Impact of Procedural Rationality on Decision Making in Supply Chain Management

--Sopnamayee Acharya

Individual differences in decision making may account for much order variation in the supply chain settings and bear significant responsibility for supply chain inefficiencies. In a supply chain, sharing information among decision makers is required to justify the ordering inefficiencies. But individual perceptions may mediate in the use of available information in decision-making processes. This paper experiments the backlog costs for supply chain to minimize inventory holding. The analysis shows that when rational decision making with backlog information was applied, costs decreased, whereas consumer demand information increased the costs.

© 2012 IUP. All Rights Reserved.

Modes, Challenges and Opportunities for Risk Management in Modern Agri-Food Chains

-- Hrabrin Bachev

This paper presents a holistic approach for analyzing and improving risk management in modern agri-food chains. First, it specifies the diverse (natural, technical, behavioral, economic, policy, etc.) agri-food risks and the alternative (market, private, public and hybrid) modes of their management. Second, it defines the efficiency of risk management and identifies (personal, institutional, dimensional, technological and natural) factors of governance choice. Next, it presents the stages in the analysis of risk management for the improvement of public intervention in risk governance. Finally, it identifies contemporary opportunities and challenges for risk governance in agri-food chains.

© 2012 IUP. All Rights Reserved.

RFID and Supply Chain Management: A Brief Outline

-- Sunita Mall and Sidharth Mishra

Enterprise-wide applications are appreciated by the companies nowadays. For better planning of resources and optimizing the process and profit, these implementations are very much beneficial. Moreover, it synchronizes the data and helps in an easy flow of information within the organization. However, capturing and tracking the actual data is a major concern which has encouraged the companies to focus on the effective supply chain management. Radio Frequency Identification (RFID) as an advanced technology can solve these problems very well. A firm’s objective of achieving efficiency and responsiveness can be fulfilled by the use of RFID technology. RFID though helps in collaborating the trading partners in an effective way and makes the supply chain process of an organization more efficient and responsive. Moreover, RFID helps the organization to enhance its overall efficiency. However, it does not come without risks which could delay the adoption of this technology. This paper proposes a conceptual model of effective supply chain management using RFID. In addition, it also identifies the attributes that affect RFID adoption. Finally, the paper summarizes the challenges as well as the benefits that companies can get by adopting this technology.

© 2012 IUP. All Rights Reserved.

Supply Chain Management Practices and Scope for Bullwhip Effect in Indian Dry Grocery Business

-- Tapan K Panda and Prashant K Mohanty

Supply Chain Management (SCM) has come to stay as a key driver of business success and source of competitive advantage. Aligning business process through corporate restructuring is an age-old phenomenon. But more significantly, streamlining flow of goods and services along with that of suppliers, i.e., beyond the organizational context and integrating business processes of a firm with its suppliers is a bigger managerial challenge. The issue becomes more complex when the demand frequency increases due to the nature of the products; it becomes more complex due to the number of stock keeping units required for satisfying the endcustomers, and overall, there are issues of market fluctuations both in terms of demand and prices. The customers also negotiate and use their order size as the source of bargaining power to enhance their profitability, thus reducing the gross margins of the suppliers. A distortion in the buyer-seller relationship cycle and erosion of trust makes the flow of goods and services more transactional. In order to protect the market and control of supply cycle not to lose the end-customers, suppliers tend to supply more, leading to higher inventory costs. These kinds of structural issues and market fallacies lead to the ‘Bullwhip effect’. Bullwhip effect (Lee et al., 1997a and 1997b), which was first published by Forrester (1961), a pioneer of modern SCM, remains a critical issue in the supply chain of products in the global market. A small variance in the demands of the downstream end-customers may cause dramatic variance in the procurement volumes of upstream suppliers via the bullwhip effect under the condition that the distortions of demand-related information exist among the members of a supply chain (Lee et al., 1997a and 1997b; and Metters, 1997). This research paper focuses on understanding the impact of various factors like demand forecast updating order, order batching, price fluctuations and rationing and storage gaming in creating the bullwhip effect among suppliers of grocery items to large retailers. This paper also examines the influences of various external variables like business practices in the industry, nature of product supplied, small customer management issues, frequency of product supply and negotiation on SCM of grocery to large retailers.

© 2012 IUP. All Rights Reserved.