Sei sulla pagina 1di 12

European Journal of Business and Management ISSN 2222-1905 !aper" ISSN 2222-2#$9 %nline" &ol.5' No.

1(' 201$

Drivers of Supply Chain Performance Enhancing Organizational Output: An Exploratory Study for Manufacturing Sector
Irum S)a)*adi' Sa+a ,min' -as)if Ma)mood .)aud)ar/0 !resident 1.23 4o+a 4e5 Sing) 1roup 6epartment of Business ,dministration' 1o7ernment .ollege 2ni7ersit/ 3aisala+ad' !a5istan 0 4el8 992$01:51;0#$' E-mail8 5as)ifma)mood59;0</a)oo.=om' www.5m59;0.we+s.=om A stract Purpose - 4)e !urpose of t)is stud/ is to e>plore t)e dri7ers of suppl/ =)ain performan=e and gi7e a framewor5 t)at )ow organi*ations =an manage t)ese dri7ers for t)eir sur7i7al. 4)is paper is written espe=iall/ for t)e students of +usiness management to en)an=e t)eir 5nowledge a+out suppl/ =)ain pra=ti=es. Methodology - 4)e paper =ontains ?ualitati7e approa=). In first p)ase t)e aut)ors re7iewed literature a+out t)e dri7ers of suppl/ =)ain performan=e. In se=ond p)ase t)e data from internationall/ pu+lis)ed arti=les were =olle=ted and suggest a framewor5 to manage t)e dri7ers of suppl/ =)ain performan=e. !indings - 4)e w)ole stud/ =on=luded t)at t)ere are si> dri7ers of suppl/ =)ain performan=e in literature t)at need to +e managed to en)an=e organi*ational performan=e. 4)ese dri7ers are@ 3a=ilities' In7entor/' 4ransportation' Information' Sour=ing and pri=ing. 4)ese dri7ers are =losel/ related wit) ea=) ot)er and )a7e a greater impa=t on organi*ational performan=e. %rgani*ations need to find a situation w)ere +ot) effi=ien=/ and responsi7eness in suppl/ =)ain pra=ti=es are at a7erage le7el to en)an=e t)eir performan=e. 4)is a7erage le7el =an onl/ +e a=)ie7ed t)roug) +etter management of dri7ers of suppl/ =)ain performan=e. Paper "imitation - 4)e paper is limited +/ t)e fa=t t)at it fo=uses onl/ manufa=turing se=tor. Originality#value - 4)is paper pro7ides a =olle=ti7e framewor5 for managing all dri7ers of suppl/ =)ain performan=e. $ey%ords - 6ri7ers of suppl/ =)ain performan=e' Effi=ien=/' Aesponsi7eness' Suppl/ =)ain management' Suppl/ =)ain performan=e Paper &ype - Aesear=) paper '( )ntroduction Suppl/ =)ain management refers to w)at is at outside t)e firm to =reate )ig) 7alues for =ustomers Balonde' 199:". Suppl/ =)ain management in=ludes t)e a=ti7ities inside and outside t)e organi*ation t)at are done +/ t)at parti=ular organi*ation in order to deli7er t)e )ig) 7alues to =ustomers. It means t)e management of organi*ation must =reate =)e=5 and +alan=e on internal and e>ternal a=ti7ities of organi*ation. 4o in=rease organi*ational effi=ien=/ t)e integration among suppl/ =)ain a=ti7ities is 7er/ ne=essar/. Ce =an not oppose t)is =on=ept of integration. Be=ause in t)e =ontrast of integration anot)er =on=ept of disintegration is alwa/s e>ist Mouritsen et al.' 200$". Integration means w)ole a=ti7ities around t)e glo+e of suppl/ =)ain management must +e =losel/ lin5ed wit) ea=) ot)er. It must alwa/s +e e>ist if one a=ti7it/ ends t)an automati=all/ t)e ne>t +egins wit) a parti=ular se?uen=e. In t)e se=ond t)oug)t if integration among suppl/ =)ain a=ti7ities not e>ist t)an t)eir will +e disintegration. ,nd in t)is wa/ of disintegration suppl/ =)ain management )a7e no meaning for organi*ations. Suppl/ =)ain management in=ludes )ow a =ompan/ s)are information and ta5e a=tion in order to ensure t)e +est flow of produ=t from raw material to end user .)iappe and Derrero' 199;". Suppl/ =)ain management is also t)e distri+ution of information to 7erif/ w)at se?uen=e of a=ti7ities an organi*ation adopted to =reate and deli7er )ig) 7alues to its =ustomers. ,n/ organi*ation =an not ma5es its =ustomers lo/al until it adopted t)e smoot) flow of raw material to produ=tion and final produ=t to end user t)at deli7ers produ=t Eust in time wit) effi=ien=/. S/n=)roni*ed suppl/ is new and emerging p)enomenon in +usiness world. Se?uen=ed suppl/ =)ain a=ti7ities are mu=) 7alua+le for an/ organi*ation in en)an=ing performan=e and effi=ien=/ Bannett and -ane' 200:". 4)is =on=ept fo=using on se?uen=ed a=ti7ities in suppl/ =)ain management are re?uired to ma5e produ=ts and ser7i=es on standard. It means it must +e well defined and do=umented t)at w)at a=ti7it/ to +e performed in w)at manner and at w)at time. In re=ent da/s t)e organi*ations =ompetes on suppl/ =)ain management rat)er t)an indi7iduall/. ,n/ organi*ation =an get a =ompetiti7e ad7antage on anot)er organi*ation t)roug) effe=ti7e and effi=ient suppl/ =)ain management Dassini' 200#". 4)is =on=ept =on=luded t)at suppl/ =)ain management is t)e +asis for all organi*ational worlds to =ompete wit) ea=) ot)ers. It s)ows t)at t)ere is not)ing else +ut suppl/ =)ain management on w)i=) t)e organi*ations =an sur7i7e. ,n/ organi*ationFs a+ilit/ to s)ow effe=ti7e performan=e alwa/s +ased on su==essful and effe=ti7e adoption of suppl/ =)ain a=ti7ities wit) proper se?uen=e and pra=ti=es. 4)ese pra=ti=es in=ludes information distri+ution' 5$

European Journal of Business and Management ISSN 2222-1905 !aper" ISSN 2222-2#$9 %nline" &ol.5' No.1(' 201$

fa=ilities management and +e o+Ee=ti7e. ,nd +arriers to suppl/ =)ain management a=tuall/ in=rease a firmFs performan=e w)en a firm =ompetes wit) t)ose +arriers to =reate lin5age +etween suppl/ =)ain a=ti7ities Ai=)e/ et al.' 2009". If an/ firm want to perform effe=ti7el/ it must adopt t)e wa/s of information distri+ution' management of fa=ilities su=) as logisti=s' transportation and w)ere )ousing. It also e>ists in realit/ t)at +arriers of suppl/ =)ain management are a=tuall/ pla/ to in=rease t)e organi*ationFs performan=e w)en it =ompete wit) t)em to =reate smoot) flow among t)e suppl/ =)ain a=ti7ities. 4o in=rease a firmFs performan=e t)e dri7ers of suppl/ =)ain management are mu=) 7alua+le Soni and -odali' 2010". 6ri7ers of suppl/ =)ain performan=e management are as fa=ilities' logisti= management' transportation' in7entor/ management' information distri+ution' pri=ing and sour=ing. 4)e +etter management of all t)ese a=ti7ities leads to in=rease a firmFs performan=e. %rgani*ations must follows se7en points in t)eir suppl/ =)ain pra=ti=es su=) as integration +etween suppl/ =)ain and +usiness strateg/' =reate goals for suppl/ =)ain' identif/ t)e mar5et demands' lin5 wit) suppliers' lin5 wit) =ustomers t)roug) logisti= management' suppl/ =)ain information distri+ution s/stem' and adopt =ross fun=tional a=ti7ities Bummus and &o5our5a' 1999". Integration +etween suppl/ =)ain strateg/ and +usiness strateg/ gi7e +irt) to effe=ti7e +usiness operations t)at lead to in=rease firmFs performan=e. .reate goals for suppl/ =)ain are Eust li5e to =reating o+Ee=ti7es and after =reating o+Ee=ti7es +e spe=ifi= to goals. Identifi=ation and 7erifi=ation of mar5et demands in =reating lin5 wit) suppliers and =ustomers +/ information distri+ution and fa=ilities management will alwa/s +e t)e priorit/ for all organi*ations. Aesear=) in t)e field of suppl/ =)ain management gi7e rise to two issues t)at are resear=) in t)is field alwa/s open for =)allenge and de+ate and resear=) not onl/ dri7e from industrial se=tor alone New Step)en' 199;". 4)is is new angle of resear=) in t)e field of suppl/ =)ain management. It refers to resear=) in t)is field is not =lose ended it must +e open ended. Ce =an furt)er e>plore t)e different angles in t)is field. ,nd resear=) must not onl/ +e of industrial se=tor. 4)ere are so man/ ot)er se=tors e>ist in w)i=) we =an e>plore and stud/ suppl/ =)ain management. 6r. -e7in M=.orma=5 and 6r. ,r=)ie Bo=5am/ III' indi=ated following fi7e maturit/ le7els of suppl/ =)ain management in t)eir resear=) paper. ,d Do=8 in t)is p)ase t)e pro=esses of suppl/ =)ain management were ill defined. %rgani*ations were using traditional wa/s at t)at time. In t)is situation =ost of suppl/ =)ain management remains )ig) and =ustomer satisfa=tion low. 6efined8 pro=esses in t)is p)ase were well defined and do=umented. 4)ere was impro7ement in organi*ational stru=ture +ut still remained traditional. Bin5ed8 t)is was t)e +rea5 t)roug) le7el. Managers too5 strategi= de=isions. .ross fun=tional teams formed and lin5 +etween =ompanies to ot)er =ompanies de7eloped. Integrated8 in t)is p)ase t)e parties of suppl/ =)ain management in7ol7ed in t)e a=tual pro=ess and ad7an=e management pra=ti=es. E>tended8 in t)is p)ase =ompetition +ased not among organi*ations +ut on mass le7el and among t)eir suppl/ =)ain pra=ti=es. Dori*ontal integration and =ustomer fo=us de7eloped. *( "iterature +evie% 2.1 Overview of Past Papers 4)e 2$ resear=) papers relating to dri7ers of suppl/ =)ain management and one +oo5 of suppl/ =)ain management are 7iewed on t)e +asis of t)is 7iew points reported as8 In t)is p)ase we ela+orate t)e pre7ious resear=) on dri7ers of suppl/ =)ain management t)at fo=used on en)an=ing t)e effi=ien=/ of t)e firm and de7eloped frame wor5 for future studies. In t)e literature' Na*ali and !itt 2009" argued t)at )ow new emerging p)enomenaFs =an lower t)e pro+lems in fa=ilities management. 4)e implementation of suppl/ =)ain management a=ti7ities is indispensa+le for t)e ease of fa=ilities management in ser7i=e deli7er/ pro+lems. It is a good effort to o7er=ome t)e gap +etween demand and suppl/ of fa=ilities management. Suppl/ =)ain management )elps organi*ations to adopt mar5et position in t)e =ompetiti7e en7ironment. 3a=ilities would +e effe=ti7el/ managed +/ strategi= planning in suppl/ =)ain management t)roug) faster ser7i=es and +/ de=reasing =osts as fa=ilities management is a dri7er of suppl/ =)ain management. Jensen 2011" dis=ussed t)at fa=ilities management alwa/s supports suppl/ =)ain a=ti7ities. .ore +usiness =on=ept =reates 7alue for e>ternal =ustomers w)ile fa=ilities management =reates 7alue for internal =ustomers wit) t)e support of =ore +usiness. 4)e purpose of long term fa=ilities management is to =reate strategi= relations)ip +etween =ore +usiness needs and pro7isions of fa=ilities. 4)is paper s)ows t)at t)e =on=ept of =ore +usiness =an onl/ +e effe=ti7e if t)e relations)ip +etween =ore +usiness =on=ept and fa=ilities management e>ists t)at dri7e suppl/ =)ain a=ti7ities wit) effi=ien=/ and effe=ti7eness. Ba5er 200;" e>plored t)e importan=e of +uffer in7entor/ in international suppl/ =)ains and told t)at it is 7er/ diffi=ult to eliminate t)is t/pe of in7entor/. 4)e proper =)e=5 and +alan=e on lead time is re?uired. It is not ne=essar/ to =)e=5 w)et)er t)e in7entor/ good or +ad +ut t)e ne=essar/ is to find w)et)er it is at =orre=t le7el or not. 4)is was t)e traditional wa/ of in7entor/ management. In t)e =urrent s=enario t)e aut)ors used to tell a+out )ow in7entor/ redu=tion strategies' ris5 management and in7entor/ =ontrol fun=tions =an +e done t)at =an


European Journal of Business and Management ISSN 2222-1905 !aper" ISSN 2222-2#$9 %nline" &ol.5' No.1(' 201$

en)an=e effi=ien=/ of suppl/ =)ain a=ti7ities. Stanger et al. 2010" ga7e frame wor5 a+out t)e two 5e/ resear=) ?uestions on in7entor/ management pra=ti=es and performan=e. ,ut)ors e>plored in t)is resear=) paper a+out w)at )appen wit) peris)a+le in7entor/ in +lood suppl/ =)ain management. ,nd t)e resear=) paper suggested t)at t)e in7entor/ t)eor/ is generall/ =orre=t. But t)e usa+ilit/ and appli=ation of t)ese pra=ti=es =an +e =)allenging in real world. ,fter =on=lusions si> 5e/ points e7aluated for )ow managers =an en)an=e t)e performan=e of peris)a+le in7entor/. 4)e/ need to adopt simple management pro=edures t)at +oosts up +/ t)e e>perien=ed staff for en)an=ing organi*ational effi=ien=/. Ae*a Nasiri et al. 2010" suggested an attempt to define )ow suppl/ =)ain distri+ution networ5 leads to lo=ation of in7entor/' allo=ation of in7entor/ and de=ision a+out in7entor/. ,ut)ors in t)is paper told a+out )ow we =an use in7entor/ poli=ies for t)e +etter management and use of in7entor/. In7entor/ poli=ies refer to at w)at le7el we demand in7entor/ and )ow =ontrol it. 4)is model =onsists non-linear mi>ed programming and sol7ed for t)e lo=ation' allo=ation module in ware)ousing and stores. ,nd t)is paper also in7estigates performan=e measures affe=ted +/ multi-=apa=it/ le7els. &erwiEmeren et al 199:" )a7e anal/*ed t)at t)e in=reasing =ustomer re?uirements are a great stimulus for networ5ed and integrated in7entories management. Dig) le7el of =ompetition in t)e result of emergen=e of new mar5ets +oosts up t)e =ustomer re?uirements. Businesses t)at )a7e t)e networ5ed and organi*ed s/stem of in7entor/ management in suppl/ =)ain a=ti7ities =an stand in =)anging en7ironment of +usiness world. Networ5ed in7entor/ management s/stem is a 5e/ =on=ept t)at =an +e used to en)an=e organi*ational effi=ien=/ and performan=e. .)andra and -umar 2001" dis=ussed t)at t)e ta>onom/ =on=ept =an +e e>plained to in7entor/ management in suppl/ =)ain using t)e e>ample of 2nited States te>tile industr/. 4)is resear=) paper e>plored t)e strategi= importan=e of in7entor/ management in suppl/ =)ain pra=ti=es. 4)e produ=t and pro=ess life =/=les are anal/*ed to stud/ in7entor/ management. ,ut)ors told a+out t)e empowered +usiness entities generali*ed t)e in7entor/ models and te=)ni?ues in +usiness en7ironment. 4)roug) t)is stud/ t)ree generi= models e7aluated for t)e in7entor/ management de=isions. S)in et al. 2012" pro7ided framewor5 for rout finding me=)anism of transportation s/stem in suppl/ =)ain management. 4)is paper )elps to gi7e e>planation and full understanding to managers t)at )ow t)e/ sa7e t)eir suppl/ =)ain a=ti7ities from 7arious unusual and unwanted ris5s. B/ using t)is assessment and route finding approa=) t)e managers =an find t)e wa/s from w)i=) t)eir une>pe=ted =ost +e=ome low and also suppl/ =)ain ris5s redu=ed. 4ransportation is =onsidered to +e +ig pro+lem in t)e management of suppl/ =)ain a=ti7ities. Du? et al. 2010" argued on t)e different effe=ts of transportation s/stem on t)e suppl/ =)ain modeling. 4)e =riti=al fa=tor of t)is stud/ is )ow t)e managers =an manage transportation and =ontrols t)e transportation =ost. ,nd also e7aluated t)e important issues of transportation t)at pla/ in t)e integrated suppl/ =)ain management =osts. Managers =an also anal/*e from t)is stud/ t)at )ow t)e/ =an sa7e t)e suppl/ =)ain transportation a=ti7ities from unne=essar/ insuffi=ien=ies and =osts. Better management of transportation s/stem =an dri7e suppl/ =)ain a=ti7ities wit) effi=ien=/ and effe=ti7eness. .rea**a et al. 2010" e>plored t)e logisti= networ5 in suppl/ =)ain management. 4)is stud/ de7elops fi7e suita+le logisti= networ5s and at t)e end suggests one +est logisti= networ5 for manufa=turing +usiness. 4)e fi7e assumptions for networ5ing are as o7erall demand' demand +etween suppliers and =ustomers' t)e supplier geograp)i=al dispersion' t)e produ=t 7alues densit/ and differential la+or =ost. In t)is =onte>t it is e7aluated t)at t)e dire=t s)ipment wit) full =ontainer load 3.B" is mu=) +etter to en)an=e transportation effi=ien=/ and to redu=e insuffi=ient =osts. Ellram and .ooper 1990" )a7e founded t)e t)ird part/ relations)ip in s)ipping and transportation a=ti7ities of suppl/ =)ain management. 4)is paper e>amines for=es t)at )a7e s)aped and organi*ed t)e relations)ip +etween suppl/ =)ain management and t)ird part/ partners)ip. 4)ird part/ relations)ip in s)ipping' transportation' logisti=s and ware)ousing +oosts up t)e wor5 effi=ien=/ and in=rease organi*ational performan=e. 4)is relations)ip is +enefi=ial +ot) for manufa=turers and for ser7i=e pro7iders and t)is relations)ip also redu=e t)e =ost of suppl/ =)ain a=ti7ities. Bummus et al. 2001" dis=ussed t)e relations)ip of logisti=s to suppl/ =)ain management. 4)e aut)ors argued t)at t)e terms Gsuppl/ =)ain managementH and Glogisti=sH are =losel/ lin5ed wit) ea=) ot)er. 4)is paper s)own t)e a=ti7ities in=luded in +ot) t)e =on=epts and de7elop )ierar=)i=al relations)ip +etween t)ese a=ti7ities. Bogisti=s management in=ludes planning' implementing and =ontrolling t)e effe=ti7e flow and storage of goods from supplier to manufa=turer and from manufa=turer to end =ustomer in order to meet wit) =ustomer re?uirement. Calter 200:" )as anal/*ed t)e role of information management in suppl/ =)ain effi=ien=ies. Management information s/stem is an essential part of an/ organi*ation w)et)er it manufa=turing or ser7i=e organi*ation. 4)is resear=) paper argued t)at +efore anal/*ing t)e suppl/ =)ain a=ti7ities we would needs to =)e=5 w)at is demand and perform fun=tions in a==ordan=e wit) demand. ,nd t)is a=ti7it/ =an +e performed in +etter wa/ if t)e management information s/stem in t)e organi*ation is well esta+lis)ed t)at en)an=e organi*ational effi=ien=/. -ar55ainen et al. 200;" pro7ided frame wor5 of information s/stem in suppl/ =)ain management. 4)e purpose of t)is paper to e>plore )ow and for w)at t)e =ompanies use inter-firm information s/stem in suppl/ =)ain management and )ow t)e inter-firm information s/stem wor5 in good manner. 4)e following t)ree


European Journal of Business and Management ISSN 2222-1905 !aper" ISSN 2222-2#$9 %nline" &ol.5' No.1(' 201$

=ategories of inter-firm information s/stem use for suppl/ =)ain management as transa=tion pro=essing' suppl/ =)ain planning and =olla+oration' order tra=5ing and deli7er/ =o-ordination. 3urt)er t)e/ e>plored t)e dri7ers of t)ese inter-firm information s/stems. Better inter-firm information s/stem =an reinfor=e t)e effi=ien=/ of suppl/ =)ain a=ti7ities and organi*ational effi=ien=/. 4i+in et al. 2012" proposed t)e information s)aring in suppl/ =)ain management a=ti7ities. In suppl/ =)ain a=ti7ities' suppl/ information reinfor=e +/ demand information ma5es input of material to +e 7alue added pro=ess t)at in=reased its mar5et 7alue for pur=)asing' manufa=turing and distri+ution. 4)e final output of suppl/ =)ain a=ti7ities =an +e determined +/ input of t)ese a=ti7ities. 4)e paper s)ows t)e d/nami= impa=t anal/sis of suppl/ =)ain information. 4)e/ suggested t)e o7erall me=)anism of information s)aring in suppl/ =)ain =o-ordination. !ieter &an 6on5 200#" argued upon t)e =)allenges in suppl/ =)ain management and information and =ommuni=ation management. 4)e output of t)is paper is to define t)e integration +etween suppl/ =)ain management and information and =ommuni=ation te=)nologies and relates it to managerial and organi*ation t)eories. Managers would needs to implement information and =ommuni=ation te=)nologies in t)e field of suppl/ =)ain management for t)e +etter output. Information s)aring and =ommuni=ation te=)nologies =onsidered to +e dri7er t)at en)an=es organi*ational effi=ien=/ in t)e =onte>t of suppl/ =)ain management. M=laren and &uong 200#" e>plored and =lassified suppl/ =)ain management information s/stem as a plus point for en)an=ing organi*ational effi=ien=ies. 4)is paper e>plored t)e suppl/ =)ain management information using )ierar=)i=al rat)er t)an traditional flat ta>onomies. 4)is paper de7eloped #$ maEor fun=tional attri+utes t)at tells a+out fi7e top le7el =ategories as primar/ suppl/ =)ain pro=esses' data management' de=ision support relations)ip management and performan=e impro7ement. Sele=tion and anal/sis of suppl/ =)ain management information s/stem is diffi=ult +ut a +etter information s/stem is =onsidered to +e dri7er t)at dri7es suppl/ =)ain a=ti7ities. .o> et al. 200;" supported t)at )ow an appropriate sour=ing strateg/ =an +e =)oose for a +usiness and also in=ludes t)e interrelations)ip among firmFs sour=ing' mar5eting and +randing strateg/. Basi=all/ t)is paper was written to e>plore t)e sour=ing of +eef suppl/ =)ain management in 2nited -ingdom to )ig)lig)t t)e need of go7ernment agen=ies. Ce lin5 t)ese sour=ing strategies to ot)er suppl/ =)ain management de=isions. Sour=ing means t)e appropriate inputs for ma5ing and deli7ering goods and ser7i=es to final =ustomers. !a*ireande) 2011" argued upon t)e sour=ing in glo+al )ealt) suppl/ =)ains for de7eloping =ountries. 4)e aut)or e>plored t)at if we want to find +est sour=ing strateg/ we would need to in7estigate produ=t' organi*ation and =ountr/ fa=tors. ,nd ?ualit/ is =onsidered to +e a 5e/ fa=tor w)ile sele=ting sour=ing strateg/. 4)is paper presented a de=ision ma5ing frame wor5 for sour=ing strategies. Sour=ing in suppl/ =)ain a=ti7ities is a 5e/ dri7er t)at dri7es t)e organi*ational fun=tions in order to a=)ie7e organi*ational effi=ien=ies. Iong et al. 2012" suggested on t)e d/nami= pri=ing in suppl/ =)ain a=ti7ities. 4)ere is an interrelations)ip e>ist +etween pri=e e>pe=tation and pri=e flu=tuation. 4)e ma>imum output in form of mone/ =an onl/ +e generated t)roug) suppl/ =)ain integration. 4)is paper refle=ts t)e influen=e of w)ole pri=ing fa=tors on different ad7antages and on suppl/ =)ain a=ti7ities. 4)is paper also suggested upon t)e pri=e models under E-=ommer=e fun=tions. !ri=ing fun=tion is a wa/ to earn w)at we deser7e from our output. ,ram/an and -uiper 2009" ga7e frame wor5 and anal/*ed pri=e transmission in agro-food suppl/ =)ains. 4)is paper identified t)ree 5e/ fa=tors in pri=e flu=tuation in agro-food suppl/ =)ains t)at are stru=ture of suppl/ =)ain' fa=tors affe=ting pri=e transmission and suppl/ response. 4)is paper proposed to empiri=all/ in7estigate )ow t)e pri=e =an flu=tuate in suppl/ =)ain a=ti7ities and in w)at manner we =an earn good output pri=e from t)ese a=ti7ities. Ian and Cang 2010" e>plored pri=ing strateg/ and firmFs performan=e in suppl/ =)ain management issues. ,ut)ors deri7ed ser7i=e le7el and pri=ing strateg/ +/ two mar5et stru=tures t)at are non-=oordinati7e stru=ture and =oordinati7e stru=ture. In order to ma>imi*e profit t)e management and giant retailer must emplo/ =oordinati7e stru=ture. .oordinati7e stru=ture in=ludes t)e proper se?uen=ing in suppl/ =)ain a=ti7ities and interrelations)ip among t)ese a=ti7ities. 1opal and 4)a55ar 2012" in t)e summar/ of t)eir literature re7iew s)ow data of representation of suppl/ =)ain management papers /ear wise and approa=) wise t)at are in figure 1 and figure 2 respe=ti7el/'


European Journal of Business and Management ISSN 2222-1905 !aper" ISSN 2222-2#$9 %nline" &ol.5' No.1(' 201$

Sunil .)opra and Meindl 200;" mentioned in t)eir +oo5 a+out si> dri7ers of suppl/ =)ain performan=e. , =ompan/ =an en)an=e its responsi7eness and effi=ien=/ +/ t)e good management of si> dri7ers of suppl/ =)ain performan=e. 4)e/ ela+orated following si> dri7ers of suppl/ =)ain performan=e as fa=ilities' in7entor/' transportation' information' sour=ing and pri=ing. a" 3a=ilities mean t)e a=tual p)/si=al pla=ement of raw material' wor5 in pro=ess material and finis)ed goods. 3or e>ample' ware)ouses and storerooms are t)e fa=ilities in suppl/ =)ain management. +" In7entor/ means flow of all material in suppl/ =)ain a=ti7ities su=) as from raw material to finis)ed goods. =" 4ransportation means +/ w)i=) medium and route t)e in7entor/ flow from one pla=e to anot)er pla=e. d" Information refers to data flow and anal/sis of data and distri+ution of t)is final information among suppl/ =)ain personnelFs. e" Sour=ing means )ow and +/ w)om different a=ti7ities of suppl/ =)ain management to +e performed su=) as manufa=turing' storing and transportation. f" !ri=ing refers to pri=e setting t)at )ow mu=) t)e =ompan/ =an demand for its produ=ts. 2.2 Findings of Past Papers B/ =olle=ting data from 2$ resear=) papers and from 1 +oo5 7arious angles upon suppl/ =)ain performan=e e7aluated and find out. 4)ese all fa=tors tell a+out t)e different stories of )ow an/ firmFs performan=e and effi=ien=/ =an +e in=reased and in w)at manner t)e e>isting resear=)ers e>plored t)ese fa=tors. ,ll t)ese fa=tors =an implements t)e suppl/ =)ain networ5 in firms wit) strong finan=ial position and wit) potential suppl/ =)ain personnelFs. 3orm a+o7e literature re7iew summer/ we find t)ere si> dri7ers of suppl/ =)ain performan=e e>ists in +usiness world of suppl/ =)ain management. 4)ese si> dri7ers are as fa=ilities' in7entor/' transportation' information' sour=ing and pri=ing. ,ll t)e si> dri7ers are interrelated wit) ea=) ot)er and supports ea=) ot)er in en)an=ing t)e firms output. ,( Discussion a out -o% Drivers of Supply Chain Performance can e managed 3.1 Facilities 3a=ilities are w)ere a produ=t is +eing stored' assem+led and fa+ri=ated. 4)e +etter management a+out t)e role' lo=ation' =apa=it/ and fle>i+ilit/ of t)ese fa=ilities )a7ing a positi7e affe=t towards suppl/ =)ain performan=e. In fa=ilities management a =ompan/ pro7ed to +e more responsi7e or more effi=ient +ut not at same 3or e>ample' an auto parts distri+utor )a7e man/ ware)ousing fa=ilities e>ist near to t)e =ustomers for pro7iding t)em ?ui=5 and +etter a==ess of produ=ts. 4)ese man/ ware)ousing fa=ilities s)ow responsi7eness of distri+utor +ut at t)e same time )is effi=ien=/ +e=omes low +e=ause )e is pa/ing )ig) =ost for ware)ousing. In =ontrast if )e )as fewer ware)ouses e>ists onl/ at main points t)an )e is more effi=ient +e=ause of low =ost of ware)ouses +ut )is responsi7eness is 7er/ low Sunil .)opra and Meindl' 200;" S)utdown of produ=tion and ot)er fa=ilities leads to downsi*ing in a firm. Managers s)ould =arefull/ =onsider t)e eig)t fa=tors +efore =losure of one site out of a set of two or more )a7ing similar a=ti7ities. 4)ese eig)t fa=tors are as a" !lant Si*e' t)e effi=ien=/ of small plants is less t)an large plants. ,t small plants t)e a7erage =ost of ea=) unit produ=ed is )ig)er. So' t)e managers would need to =lose t)e plants of small si*e rat)er t)an large si*e. +" Site .onstraints' t)is fa=tor is important in num+er of wa/s. E>tra spa=e is indispensa+le for 7e)i=les and =ar par5ing. E>tra spa=e is also )elpful for t)e future modifi=ation of produ=tion and storage fa=ilities. Managers would de=ide for =losure of less spa=e and )ig) =onstraints sites. =" .apa=it/' t)is fa=tor is =losel/ related wit) si*e of plant or site. It ma/ +e o==urs t)e =apa=it/ of one site is different from t)e ot)er. 4)e few a=ti7ities and small =apa=it/ asso=iated wit) small si*e plants and sites respe=ti7el/. Bower and small =apa=it/ plants and sites =an not sur7i7e and managers would =lose t)ese t/pes of plants and sites. d" Ba+or !rodu=ti7it/' managers must =)e=5 and +alan=e t)e la+or =)ara=teristi=s and produ=ti7it/ regarding ea=) plant. .losure s)ould +e gi7en to t)ose plants and sites w)ere t)e la+or produ=ti7it/ is low. e" 6istan=e from Dead


European Journal of Business and Management ISSN 2222-1905 !aper" ISSN 2222-2#$9 %nline" &ol.5' No.1(' 201$

%ffi=e' if t)e produ=tion plants or sites are far from firmFs )ead offi=e t)an t)e aut)orit/ of )ead offi=e top management is limited. 4)e/ )a7e less information a+out t)eir su+ordinates at =on=erned site. 4)erefore' if a firm )a7ing two plants one near to )ead offi=e and ot)er far from )ead offi=e t)an =losure would +e gi7en to )ig) distant site. f" ,ge of Building or !lant' old age +uilding and plants re?uire )ig) =ost of maintenan=e. So' managers must gi7e =losure to t)ose plants or sites w)ere t)e +uilding or ma=)iner/ is old and re?uires )ig) =ost for operations. g" Aemoteness' t)is fa=tor in=ludes transportation =ost asso=iated wit) different produ=tion and storage sites and managerial time in7ol7ed to maintain it. .losure would +e gi7en to t)ose sites w)ere t)ese t/pes of a=ti7ities are =onsidered to +e unusual. )" 1rants Elsew)ere' t)is fa=tor in=ludes plant e>pansion' +uilding re)a+ilitation and training =ost. 1rants are gi7en to t)ose site w)ere a+o7e t)ree a=ti7ities =ould +e done. 4)ose sites would su+Ee=t for =losure w)ere t)e grants for a+o7e a=ti7ities is not )elpful for t)e produ=ti7it/ of =ompan/ -ir5)am et al.' 199#". If a plant )as no formal manufa=turing strateg/ it would +e adopted one of t)ese t)ree pro=esses8 pattern of a=tion must +e =)oose' impro7ement in manufa=turing pro=ess and manufa=turing =ompeten=/ Swamidass et al.' 2001". 3.2 Inventory , =lot)ing retailer pro7ed to +e more responsi+le +/ storing large in7entor/ +ut effi=ien=/ +e=omes low +e=ause of )ig) in7entor/ =ost and low wor5 ?ualit/ Sunil .)opra and Meindl' 200;". !eris)a+le in7entor/ =an +e management in suppl/ =)ains t)roug) following si> wa/s. a" Dire t)e e>perien=ed staff and gi7e t)em training' t)is step in=ludes t)at )uman resour=es planning in an/ manufa=turing firm pla/s a 7ital role to )ire effi=ient personnels. %rgani*ations needs to )ire e>perien=ed personnels and after )iring organi*ations would gi7e t)em training for +etter output in relation to in7entor/ management. +" 6efine target sto=5 le7els and order patterns' in=ludes t)at t)e personnels for in7entor/ management to +e well 5nown a+out t)e targeted sto=5 le7els and must 5now order patterns of respe=ti7e organi*ations. 4)is leads to ensure Eust in time deli7er/ of in7entor/. =" %rgani*e and =ontrol transparen=/ of in7entories' in7entor/ management personnels must +e well 5nown a+out t)eir in7entor/ in )ome to fore=ast a+out w)at t)eir ne>t re?uirement of in7entor/. d" Simple in7entor/ pro=edures' organi*ations must follow up t)e simple in7entor/ management pro=edures. e" 3res) sto=5 and =)e=5 and +alan=e on s)elf life' t)is step tell t)at organi*ations must 5eep fres) sto=5 in t)eir in7entor/ and maintain =)e=5 and +alan=e on t)e s)elf life of in7entor/. 4)e/ must use in7entor/ +efore its e>pir/. f" .olla+oration wit) ot)er +usinesses' organi*ations must =reate 7alua+le relations wit) +usinesses outside t)e organi*ation. 4)is step leads to t)e 7erti=al and forward integration Stanger et al.' 2012" &endor-managed in7entor/ &MI" is effi=ient in =onstru=tion sites and also for ot)er manufa=turers. ,ut)ors appl/ t)eir met)odolog/ on t)ree sele=ted pilot sites and find t)at t)e effi=ien=/ and responsi7eness of 7endor managed in7entor/ is )ig)er t)an t)at of organi*ationJs self managed in7entor/. ,ut)ors argued upon eig)t 5e/ steps t)at are@ time for finding item' re=ei7ing and storing item' order 7Ks re=ording' rus)ed orders' )ardware store 7isits' time for in7oi=e )andling' total time spent at site and remaining in7entor/ 4ans5anen et al.' 2009". 4)e results regarding a+o7e eig)t 5e/ points are s)own in following figure $'

4)ere are following four approa=)es for in7entor/. a" In7entor/ spe=ulation' means )olding in7entor/ wit) +usiness in a==ordan=e wit) ?ui=5 deli7er/ of raw material for manufa=turing. In t)is =onte>t t)e ad7antage is t)e Eust in time deli7er/ of in7entor/ +ut t)e disad7antage is t)at t)e organi*ations fa=e )ig) =ost of )olding t)e in7entor/ and =apital in7estment. +" In7entor/ postponement' t)is approa=) in=ludes t)at dela/ in in7entor/ pur=)asing. It means organi*ations using t)is approa=) are totall/ out of =ost spe=ulation' free from )olding =ost and free from large spe=ulati7e =apital in7estment. But t)is approa=) is limited +/ t)e fa=t t)at ?ui=5 deli7er/ of raw material is not possi+le. =" In7entor/ =onsignment' a==ording to t)is approa=) in7entor/ p)/si=all/ )olds +/ t)e manufa=turer +ut owners)ip still in t)e )and of supplier. C)en manufa=turer used a part of in7entor/ t)an )e 5#

European Journal of Business and Management ISSN 2222-1905 !aper" ISSN 2222-2#$9 %nline" &ol.5' No.1(' 201$

pa/s t)e pri=e of used in7entor/ to supplier. In t)is wa/ manufa=turing firms =an use in7entor/ ?ui=5l/ wit)out an/ in7estment. 4)is approa=) )as disad7antage t)at inflation ma/ o==ur in t)e pri=e of in7entor/. d" Ae7erse in7entor/ =onsignment' in t)is approa=) in7entor/ is owned +/ t)e manufa=turer and manufa=turer pa/ pri=e to supplier +ut p)/si=al possession )eld in t)e )and of supplier. C)ene7er manufa=turer wants t)an supplier suppl/ t)e in7entor/. 4)is approa=) de=rease t)e inflation ris5 and )a7ing low =ost of )olding t)e in7entor/. But disad7antage of t)is approa=) is t)e =apital in7estment in in7entor/. ,n/ organi*ation =an adopt one from t)e a+o7e four approa=)es for in7entor/ management +/ fore=asting t)ese t)ree fa=tors t)at are@ =ustomer demand re?uirement' nature of suppl/ line and +argaining power of firm relati7e to t)e supplier Callin et al.' 200:". 4)e fore=asting of t)ese t)ree fa=tors is indispensa+le for an/ manufa=turing firm if it wants to adopt one in7entor/ management approa=) from a+o7e four. 3.3 Transportation B/ using fast transportation ser7i=e we =an in=rease responsi7eness +ut effi=ien=/ +e=omes low +e=ause of )ig) =ost of fast transportation and more =)an=es of damage Sunil .)opra and Meindl' 200;". , +etter transportation approa=) for manufa=turing firms is Eoint routs planning. 4)is =on=ept in=ludes t)at to en)an=e effi=ien=/ and responsi7eness t)e manufa=turing firms must =ontinue t)eir transportation fun=tion in =olla+oration wit) t)e firms outside internal en7ironment. Joint route planning =an +e a=)ie7ed +/ two wa/s t)at are outsour=ing transportation fun=tion or )ori*ontal =ooperation wit) ot)er transportation ser7i=e pro7iders. 4)ese two =on=epts lead to a=)ie7e t)e e=onomies of s=ale +/ de=reasing t)e distri+ution =ost. Joint route planning =on=ept sa7e $0.; per=ent =osts in =omparison wit) traditional transportation s/stem .ruiEssen et al.' 200;". %utsour=ing means t)e organi*ations =ontra=ts wit) t)ird parties to distri+ute t)eir final produ=t to =ustomers on t)eir own +e)alf so t)at t)e transportation =ost of manufa=turing firms +e=ome low. Dori*ontal =ooperation means t)e manufa=turing firms =ontra=ts wit) t)e firms of same si*e and le7el for =olla+oration to distri+ute t)e produ=ts. In manufa=turing firm t)e performan=e of transportation a=ti7it/ =an +e in=reased +/ a model of smart transportation management s/stem. 4)is model in=ludes t)ree =omponents t)at are smart freig)t' smart 7e)i=le and smart infrastru=ture. a" Smart freig)t' it means instead of using traditional identifi=ation of +ar=odes for indi7idual produ=ts t)e firms must needs to de7elop and use new te=)nolog/ t)at identif/ t)e w)ole freig)t unit. 4)is =on=ept of smart freig)t =an +e a=)ie7ed +/ de7eloping automati= identifi=ation software' integration of organi*ations and data e>=)ange' de=entrali*e information setup and ena+lerFs te=)nolog/ et=. +" Smart 7e)i=les' it means t)e organi*ations needs to de7elop spe=ial smart 7e)i=les in w)i=) management information =)annel installed. 4)is information s/stem automati=all/ pro7ides information at data+ase a+out t)e goods in 7e)i=le loads and unloads. 4)is =on=ept =an +e managed +/ de7eloping goods identifi=ation s/stem in 7e)i=le and t)e 7e)i=le s/stem 7e)i=le management' transportation management and dri7er management". =" 4)e smart infrastru=ture' t)is =on=ept of smart infrastru=ture =an +e a=)ie7ed +/ t)e =olla+oration of p)/si=al infrastru=ture and digital infrastru=ture Stefansson and Bumsden' 2009". 3.4 Information Information pro7ides =ustomer taste to supplier t)at leads supplierFs responsi7eness and effi=ien=/ +e=ause supplier fore=asts =ustomer demand and onl/ supplies re?uired produ=t Sunil .)opra and Meindl' 200;". In Januar/ 2000' t)e manager of Swedis) post offi=e started a programme to in7ol7e t)eir =ustomers in de7eloping new transportation ser7i=es. ,t t)at time =ompan/ losing t)eir =ustomers and wanted to 5now a+out t)e needs and wants of =ustomers to satisf/ t)em. .ompan/Fs managers de=ided to =ondu=t dire=t meetings wit) t)eir =ustomers to pro7ide ser7i=es in a==ordan=e wit) =ustomer demands. 4)is pro=ess done t)roug) e>=)ange information +etween =ompan/ and =ustomers. ,fter 5nowing t)e =ustomer demand t)e/ started t)eir transportation ser7i=es and use one 7e)i=le instead of fi7e and pollution pro+lem also redu=ed t)at resulting in in=rease effi=ien=/ Bund57ist and Ia5)lef' 200(". 4)is in=rease in =ost effi=ien=/ of t)e firm =an onl/ +e a=)ie7ed t)roug) dire=t information s)aring +etween firm and =ustomer. .ontinuous =on7ersation wit) =ustomers pla/s a 7ital role in strateg/ de7elopment t)at resulting in =reation a planning team for =ompan/. , =ompan/ =an identif/ its =ustomers or distri+utor =ompanies for strategi= planning input +/ t)ese four wa/s. a" 2se #0K20 rule' a==ording to t)is rule t)e =ompan/ must in =on7ersation wit) t)ose spe=ifi= top 20 per=ent =ustomers t)at generate #0 per=ent of =ompan/ in=ome. +" .)oose t)e =ompanies in different =on7ersation =)annels. =" .)oose t)at =ompan/ t)at =onsiders /our produ=t or ser7i=e for different appli=ations. d" .ontinue wit) =ompanies t)at want to =ontinue wit) /ou. 4)e =on7ersation in a+o7e four steps =an +e done t)roug) following fi7e wa/s. a" Mar5eting department' +est wa/ for =on7ersation to identif/ t)e =ustomer for strategi= planning input. +" .ustomer ser7i=e manager' t)is =on7ersation =)annel is good onl/ if t)eir =on7ersational le7el mat=) wit) =ustomer le7el. =" Sales staff' t)e/ =onsidered to +e e>=ellent in =on7ersation +ut it is onl/ for s)ort term purpose. d" .E%Fs =on7ersation' a good wa/ +ut t)e =on7ersation


European Journal of Business and Management ISSN 2222-1905 !aper" ISSN 2222-2#$9 %nline" &ol.5' No.1(' 201$

not at good time. e" %utside agen=ies' wor5ing as t)ird parties and 7alua+le for good information distri+ution to =ustomers %le5sa5' 2005". Business information s/stem =an +e de7eloped +/ t)ese twel7e wa/s. a" 1eograp)i=al information s/stem' t)is information s/stem ena+les t)e =ompanies to 5now a+out t)e =ustomer in=ome le7el' population and lifest/le. +" In7entor/ management s/stem' it in7ol7es Eust in time deli7er/ of in7entor/ +/ e>=)anging information a+out t)e in7entor/ le7el. =" Care)ouse management s/stem' information s)aring a+out ware)ouse t)at )ow mu=) t)e sto=5 a7aila+le for =ustomer and )ow mu=) re?uired +/ t)e =ustomer. d" Smart =)ip te=)nolog/ s/stem' t)is is te=)nolog/ in w)i=) smart =ards de7eloped to 5now t)e =ustomer )a+its and for tra=5ing t)e =ustomers. e" .ustomer relations)ip management s/stem' t)roug) t)is step t)e firms de7elop su=) information s/stem t)roug) w)i=) t)e/ 5now t)e =ustomer needs and wants and t)an manufa=ture to en)an=e relations)ip wit) =ustomers. f" Suppl/ =)ain management s/stem' t)is information s/stem e>=)anges information among t)e different stages of suppl/ =)ain management. g" 4ransportation management s/stem' t)is s/stem pro7ides information a+out t)e orders and s)ipments. )" Self =)e=5 out stands' t)roug) t)ese s/stems t)e =artons s=anned and pa/ment to +e made wit)out )uman intera=tions. i" -ios5s' t)ese are t)e s/stem Eust li5e t)e online stores. E" Ele=troni= =ommer=e s/stem' t)is s/stem pro7ides t)e fa=ilit/ of sales ele=troni=all/. 5" Ele=troni= data inter=)ange s/stem' t)is s/stem pro7ides eas/ and ?ui=5 a==ess of data from +usiness to +usiness. l" 1lo+al information s/stem' t)is s/stem is useful for t)ose organi*ations wor5ing in man/ =ountries t)roug) satellites information s)aring s/stem -adi/ala and -leiner' 2005". -nowledge =reation for t)e =ustomers is a 7alua+le =on=ept to attra=t t)e =ustomers. %rgani*ations =an pro7ide 5nowledge and information to =ustomers +/ t)ese four steps' So=iali*ation' E>ternali*ation' .om+ination and internali*ation AamLre*' 2012". 4)e interrelations)ip of t)ese four steps is indispensa+le for distri+ution of 5nowledge from =ustomersF needs to t)e end pro=ess of attra=ting t)e =ustomers. 3.5 So rcing C)en Motorola outsour=ed its produ=tion fun=tions to .)ina manufa=turers its effi=ien=/ in=reased +ut responsi7eness +e=ame low +e=ause of long distan=es Sunil .)opra and Meindl' 200;". %utsour=ing )as man/ positi7e impli=ations for organi*ations in relation to )ouse fun=tions of organi*ations JumaF) and Cood' 2000". 4)ese impli=ations are in following figure ('

4)ere are four 5e/ strategies of outsour=ing to +e adopted in an/ firm t)at are as follows. a" 3o=us M Ni5e and 6ell' alwa/s adopt t)e strateg/ of fo=using in =orporate resour=es. 3or e>ample' Ni5e started its +usiness in 19:0Fs. B/ t)e end if its first de=ade its sales were Eust N 2 Million. E7en wit) low 7olume of sales and profits t)e managers =ontinued to fo=us primaril/ on a=ti7ities and outsour=e most of produ=tion fun=tions. ,t t)e start of se=ond de=ade Ni5e was =ore =ompetent in +rand +uilding and design. ,t t)e end of se=ond de=ade Ni5eFs sales rea=)ed at N ;00 Million. Ni5e still adopts t)is outsour=ing strateg/ t)atFs w)/ it )as mu=) s)are in 2mar5et. +" S=aling wit)-out mass M No5ia and Nortel' outsour=ing leads organi*ation to e>ist in mar5et wit) out e>pansion in +usiness si*e. 3or e>ample' in 2000' w)en t)e emplo/ees at No5ia were in=reasing at 1000 per mont) and approa=)ing :000' t)e .E% of No5ia de=ided to outsour=ed most of its produ=tion fun=tion to t)ird parties to maintain same )ig) s)are in mar5et wit) out e>pansion in +usiness. =" 6isrupti7e inno7ation M I-E,' .anon and A/anair' disrupti7e in=ludes setting pri=es low at starting to attra=t =ustomers and t)an in=rease step wise to s)ow t)e impro7ements in +usiness. In t)is =on=ept firms not onl/ outsour=e t)eir produ=tion fun=tions +ut also outsour=e t)e final assem+l/ to ot)ers. 3or e>ample' I-E,Fs entr/ into furniture retailing' .anon into p)oto=op/ing ma5es and A/anair into European airline industr/. d" Strategi= repositioning M IBM' for e>ample' IBMFs traditional strateg/ was to pro7ide ser7i=es tied onl/ to final produ=t t)at t)e/ sold. But IBM adopted inno7ati7e strateg/ of pro7iding =onsultan=/ and solutions to pro+lems of =ustomers. In t)is strateg/ IBM also :0

European Journal of Business and Management ISSN 2222-1905 !aper" ISSN 2222-2#$9 %nline" &ol.5' No.1(' 201$

pla/s as pro7ider of outsour=ing ser7i=es for ot)er manufa=turers and =ompanies Bea7/' 200(". Medium =lo=5-speed firms are alwa/s +enefited from t)e outsour=ing strategies +e=ause t)e/ =an =reate long term relations wit) t)ird parties in medium duration t)at is una=)ie7a+le +/ 7er/ low or 7er/ )ig) =lo=5-speed firms !errons and !latts' 2005". 3.! Pricing If a transportation =ompan/ =)arges )ig) and low =osts for ?ui=5 and late deli7er/ respe=ti7el/ t)an effi=ien=/ oriented =ustomers demand ?ui=5 deli7er/ and responsi7eness oriented =ustomers demand late deli7er/ Sunil .)opra and Meindl' 200;". 4)ere are two approa=)es of pri=ing in rele7ant resear=) paper t)at are linear pri=ing approa=) and strateg/ matri> pri=ing approa=). Standard linear approa=) in=ludes following fi7e steps to determine t)e =orre=t pri=e. a" .ompan/ pri=ing o+Ee=ti7e' a =ompan/ pri=ing o+Ee=ti7e is ma/ +e profit ma>imi*ation' sales 7olume' mar5et s)are target return on in7estment le7el or sur7i7al. +" !ri=ing poli=ies' a =ompan/ =an =)oose pri=ing strateg/ as s5imming pri=ing' penetration pri=ing' life =/=le pri=ing' a+o7eKatK+elow =ompetitors or =ustomer 7alue. =" 6e7elop list pri=e' +/ using a+o7e strategies a pri=e list to +e de7eloped. 4)is list =an +e de7eloped +/ using =ost +ased' =ompetiti7e +ased or demand +ased met)ods. d" 6is=ounts' dis=ounts are to +e gi7en on t)e +asis of 7ariation in ?uantit/' season' =redit' spe=ial sales or allowan=es for distri+ution =)annels to perform ser7i=es. e" ,dEustments and final pri=ing' adEustments to +e made for different geograp)i=al lo=ations. It in7ol7es t)e differen=e of standard pri=es and s)ipping *one pri=es. ,fter adEustment final pri=es de=ide. Strateg/ matri> pri=ing approa=) in=ludes pri=e setting in relation wit) =ustomer =)ara=teristi=s. In t)is approa=) =ompan/ o+Ee=ti7es =ompare wit) =ompetiti7e situation and e7aluate alternati7es 6u5e' 199(". 4)ese approa=)es are in following figure 5'

4)e Aowle/Fs solution of pri=ing poli=/ and pri=ing met)ods is as follows. 4)ere are following four pri=ing poli=ies for +usiness world. a" !ioneer pri=ing poli=/' in t)is poli=/ t)e organi*ations e7aluate t)eir de7elopment =ost and t)eir aim of pa/ +a=5 period. It in=ludes pri=e s5imming setting pri=e at )ig) le7el to =apture profit in s)ort term and penetration pri=ing setting pri=e at low le7el to en)an=e mar5et s)are". +" !s/=)ologi=al pri=ing' in t)e =onte>t of t)is poli=/ organi*ations set pri=e on emotional response rat)er t)an rational response. It in=ludes odd e7en pri=ing set pri=e as (9.99 rat)er t)an 50"' =ustomar/ pri=ing t)e pri=e t)at =ustomer willing to pa/ e7en in ups and downs of mar5et situations" and set pri=e )ig) to =reate prestige image as Eewelr/". =" !rofessional pri=ing' set pri=e at standard weat)er t)e =ustomer is willing to pa/ or not. 3or e>ample' fee of a do=tor or =onsultant. d" !romotional pri=ing' t)is poli=/ is to +e adopted w)en organi*ations want to draw =ustomer attention towards a spe=ifi= produ=t. It in=ludes to options' pri=e leaders set pri=e near to =ost or +elow and earn re7enue from ot)er produ=t" and spe=ial e7ent pri=ing aims to in=rease :1

European Journal of Business and Management ISSN 2222-1905 !aper" ISSN 2222-2#$9 %nline" &ol.5' No.1(' 201$

sales 7olume and generate operating e>pense on spe=ial e7ent". 4o =al=ulate t)e pri=e Aowle/ also suggested following nine pri=e =al=ulation met)ods. a" .ost plus pri=ing' t)is is to +e used w)en t)e produ=tion =osts are undetermina+le. In t)is wa/ manufa=turer fore=ast t)e sellerFs =ost and add a per=entage of o7erall produ=tion =ost to it. +" Mar5 up pri=ing' in=ludes predetermined per=entage of =ost. =" 6emand oriented pri=ing' organi*ations use t)is met)od w)en demand of a produ=t is )ig). d" !ri=e differentiation' it in=ludes different pri=e of a same produ=t at different segments or =)annels. 3or e>ample' t)e different pri=e at restaurants and at supermar5ets. e" 1eograp)i=al pri=ing' in=lude different pri=es at different geograp)i=al lo=ations. 3or e>ample' pri=e of a =old-rin5 is )ig) at airport as =ompare to a general store. f" .ompetition oriented pri=ing' pri=es are to +e set in relation to =ompetitors. g" Distori=al pri=ing' set toda/Fs pri=e in relation wit) /esterda/Fs pri=e +e=ause =ustomers a==ept pri=es relating to earl/ pri=es. )" 6is=ounts' in t)is pri=ing met)od organi*ations offer 7arious t/pes of dis=ounts in pri=es to =ustomers. i" Bundling' in t)is met)od t)e pri=e of +undle of one produ=t is less t)an if t)e =ustomer pur=)ase one unit of same produ=t Aowle/' 199;". .( Summary and Conclusions In t)e modern era of te=)nolog/ firms w)et)er manufa=turing or ser7i=e t)e/ are loo5ing forward to in=rease t)eir effi=ien=ies and performan=es. Suppl/ .)ain Management is one of t)e maEor tools t)at pla/ a 7ital role in en)an=ing organi*ational effi=ien=/ in t)is world of new te=)nolog/. 4)is resear=) paper is written to e>plore t)e fa=tors or dri7ers in=luded t)at are indispensa+le for an/ organi*ation to in=rease effi=ien=/ in suppl/ =)ain management. Suppl/ =)ain management is fo=using on management of a=ti7ities from raw material to final produ=t and end user. It in=ludes t)e suppliers of raw material' transformational pro=ess' final produ=t and t)e a=ti7ities of )ow deli7er final produ=t or ser7i=e to end user. , =ompan/Fs suppl/ =)ain needs to a=)ie7e +alan=e in effi=ien=/ and responsi7eness t)at leads =ompan/Fs =ompetiti7e strateg/ Sunil .)opra and Meindl' 200;".4)e w)ole stud/ =on=luded t)at t)ere are si> dri7ers of suppl/ =)ain performan=e t)at need to +e managed to en)an=e organi*ational performan=e and output. 4)ese dri7ers are@ 3a=ilities' In7entor/' 4ransportation' Information' Sour=ing and pri=ing. 4)ese dri7ers are =losel/ related wit) ea=) ot)er and )a7e a greater impa=t on organi*ational performan=e. %rgani*ations need to find a situation w)ere +ot) effi=ien=/ and responsi7eness in suppl/ =)ain pra=ti=es are at a7erage le7el to en)an=e organi*ational performan=e and output. 4)is a7erage le7el =an onl/ +e a=)ie7ed t)roug) +etter management of dri7ers of suppl/ =)ain performan=e. Dig) effi=ien=/ and ma>imum responsi7eness =ould ne7er e7er to +e a=)ie7ed at same time. +eferences ,ram/an' Busine' D. and -uiper' M. 2009"' G,nal/*ing pri=e transmission in agro-food suppl/ =)ains8 an o7er7iewH' "eas ring # siness $%cellence' &ol. 1$' No. $' pp. $-12. Ba5er' !. 200;"' G,n e>plorator/ framewor5 of t)e role of in7entor/ and ware)ousing in international suppl/ =)ainsH' T&e International 'o rnal of (ogistics "anagement' &ol. 1#' No. 1' pp. :(-#0. Bannett' 6. and -ane' J.%. 200:"' G,=)ie7ing +usiness e>=ellen=e t)roug) s/n=)ronous suppl/ in t)e automoti7e se=torH' #enc&mar)ing* +n International 'o rnal' &ol. 1$' No. 1K2' pp. 12-22. .)andra' .. and -umar' S. 2001"' G4a>onom/ of in7entor/ poli=ies for suppl/ =)ain effe=ti7enessH' International 'o rnal of ,etail - .istri/ tion "anagement' &ol. 29' No. (' pp. 1:(-1;5. .)iappe' I.S. and Derrero' &.,. 199;"' G4)e status of suppl/ =)ain management in ,rgentinaFs food industr/H' T&e International 'o rnal of (ogistic "anagement' &ol. #' No. 1' pp. #;-9:. .o>' ,.' .)i=5sand' 6. and Iang' 4. 200;"' G4)e proa=ti7e alignment of sour=ing wit) mar5eting and +randing strategies8 a food ser7i=e =aseH' S pply 0&ain "anagement* an International 'o rnal' &ol. 12' No. 5' pp. $21$$$. .rea**a' ,.' 6allari' 3. and Mela=ini' M. 2010"' GE7aluating logisti=s networ5 =onfigurations for a glo+al suppl/ =)ainH' S pply 0&ain "anagement* an International 'o rnal' &ol. 15' No. 2' pp. 15(-1:(. .ruiEssen' 3.' Bra/s/' %.' 6ullaert' C.' 3leuren' D. and Salomon' M. 200;"' GJoint route planning under 7ar/ing mar5et =onditionsH' International 'o rnal of P&ysical .istri/ tion - (ogistics "anagement' &ol. $;' No. (' pp. 2#;-$0(. 6r. -e7in M= .orma=5' 6r. ,r=)ie Bo=5am/ III.' G4)e 6e7elopment of a Suppl/ .)ain Management !ro=ess Maturit/ Model 2sing t)e .on=epts of Business !ro=ess %rientationH' 1Sc&ed led for 2224 p /lication in t&e S pply 0&ain "anagement 3o rnal4. 6u5e' .)arles' A. 199("' GMat=)ing ,ppropriate !ri=ing Strateg/ wit) Mar5ets and %+Ee=ti7esH' 'o rnal of Prod ct - #rand "anagement' &ol. $' No. 2' pp. 15-2;. Ellram' Bisa' M. and .ooper' Mart)a' .. 1990"' GSuppl/ =)ain management' !artners)ips and t)e S)ippers M 4)ird !art/ Aelations)ip H' T&e International 'o rnal of (ogistics "anagement' &ol. 1' No. 2' pp. 1-10. 1opal' !.A... and 4)a55ar' J. 2012"' G, re7iew on suppl/ =)ain performan=e measures and metri=s8 2000-


European Journal of Business and Management ISSN 2222-1905 !aper" ISSN 2222-2#$9 %nline" &ol.5' No.1(' 201$

2011H' International 'o rnal of Prod ctivity and Performance "anagement' &ol. :1' No. 5' pp. 51#-5(;. Dassini' E. 200#"' GBuilding =ompetiti7e enterprises t)roug) suppl/ =)ain managementH' 'o rnal of $nterprise Information "anagement' &ol. 21' No. (' pp. $(1-$((. Du?' 3.' Stafford' 4)omas' 3.' B)utta' M.-.S. and -anungo' S. 2010"' G,n e>amination of t)e differential effe=ts of transportation in suppl/ =)ain optimi*ation modelingH' 'o rnal of "an fact ring Tec&nology "anagement' &ol. 21' No. 2' pp. 2:9-2#:. Jensen' !.,. 2011"' G%rgani*ation of fa=ilities management in relation to =ore +usinessH' 'o rnal of Facilities "anagement' &ol. 9' No. 2' pp. ;#-95. JumaJ)' ,)mad' D. and Cood' 6. 2000"' G%utsour=ing impli=ations on =ompaniesJ profita+ilit/ and li?uidit/8 a sample of 2- =ompaniesH' 5or) St dy' M.B 2ni7ersit/ !ress. ISSN.00($-#022' &ol. (9' No. ;' pp. 2:5-2;(. -adi/ala' A. and -leiner' Brian' D. 2005"' GNew 6e7elopments .on=erning Business Information S/stemsH' "anagement ,esearc& 6ews' &ol. 2#' No. 11K12' pp. 1:(-1;0. -ar55ainen' M.' Bau55anen' S.' Sarpola' S. and -emppainen' - 200;"' GAoles of inter-firm information s/stems in suppl/ =)ain managementH' International 'o rnal of P&ysical .istri/ tion - (ogistics "anagement' &ol. $;' No. (' pp. 2:(-2#:. -ir5)am' J.6.' Ai=)+ell' S.M. and Catts' D.6. 199#"' G6ownsi*ing and fa=ilit/ lo=ation8 plant =losures in multi plant manufa=turing firmsH' "anagement .ecision' &ol. $:' No. $' pp. 1#9-19;. Balonde' Bernard' J. 199:"' GIssues in suppl/ =)ain =ostingH' T&e International 'o rnal of (ogistic "anagement' &ol. ;' No. 1' pp. 1-12. Bea7/' B. 200("' GSpe=ial four-arti=le report on strategi= outsour=ing' %utsour=ing strategies8 opportunities and ris5sH' Strategy and (eaders&ip' Emerald 1roup !u+lis)ing' ISSN.10#;-#5;2' &ol. $2' No. :' pp. 20-25. Bummus' A)onda' A. and &o5our5a' Ao+ert' J. 1999"' G6efining suppl/ =)ain management8 a )istori=al perspe=ti7e and pra=ti=al guidelinesH' Ind strial "anagement - .ata Systems' &ol. 99' No. 1' pp. 11-1;. Bummus' A)onda' A.' -rumwiede' 6ennis' C. and &o5our5a' Ao+ert' J. 2001"' G4)e relations)ip of logisti=s to suppl/ =)ain management8 de7eloping a =ommon industr/ definitionH' Ind strial "anagement - .ata Systems' &ol. 101' No. #' pp. (2:-($1. Bund57ist' ,. and Ia5)lef' ,. 200("' G.ustomer in7ol7ement in new ser7i=e de7elopment8 a =on7ersational approa=)H' "anaging Service 7 ality' &ol. 1(' No. 2K$' pp. 2(9-25;. M=Baren' 4im' N. and &oung' 6a7id' ..D. 200#"' G, Ggenomi=H =lassifi=ation s=)eme for suppl/ =)ain management information s/stemsH' 'o rnal of $nterprise Information "anagement' &ol. 21' No. (' pp. (09-(2$. Mouritsen' J. Barsen' 4.S. and -ot*a+' D. 200$"' GE>ploring t)e =ontours of suppl/ =)ain managementH' Integrated "an fact ring System' &ol. 1(' No. #' pp. :#:-:95. Na*ali' M. and !itt' M. 2009"' G4)e appli=ation of suppl/ =)ain management and =olla+orati7e inno7ation in t)e deli7er/ of fa=ilities management ser7i=esH' 'o rnal of Facilities "anagement' &ol. ;' No. (' pp. 2#$-29;. New' Step)en' J. 199;"' G4)e s=ope of suppl/ =)ain management resear=)H' S pply 0&ain "anagement' M.B 2ni7ersit/ !ress O ISSN 1$59-#5(:' &ol. 2' No. 1' pp. 15-22. %le5sa5' M. 2005"' GStrategi= =on7ersation wit) /our =ustomers )elps )one t)e planning pro=essH' 8and #oo) of # siness Strategy' pp. $0$-$0;' Emerald 1roup !u+lis)ing Bimited' ISSN' 0#9(-($1#. !a*irande)' ,. 2011"' GSour=ing in glo+al )ealt) suppl/ =)ains for de7eloping =ountries' Biterature re7iew and a de=ision ma5ing framewor5H' International 'o rnal of P&ysical .istri/ tion - (ogistics "anagement' &ol. (1' No. (' pp. $:(-$#(. !errons' Ao+ert' -. and !latts' -. 2005"' G%utsour=ing strategies for radi=al inno7ations8 does industr/ =lo=5speed ma5e a differen=ePH' 'o rnal of "an fact ring Tec&nology "anagement' &ol. 1:' No. #' pp. #(2-#:$. !ieter 7an 6on5' 6. 200#"' G.)allenges in relating suppl/ =)ain management and information and =ommuni=ation te=)nolog/' an introdu=tion H' International 'o rnal of Operations - Prod ction "anagement' &ol. 2#' No. (' pp. $0#-$12. AamLre*' ,.M.' Morales' &.J.1. and ,randa' 6.,. 2012"' G-nowledge =reation and fle>i+ilit/ of distri+ution of informationH' Ind strial "anagement - .ata Systems' &ol. 112' No. 2' pp. 1::-1#5. Ae*a' Nasiri' 1.' 6a7oudpour' D. and -arimi' B. 2010"' G4)e impa=t of integrated anal/sis on suppl/ =)ain management8 a =oordinated approa=) for in7entor/ =ontrol poli=/H' S pply 0&ain "anagement* an International 'o rnal' &ol. 15' No. (' pp. 2;;-2#9. Ai=)e/' A.1.' .)en' D.' 2preti' A.' 3aw=ett' Stanle/' E. and ,dams' 3ran5' 1. 2009"' G4)e moderating role of +arriers on t)e relations)ip +etween dri7ers to suppl/ =)ain integration and firm performan=eH' International 'o rnal of P&ysical .istri/ tion - (ogistics "anagement' &ol. $9' No. 10' pp. #2:-#(0. Aowle/' J. 199;"' G!rin=iples of pri=e and pri=ing poli=/ for t)e information mar5etpla=eH' (i/rary ,eview' M.B 2ni7ersit/' !ress' 002(-25$5' &ol. (:' No. $' pp. 1;9-1#9. S)in' -.S.' S)in' I.C.' -won' J.D. and -ang' S.D. 2012"' GAis5 propagation +ased d/nami= transportation route finding me=)anismH' Ind strial "anagement - .ata Systems' &ol. 112' No. 1' pp. 102-12(.


European Journal of Business and Management ISSN 2222-1905 !aper" ISSN 2222-2#$9 %nline" &ol.5' No.1(' 201$

Soni' 1. and -odali' A. 2010"' GInternal +en=)mar5ing for assessment of suppl/ =)ain performan=eH' #enc&mar)ing* +n International 'o rnal' &ol. 1;' No. 1' pp. ((-;:. Stanger' Se+astian' D.C.' Cilding' A.' Iates' N. and .otton' S. 2012"' GC)at dri7es peris)a+le in7entor/ management performan=eP Bessons learnt from t)e 2- +lood suppl/ =)ainH' S pply 0&ain "anagement* an International 'o rnal' &ol. 1;' No. 2' pp. 10;-12$. Stefansson' 1. and Bumsden' -. 2009"' G!erforman=e issues of Smart 4ransportation Management s/stemsH' International 'o rnal of Prod ctivity and Performance "anagement' &ol. 5#' No. 1' pp. 5(-;0. Sunil .)opra' S. and Meindl' !. 200;"' Suppl/ .)ain Management8 Strateg/' !lanning' and %perations' $rd ed.' Prentice98all: $nglewood 0liffs: 6'. .D. $' !age (# and (9" Swamidass' !aul' M.' 6arlow' N. and Baines' 4. 2001"' GE7ol7ing forms of manufa=turing strateg/ de7elopment e7iden=e and impli=ationsH' International 'o rnal of Operations and Prod ction "anagement' &ol. 21' No. 10' pp. 12#9-1$0(. 4ans5anen' -.' Dolmstrom' J.' Elf7ing' J. and 4al7itie' 2. 2009"' G&endor-managed-in7entor/ &MI" in =onstru=tionH' International 'o rnal of Prod ctivity and Performance "anagement' &ol. 5#' No. 1' pp. 29-(0. 4i+in' B.' IingEin' B.' Iong' Q. and Rianglan' J. 2012"' GAesear=) on information s)aring 7alues of suppl/ =)ain managementH' ;y/ernetes' &ol. (1' No. 9' pp. 11#5-1191. &erwiEmeren' M.' &list' !.&.6. and 6onselaar' -.&. 199:"' GNetwor5ed in7entor/ management information s/stems8 materiali*ing suppl/ =)ain managementH' International 'o rnal of P&ysical .istri/ tion - (ogistics' &ol. 2:' No. :' pp. 1:-$1. Callin' ..' Jo)nn/' Aungtusanat)am' M. and Aa+ino7i=)' E. 200:"' GC)at is t)e Grig)tH in7entor/ management approa=) for a pur=)ased itemPH' International 'o rnal of Operations - Prod ction "anagement' &ol. 2:' No. 1' pp. 50-:#. Calters' 6 200:"' G6emand =)ain effe=ti7eness M suppl/ =)ain effi=ien=ies' , role for enterprise information managementH' 'o rnal of $nterprise Information "anagement' &ol. 19' No. $' pp. 2(:-2:1. Ian' A. and Cang' J. 2010"' GSer7i=e le7el' pri=ing strateg/ and firm performan=e in a manufa=turer- giant retailer suppl/ =)ainH' 'o rnal of Prod ct - #rand "anagement' &ol. 19' No. 1' pp. :1-:(. Iong' Q.' IingEin' B. and Rianglan' J. 2012"' GAesear=) on d/nami= pri=ing of suppl/ =)ain produ=ts +ased on =)annel ad7antagesH' ;y/ernetes' &ol. (1' No. 9' pp. 1$;;-1$#5.