Managing Sustainable Operations

Professor Karen Zheng is teaching students how to execute their creative ideas for improved sustainability

Karen Zheng is a Sloan School Career Development Professor and Associate Professor of Operations Management at the MIT Sloan. Her research focuses on socially responsible supply chains and smallholder agriculture operations. Recently, in coordination with the Sustainability Initiative, she infused her Operations Strategy course with sustainability related cases and coursework.

“I decided to incorporate sustainability cases for a few reasons,” Karen says. “First, sustainability and operations are very closely related. The fundamental concepts in operations about process design, efficiency, and waste minimization are core elements of sustainability. Second, operations is about execution. Without execution, a strategy of sustainability remains a plan written on a piece of paper. And third, sustainability is very close to my heart, and a big part of my research.”

Karen’s Ops Strategy course provides a framework for students to describe and formulate an operations strategy and to understand and evaluate the key decisions in operations that have a substantial impact on a firm's competitive position. Karen teaches students how decisions on the design and management of operations must fit and be consistent with a company's business strategy, as well as how decisions about different areas of operations must be consistent with each other. The course also emphasizes the concept of operations as a source of competitive advantage.

Supply Chain Transparency 

Karen is working on two lines of research in the sustainability domain. First, she’s studying how transparency in a supply chain's social responsibility practices influences consumers’ purchase decisions and firms’ operations strategies. In this line of work, her team is showing that transparency increases consumers’ trust in a firm’s social responsibility disclosures, and this increased trust leads to their willingness to pay a premium for the firm’s products.  These effects are particularly strong when the supply chain involves highly disadvantaged suppliers (e.g., suppliers in developing countries).

From the firm’s perspective, improved supply chain transparency can help the company allocate resources and investments more efficiently to target those suppliers who need the most help to improve conditions. In addition, mandating firms to disclose their social responsibility practices to the public can ensure that firms make sufficient investments to help suppliers improve their practices.

In a second line of research, Karen is collaborating with a number of partners in India to examine how to improve consumer and farmer welfare in agricultural supply chains. In one paper, Karen’s team is working with the Karnataka state government to empirically quantify the impact of a state-wide agricultural wholesale market reform on farmers’ income. In another paper, they analyze, with both analytical models and field data, the effectiveness of different types of government interventions on stabilizing market prices for essential commodities, and thus, increasing consumer welfare.

Karen, who holds a PhD degree from Stanford University and BS and MS degrees from Tsinghua University in China, believes that next-generation leaders and talents must develop a sustainability mindset. Her goal at MIT Sloan is to equip them with the tools necessary to execute their creative ideas for improved sustainability.