Supply chain configuration conundrum: how does the pharmaceutical industry mitigate disturbance factors?

How a supply chain (SC) is configured can have a significant impact on the performance of global firms. More specifically, disturbance factors (i.e. those factors associated with uncertainty and risk) are increasingly important considerations. This paper focuses on endogenous, exogenous and environment-related SC disturbance factors and their relative importance when configuring global SCs. Three alternative scenarios of SC configurations for European-based pharmaceutical firms are identified - insource nearshore, outsource nearshore and outsource offshore. Through a multi-phase, mixed-method approach we find that the top five disturbance factors managers should be aware of while configuring their SCs are quality defects, unforeseen and random interruptions in manufacturing processes, order processing difficulties, untimely delivery of products, and a mismatch between market demand and supplier responsiveness. This study is able to provide insights into the impact of disturbance factors on the SC configuration strategy for Big Pharmas. We show that SC disturbances influenced the decision to bring production back home (reshoring) or to a closer location (near-shoring). To mitigate the effects of disturbances many Big Pharmas recalibrated their SC configurations by insourcing core products, outsourcing non-core products offshore and developing offshore insourcing capabilities through ‘captives’

Responsible Research and Innovation Revisited: Aligning Product Development Processes with the Corporate Responsibility Agenda

It is well established that society faces some grand challenges ahead that have led to a call for more focus on sustainability and socially responsible business practices (European Commission 2010, 2012; Scherer and Palazzo 2011). It is now widely accepted that human-induced climate change is caused by production and consumption patterns that have emerged to meet society’s evolving needs (Unruh 2000; Foxon and Pearson 2006). There are increasing amounts of legislation to try to encourage more sustainable practices and to reduce carbon dioxide emissions. For example, the 2008 United Kingdom (UK) Climate Change Act (UK Parliament 2008) states that “It is the duty of the Secretary of State to ensure that the net UK carbon account for the year 2050 is at least 80 % lower than the 1990 baseline” (p. 1). Other legislation is encouraging manufacturers to take back and recycle their products at the end of their useful lives

Business process management and supply chain collaboration: effects on performance and competitiveness

Purpose: This study aims to examine the interrelationships among business process management (BPM), supply chain collaboration (SCC), collaborative advantage and organisational performance. Design/methodology/approach: Data were collected from 204 manufacturing firms in Thailand, and the interrelationships proposed in the framework were tested via structural equation modelling. Findings: This study highlights the role of intra- and inter-organisational practices and clearly demonstrates the joint role and impact of BPM and SCC, respectively. The results provide empirical evidence that BPM improves both organisational performance and collaborative activities. Also, SCC and collaborative advantage can have indirect positive impacts on organisational performance. Research limitations/implications: This work could be expanded by adopting a supplementary dyadic or extended supply chain (SC) approach and could also consider contextual factors, which were outside of the scope of this study. Practical implications: The BPM approach has a positive impact on organisational performance, which is essential for collaborative activities between a firm and its SC partners. Further, effective BPM and SCC practices lead to enhanced performance and collaborative benefits. Practitioners should be better able to define and measure specific actions relating to their BPM and SCC practices. Originality value: This paper stresses the need to consider the interrelationships between BPM, SCC, collaborative advantage and organisational performance for both direct and indirect effects. Rather than focusing only on improvement at individual firm level, SCC is vital to compete in the market. Improving the effectiveness of SC allows higher organisational performance levels than those that could be achieved in isolatio

Contextualisation of the complexity in the selection of developing country outsourcees by developed country outsourcers

© 2018 Informa UK Limited, trading as Taylor & Francis Group. Outsourcing research has recognised that selecting the right offshore supplier (outsourcee) in low-cost distant developing countries is complex, but central to outsourcing success. More specifically, the combination of outsourcee contextual internal factors (e.g. capabilities) with outsourced-to country contextual external factors (e.g. political, legal, economic, socio-cultural) as two fundamental and interconnected decisions firms make when outsourcing remains an underexplored research gap. Therefore, through a rigorous three-tier qualitative approach we, firstly, develop a contextual Environmental Separation Index (ESI) decision tool to help outsourcing firms in making more informed decisions when selecting outsourcees and outsourcing locations. Secondly, we operationalise the ESI as intuitive and easy to use decision tool, yet with a provision to deliver a truly context proof outsourcee selection decision. Thirdly, we adopt a complexity theory lens to explain that narrowing the contextual outsourcer–outsourcee gap facilitates a mind-set shift in outsourcing relationships from hierarchies to networks and from controlling to empowering developing country outsourcees. We show from a complexity theory perspective how contextual separation gaps between developed country outsourcers and developing country outsourcees can be an effective way to grasp the evolutionary path of outsourcing relationships

How does intellectual capital affect product innovation performance?: evidence from China and India

Purpose: Intellectual capital reflects the sum of existing knowledge a manufacturer is able to leverage and plays a critical role in new product development. This study aims to empirically investigate the mechanisms through which intellectual capital enhances product innovation performance and how economic and institutional environments affect the mechanisms. Design/methodology/approach: Using a knowledge-based view and institutional theory, this study proposes a model on the relationships among intellectual capital, supplier knowledge integration, supply chain adaptability, and product innovation performance. The hypotheses are empirically tested using multiple group structural equation modelling and data collected from 300 Chinese and 200 Indian manufacturers. Findings: We find that intellectual capital improves product innovation performance both directly and indirectly through supplier knowledge integration. However, the effects are different in China and India. In particular, the direct effect of intellectual capital on product innovation performance is significantly higher in China than that in India, and intellectual capital improves product innovation performance indirectly through supplier knowledge integration only in India. We also find that supplier knowledge integration improves product innovation performance indirectly through supply chain adaptability in both China and India. Originality/value: Using a moderated mediation model, this study provides insights into the joint effects of intellectual capital, supplier knowledge integration, and supply chain adaptability on product innovation performance. The findings enhance current understandings of how supply chain management helps a manufacturer develop new products using existing knowledge and the influences of economic and institutional environments on knowledge and supply chain management

Improving supply chain social responsibility through supplier development

Corporate social responsibility (CSR) emphasises that the entire supply chain of a company should protect natural environment and contribute to social well-being in a tangible way. This study aims to clarify the effects of supplier development practices on supply chain social responsibility. The investigation uses a qualitative case study approach and empirically explores how to develop supplier’s CSR capabilities in a pharmaceutical supply chain. The results indicate that manufacturers can apply supplier development practices, including standard operating procedures (SOPs), audits, collaboration and training, to develop supply chain social responsibility. SOPs and audits are indirect supplier development practices that are designed in response to institutional pressures, and collaboration and training are direct supplier development practices that provide resources for bridging supplier’s CSR capability gaps. In addition, the indirect and direct supplier development practices positively influence each other and they are complementary in enhancing supply chain social responsibility

3D printing services: classification, supply chain implications and research agenda

Purpose: The purpose of this paper is to identify and classify the available types of 3D printing services, with the scope of determining the potential implications that such services could have on the supply chains of manufacturing firms and creating a research agenda for future studies. Design/methodology/approach: The authors review the current literature on the potential supply chain impacts of 3D printing and evaluate the 3D printing services provided by 404 firms in selected European markets. Findings: The results show that 3D printing services form a rapidly evolving industry, with new service providers entering the market on a regular basis. Evidence from the European markets investigated suggests that services can be classified into three distinct categories: generative, facilitative and selective services. Research limitations/implications: This paper represents an attempt to take stock of a fastmoving and potentially paradigm-shifting market. The implications are dynamic as new applications, business models and techniques are continually being developed. Further studies are required to substantiate the findings. Practical implications: Three categories of 3D printing services that could significantly impact supply chain configurations of the future are proposed. Several issues specific to 3D printing services raised in the research agenda require further scrutiny and substantiation before services can reach their full potential. Originality/value: This paper provides an overview of the growing 3D printing services industry, highlighting how the market might change as additive manufacturing technology matures

Disturbances to the supply chains of high-value manufacturing firms: comparison of the perceptions of product managers and supply chain managers

We draw on the literature to categorise the supply chain disturbances (risks and uncertainties) that affect high-value manufacturing (HVM) firms when adopting the following two sourcing strategies: (a) insourcing/nearshore outsourcing, and (b) outsourcing/offshoring. We build a hierarchy structure of disturbances, which was tested in a case study of a European HVM operating in the aerospace industry. A novelty of this study is the quantitative prioritisation and comparison, using the analytic hierarchy process (AHP) method, of the disturbances reported by two groups of managers: three product managers (internally facing) and four supply chain managers (externally facing). Our findings show that managers’ perceptions of firm-related, network-related and location-related disturbances can be prejudiced by their functional boundaries. We show that both product and supply chain managers prefer the insource/nearshore outsource strategy, as they feel that the disturbances while outsourcing/offshoring are significantly greater and offset the benefits of low-cost production – a counterintuitive finding. Through in-depth interviews with both groups of managers, we found the mitigation strategies are reshoring, full consideration to the total cost of acquisition (including hidden costs of distant operations) and building clusters in emerging markets to support the firm’s regional hub by partnering with its existing suppliers from developed countries

The impact of integrated practices of lean, green, and social management systems on firm sustainability performance—evidence from Chinese fashion auto-parts suppliers

To better satisfy various stakeholders, firms are seeking integrated practices that can enhance their sustainability performance, also well known as the Triple Bottom Line (3BL). The fashion industry exhibits potential conflicts with the spirit of sustainability because of the waste created by high levels of demand uncertainty and the extant usage of resources in production. Literature suggests that selected stand-alone practices of lean, green, and Corporate Social Responsibility (CSR) management systems have a positive impact on firm sustainability performance. However, how the combination of selected practices from these three management systems impacts the 3BL remains unclear. Based on case studies, we build an integrated sustainable practices model incorporating the most popular lean, green, and social practices and develop propositions for future tests. Our framework suggests the implementation of integrated practices would have a stronger influence on 3BL performance than individual practice implementation