Electronic Business: Concepts, Methodologies, Tools, and Applications (4-Volumes) P22 pptx

7KHVH³HEXVLQHVV´DSSOLFDWLRQVDUHDOUHDG\ being introduced into supply chain manage-ment–primarily as a collaborative use of Internet technology to enable integration of value and supply ch

munication and collaboration, and customer

services (Blascovich & Goffre, 2003; Donovan

n.d; Phan, 2003)

7KHVH³HEXVLQHVV´DSSOLFDWLRQVDUHDOUHDG\

being introduced into supply chain

manage-ment–primarily as a collaborative use of Internet

technology to enable integration of value and

supply chains with key partners, by supporting

business processes to improve speed, agility,

real-time control, and customer satisfaction (Jelassi &

Leenen, 2003) This is done largely through the

use of computer and communication networks to

transfer information electronically Porter (2001)

argues that the main advantages to an organisation

LVKRZHEXVLQHVVLVGHSOR\HGWREHQH¿WIURPWKH

advantages of Internet technology, rather than

whether it is deployed There is consensus amongst

academics and practitioners that the success of

an e-business enabled supply chain depends on

two major factors:

• Collaboration between partners (Norris,

Hurley, Hartley, Dunleavy, & Balls, 2000)

and integration of supply chains through

linking information systems (Cigolini,

Cozzi, & Perona, 2004; Zank & Vokurka

(2003), which is also seen as a major source

of competitive advantage;

• Information visibility (Garcia-Dastugue &

Lambert 2003; Kehoe et al., 1998)

includ-ing the ability to share accurate data and

information from a wide range of operating

areas across the supply network (Lancioni,

Smith, & Oliva, 2000)

6XSSO\FKDLQVDUHFXUUHQWO\LQDVWDWHRIÀX[

where they must be able to manage the

complex-LW\RIVWDNHKROGHUVDQGÀRZVRILQIRUPDWLRQDQG

materials throughout, while still maintain their

³OHDJLOH´ RSWLPLVHG GHVLJQV 1D\ORU 1DLP 

Berry, 1999) Croom (2001, 2005) has suggested

the existence of a staged evolutionary process

in the adoption of supply chain strategies in

relation to e-business systems, beginning with

customer facing processes, followed by internal (operations) processes, supplier-facing processes, DQG¿QDOO\WRWDOFKDLQLQWHJUDWLRQ7KLVYLVLRQLV supported by other academics and practitioners +DQG¿HOGHWDO3RLUHUQGZKRVHHWKH supply chain of the near future as a synchronised ÀRZRIPDWHULDOVDQGLQIRUPDWLRQWKURXJKDIXOO\ networked virtual business This incorporates all the companies in the supply chain where not only are internal processes linked with customers and suppliers, but the whole value chain would be networked end-to-end, managed through creat-ing value, and all stakeholders are in a win-win position Modularisation is another trend that supply chains are experiencing where there is

³YDOXHVKLIWLQJ´DVV\VWHPVDUHEHLQJLQWHJUDWHG into smaller subsystems that can function alone

or as a part of the network (Doran, 2003) Ke-hoe et al (2001b) suggest the need for a supply chain resource planning approach where Internet technologies will enable supply chain partners

to dynamically view and manage both demand and capacity data to create supply Webs There

is however little empirical research into the type and degree of integration that is taking place and how this can be measured in order to evaluate the LPSDFW RQ LQIRUPDWLRQ ÀRZV DQG UHODWLRQVKLSV between and within supply network partners

The Importance of Information Flows

One of the critical foundations of supply networks LVLQIRUPDWLRQÀRZV7KLVLVHYHQPRUHFULWLFDO

in integrated networks where physical material supply chains are being replaced by a network of information servers distributed across organisa-tions Gadde et al (2001) see the exchange of LQIRUPDWLRQSOD\LQJDVLJQL¿FDQWUROHLQFUHDWLQJ QHWZRUN HI¿FLHQFLHV ZKHUH HI¿FLHQW LQIRUPD-WLRQÀRZVDUHSUHUHTXLVLWHVIRUFRRUGLQDWLRQRI activities in a network and for the exchange of information needed for resource development 1RWRQO\HI¿FLHQWÀRZVRILQIRUPDWLRQEXWDOVR

³LQIRUPDWLRQHQULFKHG´VXSSO\FKDLQVZKHUHWKH

information systems are carefully engineered to

PDWFK WKH VSHFL¿F VXSSO\ FKDLQ UHTXLUHPHQWV

For example, in an information enriched supply

chain, all stakeholders receive marketplace data

directly increasing transparency, reducing

distor-WLRQ DQG DYRLGLQJ GRXEOH JXHVVLQJ ³:KHUHDV

information enriched concept is highly desirable

in lean supply, it is obligatory in the achievement

of agile supply It is only when effective

market-place feedback is available that the next deliveries

can be pulled from the supplier” (Mason-Jones

& Towill, 2000, p 55) The more accurate and

WLPHO\WKHLQIRUPDWLRQÀRZWKHPRUHUHVSRQVLYH

companies are to changes in demand (Wallace et

al., 2006) Also direct knowledge of end demand

through the supply chain is a way to reduce both

inventory levels and the bullwhip effect (Cigolini

et al., 2004; Wallace et al., 2006)

However an exploration of the information

ÀRZVWKDWOLQNDOOWKHVXSSO\FKDLQPHPEHUV±7LHU

1,2, 3 suppliers as well as the manufacturer,

customer, and consumer/end-consumer–have not

been fully researched and needs further

investiga-tion (Garcia-Dastugue et al., 2003)

Integration, Technology

Infrastructures, and Supply Chains

Many current organisational supply chains are

en-trenched with manual processes and disconnected

enterprise systems Both Forrester Research and

$EHUGHHQ*URXSIRXQGQRVLJQL¿FDQWLQWHJUDWLRQV

between manufacturers and their suppliers’ and

customers’ enterprise systems with the majority

being driven by manual, spreadsheet-intensive,

only partially automated processes largely

de-pendent upon different software systems within

their own companies (Wailgum, 2006) Integrated

,7 LQIUDVWUXFWXUHV HQDEOH ¿UPV WR GHYHORS D

higher-order capability of supply chain process

LQWHJUDWLRQ 7KLV FDSDELOLW\ ³HQDEOHV ¿UPV WR

XQEXQGOHLQIRUPDWLRQÀRZVIURPSK\VLFDOÀRZV

and to share information with their supply chain

partners to create information-based approaches

for superior demand planning, for the staging and movement of physical products, and for stream-OLQLQJYROXPLQRXVDQGFRPSOH[¿QDQFLDOZRUN processes” (Rai, Patnayakuni, & Patnayakuni,

2006, p 227) Currently there is no universally accepted and widely implemented standardisation

of technological architecture and applications across supply networks: for example the use

of XML, middleware, Internet technology, the role of e-marketplaces and electronic auctions (Tassabehji et al., 2006a,b; Wallace et al., 2006)

If the technology is to be fully exploited, there is

a need for standardisation and developing Internet HQDEOHG³FRPPRQV\VWHPVLQIUDVWUXFWXUH´ HKRH

et al., 2001a) to remove the problem of systems integration

DISCUSSION

From the literature review, it can be ascertained that the main gaps in the research are a typology

of e-business as it relates to supply networks,

a deeper understanding of what integration is, its linkage with e-business, and its impact on supply networks, and a wider examination of LQIRUPDWLRQ ÀRZV WKURXJK WKH VXSSO\ QHWZRUN

in order to classify information according to a set of criteria, which will make it better support the needs and requirements of all the members

in the supply network

An ideal test bed for this kind of research is the process industry The process industry sector is extremely important and one that is estimated to grow at an average of around 4% per annum until

2010 (staff 2003) based on the projections of de-mand from process industry products and services worldwide Pharmaceuticals is estimated to be the fasted growing process industry with the trend

in highly industrialised countries towards more SURGXFWLYHPRUHHI¿FLHQWPRUHÀH[LEOHSODQWV which increase availability and environmental sustainability but are less resource intensive As such, supply chain management and the Internet

based tools that facilitate this management is a

critical part of these strategies

Towards a Standardised Approach to

Integrated Supply Chains:

Recommendations

7KHLVVXHVSUHYLRXVO\LGHQWL¿HGFDQEHGLYLGHG

into three major parts These are not mutually

exclusive and there is a strong degree of conceptual

overlap where information for all three stages can

be sought at one interaction with stakeholders

Stage 1: Develop a Typology of

E-Business Technology and

Applications Infrastructure in Support of

Information Flow in Supply Chains

The internet has improved inter-organisational

information systems’ capability and is being

adopted as a routine platform for information

systems development, with Web services, wireless

applications, and advanced software applications

all being used to facilitate supply chain

col-laboration (Ho & Lin, 2004; Kehoe et al., 2001a;

Mondragon, Lyons, Michaelides, & Kehoe, 2006)

+RZHYHUWKHUHLVQRH[DFWGH¿QLWLRQRI,QWHUQHW

based commerce (Soliman & Youssef 2003)

7KXVWKHUHLVDQHHGWRLGHQWLI\³HEXVLQHVV´

technology and how it is used in the organisation’s

business supply and value processes including

the use of electronic marketplaces and electronic

auctions The information will then be analysed

WRGHYHORSDW\SRORJ\RI³HEXVLQHVV´DFFRUGLQJ

to the technology and applications used within

the supply chain This can eventually be used as

a benchmarking tool and bring standardisation to

the area Figure 1 presents a taxonomy of relevant

hardware and software, and their application

in an e-supply network that we posit should be

standardised

E-commerce is currently seen as a

technol-RJ\¿WUDWKHUWKDQDUHODWLRQVKLSWRROEXWWKLVZLOO

change (Ruppel, 2006) In the future,

collabora-tive product commerce (CPC), a set of tools that allows companies to manage product informa-tion and share it with suppliers and partners through the Web, is expected to co-ordinate and control virtually all supply, manufacturing and customer-relationship processes supported by an e-based infrastructure backbone (Mondragon et al., 2006)

Thus, there is a need to establish this com-mon e-based infrastructure backbone to ensure interoperability and standardisation to support LQIRUPDWLRQ ÀRZV 6ROLPDQ HW DO  0RQ-dragon et al 2006) There are already attempts

to develop standardised Web-based platforms For instance, the Web Services Interoperability Organisation (WS-I) which is a consortium of the top companies in the industry such as HP, Microsoft, IBM, ORACLE, and Intel, aims to promote interoperability among Web services based on providing Web services developers ZLWKFRPPRQLQGXVWU\DFFHSWHGGH¿QLWLRQVDQG related extendible mark-up language standards support This however is voluntary and is still in the early stages of development Other industry standards like operating frequencies for RFIDs

or UDDI (universal description, discovery, and integration) platform independent business reg-istries for Web services are needed to ensure the widespread utilisation of these technologies (Mondragon et al., 2006)

In the standardisation process, there is also a need to incorporate other business related factors

in the application Mondragon et al (2006), look-LQJVSHFL¿FDOO\DWWKHDXWRPRWLYHPDQXIDFWXULQJ sector, highlight the importance and reliance of sophisticated business models, such as supplier parks and full-service-vehicle supply, on the use RI:HEEDVHGLQIRUPDWLRQV\VWHPVWRIXO¿OWKH build-to-order strategy

6KDUL¿HWDOEHOLHYHWKDWFODVVL¿FDWLRQ

of e-marketplaces, which are sales and purchasing operations conducted over a common e-enabled platform, are critical to the management of their application and adoption They use criteria such

as ownership/structure, product/market type

and required functionality for e-marketplace

FODVVL¿FDWLRQ

In a study of three supply chain management

technologies (group decision support systems,

EDI, and the Internet for electronic marketing

(e-commerce)), each was found to improve

infor-PDWLRQÀRZVDORQJWKHVXSSO\FKDLQWKHPDMRU

criteria for success was the perceived needs of

the users with respect to the implementation of

the respective technology (Ruppel, 2006) Thus

managers cannot expect to be able to implement

all SCM technologies/tools in the same manner,

as different factors affect the adoption and use of

different technologies

From this, the typology and infrastructure we

recommend needs to incorporate factors related

to user needs such as degree of trust, cost,

secu-rity, business strategies, objectives and business

models In the e-platform that is recommended in

Figure 1, we have incorporated the already rapid

growth of demand of online purchasing software

from suppliers, and included the software that is and will be required to move beyond e-commerce and achieve e-supply networks The importance

of tools enabling sales and operational planning, lean operations, and VMI and CPFR has already EHHQLGHQWL¿HGDVEHLQJFULWLFDOWRWKHVXFFHVVRI e-supply networks and need to be a part of the technological infrastructure (Friscia et al., 2004)

It is the tools plus the connectivity that is of criti-cal importance and these have been incorporated

in our e-platform

Stage 2: Determine the Degree of Integration Between Supply Network Partners

Although e-supply chain management is in its academic infancy, there are many well established software packages that have been implemented

in business AMR Research list 25 major global companies led by DELL, Nokia, and Procter and

Figure 1 Standardising hardware and software in an E-supply network

•Barcodes

•Integration platform networks (such as XML)

•RFID tags have antenna and chip containing an

electronic product code that includes more

information than a regular bar code (e.g when and

where the item was made, components source, time of

expiry etc).

•Wireless devices (e.g.PDA)

•Neural Technology

•Grid Technology

•Security infrastructure (e.g PKI)

•Global Information Systems

•E-mail

•Workflow systems and tools (use set of software

programmes that automate almost any information

processing e.g document management)

•Groupware and other collaborative tools (VOIP web

conferencing)

•Internet enabled EDI

•ERP

•Vendor Managed Inventory (VMI)

•Collaborative Planning forecasting and

replenishment (CPFR)

•Advanced planning and scheduling (APS)

•Adaptive Inventory Management

•E-marketplaces

Hardware & Software

•E-procurement: requisitioning;

sourcing; contracting; ordering; payment

•SC monitoring and control (use of

RFID)

•Inventory management (wireless

devices to enter inventory item counts; XML infrastructure)

•Collaborative planning (sharing

info via the net; dynamic data exchange; B2B workflows across multiple enterprises over the net

•E-logistics (spot buying of

trucking capacity (internet based freight auctions)

•Collaborative product

development

•Business Models

•Business Strategies and

Objectives

Application in the Supply Chain/Network

Gamble (Friscia et al., 2004) that have achieved

success with supply chains, not only by

enhanc-LQJSURFHVVÀRZVEXWDOVRE\FUHDWLQJDSODWIRUP

on which suppliers, producers, distributors, and

retailers can coordinate a response to the demand

signal from customers These SCM tools require

a high level of integration and organisations must

match the operational needs of these tools to the

JRDOV RI WKH EXVLQHVV )URP WKH ¿UVW VWDJH ZH

can see that the technology has advanced

exten-sively, but there is still much greater potential for

its growth, development and maturity (Ruppel,

2006) With standardisation will come more and

easier integration with the right partners

Soliman et al (2003) present a model of

Internet based e-commerce in manufacturing

where they emphasise the need for integration

with internal and external processes already in

place in the organisation This is a challenging

process involving a major re-engineering exercise

accompanied by resistance to change

There is a need to determine the strategic level

RILQWHJUDWLRQRIV\VWHPVDQGLQIRUPDWLRQÀRZV

and how effective they are in terms of achieving

supply chain objectives Evaluation of

integra-tion would also be made at an operaintegra-tional level

examining systems and network diagrams as

well as access; control; and permissions listings

One of the ways in which the degree of

integra-tion between supply network partners is to be

determined, is to assess the importance of each

respective partner in the process There are already

tools for sorecarding supplier portfolios that help

manufacturers determine whether their suppliers

are performing well on an individual basis

(Hoch-man, 2007) This could be extended to include

an assessment of the level of critical importance

each supplier in the value chain/network

Developing such supply chain integration

strategies for competitive advantage however

requires a new organisational mindset It will be

a real challenge for successful supply chain

play-ers to undplay-erstand the dynamics of power of their

own position and other players in their industry

enough, to be able to develop an open culture that will enable integration and close interaction with other supply chain partners This kind of partnering, if achieved, can bring about mutual EHQH¿WV DQG LQWURGXFH SHUIRUPDQFH PHDVXUHV ZKLFKUHLQIRUFHFROODERUDWLRQDQG¿QGQRYHOZD\V

of integrating information systems with other supply partners

Stage 3: Examine Information Nodes Across the Supply Network and Identify Criteria for Classifying Information Flows

,WLVZLGHO\DFNQRZOHGJHGWKDWPDQDJLQJWKHÀRZ

of information within and between organisations ZLOO OHDG WR HI¿FLHQFLHV LQ RUJDQLVDWLRQDO SUR-cesses (Krovi, Chandra, & Rajagopalan, 2003) The methodological approach to this part of the research is based on systems thinking, with a SURFHVV ÀRZ DQDO\VLV RI LQIRUPDWLRQ SDVVLQJ though the e-business enabled supply chain us-LQJÀRZFKDUWV:LWKLQWKHVHFKDUWVZLOOEHWKH LGHQWL¿FDWLRQRILQIRUPDWLRQQRGHVZKHUHWKHYDOXH RIWKHQRGHLH³WKHHQWLW\RUJURXSRIHQWLWLHV capable of altering the properties of information ÀRZ´ URYLHWDOS LVGHWHUPLQHGE\ the information content, the importance to deci-sion making and the e-business infrastructure or technology infrastructure on which it relies Tsaih and Lin (2006) identify two kinds of informa-tion processing infrastructures in a value chain:

contact points where information is processed

and the corresponding business task is carried

out and information channels which carry the

LQIRUPDWLRQ ÀRZ 7KH LQIRUPDWLRQ QRGHV WKXV can be divided into these two functional criteria The role of the contact points and information channels also change dynamically where the information recipient could be both a decider and a communicator of information (Titus & Brochner, 2005)

7KHELGLUHFWLRQDOLQIRUPDWLRQÀRZVQHHGWR

be analysed with the partner’s capacity to handle

WKH UHTXLUHPHQW DQG FDXVH WKH IXO¿OPHQW ÀRZ

The quality, timeliness, and cost effectiveness of

WKHLQIRUPDWLRQGHWHUPLQHWKHLQIRUPDWLRQÀRZ

HI¿FLHQF\7LWXVHWDO&DL-XQDQG<DQJ

(2006) found that norms of Internet information

sharing are positively associated with three key

dimensions of Internet communication: formality

(formal rules to effectively manage and control

WKHLU,QWHUQHWFRPPXQLFDWLRQÀRZVIUHTXHQF\

and diversity of information Other suggested

LQIRUPDWLRQÀRZSDUDPHWHUV URYLHWDO

include:

• Velocity: The speed of information arriving

at a node

• Viscosity:7KHGHJUHHRIFRQÀLFWDWWKHQRGH

where there might be contradictory

informa-tion components (this can potentially cause

the bullwhip effect in supply chains)

• Volatility: Uncertainty about the content,

format, or timing of information

• Density: The number of intermediate nodes

involved in the information processing

chan-nel

Each of the participants in the supply network

has a large number of needs to a) request b)

ag-JUHJDWHF¿OWHULQIRUPDWLRQIURPGLIIHUHQWDQG

multiple sources All these factors will be a starting

SRLQWLQWKHFODVVL¿FDWLRQRILQIRUPDWLRQÀRZV

Supply chains are no longer internal, but

are multi-tiered, multi-echeloned with different

FRQ¿JXUDWLRQVDWHDFKOHYHOZLWKPXOWLSOHSOD\HUV

and multiple supply chains—internal or

exter-QDO7KUHHVSHFL¿FWLHUVRIVXSSO\FKDLQVFDQEH

LGHQWL¿HG9DQGHU9HOGH 0HLMHUQDPHO\

internal supply chains, external supply chains, and

total supply chains Information can similarly be

structured into three major categories:

• Firstly macro-environmental

informa-tion—factors that impact on the

macro-en-vironment of the whole supply network—for

example, political, legal, social, economic, and technological factors

• Secondly meso-environmental informa-WLRQ²LQGXVWU\ VSHFL¿F IDFWRUV²IRU H[-ample, new technological/or innovative de-velopments in the industry, new competitors, RULQGXVWU\RUVHFWRUVSHFL¿FLQIRUPDWLRQ

• Thirdly micro-environmental factors—fac-WRUVWKDWLPSDFWRQWKH¿UPLWVHOIIRUH[DPSOH internal systems, credit control policies, and training and skills development

3DUWRIWKHLQIRUPDWLRQFODVVL¿FDWLRQSURFHVV would also need to include identifying the type

of information each supply network partner feels

is necessary to supply chain management and then to classify that information according to its importance in achieving organisational objectives, decision making, progressing processes within the e-business enabled supply chain

It is clear from current research in the literature that there are serious issues of trust and power in the use of e-business, particularly in the use of e-auctions and references therein and so issues RIWUXVWPXVWDOVREHLQFOXGHGLQWKHFODVVL¿FDWLRQ

of information which will likely impact informa-WLRQÀRZV3DUWQHUVLQWKHVXSSO\QHWZRUNPXVW also classify information according to the level

of trust with partners they are prepared to share information

The information gathered at this stage would be DQDO\VHGWRGHYHORSDQLQIRUPDWLRQÀRZFKDUWWKDW clearly marks the source of the information, the type of information (internally generated/external report), its criticality, its speed of accumulation, relevance, and importance to supply networks PHPEHUV SRWHQWLDO IRU FRQÀLFWLQJ VRXUFHV RI information, format and timing, sensitivity and willingness to share the information The crite-ULD IRU FODVVL¿FDWLRQ KDYH EHHQ VXPPDULVHG LQ Table 1

From this, a framework or series of frameworks can be developed to support the management of LQIRUPDWLRQÀRZVDFURVVVXSSO\QHWZRUNV7KLV

chain resource planning” suggested by Kehoe et

al (2001a,b)

CONCLUSION

The literature review conducted here revealed

a dearth of theory building based on empirical

research The majority of the research was mainly

descriptive and highlighted the importance of

LQIRUPDWLRQÀRZVLQGHYHORSLQJHVXSSO\FKDLQV

DQGQHWZRUNV7KLVLVFRQVLVWHQWZLWKWKH¿QGLQJV

of Gimenez and Laurenco (2004) who found that

LQIRUPDWLRQÀRZVZDVRQHRIWKHPDLQHVXSSO\

chain topics being dealt with in the Operations

Management literature They also found that the

most used methodology by these researchers was

descriptive More empirical research needs to be

conducted to study the impact of the Internet on

several e-supply chain management processes

From this literature review, we argued the

QHFHVVLW\ RI VWDQGDUGLVLQJ LQIRUPDWLRQ ÀRZ LQ

supply chains to facilitate integration, legality,

se-FXULW\DQGHI¿FLHQF\RIRSHUDWLRQV$WKUHHVWDJH

framework that can achieve this standardisation

was developed, and incorporates:

a Consolidating the different constituents of

e-business and developing a typology of

technology and applications infrastructure

to enable supply network partners to

bench-mark themselves against each other

accord-ing to an explicit set of e-business criteria This will enable closer standardisation and integration of systems throughout the sup-ply network, which will facilitate further RSHUDWLRQDOHI¿FLHQFLHV

b Determining the degree of integration be-tween and across supply network partners in order to evaluate the impact on information ÀRZVDQGHI¿FLHQFLHVLQWKHVXSSO\FKDLQDV

a whole according to the degree and type of integration By being able to classify integra-tion of supply network partners, it will be easier to highlight bottlenecks and potential problems throughout the network

c Identifying information nodes across the supply network in order to examine and FODVVLI\LQIRUPDWLRQÀRZVWKDWSDVVWKURXJK them according to a number of criteria that ZLOOLPSURYHHI¿FLHQF\OHDQQHVVDQGDJLO-ity of the network as a whole and reduce problems such as the bullwhip effect

The information resulting from this approach can then be used in future research to model e-business enabled supply chains and optimise the impact of Internet technology and types of LQIRUPDWLRQÀRZVWRFUHDWHUREXVWUHOLDEOHDJLOH and lean value networks

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This work was previously published in Information Technology Entrepreneurship and Innovation, edited by F Zhao, pp

177-188, copyright 2008 by Information Science Reference (an imprint of IGI Global).

is however little empirical research into the type and degree of integration that is taking place and how this...

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technology and how it is used in the organisation’s

business supply and value processes including

the use of electronic marketplaces and electronic

auctions... this standardisation

was developed, and incorporates:

a Consolidating the different constituents of

e-business and developing a typology of

technology and applications