committed to buying from direct and indirect suppliers that reduced deforestation to zero. Fernando Sampaio, executive director of Abiec, the Brazilian Beef Exporters Association, worked closely with meatpackers that exported beef to comply with deforestation agreements. While Abiec's mission was to grow the export sector, his members were now asked to take an active role in curbing deforestation. Progress was promising. Deforestation dropped by over 80 percent from 2004 to 2014, attributable in part to the cattle agreements. This was clear progress, since the cattle sector in the Amazon was one of the largest drivers of global deforestation. Yet, traceability of animal movements among farms and slaughterhouses was a big challenge. Some non-compliant ranches were selling to slaughterhouses without full monitoring systems. Other non-compliant ranches were selling cattle into legitimate supply chains through licensed ranches. By mid-2015, Brazilian Amazon deforestation had grown by 16 percent compared to the prior year, demonstrating that gains were fragile. How could Abiec, which represented 29 meatpackers responsible for 70 percent of slaughtering and 93 percent of exports, persuade more members to adopt a zero-deforestation policy and demand supplier compliance? Sampaio's goal of growing sales for his members while curbing deforestation was complex and required working with many beef value chain actors.

Before opening its first store in India in 1996, McDonald's spent six years building its supply chain. During that time, the company worked to successfully source as many ingredients as possible from India. However, French fries ("MacFries") were a particularly tough product to source locally-and importing fries was undesirable for both cost and availability reasons. Growing potatoes suitable for use as fries was challenging in India. By 2007, 11 years after opening its first restaurant, the MacFry was finally being produced in India. McDonald's main MacFry supplier was the Canadian company McCain, which spent many years working on potato agronomy and with farmers to build up supply in India. From 2007 to 2011, local MacFry production increased from none to 75 percent of sales. Despite the strides made, in 2011 Abhijit Upadhye, McDonald's then senior director of Supply Chain India was still a worried man. Double-digit food inflation in India had been putting cost pressure on the company. McDonald's had aggressive growth plans for the coming years. The company had 240 restaurants, and planned to more than double by 2014. The MacFry was the single largest procurement item, so having a 100 percent local supply was critical to avoiding high import duties. The question that troubled him was: "Will I ever be able to eliminate imported fries from my supply chain?" This case describes McDonald's India and McCain India's efforts to optimize the MacFry supply chain by increasing local supply in a fast-growing emerging market using agronomy, farmer relationship development and value chain innovation.

As the world population exceeded 7 billion by the end of 2011, various agencies working to alleviate poverty had come to a general consensus that pure charity was not a sustainable solution. In the absence of venture capital and angel investors in developing markets, Microfinance (MF) was one of the most promising tools in the fight against poverty. MF institutions tended to focus on micro-lending, providing small loans to micro-entrepreneurs from which interest could be earned. This case details the issues and challenges that Microfinance institutions faced a decade into the new millennium. The rise of mobile technology is a key theme as it promised innovative solutions. The case discusses various mobile financial services, including Safaricom's M-Pesa and M-Kesho offerings, and focuses on Experian's MicroAnalytics (EMA) unit, created to serve the financial services sector in developing countries. EMA developed an innovative system to enable financial service providers (clients) to serve their customers via a distributed, branchless, "mobile only" model. After a successful pilot study in the Philippines, EMA created a mobile banking platform that offered the potential of extending mobile money to other financial services as well as new customer and geographic segments.

In 1984, Trung Dung fled political persecution in Vietnam, the country of his birth, to arrive in the United States as a refugee with only $2 in his pocket. Over the next two decades, he proved his mettle as one of the most astute and successful Vietnamese-American entrepreneurs. Although Dung had never thought that he would return to Vietnam, the instinctive entrepreneur inside him recognized the opportunities presented by country's rapidly developing and modernizing economy. Dung returned in 2007 to found MobiVi, an Electronic Financial Transactions (EFT) firm. This case explores the intersection of mobile network operators, the ETF industry, and social entrepreneurs to pursue an innovative approach to providing financial services to the approximately 2 billion people worldwide who lacked access. The focus is on three of MobiVi's areas: the Nationwide Distribution System (NDS) unit, MobiVi's innovative offerings around financial services (MFS), and MobiVi Foundation. In 2012, Dung was looking at how to address market inefficiencies, help MobiVi's investors and business partners create and capture more value, and make credit more accessible to the middle and lower income classes in Vietnam. Dung was optimistic given the positive state of the Vietnamese economy, the patented MobiVi payments processing technology, and the most recent developments in telecommunication technologies.

This is an update to GS-61, describing developments at the company through 2011, including a major acquisition, distribution in China, and an initiative to cultivate start-ups that might grow into future clients.

This is an MIT Sloan Management Review article. Multinational corporations are under growing pressure to make sure that their contractors and subcontractors in China meet environmental standards in their operations. Yet traditional approaches to ensuring environmental, health and safety compliance, such as checklist audits, have proved problematic. The authors conducted research over a one-and-a-half-year period with leading multinational buyers (mostly in the apparel and footwear industries) as well as with NGOs and industry groups active in China. Based on their research, the authors report that rather than simply monitoring Chinese suppliers'compliance with local environmental, health and safety (EHS) standards, leading companies are giving suppliers tools and incentives to independently improve environmental performance. They are helping suppliers use energy, water and materials more efficiently and reaching deeper into their supply chains to where the greatest environmental damage occurs. At the same time, they are overcoming their traditional reluctance as competitors to cooperate in monitoring and fixing problems at common suppliers.<BR> <BR>The authors describe innovative approaches that companies such as Nike are taking. More generally, the authors' recommendations include working closely with suppliers and providing incentives for identifying, disclosing and addressing problems; establishing collaborative relationships with NGOs and industry groups; and finding ways both to learn from suppliers'best practices and to facilitate learning among suppliers.<BR>

In 2009, many thought Crocs was "dead." The C case presents exhibits that illustrate the company's recovery.

Through 2007, Crocs grew rapidly, and its stock soared. In early 2008, the stock plunged, as analysts cited excess inventory. During 2008, revenues decreased, and the company restructured. The B case summarizes these developments, and asks what the company should do now.

In 2008, more than 750 million cell phones were produced in China. A significant portion (20 percent, or about 150 million units) of these phones were produced by Shanzhai companies. These companies had rapidly taken a significant share (about 10 percent) of the worldwide market. This phenomenal growth was primarily due to nonconventional approaches to the global market in market positioning, rapid product development, and tightly coupled, responsive and efficient supply chain management. Though Shanzhai often has been perceived as a term for counterfeiting, in reality it is more than just copying. Modern cell phones contain sophisticated hardware, software and systems technology, yet Shanzhai companies of only 10 people could leverage a sophisticated (though informal) network of product designers, manufacturers, and distributors to make a successful business. This case describes the Shanzhai phenomenon, and how these companies operate. It also provides an example of one company that successfully transitioned from a Shanzhai culture to become a major mainstream force in the Chinese mobile phone industry. The case also discusses forces that challenge the future of the Shanzhai model.

The European Recycling Platform was the only pan-European recycling organization created in response to the European Union's groundbreaking directive to promote recycling of electronic waste. Braun, Electrolux, Hewlett-Packard and Sony established ERP in 2002 as an alternative to the monopolistic e-waste takeback systems then existing in several European countries. ERP was based on the principle of producer responsibility, in which manufacturers are financially responsible for managing the end-of-life phase of their goods. By late 2007, ERP operated in eight countries. It had achieved significant market share and stimulated competition in European e-waste recycling. In November 2007, ERP's board was meeting to evaluate whether the company should greatly expand its scope. Should ERP start handling new product categories such as discarded batteries and packaging? Should it expand to more countries? If so, which countries? If it expanded, could ERP handle the additional business complexity while preserving its low-cost, outsourced model? The case looks at an organization at the forefront of efforts to address the world's growing e-waste crisis. It highlights the importance of managing the end-of-life phase of products. Students will evaluate recycling as a business and market opportunity. They will assess the industry and market changes sparked by Europe's e-waste directive.

In November 2007, a global, cross-functional team at Cisco Systems, Inc. was seeking management approval to start manufacturing a new router, code-named Viking. The team faced a host of challenges in launching the low-cost but powerful router for telecommunications service providers. After overhauling the project to sharply increase the router's planned speed and capacity, the company had just one year to launch the product, an unusually fast schedule. In addition, Cisco wanted to debut China as a low-cost manufacturing base for the high-end product. It planned to use contract manufacturer Foxconn Technology Group to produce the machine, even though Foxconn had never made such a complex product for Cisco. Could Foxconn handle the technical complexity? Could Cisco work closely with Foxconn to mitigate the project risks? Could Cisco's methodology for new product introduction rise to the necessary level of sophistication? The case highlights the challenges and complexities of developing and manufacturing a sophisticated technology product for a worldwide market. Students will consider what it takes to achieve success in new product introduction, or NPI. The case also offers an opportunity to evaluate supply chain issues in a company that outsources manufacturing globally.

Zappos was founded in 1999, during the Internet boom, to sell shoes online. The company's founding premise was to provide the ultimate in selection to its customers-all brands, styles, sizes, and colors. Zappos organized all aspects of its business (including recruiting, culture, call center, inventory, website, and supply chain) to provide the best possible service-it wanted to "wow" everyone who interacted with the company, from customers to employees to corporate partners. Zappos grew rapidly, and by 2008 was profitable with net sales (after returns) of about $650 million. The company faced a number of issues as it looked forward. While it had penetrated only about 3 percent of the U.S. market for shoes, Zappos had expanded its product lines to items such as camping gear and video games. It needed to determine those elements of its strategy had contributed to its success in shoes, and whether it would be able to duplicate that success in other product lines. It also needed to determine how it could scale its business-much of the effort it had made to "wow" its customers was labor intensive and expensive-could this be scaled to a company with revenues of tens of billions? Finally, the economic landscape changed dramatically in late 2008, with the financial market collapse and recession. The service-intensive Zappos.com business was based on sales at little to no discount, unlike many websites that relied on selling at the lowest possible price. Would the company need to make changes to respond to the changed economic environment, and if so, what were those changes? The case provides an opportunity to evaluate the core competences of an Internet retailer that has experienced rapid, initial success. The case enables students to consider supply chain issues, which are critical to the company's success, in the broader context of the business: the bases of Zappos' success, its core competencies, culture, and competitive environment.

In August and September 2007, Mattel made a series of product recalls, totaling more than 20 million toys. The recalls were for excessive lead and for magnets that could become loose. All of the recalled toys had been made in China. The Mattel recalls followed on the heels of a number of high profile safety problems with Chinese imports, including contaminated pet food and toothpaste, defective tires, and lead-painted toys. The recalls sparked intense criticism of Mattel and its Chinese supply chain, despite the fact that more than 85 percent of the recalled toys were due to design problems (magnets), not the result of improper manufacturing (use of lead paint). The case provides a basis for discussion of outsourcing and supply chain management. The basic toy manufacturing process is fairly simple, providing a forum for discussing these issues without the complication of advanced manufacturing technology or an involved supply chain. In this case, supply chain defects, such as the use of lead paint by vendors, can have severe consequences. The supply chain must be designed to prevent these defects. The case enables discussion of why companies outsource, managing a supply chain, and the appropriate use of inspection and testing. It also provides the opportunity to examine response to a crisis situation, and the relationship between a company and government.

Operations network design is about where to locate your supply sources and manufacturing and distribution operations, as well as the deployment of such operations, i.e., who should be supplying whom. With the emergence of global supply and manufacturing sources and the global market, such a design will increasingly have to span multiple regions. In the design, we have to capture the quantitative impacts of such factors like fixed and variable costs of production or distribution facilities, inventory, freight, and other logistics costs. The global network requires explicit treatment of taxes, customs and duties. This case is about Renault's recent car Logan, which was designed to serve markets in emerging markets like Eastern Europe, North Africa and the Middle East. The company has designed its supply chain to take advantage of the special customs and duties treaties in these regions. The case illustrates the complexities of such design decisions, and the approaches one needs to take. The case also ends with a key decision that Renault has to make - how to set up the supply chain for the new market in South Africa. Again, the customs and duties implications play a big role in such a decision.

PCH International started out as a sourcing agent of low-priced electronic components from Taiwan and China to the Western world in the mid 1990s, it had evolved to become a provider of comprehensive supply chain solutions to global technology companies by 2007. PCH was designed to address the needs of a complex global technology supply chain landscape. The first section of the case provides an overview of the global technology supply chain in the 2000s; the second section describes the physical, information and capital "flows" in the technology supply chain and the third section discusses how PCH had designed solutions to address the challenges in the three "flows." Customers examples included in the case to illustrate the various supply chain principles.

IDS Group was a provider of supply chain solutions. Based in Asia and founded by William Fung of global trading company Li & Fung Group, IDS developed a supply chain concept called "Value Chain Logistics." Value Chain Logistics took a holistic view of the entire value-chain by positioning logistics as the fundamental enabler to drive maximum efficiency and responsiveness in all the steps: from manufacturing to distribution to the final consumers. Given the geo-social diversity of various Asian markets, companies often faced distribution challenges as it tried to bring high quality products to its final consumers at a reasonable costs. As a pioneer of this new supply chain concept, IDS had helped its customers to achieve overall lower supply chain costs while meeting dynamic customer needs. Actual IDS customer examples were included in this case to illustrate the Value Chain Logistics concept.

In 1996, Andrea and Barry Coleman launched Riders for Health, a United Kingdom-based nonprofit dedicated to the improvement of transportation systems for health workers in Africa. The nonprofit's main program, Transportation Resource Management, involved a maintenance and training program for motorcycles and other vehicles used by health workers to deliver medical care in remote African communities. Although dedicated to an unglamorous area of health care, the program was incredibly successful and one of the few examples of a practical solution to the world's most intractable health care problems. Nevertheless, by 2007, the organization was at a critical decision point. It had tapped its established, external funding sources almost to maximum levels but still required significant capital to expand. The organization had to decide what strategies, both financial and operational, to implement in order to achieve the much larger scale it needed to spread the benefits of its program across wider sections of Africa's afflicted population.

In 2006, Rio Tinto Iron Ore (RTIO) faced a number of challenges. The iron ore business had traditionally been dominated by a few large suppliers, who sold to a relatively few large steel producers. The business environment was changing, however, with the rapid development of China. Demand was growing faster than supply, causing increased prices, particularly on the spot market. Most of RTIO's production was committed to fulfilling long-term contracts, so it could not fully benefit from the high spot market prices. New entrants, however, were not committed to long-term contracts and were attracted by these high prices. In addition, many new Chinese iron and steel mills were small operations, geographically disbursed, and did not secure their iron ore supplies before building their plants. An important part of the iron ore supply chain was transportation. Traditionally, customers were responsible for shipping, but this did not meet the needs of small, remotely located Chinese mills. In addition to these changes in the marketplace, RTIO had developed new steelmaking technology that enabled the use of lower quality iron ore and also generated substantially fewer greenhouse gas emissions than conventional technology. There were a number of possible approaches to commercializing this technology, ranging from vertical integration to licensing.