Strategic supplier performance evaluation::a case-based action research of a UK manufacturing organisation

The main aim of this research is to demonstrate strategic supplier performance evaluation of a UK-based manufacturing organisation using an integrated analytical framework. Developing long term relationship with strategic suppliers is common in today׳s industry. However, monitoring suppliers׳ performance all through the contractual period is important in order to ensure overall supply chain performance. Therefore, client organisations need to measure suppliers׳ performance dynamically and inform them on improvement measures. Although there are many studies introducing innovative supplier performance evaluation frameworks and empirical researches on identifying criteria for supplier evaluation, little has been reported on detailed application of strategic supplier performance evaluation and its implication on overall performance of organisation. Additionally, majority of the prior studies emphasise on lagging factors (quality, delivery schedule and value/cost) for supplier selection and evaluation. This research proposes both leading (organisational practices, risk management, environmental and social practices) and lagging factors for supplier evaluation and demonstrates a systematic method for identifying those factors with the involvement of relevant stakeholders and process mapping. The contribution of this article is a real-life case-based action research utilising an integrated analytical model that combines quality function deployment and the analytic hierarchy process method for suppliers׳ performance evaluation. The effectiveness of the method has been demonstrated through number of validations (e.g. focus group, business results, and statistical analysis). Additionally, the study reveals that enhanced supplier performance results positive impact on operational and business performance of client organisation

Designing an innovation sourcing process : A case study in the pharmaceutical industry

This research was conducted as an assignment for a Finnish pharmaceutical company, Orion Corporation. Innovations have become increasingly important for organizations’ growth efforts. Particularly in the pharmaceutical industry, companies must generate innovations to sustainably increase the bottom line due to substantial pressures to lower prices. Thereby, also procurement literature has increasingly focused on highlighting the criticality of exploiting suppliers’ knowledge for increased innovation performance. Also in practice, procurement functions have recognized their significant role in enabling innovations. However, thus far, research regarding innovations in procurement focuses mainly on the supplier relationship management (SRM) process, which encompasses actions within the current supplier base. While these research contributions are valuable for emphasizing the importance of innovation efforts with suppliers, the current academic literature lacks in understanding how innovations can be driven with an aligned sourcing process. Thus, the aim of this research was to develop a case company specific innovation sourcing process and to define when to adopt the developed process. To address the research aims, relevant research disciplines were first examined to develop a theory based process and a propositional application context. To examine practical applications, four large Finnish companies that have already implemented an innovation sourcing process were interviewed. Subsequently, the researcher facilitated three interactive case company workshops. As a result, a case company specific innovation sourcing process was constructed based on the findings from theory, the benchmarked company processes and the workshops. To assess the applicability of the process and when it should be adopted, case company sourcing managers responded to a questionnaire regarding the likelihood of applying the process and the foreseen challenges. The final process comprises of five main phases: define, discover, ideate, test & develop MVP (Minimum Viable Product) and transfer. The process is characterized by substantial iteration and end user centricity in contrast to the traditional sourcing process. The average likelihood of applying the process was 3.7/5, indicating the acceptance of the process. Furthermore, regarding the applicable sourcing context, two key determinants, solution specification, and company and sourcing case attractiveness, were identified. Consequently, these determinants were incorporated into a case company specific evaluation matrix which sourcing managers can utilize when assessing the applicability of the innovation sourcing process.Tämä tutkimus on tehty toimeksiantona suomalaiselle lääketeollisuusyhtiölle, Orion Oyj:lle. Innovaatioiden tärkeyttä korostetaan yhä enemmän yhtiöiden kasvutekijänä. Tämä korostuu lääketeollisuudessa kasvavan hintakilpailun johdosta. Täten yritysten on jatkuvasti kehitettävä uusia innovaatioita kannattavuutensa puolustamiseksi. Hankinnan kirjallisuudessa korostetaan enenevissä määrin toimittajien tietotaidon hyödyntämistä innovaatioiden edistämisessä. Lisäksi käytännössä yritysten hankintaorganisaatiot ovat tunnistaneet merkittävän roolinsa innovaatioiden mahdollistamisessa. Hankinnan tutkimus innovaatioiden edistämisestä keskittyy kuitenkin pääasiassa toimittajahallintaprosessiin, joka kattaa toimet yrityksen nykyisten toimittajien kanssa. Aiemmat tutkimustulokset ovat arvokkaita, sillä ne korostavat toimittajien tietotaidon hyödyntämistä innovaatioiden edistämisessä. Toisaalta kirjallisuudessa on tutkimusaukko kilpailutusprosessin kehittämisen osalta. Täten tässä tutkimuksessa kehitettiin toimeksiantajalle soveltuva innovaatiokilpailutusprosessi ja määritettiin, milloin tai millaisiin hankintaprojekteihin tätä tulisi soveltaa. Tutkimusaukon johdosta kirjallisuudesta ei löytynyt valmista mallia innovaatiokilpailutusprosessista. Täten tutkimuksessa kehitettiin ensin teoreettinen malli eri tieteenalojen kirjallisuuden pohjalta. Kirjallisuuskatsauksen tuloksena syntyi ehdotus prosessin soveltamiskontekstista. Teorian tueksi haettiin esimerkkiprosesseja käytännöstä. Tutkija haastatteli hankinta-ammattilaisia neljässä suuressa suomalaisessa yhtiössä, jotka ovat jo ottaneet käyttöön vastaavanlaisen prosessin. Tämän jälkeen tutkija fasilitoi kolme interaktiivista työpajakertaa, johon osallistui asiantuntijoita toimeksiantajayrityksen hankinta- ja liiketoimintaorganisaatioista. Työpajoissa kehitettiin toimeksiantajalle soveltuva innovaatiokilpailutusprosessi teorian ja käytännön löydösten pohjalta. Lisäksi prosessin soveltamiskontekstia selvitettiin kyselyllä, joka lähetettiin kaikille toimeksiantajan hankintapäälliköille. Kysely kartoitti prosessin soveltamisen todennäköisyyttä ja ennakoituja käytännön haasteita. Lopullinen prosessi koostuu viidestä vaiheesta: määrittele, etsi, ideoi, testaa ja kehitä MVP (Minimum Viable Product), ja siirrä. Prosessissa korostuu iteratiivisuus ja loppukäyttäjäkeskeisyys perinteiseen kilpailutusprosessiin verrattuna. Keskiarvo prosessin soveltamistodennäköisyydelle oli 3,7/5, mikä viittaa prosessin hyväksymiseen. Lisäksi prosessin soveltamiseen liittyen tunnistettiin kaksi keskeistä tekijää: ratkaisun spesifikaatio sekä yrityksen ja projektin houkuttelevuus. Näiden tekijöiden pohjalta kehitettiin case-yrityskohtainen matriisi, jota hankintapäälliköt voivat hyödyntää arvioidessaan innovaatiokilpailutusprosessin soveltamista

A decision support tool for procurement planning process under uncertainty

This communication presents a method to support the customer in the choice of a procurement plan when the gross requirements are ill-known, in a context of collaboration with the supplier. A general model of imperfect parameter representation is suggested, imperfection gathering uncertainty (through various scenarios) and imprecision (through quantities and dates expressed by possibility distribution). A method to compute the possible quantities required to satisfy the gross requirements under the supplier delivering constraints is proposed. From this value, a set of possible supplied quantities is computed to support the decision making of the customer. The decision maker then evaluates the procurement plan with the possible evolution of the inventory

Managing the “Fuzzy front end” of open digital service innovation in the public sector: A methodology

There are many obstacles to effective open innovation in the public sector context, especially at the “fuzzy front end” (FFE), where the need or opportunity is known but serious resources have not yet been committed to possible solutions. In this paper, we report on a theoretically inspired and practically tested methodology for FFE public sector digital innovation. The methodology was purpose-built for the context and has been progressively refined using reflection-on-practice, but broadly consists of a hybrid of private sector open innovation practices, and agile software development processes. We outline the background, context, principles, stages and artefacts. Then we evaluate the method in terms of barriers and opportunities to FFE public sector innovation. We note that establishing the necessary context: a nurturing environment; cross-agency commitments in cash and in kind; and boundary spanning appointments, is as important to success as is the detailed execution of the method

A Bi-Objective Programming Model for Reliable Supply Chain Network Design Under Facility Disruption

Supply chain networks generally are composed of four main entity types: supplier, production centers, distribution centers and demand zones that consist of facilities whose activities involve the transformation of raw material into finished products that are later delivered from the suppliers to the end customers. Supply chain network design as the most important strategic decision in supply chain management plays an important role in the overall environmental and economic performance of the supply chain. The nature and complexity of today’s supply chains network make them vulnerable to various risks. One of the most important risks is disruption risk. Disruptions are costly and can be caused by internal or external sources to the supply chain, thus it is crucial that managers take appropriate measures of responses to reduce its negative effects. A recovery time of disrupted facilities and return it to the normal condition can be an important factor for members of the supply chain. In this paper, a bi-objective model is developed for reliable supply chain network design under facility disruption. To solve this model, we have applied two approaches, i.e., ε constraint method as an exact method and non- dominated sorting genetic algorithm (NSGAII) as a meta-heuristic method

Effective Strategies for Managing the Outsourcing of Information Technology

More than half of information technology (IT) outsourced projects fail, primarily due to a lack of effective management practices surrounding the outsourcing end-to-end process. Ineffective management of the IT outsourcing (ITO) process affects organizations in the form of higher than expected project costs, including greater vendor switching or reintegration costs, poor quality, and loss of profits. These effects indicate that some business leaders lack the strategies to effectively manage the ITO process. The purpose of this single-case study was to apply the transaction cost economics (TCE) theory to explore strategies 5 business professionals use to manage an ITO project in a financial services organization located in the Midwestern region of the United States. Participant selection was purposeful and was based on the integral role the participants play on the ITO project. Data collection occurred via face-to-face semistructured interviews with the participants and the review of company documents. Data were analyzed using inductive coding of phrases, word frequency searches, and theme interpretation. Three themes emerged: vendor governance and oversight, collaborative strategic partnership, and risk management strategies enabled effective management of ITO. Identifying and executing appropriate outsourcing strategies may contribute to social change by improving outsourcing infrastructure, which might support job creation; increasing standards of living, especially within emerging markets; and heightening awareness of different cultures, norms, and languages among people living in different regions around the world to establish commonalities and gain alignment with business practices