Information Sharing in Supply Chain

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Table of Contents

Introduction
Purpose
Background
Scope
Theoretical Framework
Method
Conclusion
References

Introduction

Supply chain management refers to “the management of a network of interconnected businesses involved in the ultimate provision of product and service packages required by end customers”. It involves movement, as well as, storage of materials, stock of work-in-progress and final goods. Consequently, supply chain management involves several actors which include suppliers, retailers, and transporters among others.

The effectiveness of the supply chain is contingent on the extent to which the businesses involved in it are able to plan and coordinate their activities. Coordination of supply chain activities is enhanced through effective and efficient flow of information. This means that participants in the supply chain must be able to share all the relevant information in order to enhance the competitiveness of the supply chain.

Thus, a lot of technologies have been developed in the last two decades to enhance the flow of information in supply chain systems. Effective sharing of information in supply chain will be the focus of the proposed study.

Purpose

The proposed study will focus on the use of information technology in supply chain management. In particular, the broad objective of the study is to investigate the use of modern information technology to enhance effective and efficient sharing of information within a supply chain. The specific objectives of the study include the following.

The first objective is to identify the technologies, currently, being used to enhance flow of information. The second objective is to investigate the factors that determine the use of modern technology to enhance sharing of information. The last objective is to analyze the benefits of using information technology in supply chain.

The expected practical outcome of the study is to inform policy formulation. In this context, the result, hopefully, will help organizations to formulate policies that will enable them to use modern technologies to share information. Additionally, the findings will advance knowledge by contributing to the literature on the use of information technology to share information in supply chain systems.

Background

The main objective of supply chain management is to enable an organization to offer the best customer services in targeted markets. Customers not only demand high quality goods, but also require such goods to be manufactured and delivered in time. Thus, organizations must effectively coordinate the receipt of raw materials, manufacturing of goods and dispatch of final goods.

In some cases, the quality of the goods can be compromised during transportation. This necessitates effective sharing of information between the producers and the transporters about the quality of the goods.

The customer service requirements in any given market are the basis for setting performance targets for the supply chain. In order to realize the expected level of customer service, all activities that do not add value should be eliminated from the supply chain. Thus, proper planning and synchronization of supply chain activities become apparent.

Additionally, effective supply chain management facilitates optimization of supply chain investments and costs. It should enable organizations to deliver goods to the end customers at the least cost possible. Globally, most markets are characterized with intense competition and limited growth.

Consequently, firms are focusing on cost cutting measures to enhance their effectiveness. Empirical studies reveal that adopting the right communication technology can help to reduce information costs significantly.

Delivery of products often involves complex movements among several firms that make up the supply chain. Thus, inefficiency at any point in the chain translates into failure of the entire supply chain. All links within the supply chain are important since each link contributes to value addition and profitability. Due to lack of proper coordination or adequate resources, supply chain functions have traditionally been executed in isolation.

This has always led to failures within supply chains. Consequently, it is important to recognize that the supply chain as “a whole is greater than the sum of its constituent parts”. The implication of this perspective is that all activities within the supply chain must be integrated through effective sharing of information. Thus, information management is the most important supply chain activity.

This is because the movement of goods and money (payment for goods) is often initiated and facilitated by the relevant information. In this context, information technology as a facilitator of information flow becomes an enabler of supply chain management.

The importance of information in supply chain management has often been ignored. This is attributed to the fact that many agents in the supply chain lack a clear understanding of the value of information. The advancement in information and communication technology in the last two decades has led to a shift from paper based flow of information to electronic sharing of information.

However, the factors that determine adoption of the modern information and communication technologies in supply chain management are still not well understood in academia and business cycles. Some empirical studies reveal that businesses are not likely to adopt a given technology if they do not understand its benefits.

Constraints in technological transfer have been identified as one of the major factors contributing to poor understanding of the benefits of information technology in supply chain. In conclusion, three observations can be identified. First, effective and efficient sharing of information is necessary for improving supply chain management.

Second, the factors that determine adoption of technologies that enhance sharing of information in supply chains are not well understood. Finally, the benefits associated with modern information technologies are not known to many firms. These observations justify the need for research on the use of information technology in supply chain management.

Scope

Given the objectives of the proposed study, a significant amount of time will be devoted to data collection and analysis. This is because data must be collected from participants who are located in different places. The study is expected to take three months. The fieldwork is expected to commence after the proposal is approved. Prior to the fieldwork, two weeks will be spent on designing the data collection instrument.

This will involve formulating the interview questions to be used during data collection. An additional two weeks will be spent on booking appointments with the participants. Data collection will be done in six weeks. Data analysis and preparation of the final report will be done in the remaining two weeks.

Thirty managers in charge of supply chain activities will be recruited to participate in the study. The participants will be drawn from ten companies operating in different industries. Thus, a total of thirty interviews will be conducted to collect the required data.

Theoretical Framework

Resource Based View (RBV)

RBV is a theory used to identify a firm’s strategic resources and how such resources can be used to achieve competitive advantages. The RBV theory asserts that the competitive advantage of an organization is determined by the allocation of the organization’s valuable resources.

A firm’s short run competitive advantage can be turned into a sustainable competitive advantage if the firm’s bundle of resources is heterogeneous and imperfectly mobile. Resources that meet the heterogeneity and imperfect mobility criteria are considered valuable.

This is because such resources can not be imitated or sustained without great effort. Valuable resources can help a firm to consistently realize above average returns. In the context of supply chain management, information technology can be considered a resource. Thus, the RBV theory can be used to investigate the use of information technology in supply chain management in the following ways.

First, a resource is valuable if it can enable a firm to formulate a strategy that creates value by minimizing the firm’s weaknesses or overcoming competition. Thus, the cost of investing in the resource should not exceed the expected returns. Determining the value of information technology will help in identifying its benefits in enhancing sharing of information in supply chain management.

Second, a valuable resource should be rare. This means that the resource should not be available to majority of firms within an industry. Thus, this requirement is a basis for investigating the factors that determine access or use of information technology in supply chain management. Third, valuable resources should be in-imitable. A resource is expected to create competitive advantage if it is controlled by one or a few firms.

Thus, this condition forms a basis for investigating determinants of access to information technology. Finally, a valuable resource should not be substitutable. The implication of this requirement is that the benefits of information technology will no longer be a source of competitive advantage if competitors are able to counter its benefits using substitute technologies.

Supply Chai n Integration Theory

Supply chain integration describes the process of synchronizing all supply chain activities and linkages in order to achieve efficiency and effectiveness. Supply chain integration depends on two factors namely, linkage and alignment. Alignment illustrates the extent to which visions, goals and objectives are shared by participants in the supply chain. It ensures consistency in planning and decision making in supply chain management.

Linkage describes the extent to which information can be shared and the level of interaction that planers and decision makers can engage in. linkage enhances the availability of information for decision making and the use of the same data throughout the supply chain. Linkage and alignment are achieved through the following factors. First, linkage and alignment can be achieved through communication and e-systems.

Communication and e-systems include the technology used to gather and share information, as well as, the means of facilitating communication between decision makers. The e-system ensures “data availability, accuracy and timeliness”. Communication on the other hand enhances the use of information in decision making initiatives.

Second, alignment and linkage can be achieved through organization and people. Organizational structures determine how individuals interact and share information in an organization. Important resources and relevant stakeholders can be excluded from the decision making process if the right organizational structure is not put in place.

In this context, the employees’ skills and capabilities are central to achieving integration under the existing organizational structure. Third, alignment and linkage can be enhanced through trust. Trust affects people’s willingness to share information.

In this case, the main concern is security over the given information. Finally, alignment and linkage can be achieved through metrics. This refers to the metrics and rewards that employees respond to in order to achieve the objectives of the supply chain.

In conclusion, both RBV theory and supply chain integration theory emphasize the importance of sharing information in supply chain. Using these theories forms the basis for investigating the benefits and factors determining the use of information technology to share information in supply chain management.

In particular, the theories help in formulating hypothesis for the study. For example, using the supply chain integration theory, we can hypothesize that information technology enhances timelines and accuracy of information.

Method

Research Design

The proposed study will adopt a qualitative research design. Qualitative research is based on interpretative paradigm. According to the “interpretative paradigm, social reality is created and sustained through the subjective experience of people involved in communication”. The factors underpinning the choice of a qualitative design include the following.

First, a qualitative research will facilitate a holistic study of the use of information technology in supply chain management. Second, it will facilitate the use of primary data. Through data collection methods such as interviews, the researcher is able to get first hand information on the research topic. Thus, the conclusions drawn from the data is likely to be reliable and accurate.

Third, qualitative research enhances flexibility in the research activities such as data collection, analysis, as well as, interpretation. Flexibility will be needed in the proposed study to cater for unforeseeable risks that might limit the use of any of the proposed methods. Finally, qualitative research will facilitate an in-depth understanding of the research topic by allowing the researcher to interact with the participants.

Variables and Measures

The proposed study will focus on three variables namely, types of information technology, determinants of access/ use of information technology and benefits of information technology in supply chain management. Each of these variables has specific indicators that can be conceptualized as follows:

Types of information technology: software, hardware and communication equipment
Determinants of access or use of information technology: cost, skills, technology transfer, patents, research and development
Benefits of information technology: cost benefits, timeliness of information, accuracy of information, performance of the supply chain

Sampling

Sampling refers to the process of identifying and recruiting the individuals who will participate in the study. The study will be conducted in ten companies based in New York. Three managers will be selected from each of the ten companies to participate in the study. Consequently, the total number of participants will be thirty.

The stratified random sampling method will be used to recruit the participants. The companies will first be classified according to their industries. The list of companies will be obtained from industry databases. The industries to be considered in the study include retail, automobile, pharmaceutical, hospitality and food processing industry. Two companies will then be chosen randomly from each industry.

Three managers will then be randomly chosen from each company to participate in the study. Choosing the companies through a stratified random method will help in achieving heterogeneity or representativeness. Consequently, it will be possible to use the conclusions of the study to make reliable generalization.

Using a random method to select the companies and the participants also reduces bias in the recruitment process. This is because a random approach gives an equal opportunity to every participant or company to be selected.

Data Collection

Data collection refers to the process of gathering the data that is required for the study. Qualitative data will be collected through interviews. Structured questions will be used to guide the study. Unstructured questions that transpire during the interview will be used to obtain more information and to seek clarifications on answers. Additionally, probes will be used to seek more information from the participants.

The interviews will be audio-taped to enhance data analysis. The choice of interviews is justified by the fact that interviews enable the researcher to clarify any question that might be ambiguous or seek clarifications on any answer that might be ambiguous. Additionally, interviews are easy to use and facilitate access to first hand information.

Data Analysis

The analysis will begin with transcribing the collected. The transcribed data will then be coded into themes. In this context, coding involves identifying and labeling similar words, as well as, phrases mentioned by the participants. Appropriate themes will be used in the labeling process. The themes will be used to make generalization about the research topic.

Finally, interpretations will be made based on existing literature about the research topic and the adopted theoretical framework. Simple descriptive statistics will also be used in the analysis process. The final results and conclusions will be presented in the form of a report.

Limitations

The ability to complete the study or to make reliable conclusions will be limited under the following circumstances. First, the subjective nature of qualitative research is likely to compromise the reliability of the conclusions if the participants fail to give correct information. It is usually very difficult to authenticate the information collected through interviews.

Thus, if the interviewees fail to give correct information, the findings of the research will not be reliable. Second, replicating the study will require collecting data from the same respondents and companies. Thus, replication will not be possible if any of the respondents or companies refuse to participate in subsequent studies.

Third, the in-depth analysis associated with qualitative research limits the scope of the study in terms of the number of participants that can be interviewed. Finally, lack of adequate resources will make it impossible to carryout or complete the study. For instance, interviewing the participants is expensive due to the travelling costs associated with it. Thus, lack of enough financial resources will negatively impact data collection.

Conclusion

The proposed study aims at investigating the use of information technology to enhance sharing of information in supply chain management. The objectives of the study include identifying the information technologies, currently, being used, the factors determining the use of information technology and the benefits of information technology in supply chain management.

The study will adopt the resource based view and the supply chain integration theoretical underpinnings to investigate the research topic. Additionally, the research will adopt a qualitative design, and data will be collected through interviews. The results of the study are expected to inform policy formulation and to advance knowledge by contributing to the literature on the use of information technology in supply chain management.

References

Blanchard, D., 2007. Supply Chain Management. New York: John Wiley and Sons.

Larsen, T., 2005. Supply Chain Management. New York: CBS Press.

McBurney, D., 2009. Research Methods. New York: Cengage Learning.

McNeil, P., 2005. Research Methods. New York: Routledge.

Mentzer, J., 2001. Supply Chain Management. New York: Sage Publishers

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