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A Hybrid Model for Evaluating Leagile Supply Chain Performance in Industry | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Journal of Industrial Strategic Management | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
مقاله 4، دوره 3، شماره 1، خرداد 2018، صفحه 43-54 اصل مقاله (458.9 K) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
نوع مقاله: Original Article | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
نویسندگان | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Sayyid Ali Banihashemi* 1؛ Zahra Heydarnia2 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
1Department of Industrial Engineering, Payame Noor University, Iran | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2Department of Management, Payame Noor University, Iran | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
چکیده | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Supply chain management (SCM) is one of the most important of the areas that have recently generated a great deal of interest in both industry and academia. SCM is considered an integrating philosophy to manage the total flows of materials, products and information from suppliers to the ultimate customers. The changing conditions of competition, for organizations to become more responsive and also more efficient are driving the interest in the concept of supply chain agility and leanness. The main objective of this paper is to suggest an index to reflect the agility and leanness of companies and corresponding SCs in the industry. The purpose of this paper, providing an index using two paradigms, Lean supply chain and Agile supply chain, to evaluate the Company's performance. Therefore, company to review its supply chain list, a series of criteria that are discussed in paradigm, and weighted those uses AHP method. The company evaluated its performance using a standardized questionnaire designed. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Leagile Manufacturing؛ supply chain management؛ Industry؛ Lean Supply Chain؛ Agile Supply Chain | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
اصل مقاله | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Introduction To the believe of many experts, in today's competitive world, the competition level has been stretched from companies to their supply chains and having an efficient and agile supply chain, is a crucial competitive advantage in the competition (Ketchen and Hult, 2007; Kuei and Madu, 2001). Naylor, Naim and Berry (1999), define the supply chain a system of material suppliers, production facilities, distribution services and customers, which are connected to each other through a forward flow of materials, information flow and feedback. Azevedo, Carvalho, Duarte and Cruz-Machado (2012), consider the supply chain management integration between the company and its suppliers, through the development of supplier partnerships and strategic alliances. Quinn (1997) defines the supply chain as a set of practices related to the movement of goods from raw materials to the end users. Some of these practices include sourcing and procurement, production planning, order processing, inventory management, transportation, warehousing and customer services. Dawe (1994) argues that for efficient supply chain management, thorough effort in all duties and responsibilities in a company should be accomplished. Supply chain management is an important factor to achieve and maintain competitive advantage (Mohammed, Shankar and Banwet, 2008). Li and Ragu-Nathan (2005), believe that supply chain management is a basic prerequisite for the growing profitability in the global competition of rivalry. Martin and Patterson (2009), claim that due to the need of companies to productivity and supply chain efficiency, in general, companies will have to review, evaluate and use of supply chain management concepts. Changing conditions of rivalry and increase of environmental turbulence and required by organizations, has made unavoidable the concept of being lean agile for the supply chain to increase efficiency and accountability of organizations (Mistry, 2005). The concept of agile suggest the sensitivity of the market and the ability to understand and respond effectively to actual demand (Collin and Lorenzin, 2006) and the concept of being lean seeks to eliminate additional activities and non-value-added to achieve higher levels of performance, profitability and resilience (Anand and Kodali, 2008). Simultaneous integrity of the concepts of lean and agile supply chain, leads to greater performance, efficiency and sustainability in the supply chain (Chan and Kumar, 2009). Many studies have been conducted in the field of supply chain in the world, which in this research has been focused only on one aspect of the supply chain. Supply chain of auto companies are a good example to illustrate the use of two paradigms of being lean and agile simultaneously in supply chain. In the automobile manufacturing supply chain, exploit from the paradigm of lean benefit to reduce interest expense, while reducing the cost of investment over time due to more efficient use of equipment and facilities, they use agile manufacturing system. The main objective of this research is to provide an index for the simultaneous combination of agility and being lean in supply chain of industries and organizations. This index investigates a set of evaluation criteria of agility and being lean of supply chain. Then, after a investigating literature of lean and agile supply chain and providing Leagile supply chain index, this model has been studied in three manufacturing organization. So the main question of this study is what criteria on a lean and agile supply chain is effective? And on the other hand, the importance of these criteria is how much? Finally, we are looking to have simultaneous attention on being lean and agile in the supply chain and investigate and compare an organization status based on three criteria of agility, purity and Leagile.
Theoretical Foundations and Background of Research DeGroote and Marx (2013) in a study, have investigated the role of IT in supply chain agility and performance. They have considered the measure of the ability to understand and respond to market changes as supply chain agility. To do this, the researchers have collected data from supply chain managers in 193 US companies and analyzed them. The results showed that information technology improves supply chain ability to understand the market changes, improved efficiency, accuracy, availability and timeliness of information flow within the supply chain. Also enhancement of the supply chain agility, have had positive effects on sales, market share, profitability and customer satisfaction of studied companies. Agarwal, Shankar and Tiwari (2007) in an article modeled the supply chain agility. They identified 4 important dimensions in agile supply chain and studied them in the organization. These four dimensions include processes, planning, marketing and information. Lean approach primarily focuses to reduce waste. This thinking eventually led to a real increase in value, increasing customer satisfaction and profitability (Womack, Jones and Roos, 1991). Disney, Naim and Towil (1997) state that lean thinking by eliminating waste in the supply chain creates value. Waste in the supply chain can be measured in the standards of time, inventory, unnecessary costs and activities that don't add value. Qi, Boyer and Zhao (2009), consider the main objective of the study of lean supply chain, strategy formulation and strategy, in order to reduce costs and increase productivity through eliminating waste in the internal and external processes of companies. Table 1, states the standards of lean supply chain from the perspective of several researchers. At the operational level, lean paradigm runs by some techniques such as Kanban, organizing the workplace, intuitive control and Poka-Yoke (Melton, 2005). The implementation of lean supply chain paradigm, leads to improvements in costs, flexibility, circulation of stock and prevention of defects and ultimately productivity (Chan and Kumar, 2009). Agile word in the dictionary means to move fast, agile, active, quick and easy mobility and being able to think for bold and with a clever method employed, but in the current environment, agility means of effective reaction to variable and unpredictable environment and using these changes as opportunities for organizational improvements (Agarwal, Shankar and Tiwari, 2007). This concept first was introduced by Iacocca in a meeting of many scientific experts and industry executives to find the causes of the failure of companies to deal with environmental challenges and changes, in a report entitled "Manufacturing firm strategy in the 21 century: a vision of industry professionals". Christopher (2000) defines agility as follows: 'agility is defined as an organization's ability to respond quickly to changes in demand, in both volume and variety." According to Tolon (2000), agility represents effective supply chain integration and emphasizes long-term and close relationships with customers and suppliers. To gain competitive advantage in the changing business environment, companies in the event of effectively operation must collaborate and cooperate in addition to their institution with suppliers and customers for the appropriate level of agility (Christopher and Towill , 2002). In this case, the agile supply chain is formed. An agile supply chain is able to appropriatly react to changes that occur in the workplace (Agarwal, Shankar and Tiwari, 2007). Agility in the supply chain-could be defined as follow "The ability of a supply chain to react quickly to changes in market and customer needs". In studies of researches and papers in the field of agile supply chain, the criteria that scholars have insisted on them, have been collected in Table 2. Agile supply chain states organizations needs to develop and coordinate its relationships with business partners, including suppliers, manufacturers and distributors. The table 3 summarizes some recent research on Agile and Lean subjects.
Table 1: Lean Supply Chain Indicators
Table 2: Agile Supply Chain Indicators
Table 3: Summary of Research
Leagile Index in Supply Chain To investigate the behavior of companies and organizations in the supply chains in terms of characteristics and attributes (lean and agile supply chain approach), a series of criteria and indicators arise. Table 4 reports the model notation (variables and parameters). Figure 1 represents the relationships between these criteria.
Table 4: Model notation
Figure 1: The relationship between the Indicators and behavior of Organization
As can be seen in the figure, lean or agile index in a company depends on two factors: the first factor, evaluation criteria of lean or agile supply chain are (PAi & PLi) that these criteria are definable generally and they were mentioned in the preceding sections. The weight of these criteria can be determined with the decision and ranking techniques (e.g. the Hierarchy Analytic method), so that these weights are numbers between zero and one, and their sum will be equal to one.
The second factor s the corporation behavior on determined criteria (BA & BL), which is possible to calculate using the questionnaire. To determine the behavior of a company, the Likert 5 Choice Spectrum is utilized. Thus, the lean and agile index in a company is a function of the weight of standards and behavior of company in these criteria. For example, for j company the lean and agile indexes are calculated as the following equations.
In relations 3 and 4, WAi and WLi values are representing the weight of the criteria for agile supply chain and lean supply chain. Values (BAi)j and (BLi)j respectively indicate j vompany behavior in agile and lean supply chain standards. Based on the stated criteria for lean supply chain and agile supply chain, overall index of Leagile supply chain for J Company can be expressed as a function of two indices.
Each enterprise, selects its supply chain strategy depending on the type of product (standard products and new or innovative product or hybrid product). Companies that produce standard products, since the changes in the variety of their products is less than other products, benefit from lean supply chain properties. The companies that their products are innovative, due to rapid changes in demand and the market, in the early stages of the product life cycle, use agile supply chain properties and after reaching the stage of development, use the lean supply chain. Finally, companies that their products are combined, consider the properties of Leagile supply chain the best strategy (Banihashemi, 2011). So in relation 5, it is possible to determine weight of lean (WLSC) and agile (WASC) supply chain strategies. These weights such as the weights of supply chain metrics (WLi & WAi) are calculated based on decision-making techniques.
In an overall conclusion, and with respect to the expressed relationships, in a summary index of lean/ agile supply chain in j company can be stated as follows.
So the index of Leagile supply chain will be a number between 1 to 5. Number 1 means the absence of evidence of establishing lean and agile supply chain, and number 5 also means there is strong evidence to establish lean and agile supply chain.
Case Study In the review and implementation of presented model of research, two questionnaires have been used. The first questionnaire includes 11 questions that were distributed among the three studied organizations. The first question of the questionnaire, has investigated the attitude of managers of organizations about the presented definitions and explanations, on lean and agile supply chain, in general. The next questions investigate the attitudes of people about the importance of criteria established in terms of the effectiveness of the supply chain. The second questionnaire of study, which includes 10 questions, studied the behavior of the assessed company, individually. In order to verify the reliability of questionnaire, Cronbach's alpha coefficient was calculated which is expressed in Table 5. In analyzing the data, according to the first question questionnaire number (1) of survey, the importance of lean and agile supply chains and weights are calculated. As can be seen in Table 6, and according to the respondents, the importance of agile supply chain in organizations is more than lean supply chain. In the following the weight and importance of supply chain agility and leanness criteria and its impact on organizational performance were evaluated. Tables 7 and 8 show the decision matrix of agile and Lean criteria by AHP. The results are presented in Table 9 below. CR Index for Decision Macking Matrix of Agile supply chain is 0.051 and CR Index for Decision Macking Matrix of Lean supply chain is 0.096. In the following the behavior of studied organizations are investigated in each of the criteria of lean and agile supply chain.
Table 5: Cronbach's alpha of questionnaire
Table 6: Analysis of the studied organizations
Table 7: Decision Macking Matrix of Lean supply chain criteria by AHP
Table 8: Decision Macking Matrix of Agile supply chain criteria by AHP
Table 9: Statistics of weight of supply chain criteria
Figure 2. The importance coefficient of the Leagile supply chain criteria
Table 10: Analysis of the studied organizations
As shown in Table 10, according to the relations 3, 4 and 5 score of indexes of lean, agile and Leagile supply chain for any organization is calculated which is presented in Table 11 below.
Table 11: The general analysis
Supply chain agility index in the first organization is more than lean and lean/agile index. So agile supply chain in this organization is more applicable. In the second organization the situation is the same, but in the third one a lean supply chain has more effectiveness on the performance of the organization. In the overall analysis of three studied organizations and according to the total average of agile supply chain (3.85) and lean supply chain (3.84) as well as the importance weight of the two types of supply chains, the final calculated index is equal to 3.847 which represents excellence of establishment of Leagile supply chain in industries and organizations.
Conclusion Lean and agile supply chain improvement in the companies is achieved once the companies are able to respond to customer changes at minimum cost and waste. Lean supply chain results in increased profit by reducing costs, while agile supply chain through precisely meeting the customer needs, increases the profits. The main aim of this study is to provide an index to evaluate lean and agile supply chain of companies. The model presented in three organizations were reviewed and analyzed. In this regard, the behavior of the three studied organizations was evaluated on specified criteria. To test the presented model, according to the literature of study, some factors were selected as supply chain agility that their importance weight was obtained as follows: 1. The use of information technology and its distribution (9.2 percent) 2. The ability to change decisions based on market sensitivity (13.3 percent) 3. The focus and quality improvement in order to respond quickly to customer needs (12.8 percent) 4. Ability to make rapid changes in design and production of products (32.3 percent) 5. Flexibility in production and response to market volatility (8.6 percent) 6. The ability to change the delivery of products to customers (23.7 percent) Similarly, effective standards on lean supply chain and their importance weight were calculated as follows: 1. Cost-cutting strategies (9.2 percent) 2. Minimum inventory and save on the purchase of raw materials (14.1 percent) 3. Ability of on-time Manufacturing (32.7 percent) 4. Proper and timely maintenance of machines (8 percent) 5. The error correction rate and standardization of work (35.9 percent) Then according to the behavior of organizations in each of the eleven standards of above, and weighs of that criteria, the index of supply chain agility and leanness of organization were obtained. Results showed that, in general, the importance of agile supply chain with regard to the conditions in the industries and organizations is more than lean supply chain. Also organizations and industries should adopt appropriate approaches to the implementation of both strategies simultaneously to take advantage of the benefits of both strategies and have an efficient supply chain. The reason for this is that, lean strategy, expands a value flow from supplier to end customer and agile strategy means using market knowledge and the concept of a virtual company to exploit the lucrative opportunities in volatile markets. But the strategy of Leagile, is a combination of lean and agile strategies across an entire supply chain. Most of organizations and industries have come to the conclusion that in order to create an effective and efficient supply chain, they need to asses various fields and effective criteria on supply chain. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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References
Qi, Y., Boyer, K., Zhao, X. (2009). Supply chain strategy, product | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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