Understanding information sharing in supply chains - Identifying contingency factors that impact benefits of information sharing

University dissertation from Faculty of Engineering, Department of Industrial Management and Logistics

Abstract: To increase our understanding of information sharing in supply chains the purposeof this licentiate was threefold: to review and analyze existing academic literature to describe and structure the research field; to empirically explore information sharing in a supply chain representing more than three tiers; and to explore contingency factors through literature reviews and empirical data collection. Thereby this licentiate thesis addresses several gaps identified in academic literature. Specifically, there appears to be confusion regarding the definitions of information sharing and supply chain. Second, there seems to be a lack of empirical studies of information sharing in supply chains representing three or more companies. Third, academic authors argue that the impact of information sharing on performance depends on the matching of an information sharing strategy with certain contingency factors. Previous research has mapped various potential contingency factors that may impact the benefit of information sharing in supply chains. However there is a lack of studies considering the wide spectrum of environmental factors, intra-organizational factors, and inter-organizational factors and their impact on benefits of information sharing. The research study applies a single case study with multiple embedded cases. The selected case illustrates a focal company and its supply chain partners who have worked almost 30 years with tailoring information sharing to improve supply chain performance. The data used in this research study were collected from three tiers of the supply chain: First, the production and warehouse facilities as well as customer service of The Absolut Company, which is the focal company of the studied supply chain. Second, data was collected from one tier upstream, including the suppliers of selected components required for the production and packing of a 70 cl bottle of Absolut Citron. Third, data was collected from the market companies who are responsible for distributing products to respective market through the distribution centers. A range of methods was used to collect data. The study included a full day on-site with the focal company including presentations, five one hour semi-structured interviews and reviewing documents related to information sharing processes, initiatives and performance improvements. In addition, 14 structured interviews were conducted with key staff representing the various identified companies. The respondents were also requested to fill out a questionnaire. In the final stage of data collection a half-day workshop was conducted together with a fellow researcher and key staff from the focal company. The context-specific nature of supply chains implies that it is not possible to develop normative solutions that can be “copy pasted” from one situation to another. This statement is corroborated by the studied case which illustrates that the concept of focused strategy has replaced the “one size fits all” approach. Further, based on the findings from the study, information sharing seems to be primarily dyadic in supply chains. Thus no triadic or extended sharing could be identified in the studied supply chain. Considering dyadic relationships, different information sharing strategies should be developed for the upstream and downstream supply chain. The main difference between these two parts of the supply chain is that upstream involves production whereas downstream focuses on distribution of the final product. Different contingency factors may have to be considered when deciding what information to share with whom in the upstream and downstream supply chain respectively. The risk is otherwise that organizational resources are wasted without enhancing the performance of the firm and the supply chain and without satisfying customers’ needs. In the downstream supply chain two contingency factors were identified: demand uncertainty and total volume/value of product, whereas a total of nine factors were identified in the upstream supply chain. Upstream, information sharing should primarily be focused on partners representing large volume/value of the total turnover. Thereby the impact of any changes will have the biggest effect. Capacity in terms of flexibility and constraints is another important to consider on all organizational levels. The findings are summarized by putting forward a framework that can guide researchers and practitioners in describing and analyzing information sharing in supply chains. Moreover, based on the identified contingency factors six propositions are put forward that should be subject to further research.

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