Purpose – Although a lot of attention has been paid to demand information sharing in the recent decade, few studies look at the value of supply information sharing. The purpose of this paper is to address the importance of timely supply information sharing to the supply chain management under disruption is addressed. Design/methodology/approach – By introducing a Directed Acyclic Supply Network (DASN) model and an Impact Network (INet) model, the impact of a disruption on the performance of the supply chain is quantified. A comprehensive algorithm is developed to calculate the time and cost impact of the disruption. Insights about the value of timely supply information sharing are further discussed, based on quantitative relationships of material flows. Finally, an application of the above model in a main manufacturer of China is introduced. It is then compared to its performance in the case of timely supply information sharing with cases where information is not shared or is shared late. Findings – By timely sharing of supply information, firms at downstream stages can alert a disruption at an upstream stage, derive the correct early warning time, and make proper decisions to offset the impact of the disruption. Information sharing therefore enhances the agility of firms while improving the stability and performance of the whole supply chain. Research limitations/implications – This paper only considers the time and cost impact from a single source of disruption. Further work may investigate other disruptions, which may arise from multiple sources. Practical implications – This paper provides an effective method to quantify the impact of a disruption. The method has been successfully applied in a supply chain management information system. Originality/value – This paper is among the initial studies of understanding and quantifying the value of supply information sharing. The work indicates the importance of timely supply information sharing to improve the performance of a supply chain.
Supply Chain Management: An International Journal – Emerald Publishing
Published: Sep 1, 2006
Keywords: Supply chain management; Information exchange
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