Supplier Capabilities Research Articles

Value Creation and Value Capture: Lessons Learnt from Indonesian Suppliers Inserted into GVC

The development of global value chain (GVC) has confirmed a paradigm shift in international studies. GVC suggests that the globalization of economic activity brings about gains for developing countries through capability improvement of their firms supplying for lead firm. Nevertheless, there is only a small number of developing countries insert into GVC and successfully enhance their economy. This paper aims to understand how developing countries decide to participate in and to upgrade along GVC by taking cases from Indonesian suppliers across industries. The narratives reveal that the distribution of value creation between Indonesian suppliers and lead firm within GVC is critical for the decision making to engage and to upgrade. It indicates that the suppliers scrutinize the relationship to ensure that the value creation is not only technically feasible to fit intheir existing resources and capabilities, but more importantly economically justifiable to capture more of value being created. The problem of power asymmetry tends to result in inequitable distribution of cost and benefit in value capture by Indonesian suppliers and lead firm. This makes the value creation and value upgrading within GVC less economically attractive course of action. The implication for further research on GVC shouldhighlight the value capture particularly within governance in which power asymmetry exists, while public policy should facilitate to strengthen distinctive resources and capabilities of suppliers.

Sustainable maintenance supplier performance evaluation based on an extend fuzzy PROMETHEE II approach in petrochemical industry

Petrochemical industry is a high-pollution and high-risk industry. Under the trend of maintenance business outsourcing in petrochemical industry, the performance of maintenance suppliers is directly related to operation safety. Faced with large scale and varied capability of maintenance suppliers working in a dangerous environment with high temperature, high pressure and high explosivity, petrochemical companies need to evaluate the sustainability performance of maintenance suppliers with appropriate evaluation criteria and methods. However, few scholars focused on this problem of particular industries. Therefore, in this paper, a novel performance evaluation criteria framework of maintenance suppliers was formulated and an extended fuzzy PROMETHEE II method was proposed to assess their actual performance. Firstly, considering the lack of performance criteria in maintenance process of petrochemical firms, a sustainable supplier performance evaluation criteria framework was established from 3 dimensions, including basic aspect, processing aspect as well as sustainability aspect; Secondly, the fuzzy PROMETHEE II approach was presented by combining the fuzzy set theory with PROMETHEE II method; Finally, based on the case study of a Chinese petrochemical enterprise and sensitivity analysis of the decision framework, the effectiveness of the performance evaluation criteria and the applicability of the employed method were verified.

New approaches to supermarket supplier development programmes in Southern Africa

ABSTRACT Supermarkets are strong catalysts to stimulate the growth and development of suppliers of processed food and manufactured products in Southern Africa. This paper assesses the role of supermarkets and governments in developing supplier capabilities through supplier development programmes. In South Africa, a shift is evident in supplier development programmes by supermarkets away from mere compliance as part of black economic empowerment or social responsibility objectives, to more mutually beneficial, commercially oriented and long-term investments. There is still considerable scope to replicate, broaden and deepen these programmes, including extending them to the region. The paper draws lessons from the Namibian Retail Sector Charter as the first and only sector-wide intervention in the region that combines a voluntary code of conduct and supplier development commitments, with complementary support from the government. The paper also highlights interventions in South Africa and internationally on efforts to curb supermarket buyer power which negatively affects suppliers.

Eight Weeks Later—The Unprecedented Rise of 3D Printing during the COVID-19 Pandemic—A Case Study, Lessons Learned, and Implications on the Future of Global Decentralized Manufacturing

The eruption of the severe acute respiratory syndrome coronavirus 2 (SARS-CoV-2) (corona virus disease, COVID-19) in Wuhan, China, and its global spread has led to an exponentially growing number of infected patients, currently exceeding over 6.6 million and over 390,000 deaths as of the 5th of June 2020. In this pandemic situation, health systems have been put under stress, and the demand for personal protective equipment (PPE) exceeded the delivery capabilities of suppliers. To address this issue, 3D printing was identified as a possible solution to quickly produce PPE items such as face shields, mask straps, masks, valves, and ear savers. Around the world, companies, universities, research institutions, and private individuals/hobbyists stepped into the void, using their 3D printers to support hospitals, doctors, nursing homes, and even refugee camps by providing them with PPE. In Germany, the makervsvirus movement took up the challenge and connected thousands of end users, makers, companies, and logistic providers for the production and supply of face shields, protective masks, and ear savers. The Karlsruhe Institute of Technology (KIT) also joined the makervsvirus movement and used its facilities to print headbands for face shield assemblies and ear savers. Within this paper, the challenges and lessons learned from the quick ramp up of a research laboratory to a production site for medium-sized batches of PPE, the limitations in material supply, selection criteria for suitable models, quality measures, and future prospects are reported and conclusions drawn.

Supplier–supplier coopetition and supply chain disruption: first-tier supplier resilience in the tetradic context

PurposeThe present study considers disruption in the buyer–supplier–supplier triad. This triad has a common second-tier supplier as the disruption source, which gives us the tetradic context. The goal is to advance the knowledge on how a first-tier supplier's resilience against lower-tier disruptive events can be developed through horizontally connecting with the other first-tier supplier and how the buyer can benefit from its first-tier suppliers' resilience capability.Design/methodology/approachData from 33 triads was collected and analyzed.FindingsAs predicted, coopetition between two first-tier suppliers increases the first-tier supplier's capability to be resilient to disruptive events emanating from a lower tier source. However, contrary to initial theorization, the first-tier supplier's resilience capability affects the buyer's performance during disruptive events negatively. With increasing buyer–supplier social bonds, this negative relationship can partly be alleviated.Research limitations/implicationsAnalyzing resilience within a triad to a disruption in the tetradic context reveals unexpected dynamics. Individual supplier's resilience may have a negative impact on the buyer's resilience in certain disruption events.Practical implicationsThe buyer can increase collective suppliers' resilience through establishing horizontal links. To prevent becoming a victim of the supplier's resilience in the event of a second-tier disruption, a buyer needs to become a member of the supplier's relational network.Originality/valueWe propose that resilience can rest with the suppliers. This observation has implications for the buyer when selecting and coordinating suppliers. Further, it considers a context beyond a triad by venturing into the tetradic context. We anticipate more studies in tetrads in future and this study can serve as a bridge.

Evaluation Research and Application of Cloud Service Provider Based on Real-Time Data

How to choose the right supplier from many cloud service providers has become a research hotspot. Basing on real-time data, we propose a method for evaluating and choosing the supplier of Machine Tool. Firstly, we establish the index evaluation system of Machine Tool’s performance. Secondly, we apply analytic hierarchy process (AHP) and entropy method to determine the weights of performance indexes. We obtain the performance assessment by the weights. Thirdly, taking the cost into consideration, we calculate the comprehensive assessment score. Finally, we take two service suppliers as example, and draw a conclusion that the service capability of supplier 2 is better than that of supplier 1. The assessment method proposed in this paper provides a reference for matching the service provider and the service demander.

Perceptions of supplier impacts on sustainable development in the mining and minerals sector: a survey analysing opportunities and barriers from an Australian perspective

Suppliers have an important role in enabling the mining and minerals industry to achieve their goals for sustainable development and demonstrating corporate responsibility. Barriers that are limiting their business’ ability to maximise the contribution of suppliers to business outcomes were a limited understanding of their client’s business’ (by suppliers), insufficient time, and resources to dedicate to managing suppliers effectively (from the mining company’s perspective), and preferred vendor status. When mining companies had successfully engaged with suppliers, the supplier understood the needs of the business and tailored its approach accordingly. The supplier could demonstrate how its own commitment to environmental management and sustainable development would benefit the mining operation so understood the needs of their client. The supplier created value for the mining operation by reducing costs and providing an improved solution (compared with existing solutions). The supplier also knew the life-cycle impacts of its own goods and/or services on the mining operation’s business. Recommendations for future research would be in understanding application of blockchain and other technologies to streamline the transactions between suppliers and mining companies. They also could include harnessing the capabilities of suppliers to de-risk supply chains in terms of modern slavery, increasing the efficiency of their supply chains (i.e. reduce time, cost, maintaining quality), and eliminating waste in the broadest sense across mining operations.

Impact of Supply Chain Transparency on Sustainability under NGO Scrutiny

We analyze a brand's disclosure of its supplier list to improve the suppliers’ compliance with social and environmental sustainability standards. We develop a model of a buyer, a supplier, and an NGO; when a violation of the supplier occurs, the buyer and the supplier both incur penalties. Given that the disclosure influences the NGO's perception of the supplier and results in a different level of NGO scrutiny, the buyer decides whether to reveal her supplier. Our model characterizes the buyer's optimal revelation strategy and provides the equilibrium efforts of the supplier and the NGO. The results show that an increase in the penalty for the supplier or an increase in the NGO's auditing efficiency always gives the buyer an incentive to reveal the supplier and has a beneficial effect on supply chain sustainability. However, an increase in the penalty for the buyer acts as a deterrent to the revelation, and thus it often has a detrimental effect on sustainability, except when the increase is modest and the buyer makes an individual effort to monitor her supplier. Moreover, although an increase in the NGO's gain in utility from targeting a revealed supplier acts as a deterrent to the revelation, it can have either a beneficial or detrimental effect on sustainability, depending on the extent of the increase and the efficiency of the NGO's auditing. Last, if the buyer can invest in improving the supplier's capability, the above‐mentioned factors that have beneficial (detrimental) impacts on sustainability also make the investment more (less) worthwhile.

Achieving organisational resilience through inbound logistics effort

PurposeThe purpose of this paper is to identify how the relationship between inbound logistics (IL) activities and elements of resilience (EoR) can contribute to organisational resilience.Design/methodology/approachTwo in-depth case-based studies were conducted in the dairy industry. After identifying EoR and IL activities through a systematic literature review, relationships among them have been empirically discussed in six groups (emerged content analysis results): supplier and response capability; transportation; security; quick response to disruption; logistics management; trust and knowledge.FindingsA framework was developed describing the contribution of these six groups to organisational resilience by highlighting and discussing three aspects: rigidity of the hierarchy, type of relationship and geographical dispersion. These aspects emerged from the process of content analysis and are related to the companies’ characteristics.Practical implicationsThe proposed framework can assist managers to decide which group of EoR and IL activities they should prioritise, depending on the company’s characteristics and needs.Originality/valueAlthough some studies have discussed the IL contribution to generating resilience in companies, none of them have explored in detail the relationship between EoR and IL activities, and their contribution to organisational resilience. The proposed framework shows the contribution of the EoR to three different organisational aspects.

Sanitary and phytosanitary regulations and international red meat trade

Purpose The purpose of this paper is to provide an ex post econometric examination of SPS measures and their influences on red meat trade. Design/methodology/approach The authors conduct multiple new assessments to further assess the particular effects of specific SPS measures related to animal health, human health and maximum residue limits on red meat trade values. This finer assessment provides updated and more detailed insights into the marginal trade impacts of different SPS measures. Findings The current study sheds important light on the determinants of red meat trade. The economic conditions of destination countries and production capability of suppliers are key to determining trade values. Factors including personal income and exporters’ meat supply are identified as trade facilitators. Since the restrictiveness of SPS measures vary across beef and pork sectors, maintaining commodity-specific SPS measures is essential for accurate assessment of trade determinants. Originality/value This paper provides multiple contributions to the existing literature and more broadly the authors’ economic understanding on the increasingly contentious issue of global meat trade. Combined, this study yields several implications for food policy, trade negotiators and industry leaders given the growing role and surrounding controversies of trade in meat and livestock markets around the world. The authors further believe the paper would be of notable interest to fellow researchers consistent with the existence of a sizable published literature and ongoing debates in international meat trade.

Network-based pricing for 3D printing services in two-sided manufacturing-as-a-service marketplace

PurposeThis paper presents approaches to determine a network-based pricing for 3D printing services in the context of a two-sided manufacturing-as-a-service marketplace. The purpose of this study is to provide cost analytics to enable service bureaus to better compete in the market by moving away from setting ad hoc and subjective prices.Design/methodology/approachA data mining approach with machine learning methods is used to estimate a price range based on the profile characteristics of 3D printing service suppliers. The model considers factors such as supplier experience, supplier capabilities, customer reviews and ratings from past orders and scale of operations, among others, to estimate a price range for suppliers’ services. Data were gathered from existing marketplace websites, which were then used to train and test the model.FindingsThe model demonstrates an accuracy of 65 per cent for US-based suppliers and 59 per cent for Europe-based suppliers to classify a supplier’s 3D printer listing in one of the seven price categories. The improvement over baseline accuracy of 25 per cent demonstrates that machine learning-based methods are promising for network-based pricing in manufacturing marketplacesOriginality/valueConventional methodologies for pricing services through activity-based costing are inefficient in strategically priced 3-D printing service offering in a connected marketplace. As opposed to arbitrarily determining prices, this work proposes an approach to determine prices through data mining methods to estimate competitive prices. Such tools can be built into online marketplaces to help independent service bureaus to determine service price rates.

Contracting for Innovation in Public Services: Capabilities, Institutions and Intermediation

Contracting for innovation in the public sector is challenging due to a shortfall of related capabilities of buyers and suppliers, and institutional constraints impeding innovation sourcing and adoption processes. In this context, innovation intermediary organisations intervene to tackle some of these challenges. This paper seeks to develop middle-range theory regarding the mechanisms underpinning the contribution and impact of innovation intermediaries in settings of public sector innovation sourcing. We uncover two key mechanisms. First, intermediaries contribute innovation contracting know-how by brokering connections and innovation-related interactions, providing access to different types of know-how and helping to bridge indirect capability gaps of buyers and suppliers. Second, intermediaries leverage their institutional know-how to facilitate innovation sourcing and adoption processes by exposing institutional constraints at play, forming relationships with and lobbying relevant stakeholders, and shaping change in innovation- and procurement- related institutions. Intermediaries’ contribution of innovation contracting know-how and institutional know-how positively influences innovation sourcing and adoption outcomes. However, such effects are negatively moderated by factors pertaining to processes and mind sets within public buying organisations, intermediaries’ own limitations and institutional inertia resulting from misaligned innovation and public procurement policies.

Generating Efficient Production Plans for Heater Manufacturing Industry

Nowadays, manufacturers in Malaysia as well as global have been facing challenges in order to overcome the uncertainty of demand fluctuations, supplier capability and achieved customer expectations and satisfaction. To increase competitiveness in global market, manufacturers from various aspects keep one’s eyes open on lean implementation and factory automation. This journal aims to develop an efficient production plans for heater manufacturing industry in order to achieve higher productivity and reduce wastes. With the traditional production line which had been implemented for years, several difficulties have been faced by company. For instance, abundance numbers of worker in production line which is not fully utilize and product quality is highly depends on skilled operators due to manual process. Smoothness index is used to determine the improvement of proposed production plan. Although minimization of smoothness index is essential in solving line balancing problem, this research has highlighted that researcher or company shall not rely on smoothness index alone while other aspect such as acceptable productivity and minimization of human resource should be considered.

Assessing supplier capabilities to exploit building information modelling

PurposeA number of governments are making building information modeling (BIM) a mandatory requirement for all public works construction projects. While main contractors may be ready to comply with such requirements, the supply chain as whole may be vulnerable as lower-tier suppliers may not be able to adopt BIM. There is currently no objective approach to assessing BIM maturity; hence, this paper aims to develop a new approach to determine suppliers’ current vision and execution-based capabilities to exploit BIM and their capacity to reach a higher maturity level.Design/methodology/approachBased on UK Government BIM maturity levels, the authors exploit a unique data set made available by a main contractor, to determine a data-driven approach, using K-means, to assess the capabilities and vision of its supply base.FindingsThe authors find a direct comparison between our suggested K-means clusters and the UK Government’s BIM maturity levels. However, in interrogating specific cases, the authors find that using a subjective approach would have wrongly categorized certain companies. The authors also determine what capability and strategic developments are required for companies to move to a higher level.Research limitations/implicationsThe method aligns with the existing UK BIM maturity model and enhances the model by determining the likelihood of a supplier in progressing to a higher level of maturity. The research was with a single case company, exploiting their existing survey instrument and data. A more comprehensive study could be adopted with a generic survey questionnaire.Practical implicationsThe research may be exploited by companies to take a strategic approach to assess suppliers in BIM adoption and to establish supplier development mechanisms.Originality/valueThe data-driven approach avoids ambiguity of categories and mis-categorizing suppliers.

Prioritization of Supplier Development Practices: A Fuzzy Method

Today, manufacturing firms are demanding a higher level of performance from their suppliers. Manufacturing firms need to ensure that their suppliers are able to provide the best quality of materials, on time, at the right place and the right level of service. To achieve this objective, manufacturing firms may engage in supplier development (SD) program. However, the number of practices involved in SD is extensive. The management of a manufacturing firm should understand the roles and relationship between these practices, so that it may provide additional information on how to manage them. Thus, this paper proposed a model for evaluating and selecting supplier development practices using an integration of fuzzy logic and Analytical Hierarchy Process (AHP). Experts' decision making is used in the process of developing the model. The result suggested that practices associated with transferring knowledge have the highest priority. The results obtained can be referred by manufacturing practitioners as guidelines of seeking the opportunity to implement SD program in enhancing the capabilities of suppliers who contribute to the movement of a supply chain in achieving the greater performance of manufacturing sustainability and responsiveness.

Mobile usage in travel: bridging the supplier-user gap

PurposeConsumer-driven technology innovations are transforming travel behavior. However, travel suppliers are still struggling to grasp their customers’ desires regarding mobile device usage in travel and also face other barriers. This paper aims to take a two-pronged approach to identify the gap between what travelers would like to do on mobile devices and what suppliers currently offer and to provide insights from technology industry experts on future trends.Design/methodology/approachThis paper uses two exploratory studies: a consumer survey to understand travelers’ needs and wants regarding mobile devices and a qualitative study to learn more about how travel suppliers are responding and to identify barriers. Statistical techniques include ANOVA tests to identify individual differences and factor analyses to discover patterns in the data.FindingsConsumers would like to do more on mobile devices than is currently available; therefore, industry providers must be more forward-thinking with technology development and overcome the barriers identified in this paper.Research limitations/implicationsGiven the limitations to existing supplier offerings and capabilities, travelers were asked what they would like to do on mobile devices. Although marketing and technology personnel from various companies were interviewed, other perspectives exist.Originality/valueThis paper contributes to the technology adoption and service-supplier innovation literatures by helping mobile technology service providers in the travel industry better understand and bridge the supplier-user gap. Suggestions to close this gap and predictions from technology industry experts are included to direct future actions.

Interorganizational information processing and the contingency effects of buyer-incurred uncertainty in a supplier's component development project

Supplier integration into new product development (NPD) necessitates effective information exchange and absorption between a buyer and a supplier. While prior research has emphasized the buyer's ability to manage the supplier's interface, this research takes a supplier perspective and investigates under which circumstances a supplier's interorganizational information processing capability (IIPC) drives the supplier's component development performance. We take a contingency view and theorize that the effect of the supplier's IIPC is either amplified or dampened by three sources of buyer-incurred project uncertainty: a buyer's component novelty, a buyer's engineering change orders (ECOs), and a buyer's knowledge protectiveness. The hypotheses are tested with data collected from 103 supplier component development projects in South Korea. As a result, this study empirically demonstrates the significant effects of a supplier's IIPC in enhancing the supplier's component development performance. In addition, we substantiate that the magnitude of a buyer's ECOs positively amplifies the benefits of the supplier's IIPC, while the buyer's knowledge protectiveness significantly hampers it. Academic and managerial implications are presented, and future research directions are discussed.

Application and Research on Online Evaluation for Service Capability of Cloud Manufacturing Supplier

Online evaluation for the service capability of cloud manufacturing service suppliers is the key to efficient service matching. This paper proposes a method for real-time online evaluation of supplier’s service capability using data from performance test of machine tool. First of all, cloud platform needs to collect data from performance test of supplier’s machine tools; secondly, evaluate performance of machine tool based on these data; thirdly, evaluate processing stability of machine tool in combined with historical data; and then, calculate machine tool’s comprehensive score based on the results of performance test and processing stability; lastly, evaluate supplier’s service capability according to the number of supplier’s machine tools and the comprehensive score of each machine tool. It has reference value for many services in cloud manufacturing, such as matching supply with demand, tracking execution process of service and feedback adjustment.

Supply-chain management in the oil industry

The logistics network in the oil industry is highly inflexible, which arises from the production capabilities of crude oil suppliers, long transportation lead times, and the limitations of modes of transportation and energy planning and management. The paper considers the key factors for reducing costs and increasing the company’s profits in managing supply chains: demand management, efficient distribution of petroleum products among customers, better transportation scheduling, warehouse management, and quality and timeliness of information through the automation of the supply chain. And this principle is carried out within the framework of the logistics concept of supply chain coordination - Supply Chain Management. The paper also considers advantages from implementation of supply-chain management. Implementation of supply-chain management in the oil industry can help to reduce costs, increase the company’s profits in managing supply, and manage the planning of deliveries.

Developing system supplier capability by integrating knowledge with customers

Developing system supplier capability by integrating knowledge with customers