Exploring Business Value through Information Quality of Collaborative Supply Chain Practices and Performance in Context of Pharmaceutical Industry of Bangladesh

Mohammod Naymur Rahman, Md. Mohiuddin, Md. Zainal Abedin

Abstract


In Bangladesh, Pharmaceutical sector is one of the most developed high-tech sector which is contributing in the country's economy. Nowadays, this sector is providing 95% of the total medicine requirement of the local market. The professional knowledge, collaborative supply chain management practices, thoughts and innovative ideas of the pharmacists working in this sector are the key factors for these developments. Recently, researchers have highlighted the multidimensional nature of collaboration that goes beyond the exchanged of information. Collaborative practices should also incorporate joint decision-making and the alignment of incentives [1, 2]. With regard to information exchanged, the pharmaceutical industry has shared information for many years to arguably an unparalleled level compared with other industries. However, information quality has been largely overlooked by previous research. Research has thus essentially oversimplified the complex nature of supply chain collaboration. There appears to be a gap in the literature acknowledging the multidimensional and complex nature of collaboration and linking it to information quality. This research paper aims to explore the complex nature of collaboration and the role of information quality in the collaboration practices and performance relationship in Bangladesh pharmaceutical industry.

Specifically, this research focuses on the following research question: does the impact of collaborative practices on operational performance depend on the quality of the information exchanged in terms of its timeliness, accuracy, relevance and added value in context of pharmaceutical industry in Bangladesh. However, the findings suggest that the collaborative practices of information sharing, incentive alignment and joint-decision making do not equally improve performance. In addition, some aspect of collaboration appear to only become important performance drivers if the information exchanged between supply chain partners is of high quality; the quality of information being dependent on its timeliness, accuracy, relevance and added value. Therefore, this study makes a significant contribution to practice by revealing how the specific elements of collaboration impact differently on operational performance. In addition, this work draws particular attention to the practical importance of information quality and its pivotal role for the success of collaboration practice. Specifically, incentive alignment and joint decision-making only significantly improve operational performance when the information is timely, accurate, relevant and adding value, i.e. of high quality. At the same time as information sharing improves operational performance under low and high quality conditions; its impact is significantly stronger when the exchanged information is of high quality. Therefore, to gain the full potential benefits from collaborative initiatives, companies need to priorities investment towards improving the quality of information shared and exchanged between supply chain partners.

 


Keywords


Business Value; IOS; Supply chain collaboration; Information quality; Incentive alignment.

References


. Simatupang, T.M. and Sridharan, R., “The collaborative supply chain”, International Journal of Logistics Management, Vol. 13 No. 1, pp. 15-30, 2002.

. Simatupang, T.M. and Sridharan, R. , “The collaboration index: a measure for supply chain collaboration”, International Journal of Physical Distribution & Logistics Management, Vol. 35 No. 1, pp. 44-62, 2005.

. Gosain, S., Malhorta, A. and El Sawy, O.A., “Coordinating for flexibility in e-business supply chains”, Journal of Management Information System, Vol. 21 No. 3, pp. 7-45, 2004.

. Miller, H.E., “The multiple dimensions of information quality”, Information Systems Management, Vol. 13 No. 2, pp. 62-73, 1996.

. De Toni, A. and Tonchia, S., “Performance measurement system models, characteristics and measures”, International Journal of Operational & Production Management, Vol. 21 No. 1, pp. 46-70, 2001.

. Miller, J.G. and Roth, A.V., “A taxonomy of manufacturing strategy”, Management Science, Vol. 40 No. 3, pp. 285-304, 1994.

. Ward, P.T., Duray, R., Leong, G.K. and Sum, C.C., “Business environment, operations strategy, and performance: an empirical study of Singarpore manufacturers”, Journal of Operations Management, Vol. 13 No. 2, pp. 99-115, 1995.

. Pearl, D.K. and Fairley, D. , “Testing for the potential for nonresponse bias in sample surveys”, The Public Opinion Quarterly, Vol. 49 No. 4, pp. 553-560, 1985.

. Lambert, D.M. and Harrington, T.C., “Measuring nonresponse bias in customer service mail surveys”, Journal of Business Logistics, Vol. 11 No. 2, pp. 5-25, 1990.

. Armstrong, J.S. and Overton, T.S., “Estimating nonresponse bias in surveys”, Journal of Marketing Research, Vol. 16, pp. 396-402, 1977.

. Bollen, K.A., Structural Equations with Latent Variables, John Wiley & Sons, New York, NY, 1989.

. Anderson, J.C. and Gerbing, D.W., “Structural equation modeling in practice: a review and recommended two-step approach”, Psychological Bulletin, Vol. 103 No. 3, pp.411-423, 1988.

. De Vellis, R.F. , Scale Development: Theory and Applications, Saga, Newbury Park, CA, 1991.

. Fornell, C. and Larcker, D.F. , “Evaluating structural equation models with unobservable variables and measurement error”, Journal of Marketing Research, Vol. 18 No. 1, pp. 39-50, 1981.

. Das, A., Narasimhan, R. and Talluri, S., “Supplier integration: finding an optimal configuration”, Journal of Operations Management, Vol. 24 No. 5, pp. 563-582, 2006.

. Kahn, K.B. and Mentzer, J.T., “Logistics and interdepartmental integration”, International Journal of Physical Distribution and Logistics Management, Vol. 26 No. 8 pp. 6-14, 1996.

. Stank, T.P., Keller, S.B. and Daugherty, P.J., “Supply chain collaboration and logistical service performance”, Journal of Business Logistics, Vol. 22 No. 1, pp. 29-48, 2001.

. Pagell, M., “Understanding the factors that enable and inhibit the integration of operations, purchasing and logistics”, Journal of Operations Management, Vol. 22 No. 5, pp. 450-487, 2004.

. Sanders, N.R., “An empirical study of the impact e-business technologies on organizational collaboration and performance”, Journal of Operations Management, Vol. 25 No. 6, pp. 1332-1347, 2007.

. Barratt, M. , “Understanding the meaning of collaboration in the supply chain”, Supply Chain Management: An International Journal, Vol. 9 No. 1, pp. 30-42, 2004.

. Frohlich, M.T. and Westbrook, R., “Arcs of integration an international study of supply chain stratigies”, Journal of Operations Management, Vol. 19 No. 2, pp. 185-200, 2001.

. Narasimhan, R. and Kim, S.W., “Effect of supply chain integration on the relationship between diversification and performance: evidence from Japanese and Korean firms”, Journal of Operations Management, Vol. 20 No. 3, pp. 303-323, 2002.

. Bagchi, P.K. and Skjott-Larsen, T. , “Supply chain integration: a European survey”,The International Journal of Logistics Management, Vol. 16 No. 2, pp. 275-294, 2005.

. Das, A. and Jayaram, J., “Relative importance of contingency variables for advanced manufacturing technology”, International Journal of Production Research, Vol. 41 No. 18, pp. 4429-4452, 2003.

. Vereecke, A. and Muylle, S., “Performance improvement through supply chain collaboration in Eroupe”, International Journal of Operation & Production Management, Vol. 26 No. 11, pp. 1176-1198, 2006.

. Cannon, J.P. and Perreault, W.D. Jr , “Buyer-seller relationships in business markets”, Journal of Marketing Research, Vol. 36 No. 4, pp. 439-460, 1999.

. Matopoulos, A., Vlachopoulou, M., Manthou, V. and Manos, B. , “A conceptual framework for supply chain collaboration: empirical evidence from the agri-food industry”, Supply Chain Management: An International Journal, Vol. 12 No. 3, pp. 177 186, 2007.

. Nyaga, G.N., Whipple, J.M. and Lynch, D.F. , “Examining supply chain relationships: Do buyer and supplier perspectives on collaborative relationships differ?”, Journal of Operations Management, Vol. 28 No. 2, pp. 101-114, 2010.

. Fearne, A., Barrow, S. and Schulenberg, D. , “Implanting the benefits of buyer-supplier collaboration in the soft fruit sector”, Supply Chain Management: An International Journal, Vol. 11 No. 1, pp. 3-5, 2006.

. Forrester, J.W., Industrial Dynamics, MIT Press, Cambridge, MA, 1961.

. Lee, H.L. and Billington, C., “Managing supply chain inventory: pitfalls and opportunities”, Sloan Management Review, Spring, pp. 65-73, 1992.

. Malhotra, A., Gosain, S. and Sawy, O.A., “Absorptive capacity configurations in supply chains: gearing for partner-enabled market knowledge creation”, MIS Quarterly, Vol. 29 No. 1, pp. 145-187, 2005.

. Gosain, S., Malhorta, A. and El Sawy, O.A. , “Coordinating for flexibility in e-business supply chains”, Journal of Management Information System, Vol. 21 No. 3, pp. 7-45, 2004.

. Rossin, D., “An exploratory analysis of information quality in supply chains: efficient and responsive models”, Journal of Global Business Issues, Vol. 1 No. 2, pp. 151-158, 207.

. Forslund, H., “Measuring information quality in the order fulfillment process”, International Journal of Quality & Reliability Management, Vol. 24 No. 5, pp. 515-524, 2007.

. Gustavsson, M. and Wanstrom, C., “Assessing information quality in manufacturing planning and control processes”, International Journal of Quality & Reliability Management, Vol. 26 No. 4, pp. 325-340, 2009.

. Monczka, R.M., Peterson, K.J., Handfield, R.B. and Ragatz, G.L., “Success factors in strategic supplier alliances: the buying company perspective”, Decision Sciences, Vol. 29 No. 3, pp. 69-73, 1998.

. Legner, C. and Schemm, J., “Towards the inter-organizational product information supply chain- evidence from the retail and consumer goods industries”, Journal of the Association for Information Systems, Vol. 9 No. 34, pp. 119-150, 2008.

. Kennedy, P., A Guide to Econometrics, Blackwell Publishers, Oxford, 1999.

. Belsley, D.A., Kuh, E. and Welsch, R.E., Regression Diagnostics, John Wiley & Sons, New York, NY, 1980.

. Chow, G.C., “Tests of quality between sets of coefficients in two linear regressions”, Econometric, Vol. 28 No. 3, pp. 591-605, 1960.


Full Text: PDF

Refbacks

  • There are currently no refbacks.


Creative Commons License
This work is licensed under a Creative Commons Attribution 3.0 License.



 

 



About IJSBAR | Privacy PolicyTerms & ConditionsContact UsDisclaimerFAQs

IJSBAR is published by (GSSRR).

 Plagiarism Policy