A Demand‐side Perspective on Supply Chain Management

Abstract

When and how can supply chain management (SCM) be a source of long‐term competitive advantage for the firm? We revisit and update arguments recently advanced by Hunt and Davis (2008) in this journal concerning which theoretical perspectives — the resource‐based view of strategy or resource‐advantage theory — may provide the most useful “lenses” for SCM scholars interested in addressing these critical questions. In this brief article we suggest that SCM research addressing questions of competitive advantage can be enhanced by a more rigorous definition of resources and by a more system‐wide view of competition. We also recommend that the nascent demand‐side perspective on strategic management can serve to provide new insights and a more complete understanding of SCM's role in competition. While the existing SCM literature offers a few examples of this perspective, in our opinion this remains an unfulfilled opportunity for SCM scholars.

Supply and demand chain management: the effect of adding services to product offerings

“…For instance, when taking a supply chain perspective empirical research into product or service would assume the same outcome is provided to the consumer, and would likely provide no visibility of new entrants with small market share. However, a demand based perspective tests the different value consumers assign product and service formats, and through such analysis captures the potential market share gained by new entrants (Priem et al, 2012). Our empirical approach examines this value shift through analysis of an extensive consumer data set.…”

Supply chain management resources, capabilities and execution

“…The basis of this higher efficiency is that the network manager knows the capabilities of the actors responsible for creating value, and can therefore better manage value-creating activities and processes (Möller, Rajala, and Svahn 2005). This requires an understanding of the effects SCM resources have on the performance of the firm and the rest of the supply chain (Cook, Heiser, and Sengupta 2011;Johnson and Templar 2011), and on the firm's long-term competitive advantage (Priem and Swink 2012).…”

Alliance strategy: context, process, and requirements

“…network-level value creation and innovation (Busquets, 2010). Similarly, Priem and Swink (2007) note that 'R-A (resource advantage) theory may also be more useful to SCM if it is applied to value creation by the entire value system rather than to value capture by a specific firm. Considering the complete value system brings to the fore opportunities for value co-creation by suppliers and buyers up and down the value system, which thereby highlights the potential of cooperative efforts like user innovation'.…”

“…Rolls Roys' engines). Vertical ISS thus could foster innovation and increase the 'size of the pie' of (segments of) the value chain (Priem and Swink, 2007). Yet for vertical ISS to work, drivers of innovation, distribution of value, and costs for customers and suppliers are a concern.…”

“…ISS research will elaborate on inter-organizational conjunctions of these paths of innovation, building on the context and background (e.g. public versus private) of stakeholders and their organizations (Dahan et al, 2010;Gold, 2011;Yaziji and Doh, 2009 (Gutek et al,1999), from supply chains to demand chains (Jüttner et al, 2006), from product to service logics (Ng et al, 2012), and from purchasing to supply chain management (Priem and Swink, 2007). Such strategic reframing implies new ways of thinking about content and its relationship to strategic processes (De Wit and Meyer, 2010b).…”