International Journal of Physical Distribution & Logistics Management

Mark Johnson; Simon Templar

2011 International Journal of Physical Distribution & Logistics Management

doi: 10.1108/09600031111118512

Purpose – Supply chains directly influence the differentiation and cost of a firm's products and services and its exposure to risk. The purpose of this paper is to use secondary financial data to explore the relationship between supply chain and firm performance by developing a unified proxy for supply chain performance. Design/methodology/approach – Established econometric techniques were used to validate the proxy using a sample frame comprising the annual reports of 117 publicly traded UK manufacturing firms from the period 1995 to 2004. Findings – Increases in change in the proxy lead to an increase in change in the rate of return on capital employed and a change in the rate of cash‐to‐cash cycle length, both of which are traditional measures of improved supply chain management. Moreover, as the rate of change of the proxy increases, so does enterprise value at a level that is statistically significant, indicating that improving supply chain management practices has a positive impact upon improved firm performance. Research limitations/implications – As annual financial results were used the analysis is at a high level so there is a lack of resolution in identifying discrete causes. The use of annual financial results also means that the research can only take yearly snapshots of firm performance. Practical implications – The paper indicates that the supply chain is an enabler, not an impediment, to superior organisational performance. Originality/value – The originality and value of this paper is that it develops a proxy to explain the relationships between supply chain and an organisation's financial performance taking into account the three imperatives of profitability, liquidity, and productivity.

Lori S. Cook; Daniel R. Heiser; Kaushik Sengupta

2011 International Journal of Physical Distribution & Logistics Management

doi: 10.1108/09600031111118521

Purpose – The purpose of this paper is to examine the relationships between specific supply chain practices and organizational performance and whether this relationship is moderated by the role that a company assumes in its respective supply chain. Design/methodology/approach – This paper uses regression analysis and the relative weights method to analyze a set of survey data from respondents within the non‐academic, North American membership of the Institute of Supply Management. Findings – The results show that the supply chain role for a company makes a difference in terms of the specific supply chain practices that lead to better performance. Further, there is a clear indication that the relative importance of a specific practice varies across the supply chain roles thereby indicating that a general link between practice and performance may be erroneous without considering the specific context of the company concerned. Research limitations/implications – Supply chain practices are complex constructs. While this study shows the effect of broadly‐accepted supply chain practices on performance, not all possible practices are covered in the study. Additional practices not considered may have an effect on company performance and future research may improve upon the findings by extending the analysis to include an expanded segmentation of supply chain role. Practical implications – The results of the study serve as a practical guideline for managers that not all practices would be effective for all companies. Managers must look at the role‐specific context of their organization in the supply chain before deciding which practices are likely to be appropriate. Originality/value – This paper expands the current body of research in the supply chain area by examining the supply chain roles of manufacturer, distributor, retailer and service provider. This is a much broader construct than the more common dyadic treatment of a supply chain consisting only of a customer and supplier, and adds a new contextual dimension to supply chain research. In addition, service provider as a supply chain role has been hardly researched before.

Teresa M. McCarthy‐Byrne; John T. Mentzer

2011 International Journal of Physical Distribution & Logistics Management

doi: 10.1108/09600031111118530

Purpose – The purpose of this paper is to explore the structural and process integration mechanisms used by firms to form a hybrid mode of supply chain governance referred to as supply chain value integration (SCVI). Design/methodology/approach – The authors employ a multi‐method approach, conducting depth interviews following the grand touring technique to develop the model, and survey methodology to test the model using partial least squares approach for structural path estimation. Findings – SCVI is a multi‐dimensional concept comprised of two second‐order constructs, SCVI infrastructure and SCVI process, each comprised of three first‐order constructs, that lead to joint value creation and improved supply chain performance. Practical implications – Dependent suppliers striving to compete on value creation can adopt bonding behavior by establishing an integrative infrastructure comprised of people, technology, and knowledge components, which balances the level of dependence and motivates the customer to engage in integrative processes. Originality/value – The authors expand on previous models of integration by developing and testing a comprehensive multi‐dimensional theory of SCVI that explains the relationships between resource dependency theory, resource‐based view of the firm, and relational exchange theory.

Yong Lin; Li Zhou

2011 International Journal of Physical Distribution & Logistics Management

doi: 10.1108/09600031111118549

Purpose – The main purpose of this paper is to address the impact of product design changes on supply chain risk, and to identify the supply chain risk dimensions in the Chinese special‐purpose vehicle (SPV) industry in the context of product design change. Design/methodology/approach – Case study methodology is adopted to describe the current situation of supply chain risk management in the Chinese SPV industry. Data are mainly collected from in‐depth semi‐structured interviews, and a cause‐effect diagram is used to identify and summarize the internal and external risk dimensions of supply chain risk. Findings – This paper identifies both the internal and external supply chain risk from the perspective of the focal manufacturer in the SPV supply chain. At the level of the external supply chain, customer‐required design change normally leads to risk in supply, delivery, and policy. Internally for the manufacturer, the risk dimensions are R&D, production, planning, information, and organization. All of these risk dimensions have their respective causes. Research limitations/implications – The risk identification of product design change in this paper is only meant to lay a foundation; further case studies should focus on the best practices and approaches of risk management and extend them to other industries. Practical implications – The current identification of the risk dimensions and their respective causes will help both practitioners and researchers to better understand supply chain risk in the context of product design change. The identified risk dimensions and cause‐effect diagram provide practitioners with a risk framework and useful tools to recognize and identify their potential supply chain risks. Originality/value – This paper shows the “big picture” of supply chain risk from product design changes in the Chinese SPV industry.

Christian Busse; Carl Marcus Wallenburg

2011 International Journal of Physical Distribution & Logistics Management

doi: 10.1108/09600031111118558

Purpose – The purpose of this paper is to provide a sound basis to facilitate further research on innovation management at logistics service providers (LSPs). Design/methodology/approach – Content analysis of extant literature was undertaken and supplemented by conceptual deliberations. Findings – Future LSP‐specific innovation research should be undertaken. While comparatively much knowledge on innovation management by LSPs does already exist, it is hardly integrated. More comprehensive studies of LSPs' innovation processes and systems are required. Research limitations/implications – The review is limited to articles written in English and published in academic journals from 1999 to mid‐2009. This research should be supplemented by empirical research, in particular case studies. Practical implications – LSPs can compare their own innovation management concepts to the body of scientific knowledge presented here. As long as research does not take their specific context into account, LSPs are required to adapt more general concepts to their needs. Originality/value – This paper outlines theoretical features of a research stream on innovation management at LSPs. It integrates previous findings on LSPs' innovation management in a suitable framework, and it proposes an agenda for future research.