Supply Chain Level Research Articles

Can a supplier benefit from investing in transaction-specific investments? A multilevel model of the value co-creation ecosystem perspective

Purpose This paper aims to build and empirically test a multilevel framework integrating transaction cost economics and a resource-based view into a value co-creation ecosystem perspective to explain the chain- and firm-level effects of transaction-specific investments (TSIs) on supplier performance. Design/methodology/approach This paper investigates cross-level network effects using survey data from the List of Taiwanese Central Satellite Production Systems. A total of 34 buyers (hub firms) and 106 suppliers (satellite firms) from 34 supply chains responded to the survey. Findings Findings confirm that individual firms’ TSIs can foster co-specificity at the supply chain level, thereby improving supply chain integration (SCI). SCI can have a positive cross-level moderating effect on the TSI–performance relationship. Research limitations/implications These two key concepts, value co-creation and co-specificity, extend the theoretical application of transaction cost theory and the resource-based view to cross-level study by contributing to the research on the TSI–performance relationship. Practical implications This study’s framework is a counter to the buyer–supplier–supplier relationships in which each actor who may have different goals can create value jointly and share benefits from their TSIs. Social implications Owing to high co-specificity, being embedded in a well-integrated supply chain can be a threat when the environment is turbulent; for losing strategic flexibility, co-specificity and embeddedness may result in a collective adaptation concern. High degrees of SCI may slow the reaction to environmental turbulence for both buyers and suppliers. Originality/value Individual firms’ TSIs can foster co-specificity at the supply chain level, subsequently enhancing SCI. An integrated supply chain can be a collective asset that facilitates value co-creation. Individual firms can benefit from the sharing of collective value. SCI can also increase switching costs, thus reducing the likelihood of individual firm engaging in opportunistic behavior and cost safeguarding.

Uncovering the dark and bright sides of implementing collaborative forecasting throughout sustainable supply chains: An exploratory approach

This research inquired into the constituents making up the dimensions of the United Nations (UN) Global Compact, explored the challenges and opportunities associated with collaborative forecasting. This direction was motivated by the fact that social sustainability, has received minimal attention in the literature. This study determined the constructs that are critical to creating sustainable supply chains. A three-phase Delphi approach involving qualitative and quantitative analyses was carried out. Feedback was obtained from 18 international experts who are very knowledgeable about collaboration and sustainable supply chains. Initially, 24 independent constructs that can be regarded as sub-dimensions of the dimensions making up the UN Global Compact were identified. However, sub-questions directed at all opportunities and challenges that are encountered at both corporate and supply chain levels yielded 38 constructs. Finally, eight key constructs were identified as highly critical to supply chain sustainability. No study has directly extracted the sub-dimensions of the UN Global Compact dimensions, and most research focused on economic and environmental sustainability while neglecting social sustainability. The current work is an attempt to address these gaps. Additionally, the research directed attention to the neglected relationship between collaborative forecasting and supply chain sustainability.

Simulation based optimization of multi-product supply chain under a JIT system

It is scientifically challenging to determine the inventory level all through the supply chain in such a way that the desired objectives such as effectiveness and responsiveness of the supply chain system can be obtained. Simulation is a means for solving various problems which cannot be solved by regular exact models such as mathematical ones due to their complexity. The present paper is aimed at simulating lean multi-product supply chain system as well as optimization of the objectives of supply chain. Variables of the simulation model include two types of Kanbans namely withdrawal, and production to determine the inventory level, and batch size of delivery parts for each stage of supply chain. So, in this paper simulation model was developed for supply chains, taking into consideration the different production scenarios and were modeled and compared. A production scenario is adopted for each level of the chain in order to achieve the objectives. The use of meta-heuristic techniques leads us to optimization of these variables which helps decrease delay of both product delivery and inventory level of supply chain. In this case, Genetic Algorithm has applied to find the best variable values of each scenario (included in the right number of each Kanbans), aimed at decreasing the costs and delivery delays. An example based on a case study is given to illustrate the efficiency of the proposed approach. Considering each level of supply chain, the ratio between and among cost, inventory, and delivery delay variables were obtained.

A scenario-based possibilistic-stochastic programming approach to address resilient humanitarian logistics considering travel time and resilience levels of facilities

There is a great deal of interest in addressing humanitarian logistics due to the need for emergency services in the case of disaster. Controlling both operational and disruption uncertainties in the emergency management is one of challenging topics lately to propose a robust plan for humanitarian logistics. Designing a robust and resilient humanitarian relief chain networks under both operational and disruptive risks can ensure the delivery of the essential supplies to beneficiaries. In this paper, a humanitarian logistic network design with multiple central warehouses and local distribution centres in an integrated manner is addressed by a novel scenario-based possibilistic-stochastic programming approach. The main real-life application of the proposed methodology is to consider the transportation network's routes after an earthquake to provide a plan against uncertainty in whole levels of supply chain along with its availability. To this end, a real case study of Mazandaran province in the north of Iran is provided to validate our methodology as well as a comprehensive discussion and managerial insights are concluded from the results.

Comparison of Cooperation Modes in a Two-Period Closed-Loop Supply Chain System considering Green Manufacturing

In order to improve the efficiency of collection and green manufacturing level in a closed-loop supply chain (CLSC) system, the manufacturer invests green manufacturing efforts in product design and production process and intends to cooperate with other CLSC members to achieve excellent performance. In a two-period CLSC system consisting of one manufacturer, one retailer, and one third-service provider, a game-theoretical approach is adopted to compare the optimal decisions and profits of the three green manufacturing cooperation modes, namely, the manufacturer cooperates with the retailer and third-service provider, respectively, and the noncooperation mode is a benchmark. Moreover, the impact of different cooperation modes on CLSC decision-making is analyzed as well. The results indicate that the influence of difference among cooperation modes on CLSC decision is significant, and cooperation is always better than noncooperation. From the perspective of consumers as well as recycling and profit, although the collection rate of used products is not the highest when the manufacturer cooperates with the retailer, the price of product is the lowest and the green property of product is the most obvious; thus, this is regarded as the suitable cooperation mode after a comprehensive analysis. Besides, a coordination mechanism is designed to solve the inefficiency caused by double marginalization. Finally, numerical examples are presented to intuitively observe the relationships between decisions and profits and the impact of different parameters on them in the three modes, and some management inspirations are proposed ultimately.

Industry 4.0 sustainable supply chains: An application of an IoT enabled scrap metal management solution

The fourth industrial revolution and the digitisation of supply chains have led companies to realize that the adoption of Industry 4.0/Internet of Things (IoT) solutions creates opportunities for more sustainable management. The sustainable management of scrap metal is a challenging task for all the organisations that participate in the supply chain and especially for scrap metal producers and waste management companies. Although metals are considered to be infinitely recycled, scrap metal management is often inefficient due to several factors including collection processes, communication and marketplace limitations, which have significant environmental and economic impacts. The purpose of this paper is to provide evidence of the impact of an IoT solution on the sustainable supply chain management (SSCM) performance. A case study from a scrap metal producer that operates in the lift industry and a waste management company is presented, in order to illustrate how the deployment of a state-of-the-art industry 4.0 solution has the potential to improve sustainability both in the firm level and in the supply chain level. Direct benefits of the introduced solution are the automation of monitoring and negotiation procedures for the produced scrap metal. Indirectly, the proposed solution is beneficial in terms of CO2 emissions’ reduction, resources availability and response time optimization. The results validate the framework for assessing SSCM for Industry 4.0 developed by Manavalan and Jayakrishna (2019) and demonstrate that Ιndustry 4.0 solutions have the potential to improve, among others, the economic, environmental and social sustainability in supply chain management. The present study contributes to the literature by bridging the gap between theoretical developments and real-world cases in the fields of industry 4.0 and SSCM. Managerial implications, limitations and future research opportunities are also provided.

Stock replenishment policies for a vendor-managed inventory in a retailing system

Using Vendor Managed Inventory (VMI), the vendor determines the replenishment decisions at the location of buyers (retailers). This strategy is used primarily for handling demand fluctuations stemming from the Bullwhip effect, leading the system to prevent from holding excessive inventory that result in a reduction in the overall cost of the supply chain. The main advantages of VMI for vendors are higher levels of accessibility to inventory information and more direct contact with the customers. Similarly, VMI has some pros for the buyers, such as shared risk with upper levels of supply chain and reduction in their holding costs of inventory. In this paper, a vendor-managed inventory system is developed containing one vendor and two buyers in which the main assumption is that back-ordering and lost sales are permitted. In this system, (r, Q) and (R, T) replenishment policies are compared according to their performances to see which one performs more cost-efficiently when partial back-ordering is allowed. In accordance, mathematical models utilizing (r, Q) and (R, T) replenishment policies are developed, and algorithms for deriving the optimal replenishment decision variables are proposed. Moreover, significant differences between the two replenishment policies are discussed. The main finding obtained by this research is that when shortage is permitted, both (r, Q) and (R, T) replenishment policies under VMI have pros and cons in different contexts.

A new sustainability indicator for supply chains: theoretical and practical contribution towards sustainable operations

ABSTRACT Both business and policymakers’ agendas have been dominated by a debate on the lack of an integrated approach to measure the sustainability level of supply chains. To help in overcoming this crucial gap, this study proposes a framework for obtaining a sustainability index based on supply chain sustainability sub-criteria, criteria, and dimensions. This study considers 63 sub-criteria and 10 criteria for sustainability triple bottom lines including environments, social and economic. Since there are always uncertainties involved with decision data, the fuzzy logic is incorporated in calculations. This study is unique in the sense that it reduces the computational complexities of previous approaches by utilising subjective preferences and a more facilitated hierarchical soft computing method. The outcomes of this study contribute the practitioners to consider more environment-related practices through their system. An illustrative case is also resolved to demonstrate the applicability of the proposed index in real supply chains.

Is this too ugly for you?

Background: Globally 1.3 billion tonnes of food are wasted every year equating to approximately 750 billion US dollars (1). In Canada it has been estimated that $31 billion of food is wasted annually (2). This amount can easily be used to feed hundreds of thousands of undernourished people across the world. Food wastage can occur at every level of the food supply chain. The purpose of this study was to evaluate the food waste generated by residents of British Columbia, Canada. The study aimed to identify the general knowledge regarding food waste and ugly produce, the attitudes of the public towards food waste, and the general practices of waste disposal. Methods: A self-administered electronic survey created on Survey Monkey Canada was distributed on various social media platforms over a two-week period in January 2020. The survey contained questions that resulted in a score for knowledge of food waste, attitude towards food waste and the waste reduction practices of British Columbian residents. Chi square and correlational analyses were performed using the statistical package NCSS. Results: 96 respondents met the inclusion criteria and completed the survey. Many participants received a medium score for knowledge (N=67) and possessed a positive attitude (N=71) towards food waste. There was an even distribution between good and fair practice level (N=49 and N=46). There was no association between level of food waste knowledge and demographic categories except for age (p=0.025). Younger participants were less knowledgeable. Between practice and demographic variables, no statistically significant associations were found. The results for attitude were determined to be non-statistically significant for age, gender and experience working in the food industry while there was a statistically significant association between attitude and an individual’s education level (p = 0.008). Those with higher levels of education had a more positive attitude. No correlation was determined between knowledge and practice indicating that there is no influence of knowledge on practice and vice versa. The study found that there is a positive correlation (p = 0.0004 and r = 0.3542) between attitude and practice indicating that these two variables influence each other. Conclusion: This study demonstrated that the population in B.C. who responded to the survey has adequate knowledge, a positive attitude and moderate practice behaviours regarding food waste. Younger individuals were less knowledgeable about food waste and the more educated one is, the more positive their attitude towards food is. The study also indicated that positive attitudes translated into better practice. These results are only a starting point in determining the causes for food loss and waste in B.C as it reveals the need for more local initiatives to bring everyone to start adopting food waste reduction strategies.

Collaborative Innovation with Dynamic Incentive Contracts in a Supply Chain

The collection and sharing of consumers’ knowledge by retailers can help manufacturers improve the innovation level of products, thereby improving the performance of supply chain. However, due to the cost of collecting consumers’ knowledge, the wholesale price contract can no longer coordinate supply chain members effectively. It is necessary to study the problem how the retailers are encouraged to make more efforts for the cooperative innovation with manufacturers. This paper introduces two dynamic incentive contracts for improving collaborative innovation level in a two-player supply chain, and the impacts of these contracts on supply chain’s performance are investigated, by using a Stackelberg differential game model. The manufacturer, as a Stackelberg leader, determines the R&D investment while the retailer is responsible for the retail price and the efforts in collection of the consumer’s information (or preference) to the products. The model incorporates a wholesale price contract and two incentive contracts to better understand how the manufacturer can facilitate the retailer’s efforts in the collection of consumer’s information and increase the profits of the members of supply chain. Our results suggest that the optimal profit of the supply chain, the retailer’s efforts in the collection of consumer’s knowledge, the retail price, and the innovation level under the reward incentive contract are higher than their counterparts in other contracts. In particular, the retailer’s optimal effort under the reward incentive contract is even higher than the one in the centralized decision scenario. However, if the manufacturer commits an effort target to the retailer, it shows that the retailer’s optimal effort is independent of the target. The manufacturer’s optimal R&D investments are constants in the three contracts under the dynamic setting. Furthermore, numerical simulations show that the effort target has little impact on profits of the supply chain although it affects the decision making of supply chain members to some extent, whereas the retailer’s marginal reward offered by the manufacturer influences the innovation level of product and the supply chain’s profit significantly.

Variation in the carbon footprint of milk production on smallholder dairy farms in central Kenya

Milk production by smallholders in Africa has a high carbon footprint (CF) and is predicted to increase significantly in the coming decades. This study, based on data from a sample of 382 farms in central Kenya, is the first assessment of the CF of milk production in Sub-Saharan Africa based on a large dataset of actual farm management practices. The aims of the study were (1) to determine whether there are significant differences in the CF of farms with different feeding systems (i.e., zero-grazing, grazing and mixed systems), and (2) to identify factors associated with variability in CF between farms. This analysis is used to identify options for mitigating GHG emissions from Kenya’s growing dairy production. Average CF ranged between 2.19 and 3.13 kg CO2e/kg fat and protein corrected milk (FPCM), depending on the GWPs and allocation method used. Analysis based on variability in farm management showed that CF was similar between farms with zero-grazing and mixed feeding systems, and significantly higher on farms with grazing only feeding systems, but no difference was detected when input parameter uncertainty was considered. At individual cow level, variation in milk yields explained more than 70% of the variation in GHG intensity. At farm level, milk yield explained less than half of variation in CF. CF was correlated with feed characteristics, manure management practices and herd size and composition. In particular, the level of concentrate use was positively correlated with CF, and was the most important factor explaining variation in CF not attributable to variation in milk yield. Our findings suggest that promoting balanced feed rations and feeding concentrate according to cows’ needs across the lactation cycle could provide opportunities to both increase milk production and reduce the CF of milk production on smallholder farms in central Kenya. Supporting smallholder farmers to implement these mitigation options will require interventions at several levels in feed supply chains in the dairy sector.

Servitization and supply chain integration: An empirical analysis

Supply chain literature highlights the importance of the role of supply chain partners in a manufacturer's journey towards servitization. However, there is scarce empirical research seeking to explain supply chain level factors that enable servitization. Using resource dependence theory, we argue that servitization orientation encourages organizations to enhance supplier, internal, and customer integration (three dimensions of supply chain integration) which in turn enhance servitization (basic and advanced service provision) ultimately affecting firm performance. Covariance-based structural equation modelling is applied to test the hypotheses using data of 307 manufacturing companies obtained from the sixth version of International Manufacturing Strategy Survey. Empirical examination provides evidence that servitization oriented firms enhance internal integration and the integration with key suppliers and customers. However, there is an uneven relationship between firm's integrative practices with suppliers and customers and the provision of basic and advanced services such that enhanced provision of basic services requires more supplier integration while enhanced provision of advanced services requires more customer integration. Also, the performance implications of different types of service provision are found to be unequal. These findings suggest that servitization oriented firms need to improve a specific dimension of supply chain integration to enhance a particular type of service provision. The paper makes an initial attempt to empirically explore the enabling role of supply chain integration in facilitating servitization.

ANALISIS DAN PENENTUAN STRATEGI PERBAIKAN NILAI TAMBAH PADA RANTAI PASOK KELAPA SAWIT (STUDI KASUS PROVINSI RIAU)

Palm oil has become a leading commodity for improving the economy in Indonesia. At present, many people depend their lives on the plantation and oil palm agro-industry sectors through the establishment of supply chain links. In the palm oil supply chain, there are business actors from upstream to downstream. However, nowaday, every actor has different added values ​​for each level. This study aimed to measure the level of added value at each level of the palm oil supply chain and at the same time determine the strategy of added value improvement in the future. Based on calculations made by the Hayami method, added values at the level of independent smallholders, traders, and factories were 18.6%, 20%, and 28%, respectively. While the profits obtained by farmers, traders, and factories were Rp 4,125,900, Rp 56,400,000, and Rp 4,127,324,500, respectively. Then, by using the Non-numerical Multi Expert Multi Criteria Decision Making Method, recommended strategies have been obtained, among others through improving GAP, and development of cooperation and partnerships. Keywords: added value, palm oil, supply chain, strategy

HALAL RISK CONTROL AT THE UPSTREAM LEVEL OF THE BROILER CHICKEN SUPPLY CHAIN

Halal Assurance System (HAS) was develop over the past 6 years and has undergone several changes and enhancements in terms of its policy requirement in 2019 by JAKIM. However, the implementation of HAS in the poultry industry only discuss the development of this system at the slaughtering stage and also produces downstream of chicken products only. Therefore, there are still no studies that focus on the implementation of HAS at the upstream level of the halal food supply in livestock farms although much research has been conducted. The basic criteria emphasized in the HAS is the determination of the halal control point at each step or process involved. For example, there is five elements in the farming of broiler farms that have been identified as halal risks consisting of food and beverage, medical, farm biosecurity and infrastructure, and logistics were proposed by the authors. Therefore, the qualitative methodology approach through documentation analysis is used to obtain sources of information to discuss the importance of HAS and to explain the elements of halal risk control (HRC) in poultry farming activities. Implementing of this systematic system can also help the industry especially in the livestock sector and the implementation of halal certification policies makes it a key in maintaining the transparency and halal integrity to benefit the consumer starting from the upstream level of halal food supply chain. The study also suggested that the HAS be applied in the poultry sector in future and that it would also have a positive impact if it was implemented in other livestock activities such as others ruminant animals and fish which it is a main supply of halal meat to the Muslim communities in Malaysia.

Determining the antecedents of dynamic supply chain capabilities

PurposeThe purpose of this paper is to determine the antecedents of dynamic supply chain capabilities (DSCCs). The authors test entrepreneurial orientation (EO) and supply chain learning orientation (SCLO) as two antecedents of DSCCs.Design/methodology/approachThe paper uses structural equation modelling to test a hypothetical model. Data are gathered from a survey of 275 operations managers in Pakistan’s turbulent manufacturing industry.FindingsThe findings suggest that the weaker direct effects of EO, in comparison to the indirect effects, indicate that an SCLO mediates the relationship between EO and DSCCs.Research limitations/implicationsIt is widely accepted that firms do not compete with each other, instead, it is end-to-end supply chains that fight for market dominance. Many scholars use the dynamic capabilities view to understand supply chain level competition. However, the dynamic capabilities view is firm-centric in its examination of how companies transform internal resources to compete in the external environment. The theoretical contribution of this paper is a roadmap of how to build dynamic, supply-chain level and capabilities by determining the key antecedents. This paper explains that DSCCs emerge when buyers and suppliers share strategic orientations. Firms with an EO and the ability to learn with supply chain partners are well-positioned to develop DSCCs. This provides a new angle to theory testing by indicating that dynamic capabilities are enabled by an EO and an ability to learn with supply chain partners.Practical implicationsManagers are given the building blocks of DSCCs, starting with fostering an entrepreneurially-oriented mindset in the company and then learning with supply chain partners. Entrepreneurially-oriented managers are encouraged to take risks and co-develop innovative ideas with suppliers during the supply chain learning process.Originality/valueThis study is one of the earliest efforts to determine the strategic orientations that antecede the emergence of DSCCs.

Factors associated with stockout of Nevirapine syrup in Oshana Region, Namibia.

Infants who are born with HIV/AIDS is still a public health concern in developing countries, especially in Sub Saharan Africa. In Namibia, it is estimated that the prevalence rate of HIV pregnant women is around 17.2%, makes it to be among the countries with the highest prevalence rates among HIV women in sub-Saharan Africa (SSA). Some improvement regarding Prevention of Mother to Child Transmission has been made, however, frequent stock out of Nevirapine syrup continues to slow down, government efforts to foster the emergence of an HIV-free generation of Namibians. Given the nature of current conditions, justification exists for a study to determine the factors associated with stock out of Nevirapine (NVP) syrup.Mixed method was employed. In which descriptive approach was employed to acquire data from a period of five years retrospectively (2012-2016) and informants from different levels of supply chain in Oshana region. Initial, order receiving is not a predictor of NVP syrup. Lack of pharmaceutical knowledge is the biggest challenge which leads to sporadic stock out of NVP syrup. Pharmaceutical knowledge of ordering NVP syrup is needed to prevent stock out of NVP syrup. It is a recommendation of this study that training is needed for staffs who are involved in ordering of pharmaceutical items.

Multilevel environmental assessment of the anaerobic treatment of dairy processing effluents in the context of circular economy

The capability of Anaerobic Digestion (AD) in minimising waste and retaining the value of materials and energy within the biological and technical cycles in the Dairy Industry (DI) makes AD a critical instrument of transition to circular economy. The aim of this paper is to propose an approach for measuring the environmental performance of the anaerobic treatment of dairy processing effluents based on the circular economy principles. The potential of AD to close the water, energy and nutrient circular loops is investigated together with the relevant environmental costs and benefits at different levels of the dairy supply chain. The developed methodology was based on Material Flow Analysis (MFA) and Life Cycle Assessment (LCA) applied at three different system levels: the AD plant, the dairy processing facility, the entire dairy supply chain. The approach is demonstrated in a dairy facility coupled with a full-scale AD unit. The results show that the excess electricity (426 MWh/annum) and heat (1236 MWh/annum) produced from the AD plant cause significant reduction of the overall environmental impact of the processing facility. The recovered energy from AD provides 20% of the energy requirements of the factory reducing the total carbon footprint emissions by 13% compared to the baseline scenario.

Geographical Indication to Build up Resilient Rural Economies: A Case Study from Ghana

This paper deals with Geographical Indications (GI) as a critical strategy aimed to boost agri-food local supply chain and rural development. The main concern of this work, therefore, is to verify how the identification of these products and establishment of GI systems can propel sustainable development in local areas in Africa. Two assumptions are at the basis of our paper: viable GI systems can be established in Africa, and the establishment of a GI system can stimulate rural development. In order to clarify the process of GI setting up and valorization, we will test GI virtuous circle and the rural web, with the purpose of exploring the multiple dimensions (endogeneity, social capital, sustainability, novelty, institutional arrangements, governance of markets) interfering in the process at both the agri-food supply chain and rural context levels of analysis. The analysis is applied to the shea butter production in Ghana and will employ primary data. Questionnaires and interviews were administered in the study area (Yendi Municipality of Ghana) to gather both qualitative and quantitative data. Our analysis confirms the potentialities of the shea butter as GI, by underlying its engine for the development of local rural communities.

An assessment of emerging networks in the fruit sector: The case of inca berry in Ecuador

The diversification of agri-food products through emerging chains has a fundamental social and economic role in Ecuador. A substantial amount of research focused only on examining critical factors in terms of agronomic and environmental performance. However, there is a shift in the agri-food chain perspective and study towards more sustainable models of production, logistics trade, and consumption. Aspects such as the socio-economic sustainability, level of collaboration between actors, an adequate chain configuration, and the employment of smart governance mechanisms show the weaknesses where stakeholders can propose enhancements. In this respect, socioeconomic and productive factors are consequential and still affecting the progress of these chains. Also, the current growth of market opportunities at the local and international level is a driver to support them by setting sustainable strategies. This study aimed to analyze socio-economic and production aspects to understand the dynamic across the emerging Inca berry (Physalis peruviana) chain located in Ecuador and bring forward potential strategies. Thus, chain vertical and horizontal dimensioning was introduced to contribute with relevant insights. The framework applied accounts with a revision of primary and support activities, and flows of high and low relevance. The investigation clustered pre-production, production, and post-production tiers. Also, it executed the food chain mapping, the identification of chain actors, and application of surveys at the supply chain levels to identify strengths and weaknesses based on specific socio-economic and productive variables. Results stated several viable long-term strategies. Examples of those strategies are the diversification of marketing channels, the intervention of academic institutions to improve efficiency, productivity, and the associations' empowerment. All of them aimed at circular economic models. The main research contribution is the application of the chain configuration to assess the chain performance comprehensively. Based on the results, our recommendation is incorporating new indicators to analyze the environmental and institutional components profoundly.

How does IATF 16949 add value to ISO 9001? An empirical study

This article analyses the added value of IATF 16949 – a standard for quality management in the automotive sector – with respect to ISO 9001, the most popular standard for quality management worldwide. An exploratory qualitative study was carried out based on a multiple case study. Eight companies operating at different levels of the Spanish automotive sector supply chain were analysed and 27 interviews were conducted – 17 with managers of these companies and 10 with auditors and consultants. Multiple internal and external sources of documentation were also analysed. The findings show that IATF 16949 adds value to a more flexible ISO 9001 in five main areas: market, customer service in the supply chain, operational performance, staff, and technology. Overall, IATF 16949 is seen as a ‘license to operate’ for automotive sector suppliers, for whom ISO 9001 seems to have lost its signalling value. This study sheds light on the raison d'être of sectoral standards for QMSs such as IATF 16949 and contributes to the literature on the neo-institutional approach to QMSs and explains some of the main weaknesses of ISO 9001.