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Abstract:
Purpose: This Paper investigates the moderating effect of various value
chain activities on the Firms supply chain activities.
Design/ Methodology/ Approach: The data was collected from 120
manufacturers/ suppliers/ distributors with the help of a well designed and
pre-tested questionnaire. Exploratory factor analysis and linear regression
analysis were used to finalize the items of different constructs.
Findings: The study identified eleven value chain adding activities with
the help of explanatory factor analysis. Further the study found that out of
these identified value adding activities, fill rates, impact of promotions on
demand and cost of holding inventory are the most quantifying activities
of all.
Limitations: This study does have a few major limitations. First, the
manufacturers didnt provide any kind of financial information and
secondly the responses of the sample population are another limitation
which was resolved to some extent by applying reliability and validity test.
Also this study is limited only to Jammu region.
Originality/value: The study makes an attempt to understand the
operational dynamics, which may not be visible as such in the real world
but can act as a very important components. The study makes a
contribution by exploring that what are the different value adding
activities that affect the supply chain of the organization.
Keywords: Marketing functions, Supply Chain Functions, Supply Chain,
value chain management.
INTRODUCTION
Supply Chains and Supply Chain Management (SCM) have emerged as
important areas in both business practice as well as academic research.
Recognized as separate area in the 1980s, SCM has garnered a lot of
interest and attention from both academicians and practitioners. Recent
conceptions of SCM show its increasing role within organizations to
encompass activities associated with the integration of supply and
demand management within and across companies, including
coordination and collaboration with channel partners and customers,
sourcing, procurement, conversion, and logistics. It also includes
importantly, coordination and association with channel partners, which
can be intermediaries, third-party service providers, suppliers, and
customers. In essence, Supply Chain Management integrates supply and
demand management not only within but across companies. As reflected
in their definitions and other conceptual developments, the disciplines of
both Marketing and SCM have evolved over time. Many researchers have
described conceptual developments in and across these disciplines for
advancing the understanding of the interrelationship between marketing
and SCM. To address this vital aspect, Esper et al. (2010) introduced a
conceptual framework which focuses on the creation of customer value
through implementation of knowledge management processes between
firms; they described how successful integration may be achieved through
the shared generation, dissemination, interpretation and application of
real-time customer demand together with supply capacity restraints. In
both marketing and SCM, the notion pertaining to supply chains has
steadily evolved from a narrow focus on tangible goods and their
movement for the purposes of manufacturing to broadened consideration
of
(1) The nature of goods offered in the market and
(2) The scope of managerial architectures within and between firms for
doing so
This broadening consideration of thought within marketing and SCM has
led to expansion of the breadth and scope of these disciplines over time.
This expansion has been a critical source for SCMs advancement but at
the same time it also led to some confusion. On one hand it has enabled
SCM to better address its integration goals, but on the other it has created
challenges for its understanding and development. It has also resulted in
perceived redundancies with other disciplines in some areas. In an effort
to facilitate better understanding of the field, to clarify its development
and to identify opportunities for future research, in their article Stock, et
al; (2010) trace and qualitatively analyze 166 unique definitions of SCM
that have emerged since SCMs introduction in the 1980s. They identify
and elaborate on the major themes that have emerged over time to define
SCM. In so doing they identify key research questions and issues
pertaining to supply chains and SCM that would benefit from research
including work by marketing scholars.
LITERATURE REVIEW
In the area of business procurement, purchasing and operations, the
term " Supply Chain Management" has become ubiquitous. A supply chain
has been defined as, "encircling all activities associated with the flow and
conversion of goods from the raw materials (extraction) stage, through to
the end user" (Handfield and Nichols, 1999). Supply chain management
has been defined as "a systems approach to managing the entire flow of
information, materials, and services from raw materials suppliers through
factories and warehouses to the customer (Leenders and Fearon, 1997).
From these definitions, Supply Chain Management can be seen as a
broadly encompassing concept that can include basic marketing elements
such as, product, price, place (channels), and communications
(promotion). However, while Supply Chains exist in both manufacturing
and service organizations, the concept is generally applied to physical
products that have to be handled, assembled, or physically processed in
some way, and not as often to services or products that have a large
service component. Typical debate of supply chain management is
presented in the perspective of manufacturing situations, (for elaboration,
refer for instance, paper by Ganeshan and Harrison, 1995). Because
supply chain management is often accessible in the purchasing or logistics
management literature (e.g. Cooper and Ellram, 1993, Ellram, 1994;
Kranz, 1996) one may be inclined to conclude that it is most often
initiated by the buying rather than the selling entity. Thus it may be
dismissed as having little potential importance to marketing because it
appears to be simply a new purchasing technique that may have limited
impact on marketing. However, almost all of the descriptions of how
supply chain management works include as a primary characteristic that
buying, selling, and other involved organizations such as, transportation
and distribution channels, must work together closely, usually as part of
cross-functional and cross-organizational teams (Monczka, Trent, and
Handfield et al. 1998). Therefore, supply chain management appears to
be a concept that marketing can neither afford to ignore nor wait for
buyers to initiate. Because supply chain management involves the
integrated management of the entire supply chain from raw material to
end user, marketing may be involved in two types of situations vis-a-vis
supply chain management:
(2)
.556
337.347
120
.000
The value of KMO from the results was 0.556 which should be above 0.5 &
also the value of Bartletts test is significant so it can be assumed that the
factor analysis test is suitable for the data/samples collected
(Kaiser,1963), Bartlett,1950). During the analysis it was found that all the
variables will be grouped under the eleven components; which can also be
justified by the help of scree plot as shown below in Figure 1.
Derived
Lateral
1
X16
X22
X29
X36
0.783
0.742
0.672
0.664
Variable
2
X14
X10
X28
X7
X9
X35
X33
X26
X12
X39
X37
0.651
0.557
0.839
0.838
0.743
0.594
0.46
0.832
0.747
0.737
0.417
coefficient
of
the
Unstandardized
Coefficients
Model
B
(Constant)
Std. Error
Beta
Sig.
0.281
0.504
0.558
0.578
0.305
0.133
0.272
2.298
0.023
0.054
0.057
0.106
0.948
0.345
-0.102
0.072
-0.155
-1.43
0.156
-0.036
0.09
-0.052
-0.394
0.695
0.129
0.062
0.211
2.075
0.04
-0.047
0.08
-0.062
-0.592
0.555
-0.032
0.1
-0.037
-0.322
0.748
0.188
0.072
0.3
2.608
0.01
0.036
0.044
0.078
0.812
0.419
10
-0.017
0.043
-0.038
-0.405
0.687
11
0.163
0.12
0.184
1.364
0.175
(Supply
Chain
Factors)
S=0.281+.305V1+.504V2-.102V3-.0.36V4+.129V5-.047V6-.032V7+.18
8V8+.036V9-.17V10+.163V11+ (error).
After factor analysis the deduced factors are regressed with the
promotional schemes variable and result are shown in the Table 4 (a) &
(b); only the variable first, fifth & eighth were found to be significant and
all other factors are not significant for the study.
CONCLUSION, LIMITATION & FUTURE SCOPE
From the deduced regression equation we can easily understand
that out of eleven grouped factors there are only three factors which are
affecting the supply chain namely the factors like fill rate, impact of
promotions on demand and cost of holding are significant. And fill rates
affect supply chain the maximum. In todays markets, understanding the
customers situation and responding effectively to differing needs through
the coordination of marketing and supply chain can be a source of
superior value creation. Promotions/Marketing is traditionally externally
focused and creates customer value, while SCM is inwardly focused and
concentrates on the efficient use of resources in implementing marketing
decisions. Promotions/Marketing and SCM integration is between those
generate demand with those who fulfill it. The results from this analysis
are in concurrence with the study by (Soonhong Ming & John T. Mentzer,
2000). Until today, the concept of integration has been addressed from
SCM and operations perspectives; however, despite its clear relevance, no
promotional marketing contribution can be cited.
The study was conducted in the Jammu region only and the
responses depend upon the psychological state of the respondent while
answering the questions, so in future the study can be extended beyond
the Jammu region & a wide variety of products can also be involved with
more number of specific variables and also some different method of
analysis can be used.
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