Academic journal article Journal of Supply Chain Management

Supply Chain Management: Practices, Concerns, and Performance Issues

Academic journal article Journal of Supply Chain Management

Supply Chain Management: Practices, Concerns, and Performance Issues

Article excerpt

INTRODUCTION

During the 1990s, many manufacturers and service providers collaborated with their strategic suppliers to upgrade traditional supply and materials management functions and integrate them as part of corporate strategy. Correspondingly, many wholesalers and retailers also integrated their logistics functions with other functional areas to enhance competitive advantage. Eventually, these two traditional supporting functions of corporate strategy evolved and merged into a holistic and strategic approach to materials and logistics management, commonly known as supply chain management (SCM). The literature is replete with buzzwords such as supplier integration, partnerships, supply base management, supplier alliances, and supply chain synchronization to address aspects or stages of this new management philosophy (Tan 2001; Tan et al. 1998a; La Londe and Masters 1994).

Scott and Westbrook (1991) and New and Payne (1995) described SCM as the chain linking each element of the manufacturing and supply process from raw materials through to the end users, and treating all firms within the supply chain as a unified virtual business entity. Baatz (1995) further expanded SCM to include recycling. The philosophy of SCM focuses on how firms utilize their suppliers' processes, technology, and capability to enhance competitive advantage (Farley 1997), and the coordination of the manufacturing, logistics, materials, distribution, and transportation functions within an organization (Lee and Billington 1992). In an attempt to trace its development, Tan (2001) classified the SCM literature into two perspectives, that is, the purchasing perspective of the manufacturers and the logistics perspective of the merchants. While SCM includes all of the value-adding activities through the supply chain, a practical approach is to consider only strategic suppliers because it is too complex to achieve a full integration of all business entities within the supply chain (Tan et al. 1998a, 1998b). This narrower definition of SCM involves the integration of the various functional areas within an organization to enhance the flow of goods from immediate strategic suppliers through the manufacturing and distribution chain to the end users (Houlihan 1987, 1988).

This article describes a research effort driven by three objectives. The first objective was to derive a set of SCM practices and compare how practitioners ranked these practices to enhance competitive position. The second objective was to identify and compare the major concerns in implementing a successful SCM program. Finally, the third objective attempted to identify the practices and the concerns associated with successful supply chains. The following section examines the evolution of SCM. Subsequent sections describe the research construct, provide demographic characteristics of the respondents, address non-response bias, and describe the survey methodology, followed by an analysis of the results and the managerial implications of the study. Future research directions are also discussed.

SUPPLY CHAIN MANAGEMENT LITERATURE

The following section examines the evolution of SCM. Subsequent sections describe the research construct, provide demographic characteristics of the respondents, address non-response bias, and describe the survey methodology, followed by an analysis of the results and the managerial implications of the study. Future research directions are also discussed.

In the 1950s and 1960s, most manufacturers emphasized mass production to minimize unit production cost as the primary operations strategy, with little product or process flexibility. New product development was slow and relied exclusively on in-house technology and capacity. Excess inventory was used to cushion bottleneck operations to maintain a balanced line flow, thus resulting in huge investment in work-in-process (WIP) inventory. Sharing technology and expertise with customers or suppliers was considered too risky and therefore unacceptable, thus little emphasis was placed on cooperative and strategic buyer-supplier partnerships. …

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