Utilizing IT as an Enabler for Leveraging the Agility of SCM

Abstract

Supply chain management (SCM) is the 21st century operations strategy for achieving organizational competitiveness. Companies are attempting to find ways to improve their flexibility, responsiveness, and competitiveness by changing their operations strategy, methods, and technologies that include the implementation of SCM paradigm and Information Technology (IT). The use of IT is considered as a prerequisite for the effective control of today’s complex supply chains. Indeed, a recent study is increasingly dependent on the benefits brought about by IT to: improve supply chain agility, reduce cycle time, achieve higher efficiency, and deliver products to customers in a timely manner (Radjou, 2003). However, IT investment in the supply chain process does not guarantee a stronger organizational performance. The debate on the ‘‘IT-productivity’’ paradox and other anecdotal evidence suggests that the impact of IT on firm performance remains unclear (Lucas & Spitler, 1999). In fact, the adoption of a particular technology is easily duplicated by other firms, and it often does not provide a sustained competitive advantage for the adopting firms (Powell & Dent-Micallef, 1997). The implementation of IT in the SCM can enable a firm to develop and accumulate knowledge stores about its customers, suppliers, and market demands, which in turn influences firm performance (Tippins & Sohi, 2003). The main objective of this paper is to provide a framework that enhances the agility of SCM with IT. The rest of this article is organized as follows. IT systems and Supply Chain Management will be described in the next sections. Therefore we begin with a brief review of the IT and SCM. Definitions for agility–as key subjects in this articleare ambiguous. Then, leveraging the agility of SCM is argued and the framework is represented. This is ended by conclusion.