Supply Chain Management (SCM)

SCM is defined as the integration of key business processes from end user through original suppliers that provides products, services, and information. Hence, add value for customers and other stakeholders (Lambert et al., 1998). SCM is defined as the integration of key business processes from end user through original suppliers that provides products, services, and information and hence add value for customers and other stakeholders. SCM is a set of approaches utilized to effectively integrate suppliers, manufacturers, warehouses, and stores, so that merchandise is produced and distributed at the right quantities, to the right locations, and at the right time, in order to minimize systemwide cost while satisfying service level requirements (Simchi Levi et al. (2000).

            The concepts of supply chain design and management have become a popular operations paradigm. The complexity of SCM has also forced companies to go for online communication systemssuch as, the Internet increases the richness of communications through greater interactivity between the firm and the customer (Watson et al.1998). The roles of the Internet in building commercially viable supply chains in order to meet the challenges of virtual enterprises. Supply chain management emphasizes the overall and long-term benefit of all parties on the chain through co-operation and information sharing. This signifies the importance of communication and the application of IT in SCM. Some of the problems often cited in the literature both by the researchers and practitioners when developing an IT-integrated SCM are lack of integration between IT and business model, lack of proper strategic planning, poor IT infrastructure, and insufficient application of IT in virtual enterprise, and inadequate implementation knowledge of IT in SCM.

The strategic planning with the objective of developing long-term plans and changes to their organization and in turn to improve their competitiveness and also the  strategic planning of IT should support the long-term objectives and goals of SCM both in terms of flexibility and responsiveness to changing market requirements. Besides that, strategic planning of IT in SCM includes organizational issues such as organizational structure, awareness of top management, business processes, strategic alliances, and information technology that influence the overall performance of IT-enabled SCM. The organizations business and top level strategies is suitable for information systems should be selected with a view to support the application of IT and in turn to develop an effective supply chain. IS also can be a supportive facilitator of change extending and enhancing organization choice and improving the quality of decision making and supporter of innovation.

 IS strategic alignment incorporating four fundamental domain of strategic choice which is business strategy, IT strategy, organizational infrastructure and processes, and IT infrastructure and processes. (Henderson and Venkataraman 1993) Nevertheless, the strategic human aspects have been ignored. Then, Standardization of business processes and IT systems facilitate effective and protected access information in a supply chain. Strategic planning of IT in SCM has the objective of making long-term decisions such as the selection and productive implementation of IT with the objective of achieving an effective and well-connected supply chain. The characteristics of SCM, long-term decisions should be promote functional co-operation as well as extended enterprise integration. IT plays a major of role in both integration and creating demand, market for products, and services in SCM.

Mastery of Operational Competencies in The Context of Supply Chain Management

Supply chain management (SCM) is a concept that encompasses different perspectives and has been the object of numerous studies in various academic fields such as marketing, operational management, purchasing and logistics. A growing number of studies conclude that the supply chain may also be a setting where competencies can be developed, in particular core competencies (Dyer and Singh, 1998).

According to Rungtusanatham et al. (2001), during the past 20 years, several studies have attempted to integrate different supply chain management dimensions, such as the nature of information exchanged and the improvement of competitive priorities, supply chain integration practices and their impact on demand amplification phenomenon, the impact of supplier involvement in product design, and the impact of strategic sourcing on operational performance improvement. In recent years, a growing number of studies have considered supply chains, not only as a network to get products where they need to be, but also as a tool to enhance key outcomes. For example, the works by Green et al. (2006) and by Zailani and Rajagopal (2005) show a very strong relationship between supply chain management practices and performance improvement.

In extrapolating the ideas set forth by Braganza (2002), this notion of integration refers to a concept of two‐way communication and coordination of knowledge among the echelons. The characteristic of notions and integration according to two dimensions which is a horizontal perspective and a vertical perspective. First, using a horizontal perspective, coordination practices can be used with a more or less large number of partners in the supply chain. This connection can move backward to suppliers or forward to customers. Besides that, using a vertical perspective, propose a spectrum of knowledge coordination practices that can range from being absent in certain business relationships (open‐market negotiations) to being very present and leading to a sharing of more strategic information, thus contributing to improved performance of the supply chain (collaboration). We define that the supply chain integration as the various management practices associated with the linking of activities with a varied level of added value and the deployment of these practices with a small or large number of partners. Greater integration of the supply chain (characterized by the intensive deployment of supply chain management practices) is associated with increased mastery of a company's core operational competencies.

For the data collection and sample, to study operational competencies within supply chains, we have decided to conduct a survey of Canadian manufacturers and have developed a questionnaire. The questionnaire was pre‐tested with four respondents. These respondents worked for large industrial companies (electronics, pharmaceuticals, aerospace, transport) and were experienced in the design of questionnaires. The length of the questionnaire as well as the fact that it was sent mainly to small‐ and medium‐sized enterprises may explain this low response rate. To measure the potential presence of such a bias, we have applied the test used by Zsidisin and Ellram(2003) and by Green et al. (2006), which consists of comparing the date of early and late respondents. This test is based on the assumption that the final respondents tend to have a similar behavior to that of the non‐respondents.

In four respondent profiles, the collected data were entered into an Excel spreadsheet. This database was then transferred to the SPSS program. The initial analyses aimed to assess the explanatory nature of the variables and their degree of overlapping aiming to classify the relational practices in the upstream and downstream supply chain of the companies in our population sample. These four groups are characterized by different upstream and or downstream integration levels in their supply chain. To confirm this result, must carry out an undirected classification using SAS software. To use this software because it allows the construction of an algorithm that determines the optimal number of clusters, whereas the SPSS software version we were using required us to first determine this number.

A first group of 20 respondents that we label as “balanced integrated”. The second group is made up of 49 companies focusing on supplier integration practices, and is labeled “upstream integrated”, a third group of 42 respondents is labeled “downstream integrated” and finally, the last group comprises 52 companies and is called “defensive integrated”. Since the determination of these four groups is based on a composite index built on several statements, a relatively high global score could be the result of high scores on some of the statements. The supply chain of these respondents is thus characterized by a great overlap of responsibilities with many stakeholders, both upstream and downstream.