Supply Chain Integration: A Case-based Investigation of Status, Barriers, and Paths to Enhancement.

Abstract

In a global marketplace supply chain integration is recognised to be one of today's competitive advantages; where the aim is to optimise material- and information-flows inside the focal company and also across supply chain companies. However, many academics report that such supply chain excellence is still rare, and that guidance is missing on how supply chain integration is achieved in practise. This exploratory research utilised a stepwise methodology to investigate pathways to supply chain integration. First, a suitable investigation method was identified and further developed, before being used to assess the current status of supply chain integration in New Zealand. Next, because removal of barriers is recognised to be crucial, the internal and external barriers to supply chain integration were investigated. Finally, longitudinal case studies were used to investigate ways of supply chain integration enhancement and to develop a deeper and more complete understanding of current integration status, barriers, and ways of enhancement. In total, some 240 person days were spent in eleven different companies from multiple industry sectors to investigate supply chain integration in practise.

Current practises of a large sample of New Zealand value streams were evaluated using the Quick Scan Audit Methodology. The Quick Scan Audit Methodology is carried out by a team of researchers (investigator triangulation) which utilise multiple and rigorous data collection techniques and methods (data- and method triangulation). The research revealed that supply chain integration practise rarely resembles the theoretical ideal and, similarly, seldom do available supply chain integration models reflect reality. Also, New Zealand value streams are significantly less integrated on the customer side compared to the supplier side. Further, every case company was found to face significant barriers to supply chain integration. Managerial, socio-cultural factors are the major obstacles to internal supply chain integration resulting in functional silos. Similarly, power and dependency issues limit the levels of integration achieved externally.

The research revealed that good top management support and favourable external dependencies offer the best setting for enhancing supply chain integration in practise. However, if a focal company lacks top management support and/or has an unfavourable dependency structure, the focal company chooses the path of least resistance when integrating its supply chain. Also, supply chain managers and change agents address people factors and cultural change first, before addressing either internal process issues or external relationship issues; after which communication technology upgrades are addressed. Finally, this exploratory study yielded some early insights that the speed of supply chain integration development in practise follows a learning curve trajectory.