Expert systems for vendor selection

The survival of organisations, especially SMEs, depends, to the greatest extent, on those who supply them with the required material input. This is because if the supplier fails to deliver the right materials at the right time and place, and at the right price, then the recipient organisation is bound to fail in its obligations to satisfy the needs of its customers, and to stay in business. Hence, the task of choosing a supplier(s) from a list of vendors, that an organisation will trust with its very existence, is not an easy one. This project investigated how purchasing personnel in organisations solve the problem of vendor selection. The investigation went further to ascertain whether an Expert Systems model could be developed and used as a plausible solution to the problem. An extensive literature review indicated that very scanty research has been conducted in the area of Expert Systems for Vendor Selection, whereas many research theories in expert systems and in purchasing and supply management chain, respectively, had been reported. A survey questionnaire was designed and circulated to people in the industries who actually perform the vendor selection tasks. Analysis of the collected data confirmed the various factors which are considered during the selection process, and established the order in which those factors are ranked. Five of the factors, namely, Production Methods Used, Vendors Financial Background, Manufacturing Capacity, Size of Vendor Organisations, and Suppliers Position in the Industry; appeared to have similar patterns in the way organisations ranked them. These patterns suggested that the bigger the organisation, the more importantly they regarded the above factors. Further investigations revealed that respondents agreed that the most important factors were: Product Quality, Product Price and Delivery Date. The most apparent pattern was observed for the Vendors Financial Background. This generated curiosity which led to the design and development of a prototype expert system for assessing the financial profile of a potential supplier(s). This prototype was called ESfNS. It determines whether a prospective supplier(s) has good financial background or not. ESNS was tested by the potential users who then confirmed that expert systems have great prospects and commercial viability in the domain for solving vendor selection problems.

Technology valuation within the context of transfer collaborations with Chinese machine tool companies

The point of departure for this study was a recognition of the differences in suppliers' and acquirers' judgements of the value of technology when transferred between the two, and the significant impacts of technology valuation on the establishment of technology partnerships and effectiveness of technology collaborations. The perceptions, transfer strategies and objectives, perceived benefits and assessed technology contributions as well as associated costs and risks of both suppliers and acquirers were seen to be the core to these differences. This study hypothesised that the capability embodied in technology to yield future returns makes technology valuation distinct from the process of valuing manufacturing products. The study hence has gone beyond the dimensions of cost calculation and price determination that have been discussed in the existing literature, by taking a broader view of how to achieve and share future added value from transferred technology. The core of technology valuation was argued as the evaluation of the 'quality' of the capability (technology) in generating future value and the effectiveness of the transfer arrangement for best use of such a capability. A dynamic approach comprising future value generation and realisation within the context of specific forms of collaboration was therefore adopted. The research investigations focused on the UK and China machine tool industries, where there are many technology transfer activities and the value issue has already been recognised in practice. Data were gathered from three groups: machine tool manufacturing technology suppliers in the UK and acquirers in China, and machine tool users in China. Data collecting methods included questionnaire surveys and case studies within all the three groups. The study has focused on identifying and examining the major factors affecting value as well as their interactive effects on technology valuation from both the supplier's and acquirer's point of view. The survey results showed the perceptions and the assessments of the owner's value and transfer value from the supplier's and acquirer's point of view respectively. Benefits, costs and risks related to the technology transfer were the major factors affecting the value of technology. The impacts of transfer payment on the value of technology by the sharing of financial benefits, costs and risks between partners were assessed. The close relationship between technology valuation and transfer arrangements was established by which technical requirements and strategic implications were considered. The case studies reflected the research propositions and revealed that benefits, costs and risks in the financial, technical and strategic dimensions interacted in the process of technology valuation within the context of technology collaboration. Further to the assessment of factors affecting value, a technology valuation framework was developed which suggests that technology attributes for the enhancement of contributory factors and their contributions to the realisation of transfer objectives need to be measured and compared with the associated costs and risks. The study concluded that technology valuation is a dynamic process including the generation and sharing of future value and the interactions between financial, technical and strategic achievements.

Acquirer and owner perceptions of technology integration:the South African case

Developing countries are subject to the same global pressures as their developed counterparts but have additional domestic challenges that may place them at a significant, and perhaps insurmountable, disadvantage. However, technology still offers them the opportunity to participate in the international economy. Difficult conditions in their countries do not absolve managers from formulating and implementing technology policies that can make their firms globally competitive. At a macro-economic level, a number of broad developmental issues impact on the use of technology in developing countries. The subject of this paper is to examine the challenge for South African firms in their efforts to master technology, despite internal and external difficulties. Owners of technology need to consider the local context when supplying their technology to developing markets. The paper aims to investigate the views of technology recipients by examining the perceptions of South African managers regarding technology integration in a manufacturing environment. A number of technology suppliers were also interviewed in order to obtain their opinions on the issues raised by the technology acquirers. The importance of different factors in integrating technology is studied in relation to managers ’ abilities to control these variables. An importance-control grid framework is used to identify critical parameters and to assess how they can be managed in a complex environment.

Transaction attributes and buyer-supplier relationships in AMT acquisition and implementation:the case of Malaysia

This paper explores how transaction attributes of technology affect differences in the relationship between technology buyers and suppliers. It also examines the impact on performance of different patterns of relationship between technology buyers and suppliers. Data obtained from 147 manufacturing firms in Malaysia are used to test several hypotheses, which were derived from a review of the literature on technology, transaction cost theory and buyer–supplier relationships (BSR). The research results indicate that the higher the level of technological complexity, specificity and uncertainty, the more firms are likely to engage in a closer relationship with technology suppliers. Even though the majority of firms reported improvements in their performance, results indicate that firms demonstrating a closer relationship with technology suppliers are more likely to achieve higher levels of performance than those that do not. It is also shown that with high levels of transaction attribute, implementation performance suffers more when firms have weak relationships with technology suppliers than with moderate and low levels of transaction attribute.

Strategies for performance improvement in the Chinese chemical industry:evidence from case study investigations

Purpose – This paper sets out to explore the proposition that building competences is more effective than privatisation and restructuring to improve performance in the Chinese chemical industry. Design/methodology/approach – Case study research has been undertaken in the Chinese chemical industry. The two case companies provide representative data on the factors under investigation. The case investigations that are described were complemented by a survey, the results of which have been reported elsewhere. Findings – Results obtained from the research show that privatisation of Chinese state-owned enterprises is not always an effective strategy to improve performance. In the case study companies, the development of core competences was more effective in enhancing performance. Research limitations/implications – The research results are limited by the scope of the study, which was carried out in the Chinese chemical industry. They are also based on in-depth case investigations in only two companies, but are supported by a large-scale survey reported elsewhere. The results have implications for academic researchers interested in China's privatisation programme. Practical implications – The research has practical implications for companies outside China that are considering collaborative operations with Chinese companies or investing in joint ventures. It also has implications for suppliers or customers of Chinese companies. Originality/value – The paper is based on original case study investigations carried out in Chinese enterprises and is supported by a survey of representative companies in China's chemical sector. Value is derived from understanding the basis of improved performance in the companies studied.

The precursors and impacts of BSR on AMT acquisition and implementation

This paper reports on the results of research into the connections between transaction attributes and buyer-supplier relationships (BSRs) in advanced manufacturing technology (AMT) acquisition and implementation. The investigation began by examining the impact of the different patterns of BSR on the performance of the AMT acquisition. In understanding the phenomena, the study drew upon and integrated the literature of transaction cost economics theory, BSRs, and AMT, and used this as the basis for a theoretical framework and hypotheses development. This framework was then empirically tested using data that were gathered through a questionnaire survey with 147 companies and analyzed using a structural equation modeling technique. The results of the analysis indicated that the higher the level of technological specificity and uncertainty, the more firms are likely to engage in a stronger relationship with technology suppliers. However, the complexity of the technology being implemented was associated with BSR only indirectly through its association with the level of uncertainty (which has a direct impact upon BSR). The analysis also provided strong support for the premise that developing strong BSR could lead to an improved performance in acquiring and implementing AMT. The implications of the study are offered for both the academic and practitioner audience.

Towards an inter-organisational knowledge transfer framework for SMEs

This paper aims to develop a framework for SMEs to help them understand, and thus to improve, the process of knowledge exchange with their customers or suppliers. Through a review of the literature on knowledge transfer, organisational learning, social network theory and electronic networks, the key actors, key factors and their relationships in the process are identified. Finally, a framework containing all above points is proposed.

Designing channel incentives to overcome reseller rejection

As more and more products are distributed through independent channel resellers, suppliers find it increasingly difficult to craft highly motivational incentive packages. Instead, many suppliers' product lines are neglected by resellers in deference to more compatible incentive offers. This paper studies the many aspects of incentive rejection and incentive compatibility and prescribes a four-step, theory-based process to help suppliers craft attractive incentive programs. The process involves identifying resellers' performance needs, recognizing how each need suggests a different basis for incentive rejection, and designing an incentive package such that the incentives support specific reseller needs. Also, unique channel conditions are considered.

Toward a business-to-business channel incentives classification scheme

A recent focus on intermediary compensation underscores the need to organize the many complex incentives used by channel practitioners. Employing a grounded theory methodology, a channel incentives classification scheme is induced from 170 unique channel incentives used in 59 high technology suppliers’ channel programs. The incentives are organized into 16 subcategories and 5 major categories: Credible Channel Policies, Market Development Support, Supplemental Contact, High-Powered Incentives, and End-User Encouragements. Each incentive subcategory is discussed as a means of controlling reseller behaviors. Also, the conditions that give rise to the implementation of incentives are investigated through four testable research propositions.

The contribution of modularity to green operations practices

This paper discusses the possible contributions from modularity and industrial condominiums towards enhancing environmental performance in the automotive industry. The research described in this study is underpinned by a review of journal articles and books on the topics of: modularity of production systems; green operations practices, and the automotive industry and sustainability. The methodology is based on theoretical analysis of the contribution of the modular production system characteristics used in the automotive industry for Green Operations Practices (GOP). The following GOPs were considered: green buildings, eco-design, green supply chains, greener manufacturing, and reverse logistics. The results are theoretical in nature; however, due to the small number of studies that investigate the relationship between modularity and sustainability, this work is relevant to increase knowledge in academic circles and among practitioners in order to understand the possible environmental benefits from modular production systems. For instance, based upon our analysis, we could deduce that the existing modular production systems in the automotive industry may contribute in different ways to the implementation of GOPs. In all types of modularity, product simplification through the use of modules can enhance environmental performance and facilitate further activities such as maintenance and repair contributing to a longer life of cars on the road. Moreover, modules will make automobiles easier to disassembly, so increasing the chances of reuse of valuable components and a better final disposal of scrap. Regarding the potential benefits of each type of modularity, it is expected that modular consortia will have a better integration of environmental practices with suppliers and seize on high efficiency during manufacturing and logistics compared with conventional production systems.

Design and development of agent-based procurement system to enhance business intelligence

The purpose of this research is to propose a procurement system across other disciplines and retrieved information with relevant parties so as to have a better co-ordination between supply and demand sides. This paper demonstrates how to analyze the data with an agent-based procurement system (APS) to re-engineer and improve the existing procurement process. The intelligence agents take the responsibility of searching the potential suppliers, negotiation with the short-listed suppliers and evaluating the performance of suppliers based on the selection criteria with mathematical model. Manufacturing firms and trading companies spend more than half of their sales dollar in the purchase of raw material and components. Efficient data collection with high accuracy is one of the key success factors to generate quality procurement which is to purchasing right material at right quality from right suppliers. In general, the enterprises spend a significant amount of resources on data collection and storage, but too little on facilitating data analysis and sharing. To validate the feasibility of the approach, a case study on a manufacturing small and medium-sized enterprise (SME) has been conducted. APS supports the data and information analyzing technique to facilitate the decision making such that the agent can enhance the negotiation and suppler evaluation efficiency by saving time and cost.

Multi-criteria decision making approaches for supplier evaluation and selection:a literature review

Supplier evaluation and selection problem has been studied extensively. Various decision making approaches have been proposed to tackle the problem. In contemporary supply chain management, the performance of potential suppliers is evaluated against multiple criteria rather than considering a single factor-cost. This paper reviews the literature of the multi-criteria decision making approaches for supplier evaluation and selection. Related articles appearing in the international journals from 2000 to 2008 are gathered and analyzed so that the following three questions can be answered: (i) Which approaches were prevalently applied? (ii) Which evaluating criteria were paid more attention to? (iii) Is there any inadequacy of the approaches? Based on the inadequacy, if any, some improvements and possible future work are recommended. This research not only provides evidence that the multi-criteria decision making approaches are better than the traditional cost-based approach, but also aids the researchers and decision makers in applying the approaches effectively.

The analysis and case studies of successful express logistics companies

With the globalisation of world business, the border-crossing activities between organisations have substantially increased. Organisations not only need to handle supply functions, but also play a tremendous role in demand simulation through integration both inside the firm and outside with business partners and customers. Logistics has become more and more mature and sophisticated by taking on an external focus, incorporating suppliers and customers in the business processes, with all the supply chain functions integrated into a whole. By minimising the costs in the value chain or providing customised services, logistics acts as a major source of competitive advantages and profitability. To meet this goal, it would require the integration of activities to focus on customer-oriented measures. Customer service and logistics activities are a chain of interdependent activities that supplement each other to facilitate the flow of information, goods and cash within the value chain. The absence of one activity may imply some specific channels need to supplement another unit. Generally, this paper is to study the impact of corporate strategy, technology and customer satisfaction on the firm’s performance, filling the gap of good customer service effects on long-term profits. Two international delivery providers, UPS and FedEx, are studied to realise the critical success factors of express logistics.

Trade-offs in customer–employee focus:implications on boundary-spanning capabilities

In pursuing their particular strategic goals, organisations place differential emphasis in their activities on employees and customers. Those who focus predominantly on employees see them as key resources contributing to successful achievement of goals, while those who focus on customers believe that customer commitment is the prime source of financial prosperity and competitive advantage. In all firms, there is potential for conflict and subsequent trade-offs in the emphasis placed on employee resources and customers. This paper investigates the implications of these potential trade-offs on firms’ boundary-spanning capabilities (those capabilities that enable firms to interact effectively with their customers, their suppliers, their strategic allies and others in their business networks) in European and Australasian markets. The results suggest that those companies which achieve a strong but balanced focus on both employees and customers have heightened boundary-spanning capabilities. The comparison between UK and Australian businesses indicates that the balance is more highly developed in Australasian than European (UK) markets.

Trade-offs in customer-employee focus:Implications on boundary-spanning capabilities

In pursuing their particular strategic goals, organisations place differential emphasis in their activities on employees and customers. Those who focus predominantly on employees see them as key resources contributing to successful achievement of goals, while those who focus on customers believe that customer commitment is the prime source of financial prosperity and competitive advantage. In all firms, there is potential for conflict and subsequent trade-offs in the emphasis placed on employee resources and customers. This paper investigates the implications of these potential trade-offs on firms' boundary-spanning capabilities (those capabilities that enable firms to interact effectively with their customers, their suppliers, their strategic allies and others in their business networks) in European and Australasian markets. The results suggest that those companies which achieve a strong but balanced focus on both employees and customers have heightened boundary-spanning capabilities. The comparison between UK and Australian businesses indicates that the balance is more highly developed in Australasian than European (UK) markets. © 2004 by The Haworth Press, Inc. All rights reserved.