Virtuous and vicious cycles on the road towards international supply chain management

Abstract

An increasing number of companies claim to pursue international supply chain management (ISCM), but the empirical evidence of successful implementation programs is still scarce. This paper aims to contribute to theory-building in this area by presenting an exploratory causal model of goals, barriers, and enablers on the road towards effective ISCM. The model was established in a workshop with a panel of content matter experts. The results point at a disturbingly gloomy picture of vicious cycles frustrating the implementation of effective ISCM strategies. Fortunately, it appears that it is possible to apply the same generic mechanisms to create a virtuous cycle, for instance by promoting cross-functional careers and by actively responding to demanding customer needs. The challenge ahead is to test the model's content and validity.IJOPM 19,5/6 566 globalisation process has added substantially to the complexity of designing and managing supply chains (see for example Vos and Akkermans, 1996).Thus, it comes as no surprise that supply chain management, as the integral approach to operations management is labelled nowadays, has become one of the top priorities on the strategic agenda of industrial companies. Still, observations in practice reveal that many companies continue to manage the main stages of their global supply chain (purchasing, manufacturing and distribution) independently. And until now, the operations management literature has shown very little empirical evidence of successful strategic moves towards supply chain management. At present, there are at best some survey reports containing``laundry lists'' of critical success factors and roadblocks on the way towards effective supply chain management (Holmes, 1995). Some of the critical success factors listed there include the``usual suspects'' of top management commitment, involving staff in cross-functional teams to plan and implement change, continuous feedback between management and staff, planning of new information systems, and actively seeking customer input.However, there is at present little known on how these factors drive effective supply chain management, and even less on how they drive each other, let alone on what drives them in turn. What are the right levers to pull and buttons to push in the organisational change effort? In other words, we do not yet have causal relationships between the various factors driving effective supply chain management and their interrelations with performance improvements in areas like inventory management, supply chain costs, and customer satisfaction. And we do need to learn more on such causal relationships if we are to give good recommendations; not just laundry lists of what is important, but also explanations of why, when, where, and how. Without answers to such questions, it is difficult to arrive at sensible and robust growth strategies towards international supply chain management (ISCM).This paper presents a first attempt to arrive at such a theory of why achieving effective supply chain management is so ...

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