The impact of supply chain performance measurement systems on dynamic behaviour in supply chains

The amplification of demand variation up a supply chain widely termed ‘the Bullwhip Effect’ is disruptive, costly and something that supply chain management generally seeks to minimise. Originally attributed to poor system design; deficiencies in policies, organisation structure and delays in material and information flow all lead to sub-optimal reorder point calculation. It has since been attributed to exogenous random factors such as: uncertainties in demand, supply and distribution lead time but these causes are not exclusive as academic and operational studies since have shown that orders and/or inventories can exhibit significant variability even if customer demand and lead time are deterministic. This increase in the range of possible causes of dynamic behaviour indicates that our understanding of the phenomenon is far from complete. One possible, yet previously unexplored, factor that may influence dynamic behaviour in supply chains is the application and operation of supply chain performance measures. Organisations monitoring and responding to their adopted key performance metrics will make operational changes and this action may influence the level of dynamics within the supply chain, possibly degrading the performance of the very system they were intended to measure. In order to explore this a plausible abstraction of the operational responses to the Supply Chain Council’s SCOR® (Supply Chain Operations Reference) model was incorporated into a classic Beer Game distribution representation, using the dynamic discrete event simulation software Simul8. During the simulation the five SCOR Supply Chain Performance Attributes: Reliability, Responsiveness, Flexibility, Cost and Utilisation were continuously monitored and compared to established targets. Operational adjustments to the; reorder point, transportation modes and production capacity (where appropriate) for three independent supply chain roles were made and the degree of dynamic behaviour in the Supply Chain measured, using the ratio of the standard deviation of upstream demand relative to the standard deviation of the downstream demand. Factors employed to build the detailed model include: variable retail demand, order transmission, transportation delays, production delays, capacity constraints demand multipliers and demand averaging periods. Five dimensions of supply chain performance were monitored independently in three autonomous supply chain roles and operational settings adjusted accordingly. Uniqueness of this research stems from the application of the five SCOR performance attributes with modelled operational responses in a dynamic discrete event simulation model. This project makes its primary contribution to knowledge by measuring the impact, on supply chain dynamics, of applying a representative performance measurement system.

IT support for managing aircraft spares in a closed-loop supply chain

This paper reports on the development of elements of an e-supply chain management system for managing maintenance, repair and overhaul (MRO) relationships in the aerospace industry. A standard systems development methodology has been followed to produce a process model (i.e. the AMSCR model); an information model (i.e. business rules) and a computerised information management capability (i.e. automated optimisation). The proof of concept for this web-based MRO supply chain system has been established through the collaboration with a sample of the different types of supply chain members. The proven benefit is a reduction in the stock-holding costs for the whole supply chain whilst also minimising non-flying time of the aircraft that the supply chain supports. This type of system is now vital in an industry that has continuously decreasing profit margins, which in turn means pressure to reduce servicing times and increase the interval between maintenance actions.

Supply chain knowledge management:a literature review

This paper aims to contribute to the debate on the role of knowledge management in supply chain management by reviewing the published literature. A total of 58 selected referred journal articles were systematically analyzed. This review identifies various theoretical and methodological characteristics of the way in which knowledge management applications are proposed in the supply chain context. The review shows that little evidence exists of the positive relation between the use of IT solutions and firms’ performance. Some issues remain unexplored such as the problem of knowledge obsolescence in supply chain management. A deeper understanding of the knowledge accumulation process could give new insights. The paper concludes with some future directions for theory construction and empirical research.

Supply chain "mega-trends":current status and future trends

The supply chain management (SCM) concept has become embedded in the thinking of many organisations in recent years. Originally introduced by management consultants in the early 1980s, SCM has a strong focus on integration of processes across functions within firms, as well as between the organisations that comprise the wider extended enterprise. There is a significant body of research to support the notion that the consistent delivery of value to customers is predicated on higher levels of intra-firm and inter-firm integration. Putting the supply chain integration (SCI) concept into practice is critically dependent on the ability of firms to manage material, money and information flows in a holistic manner. It also depends on the way in which relationships between key supply chain actors are managed. This article explores the “mega-trends” that are evident across most sectors and which have a potentially significant impact on the ability of organisations to put SCM theory into practice. The late Don Bowersox and his colleagues from Michigan State University introduced the idea of supply chain “mega-trends” over a decade ago in their widely cited article in the Journal of Business Logistics (Bowersox et al., 2000). This article explores the current status of these “mega-trends” in an Irish context based on research being undertaken at the National Institute for Transport and Logistics (NITL). It also identifies some key factors that are likely to impact upon progress in these key areas in the medium term.

Supply chain innovation for competing in highly competitive markets:challenges and solutions

Rapid changes in technological development are forcing businesses to continuously innovate to improve their competitiveness, which is particularly evident in logistics and supply chain management (SCM), where innovation impacts both the strategic and operational levels. Supply Chain Innovation for Competing in Highly Dynamic Markets: Challenges and Solutions investigates the role of innovation in the management of supply chains of today. This book focuses on supply chain integration from both strategic and operational perspectives and the impact of information technology-related innovation in supply chain and logistics service industries. It also analyzes how environmental innovation affects logistical decisions throughout the supply chain and the strategies employed in managing logistics-related environmental impacts. Finally, the book explores theoretical and practical implications of innovation in the management of supply systems.

Supply chain learning needs:towards a port community perspective

The traditional role of ports in the wider supply chain context is currently being subject to a process of radical review. In broad terms, the traditional model is being replaced by a model which focuses on higher value and more knowledge intensive activities. This trend requires a change in the way in which new knowledge and skills are developed by staff in companies of all kinds within port communities. Traditional models need to be re-evaluated to reflect the increasing importance of knowledge and skills acquisition, particularly in relation to the supply chain management (SCM) concept and the evolving role of information and communications technology (ICT) in improving supply chain capability. This paper describes the case of NITL’s Foundation Certificate Programme (FCP) learning programme with specific reference to its use in addressing some of current shortcomings related to supply chain knowledge and skills in port communities. The FCP rationale is based on the need to move from traditional approaches of supply chain organisation where the various links in the chain were measured and managed in isolation from each other and thus tended to operate at cross purposes, towards more cooperative and integrated approaches.

Techonology usage in the supply chain:the case of small 3PLs

In today's supply chain management practices, a successful strategy depends increasingly on the performance of third party logistics (3PLs) providers as they play a key integrative role linking the different supply chain elements more effectively. Information and communications technology (ICT) has become an important element of 3PL competitive capability as it enables higher levels of supply chain integration. Recent industry developments have widened the technological gap between large and small 3PLs. This is critical particularly for those markets populated by a large number of small 3PLs such as the Italian logistics industry. The purpose of this paper is to provide an overview of ICT adoption in small logistics service providers. The focus of the study is the Italian 3PL market. The methodology adopted in this paper is based on the action research framework and it is a combination of theoretical analysis and empirical findings (focus groups and surveys). Firstly, a literature review on ICT dissemination in the international and Italian 3PL industry has been carried out. Then, a field survey has been developed preceded by two focus groups. The empirical investigation examined a sample of 153 small Italian 3PLs on the base of a definition and taxonomy proposed by the authors. The results provide a useful technological profile of the surveyed companies, as well as an analysis of the role of ICT in customising services and of the factors influencing ICT adoption. To give a more robust scientific justification of the survey results, it would be useful to carry out an additional large-scale analysis including other countries with a high presence of small logistics service companies. Furthermore, a complementary case-study analysis would be of help in defining the role of specific factors in different types of 3PL. Further investigations in this field are needed to better understand innovation paths, and how ICT can improve the competitive capabilities of 3PLs and of the wider supply chain. Managers of small 3PLs can use the findings to set-up guidelines for improving a company's technology innovation. Technology vendors can use the findings to better market their service/product into the small logistics service provider segment. Despite the fact that much has been written about the dissemination of ICT, there is still a shortage of research in the field of small 3PLs with little empirical investigation into the usage of ICT by small 3PLs. This paper provides a contribution to filling this void and suggests some possible research directions.

A conceptual framework for supply chain collaboration:empirical evidence from the agri-food industry

Purpose - The purpose of this paper is to analyse the concept of supply chain collaboration and to provide an overall framework that can be used as a conceptual landmark for further empirical research. In addition, the concept is explored in the context of agri-food industry and particularities are identified. Finally, the paper submits empirical evidence from an exploratory case study in the agri-food industry, at the grower-processor interface, and information regarding the way the concept is actually applied in small medium-sized enterprises (SMEs) is presented. Design/methodology/approach - The paper employed case study research by conducting in-depth interviews in the two companies. Findings - Supply chain collaboration concept is of significant importance for the agri-food industry however, some constraints arise due to the nature of industry's products, and the specific structure of the sector. Subsequently, collaboration in the supply chain is often limited to operational issues and to logistics-related activities. Research limitations/implications - Research is limited to a single case study and further qualitative testing of the conceptual model is needed in order to adjust the model before large scale testing. Practical implications - Case study findings may be transferable to other similar dual relationships at the grower-processor interface. Weaker parts in asymmetric relationships have opportunities to improve their position, altering the dependence balance, by achieving product/process excellence. Originality/value - The paper provides evidence regarding the applicability of the supply chain collaboration concept in the agri-food industry. It takes into consideration not relationships between big multinational companies, but SMEs. © Emerald Group Publishing Limited.

Evaluation of integration technology approaches in the healthcare supply chain

Healthcare organisations are increasingly being challenged to look at their operations and find opportunities to improve the quality, efficiency and effectiveness of their supply chain services. In light of this situation, there is an apparent need for healthcare organisations to invest in integration technologies and to achieve the integration of supply chain processes, in order to break up the historical structure characterised by numerous interfaces and the segregation of responsibilities. The aim of this paper is to take an independent look at the healthcare supply chain and identify at different levels the core entities, processes, information flows, and system integration challenges which impede supply chain quality improvements to be realised. Moreover, this paper proposes, from an information systems perspective, a framework for the evaluation of different integration technology approaches, which can be used as a potential guideline tool for assessing integration technology alternatives, in order to add value to a healthcare-supply-chain management system. Copyright © 2007 Inderscience Enterprises Ltd.

An empirical study of the imperatives for a supply chain implementation project in Seagate Technology International

Singapore's electronics manufacturers are facing many questions. In the computer hard-drive industry, where the problem of obsolescence is common and where a product's lifecycle may be only six months, manufacturers are anxious to know what the next order-winning criteria will be. Since low labour costs are no longer a key factor, many organisations are developing their competencies in research and development, sales and marketing, logistics and supply chain management in order to maintain competitiveness. This paper illustrates how Seagate has envisaged a climate of cooperation and collaboration to better serve its customers in the areas of technology, cost and delivery. The paper is based on observations and findings following a longitudinal case study approach at the Seagate Storage Product Group (SPG) in Singapore. The seven-stage implementation framework adopted by Seagate in their SCM project is discussed, together with the process of how Seagate has created a paradigm shift towards a new culture of teamwork-based collaboration.

Green as the new Lean:how to use Lean practices as a catalyst to greening your supply chain

The aim of this research paper is to explore and evaluate previous work focussing on the relationship and links between Lean and Green supply chain management practices. Several explanatory frameworks are explored and discussed. It is intended that evidence and insights can be developed and used: (a) to assist our understanding of where Lean practices are synergistic for Green; (b) to clarify if Green practices are synergistic for Lean; and (c) to identify opportunities for companies to use their Lean framework as a catalyst to making their processes Green. The paper provides evidence suggesting that Lean is beneficial for Green practices and the implementation of Green practices in turn also has a positive influence on existing Lean business practices. © 2010 Elsevier Ltd. All rights reserved.

Supply chain performance measurement framework:case studies on the Thai manufacturers

One of the most significant paradigm shifts of modern business management is that individual businesses no longer compete as solely autonomous entities, but rather as supply chains. Firms worldwide have embraced the concept of supply chain management as important and sometimes critical to their business. The idea of a collaborative supply chain is to gain a competitive advantage by improving overall performance through measuring a holistic perspective of the supply chain. However, contemporary performance measurement theory is somewhat fragmented and fails to support this idea. Therefore, this research develops and applies an integrated supply chain performance measurement framework that provides a more holistic approach to the study of supply chain performance measurement by combining both supply chain macro processes and decision making levels. Therefore, the proposed framework can provide a balanced horizontal (cross-process) and vertical (hierarchical decision) view and measure the performance of the entire supply chain system. Firstly, literature on performance measurement frameworks and performance measurement factors of supply chain management will help to develop a conceptual framework. Next the proposed framework will be presented. The framework will be validated through in-depth interviews with three Thai manufacturing companies. The fieldwork combined varied sources in order to understand the views of manufacturers on supply chain performance in the three case study companies. The collected data were analyzed, interpreted, and reported using thematic analysis and analysis hierarchy process (AHP), which was influenced by the study’s conceptual framework. This research contributes a new theory of supply chain performance measurement and knowledge on supply chain characteristics of a developing country, Thailand. The research also affects organisations by preparing decision makers to make strategic, tactical and operational level decisions with respect to supply chain macro processes. The results from the case studies also indicate the similarities and differences in their supply chain performance. Furthermore, the implications of the study are offered for both academic and practical use.

Managing the impact on biodiversity of supply chain companies

Industrial development has had a major role in creating the situation where bio-diverse materials and services essential for sustaining business are under threat. A key contributory factor to biodiversity decline comes from the cumulative impacts of extended supply chain business operations. In order to contribute to stopping this decline, the industrial world needs to form a better understanding of the way it utilizes the business and biodiversity agenda in its wider operations. This thesis investigates the perceptions and attitudes to biodiversity from government, society and a wide cross-section of industry. The research includes the extent of corporate attention to and use of environmental business tools and guidelines in reporting on biodiversity issues. A case study of three companies from different industrial sectors is undertaken to observe procurement and related environmental management of their supply chains. The use of accredited and non-accredited environmental management systems (EMS) are analysed as frameworks for introducing biodiversity aspects into supply chain management. The outcome is a methodology, which can be used either as a bespoke in-house biodiversity management system or within an accredited ISO 14001 EMS, for incorporating the assessment and management of the potential risks and opportunities involving environmental impacts on biodiversity of supply chain companies.

Corporate responsibility reporting of biodiversity in the supply chain

Industrial development, accompanying human population growth, has had a major role in creating the situation where bio-diverse materials and services essential for sustaining business are under threat. A major contributory factor to biodiversity decline comes from the cumulative impacts of extended supply chain business operations. However, within Corporate Responsibility (CR) reporting impacts on biodiversity due to supply chain operations have not traditionally been given equal weighting with other environmental issues. This paper investigates the extent of CR reporting in managing and publicising company biodiversity supply chain issues by reviewing a cross-sector sample of publicly available CR reports. The report contents were examined for suggestions of industrial sectorial trends in the level of biodiversity consideration. The reporting of environmental management system use within company supply chain management is assessed in the samples and is considered as a mechanism for responsible supplier partnership working.