Analysis of interaction among variables of reverse logistics: a System Dynamics approach

Reverse logistics is an issue which has gained increasing attention from the researchers in recent years. The reverse distribution activities are crucial to the survival of companies in the long run as the present day customers are more conscious of environmental friendly products. In this paper, System Dynamics (SD) based approach is employed to model reverse logistics variables in an automobile company. The variables treated under the three major constituents, viz., enablers, results, and inhibitors of reverse logistics, used to model the system, and the interactions among the variables affecting the system is investigated and a causal relationship are also developed. Effect of variables influencing Reverse Logistics Index is simulated for a period of 36 months. SD model is used to determine status of variables through which the performance of reverse logistics operations could be better estimated. This model is validated based on a case study in an automobile company.