ISM analysis of CPFR implementation barriers

Abstract

Collaborative Planning, Forecasting and Replenishment (CPFR) as an interconnection scheme between organizations has been shown to have significant benefits. Since its inception in the 1990s, its uptake has been lower than originally predicted. This paper identifies the major barriers and their interrelationships in CPFR implementations with a focus on high-tech industries. Interpretive Structural Modeling (ISM) is used with a group of CPFR experts from industry/academia and Matrice d'Impacts Croisés Multiplication Appliquée àun Classement (MICMAC) analysis to identify the driving and dependence powers. The paper identified 45 CPFR barriers and classifies them into four categories based on expert opinion, with only 13 of these determined to be significant. The results indicate that in terms of categories, managerial barriers are a significant root cause for both process and cultural barriers and CPFR implementation difficulties. It also indicates that although the importance of information technology to launch collaborative schemes has been addressed by many scholars, technology alone is not the complete solution for successful CPFR implementation. The paper has significant practical implications for organizations as it identifies the main CPFR barriers and their causal relationships. This will help firms in the process of CPFR strategy development particularly for mitigation strategies for dominant barriers.

A hybrid approach to the study of CPFR implementation enablers

“…This indicates that although technology is important for success, it is likely to be the non-technological dimensions which if not managed correctly can lead to ultimate failure. This aligns with the findings of Frankel et al (2002), Attaran (2012) and Panahifar et al (2014). This is an important factor that is often over looked by senior management.…”

“…Most studies simply focus on an analysis of the success itself. In recent times three studies have been presented which have begun to review CPFR in slightly broader terms (Fu et al 2010;Lin and Ho, 2014;Panahifar et al 2014). The study of Fu et al (2010) was conducted in the retail sector using Fuzzy AHP.…”

“…The study also shows that upfront planning (including a pilot) is a key success factor. Panahifar et al (2014) explored the most dominant barriers to the implementation of CPFR in high-tech industries. As part of this study they presented 45 barriers which were reduced to the 13 most significant barriers and their hierarchical relationships through ISM model development.…”

“…ISM aims to decompose a complicated system into several simple subsystems by using experts' opinion and knowledge in order to construct a multi-level structural model. As described by Panahifar et al (2014), ISM is an advanced planning methodology applied to identify and summarise the relationships between identified variables used to define a problem or issue. This technique is also useful where the opinions and judgements of experts and practitioners are needed to gain a consensus.…”

A framework for Collaborative Planning, Forecasting and Replenishment (CPFR)

“…Personal comfort zones -Seifert (2003) Table 7 presents a full classification of CPFR implementation barriers. Technology is also no longer seen as a major inhibitor to successful implementation of CPFR and is now only considered a small part of the implementation challenge (Småros and Främling, 2001;Panahifar et al, 2014). If companies can overcome these obstacles, CPFR offers significant benefits for the entire supply chain.…”