Supply Chain Restructuring Research Articles

The Restructuring of Agrifood Supply Chains in CEE and the CIS

The recent restructuring of relationships between farmers and the buyers of agricultural output (principally processors and retailers) in Central and Eastern Europe (CEE) and the Commonwealth of Independent States (CIS) is reviewed. The interconnected growth of contracting, multiple food retailers, imposition of private standards and foreign direct investment have contributed to the internationalization of agri-food markets in the CEE–CIS region. The restructuring of supply chains is profoundly affecting the opportunities available to farmers in CEE and the CIS. The paper advocates that public support to the agricultural sector should be geared to enabling domestic farmers to have access to restructured food supply chains, in contrast to much of the assistance to develop market infrastructure in the 1990s, which was geared to commodity spot markets, which in many cases are now in decline.

Emerging Hubs in Central-Eastern Europe, Trade Blocs and Supply Chain Restructuring

Many European countries have faced the erosion of the competitive advantage in the international market with a mixed stratgy of productivity increase at home and labour cost reduction abroad, through the international fragmentation of production and subcontracting in low wage countries. Italy in particular, has delocalized segments of its industrial production in Eastern Europe. The advantage of delocalization abroad - with particular reference to East European countries - is due to the low cost of labour, depends from the capability to transmit information efficiently and the availability of a complete supply-type blueprint in the receiving country. The paper discusses the prospects open to Italia apparel firms and presents a case study dealing with the development of outsourcing by the Benetton group in the last decades.

Foreign Investment, Supermarkets, and the Restructuring of Supply Chains: Evidence from Eastern European Dairy Sectors

The combination of transition and globalization since the early 1990s has caused dramatic changes in supply chains globally. This paper uses survey evidence from several Eastern European countries (Albania, Bulgaria, Poland, Slovakia, Romania and Russia) on how these forces affect the dairy sector. In many countries dairy farms are small family farms. Investments by foreign companies in processing and retailing and the opening to international markets have introduced higher standards, leading, in turn, to extensive contracting and vertical coordination in the dairy chain. In countries close to the EU the restructuring of the dairy chain was mostly driven by investments in dairy processing, while in countries further from the EU, and less advanced in transition, retail investments are playing a more important role in driving change throughout the dairy chain. There have been significant efficiency gains, and the vertical coordination had positive effects on farm investments and productivity, especially since the late 1990s. Evidence suggests that small dairy farms have generally benefited from the vertical coordination processes.

Impact of the Rapid Rise of Supermarkets on Dairy Products Systems in Argentina

The reconfiguration and consolidation of food retailing in Argentina during the 1990s profoundly changed the marketing system for food and agricultural products. The new commercial requirements and ‘rules of the game’ imposed by supermarkets on their suppliers have caused a substantial restructuring of supply chains — a process in which some suppliers fail. This article describes the changes in the past decade in the Argentine retail sector, and then focuses on the effects of those changes (and related changes in processing) on milk products supply chains. Its conclusions focus on the challenges specific to small farms and firms in the face of this transformation.

Ports as elements in value-driven chain systems: the new paradigm

This paper argues that, with the rapid and pervasive restructuring of supply chains and of the logistics pathways in which ports are embedded, existing paradigms no longer offer adequate insights into the functions of ports or port authorities. Rather, ports must now be seen as elements in value-driven chain systems or in value chain constellations. They deliver value to shippers and to third party service providers; customer segmentation and targeting is on the basis of a clearly specified value proposition; and the port captures value for itself and for the chain in which it is embedded. The role of ports and port authorities, and the way in which they position themselves in the new business environments beyond 2001 must be defined within a paradigm of ports as elements in value-driven chain systems, not simply as places with particular, if complex, functions.

Logistical Restructuring of Supply Chains of Building Materials and Road Freight Traffic Growth

ABSTRACT Explaining increasing road freight demand solely in terms of growth of Gross Domestic Product and road tonne-kilometres is not sufficient. The objective of this article is to identify how changes in logistical decisions of firms in the building materials industry affect the resulting demand for road freight transport in this industry. Based on the analysis of national and international transport statistics (research on a macro level), it is first estimated how much the growth in lorry traffic is a function of economic growth and how much is attributable to changes in the logistical organisation. Second, it is analysed whether a multiple case study of supply chains in the building materials industry (the micro analysis) supports the outcomes of the macro analysis. The relationships between changes in the logistical decisions of firms in these supply chains and the key parameters affecting the increased demand for road freight transport in the building materials industry are demonstrated.

The Geography behind the Internet Cloud - Peering, Transit and Access Issues

In 1999, the Internet development varies considerably by geographic region. The network of networks is the most transforming invention and is developing at a far greater speed than any other technology of the 20th century. The Internet affects the way people do business, learn, play and work and TCP/IP is the protocol which defines the Internet. The levels of change are very different : social and cultural changes through increased networking, re-location of companies and new forms of businesses and organisations, restructuring of supply and demand chains and new working methods as well as reshaping of processes in retail and wholesale business. These changes influence the spatial structure due to the kind and geographic spread of access and connectivity to networks beside the location pattern of the Internet industry itself. The growth potentials of the Internet are mainly influenced by the availability and performance of physical network infrastructure. Since Internet Service Providers (ISPs) partially use the public-switched network, access to backbone network resources via leased lines, local access via unbundled local loops, co-location and interconnection are important to the growth of the information society. The key drivers for the development of telecommunications infrastructure for access to the Internet and global connectivity are to ensure competition and appropriate regulation of dominance to maximise the roll-out to rural geographic areas, to new subscribers and to ensure a reasonable quality of service while at the same time encouraging carriers to compete for those markets. This paper provides insight behind the Internet cloud and the regulatory environment which has a significant impact on the development and connectivity of places and thus spatial structures within regions and countries. It considers the broad infrastructural issues, the structure of the market and the role played by tele¬ communications operators and discusses the market dynamics of access and Internet interconnection. In order to understand market dynamics of the Internet industry and the spatial implications, issues of traffic flows and communication structures, recent backbone market changes and interconnection on the backbone as well as local level regarding peering and transit systems need to be observed. Pricing of leased lines and Internet access pricing as well as special access products offered by Incumbents to ISPs to connect their customers are important elements which define the different developments of the Internet throughout geographic regions. Considering costs of connectivity and access, localisation of traffic nodes and geography of investments in new IP infrastructure, space and distance remain important for the evolution of the Internet

LOGISTICS PARTNERSHIPS AND SUPPLY CHAIN RESTRUCTURING: SURVEY RESULTS FROM THE U.S. COMPUTER INDUSTRY

This research investigates the interaction between formation of logistics partnerships and supply chain restructuring in the U.S. computer industry via a survey of 30 ongoing partnerships. Partnerships that have included restructuring are compared to those that have not. Examples of representative partnerships are presented. The survey results indicate that restructurers use partnerships to facilitate restructuring. Restructurers and non‐restructurers form partnerships for different reasons and realize different types of benefits. Furthermore, restructurers realize greater benefits than do non‐restructurers and view their partnerships as more successful. Restructurers report dramatic improvements in logistics cost (1l‐30%) and order cycle time (62%). The research contributes to the existing literature by highlighting restructuring as an important aspect of logistics partnership formation and by presenting empirical data that shows how the two strategies are linked.

Structural Changes in the Supply Chain

Logistics is changing from a focus on cost reduction and service improvement at the firm level to an emphasis on supply chain restructuring and organizing to increase overall efficiency and effectiveness. In this article, we focus on structural changes in the supply chain, the results of which are the reengineering of materials management, physical distribution and sales activities. Using case studies, we identified five different structural changes which affected the organization of logistics, marketing and sales activities. By using modern information technology, it was possible to centralize physical and administrative activities and, at the same time, maintain a decentralized sales organization. Total distribution costs were reduced by 30‐50 per cent and customer service was significantly improved.

Global Supply Chain Management at Digital Equipment Corporation

Digital Equipment Corporation evaluates global supply chain alternatives and determines worldwide manufacturing and distribution strategy, using the Global Supply Chain Model (GSCM) which recommends a production, distribution, and vendor network. GSCM minimizes cost or weighted cumulative production and distribution times or both subject to meeting estimated demand and restrictions on local content, offset trade, and joint capacity for multiple products, echelons, and time periods. Cost factors include fixed and variable production charges, inventory charges, distribution expenses via multiple modes, taxes, duties, and duty drawback. GSCM is a large mixed-integer linear program that incorporates a global, multi-product bill of materials for supply chains with arbitrary echelon structure and a comprehensive model of integrated global manufacturing and distribution decisions. The supply chain restructuring has saved over $100 million (US).