Critical Analysis Of Supply Chain Management

J. CHEN and A. PAULRAJ (2005) in there study on supply chain management developed a frame work studying over 400 articles from diverse disciplines. As these are from different disciplines there contribution is isolated but getting together they have many of the critical elements for the successful management of supply chain. This analysis of SCM divided it into two categories namely Critical elements and Supply chain performance.

 Critical SCM elements :

• Strategic purchasing: The conceptual re-description of purchasing as the integration of internal and external exchange functions is affiliated with many neo-classical tasks of industrial purchasing such as measuring internal customer’s perception of purchasing’s service quality (Young

2002). Researchers also argue that the concept of SCM should be broader than only explaining it in terms of a company’s involvement in managing relationships with its suppliers (e.g. Ho et al. 2002).

Communication: For a successful supplier relationship two-way communication is much important. Buyer and supplier must share a greater amount of information and should be willing to share sensitive design information to find joint solution for material problems and design issues (Pearson 1999). Supplier’s quality performance was observed to be improved when there is a communication between design, engineering, quality control and other bodies along with purchasing-sales interface among supplier and buyer firms as compared with communication only among purchasing-sales interface (Carter and Miller 1989).

Figure 1 Theoretical framework for supply chain management

• Supplier selection: Supplier quality begins with supplier certification described a certified supplier as a vendor who, after extensive investigation of its manufacturing operations, production capabilities, personnel and technology, is certified to provide materials and components without routine testing of each receipt. American Quality Foundation and Ernst and Young (1998), in their international quality study of over 500 organizations, reported that formal programs for certifying suppliers showed an across-the-board beneficial impact on performance, especially in quality and productivity.

• Supplier involvement: involvement of supplier for minor design suggestions would give up responsibility for supplier and around 30% of quality problems and 80% of product lead-time problems can solved (Burton 1988). Mabert et al. (1992) found supplier involvement to be an important part of the strategy in five out of the six companies they examined who were attempting to collapse new product development