Breakout Session Supply Chain Inefficiencies - American Antitrust

70 Pages·2014·1.49 MB·English

by  Sarah Frey

The changing landscape of supply chain
management, marketing channels of
distribution, logistics and purchasing
Gregory T. Gundlach, Yemisi A. Bolumole, Reham A. Eltantawy and Robert Frankel
Coggin College of Business, University of North Florida, South Jacksonville, Florida, USA
Abstract
Purpose – The paper seeks to examine the changing landscape of supply chain management, marketing channels of distribution, logistics and
purchasing.
Design/methodology/approach – Theauthorsexamineandtakestockofthechangingnatureandlandscapesurroundingtherelateddisciplinesof
supplychainmanagement,marketingchannelsofdistribution,logisticsandpurchasing.Thisexaminationhighlightstheconsiderableevolutionand
significantadvancesoccurringwithinandbetweenthesedisciplines.
Findings – Theauthorsfindthatthisnewlandscapeprovidesbothopportunitiesandchallengesforfuturescholarshipandpracticeintheserelated
disciplines.
Originality/value – Theexaminationandfindingsshouldbeofvaluetothoseattemptingtounderstandtheevolvingnatureandinterrelationshipof
thesefields,andthosewhocurrentlypractisewithinthem.
Keywords Supply chain management, Distribution channels and markets, Distribution management, Purchasing
Paper type Viewpoint
The last two decades have witnessed the development and Background
continuing evolution of a number of related disciplines
Drawing on selected literatures and with the intention of
including supply chain management (SCM), marketing
providing background (versus an in-depth review), we first
channels of distribution, logistics and purchasing. Reflective
overview accepted definitions and research topics of interest
of both academic development and managerial innovation,
foreacharea,commonunitsandlevelsofanalysisappliedto
advances occurring within these fields and across them have
research, prevalent theories and methods for such research,
yielded considerable insights and furthered business
and recent trends identified for both research and practice.
knowledge and practice. At the same time, this evolution
TableIorganizesouranalysisframeworkandsummarizesthe
has fundamentally altered the scholarly landscape addressing
key findings of this overview.
these related fields and their managerial practice.
Examples of such changes include the increasing
Supply chain and supply chain management
expansion and prominence of supply chain management
Definition
as a field of inquiry and practice, its encompassment of
The supply chain is generally conceptualized as anetworkof
logistics, the evolving sophistication and re-emergence of
companies from suppliers to end-users, which have with the
purchasing as a strategic function, and the increasing
intention of integrating supply/demand via coordinated
emphasis of relationships and dynamic considerations
company efforts. The origin of the term “supply chain
within marketing channels research and practice. In this
management” is thought to reside in the workof consultants
essay, we examine and attempt to take stock of this new during the early 1980s (Oliver and Webber, 1982). A review
landscape to better understand the nature and of the supply chain management literature during the late
interrelationship of these disciplines and the implications 1980s and the early 1990s reveals the interchangeable use of
of changes occurring within and across them for neologisms: logistics management, network sourcing,
scholarship and their consequences for practice. Our supplier-base reduction, and inter-organizational integration.
examination highlights the ongoing changes occurring in In the late 1990s, to some extent, supply chain management
these fields, reveals insights regarding the nature of their supplanted the term “logistics” (Rogers and Leuschner,
inter-relationship, and points to a number of opportunities 2004). In an attempt to clarify confusion surrounding the
and implications for scholarship and practice. term, the Council of Supply Chain Management
Professionals (CSCMP) announced a modified definition of
SCMandastatementthatclarifieditsscopeandboundaries.
Thecurrentissueandfulltextarchiveofthisjournalisavailableat CSCMP, formerly the Council of Logistics Management
www.emeraldinsight.com/0885-8624.htm (CLM) and the National Council of Physical Distribution
Management (NCPDM), was formed in 1963 with the
objective to develop the theory and understanding of the
JournalofBusiness&IndustrialMarketing supplychainprocessesandtofosterprofessionaldialogueand
21/7(2006)428–438 developmentinthefield.Academictextbooksandresearchers
qEmeraldGroupPublishingLimited[ISSN0885-8624]
[DOI10.1108/08858620610708911] inthefieldoflogisticsandsupplychainmanagementtypically
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Purchasingandpurchasingmanagement Phenomenon:RequirementsatisfactionManagementThesystematicprocessofdecidingwhat,when,andhowmuchtopurchaseandensuringthatwhatisrequiredisreceivedontimeinthequantityandqualityspecified Themanagerialdecisionsessentialtoobtainingtheoptimalflowofmaterialsincluding:suppliermanagement,developmentandintegrationandtheoptimizationofindividualfirmpurchasingperformance Unit:IndividualtodyadLevel:Tacticaltostrategic Theories:Transactioncosttheory,interdependencetheory,managementtheory,decisiontheory,theresource-basedtheoryofthefirm,andgamingtheoryMethodology:Descriptive,qualitativecontextualapproachesandanalyticalquantitative(mathematicalandempirical)models
Logisticsandlogisticsmanagement Phenomenon:Totalinboundandoutboundflowandstorageofgoods,services,andinformationwithanemphasisonintegrationManagement:Planning,implementingandcontrolling;betweenthepointoforiginandconsumptiontomeetcustomers’requirementsThemanagerialbehavioranddecisionsessentialtoobtainingtheoptimalflowandstorageofgoodsandservicesincluding:physicaldistribution,materialshandling,packaging,returngoodshandling,orderprocessingandinformationsystems,andcustomerserviceUnit:Individual,dyad,andsystemsLevel:Operational,tactical,strategyandstrategicTheories:Economics,organizationalstrategy,andmarketingtheoriesincluding:transactioncosttheory,resource-basedtheory,relationalcontractingtheorydyadiccoordinationtheory,systemstheoryandnetworktheoryMethodology:Positivist,quantitativeapproaches,andinterpretative,qualitativemethods.Increasinguseofcasemethods,andmulti-method(triangulation)approaches
Marketingchannelsandmarketingchannelmanagement Phenomenon:ThesetofinterdependentorganizationsinvolvedintheprocessofmakingaproductorserviceavailableforuseorconsumptionManagement:Planning,organizing,coordinating,directingandcontrollingeffortsofchannelmembersThemanagerialbehavioranddecisionsessentialtothedevelopmentandfunctioningofamarketingchannelincludingchannelstructure,governance,andrelationshipmanagement Unit:Individual,dyad,networksandsystemsLevel:Tactical,operational,strategyandstrategicTheories:Economics,sociology,psychology,marketing,strategicmanagement,politicaleconomy,andlife-cycletheoriesMethodology:Descriptive,quasi-experimentalandanalytic(mathematicalandempirical)models
ameworkandsummaryoffindings Supplychainandsupplychainmanagement Phenomenon:Thenetworkofcompanies,orindependentbusinessunits,fromsuppliertoend-usersManagement:Planning,coordinatingandmanagingsourcing,procurement,conversion,andlogisticsthroughcollaboratingwithchannelpartnersThemanagerialbehavioranddecisionsessentialtothedevelopmentandfunctioningofasupplychainincluding:systemintegration,businessprocessmanagement,reengineering,andsupplier/customerrelationshipmanagement Unit:DyadtonetworksLevel:Tactical,operational,strategyandstrategicTheories:Marketing,industrialeconomics,organizationalmanagementandinformationtechnologytheories,includingtransactioncosttheory,knowledgeandresourcedependencytheory,institutionaltheory,interdependencetheory,relationalcontracttheory,opensystems,agencytheory,andrelationalmodelstheoryMethodology:Descriptivequalitativecontextualapproachesandanalyticalquantitative(deterministicstochastic)models
TableIAnalysisfr Framework Definitions Topicsofinterest Unitandlevelofanalysis Theoriesandmethodology
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adopttheCSCMPdefinitions.AccordingtotheCSCMP(see This situation is not a perfect dichotomy, however, as
www.cscmp.org): researchers in each of these areas have carried out both, and
Supplychainmanagementencompassestheplanningandmanagementofall other forms of research.
activitiesinvolvedinsourcingandprocurement,conversion,andalllogistics
management activities. Importantly, it also includes coordination and
collaborationwithchannelpartners,whichcanbesuppliers,intermediaries,
Unit and level ofanalysis
third-party service providers, and customers. In essence, supply chain
managementintegratessupplyanddemandmanagementwithinandacross ThepredominantunitofanalysisinearlySCMresearchwas
companies. the dyad, emphasizing the management of boundary-
spanning activities. As the field evolved in the late 1990s,
This is a broader and more detailed definition of SCM than
the unit of analysis became predominantly the network as
those put forward by researchers to date, some of which
firmsincreasinglyrecognizedtheirroleaspartofanumberof
include:
supplychains,havingmultiplecustomersandmultipleaswell
The integration of key business processes from end user through original as alternative suppliers. During the 2000s, the systems
suppliers,thatprovidesproducts,services,andinformationthataddvalue
forcustomersandotherstakeholders(Croxtonetal.,2001). approach has been used to provide a framework for
understanding SCM. “This systems approach provides the
Thesystemic,strategiccoordinationofthetraditionalbusinessfunctionsand
thetacticsacrossthesebusinessfunctionswithinaparticularcompanyand frameworkinwhichtobestrespondtobusinessrequirements
acrossbusinesseswithinthesupplychain,forthepurposesofimprovingthe that otherwise would seem to be in conflict with each other”
long-termperformanceoftheindividualcompaniesandthesupplychainas
(Hugos,2003).Currentinterestindifferingunitsof analyses
awhole(Mentzeretal.,2001,p.18).
continues as SCM research aims to provide analytical depth
Theefficientmanagementoftheend-to-endprocessofdesigning,planning
and implementation models for SCM practice. Apart from
andforecasting,sourcingthoughcomplexsuppliernetworks,manufacturing,
anddistributingproductsfromrawmaterialtotheendcustomer,andthe differing units of analysis, SCM research has encompassed a
finaldisposaloftheproductbythecustomer(ChanandLee,2005,p.31). rangeofanalysislevelsincludingtactical,operational,strategy
The design and management of seamless, value-added processes across and strategic orientations.
organizational boundaries to meet the real needs of the end customer
(InstituteofSupplyManagement,2005).
Theoryand methodology
Although differences exist in terms of the scope of SCM
Because SCMis atthe confluence ofmanyother disciplines,
amongthesedefinitions,therearemanycommonalities.Each
drawingonthesefieldstoinformitsintegrativephilosophy,it
relies on terms such as coordination and integration and
necessarily incorporates the various concepts, theories and
emphasizes the harmonization of operations among supply
methods found in each of these other disciplines. These
chain members. A further commonality is their focus on
include concepts and theories from marketing (customer
cross-functional business processes with the objective of
relationship management, buying strategies), industrial
providing value for the entire supply chain (Lambert et al.,
economics (make-or-buy, procurement, supplier/customer
2005).
evaluation), operations management (inventory
Domain of interest management, production planning), logistics (distribution
In the early 1980s researchers focused on understanding the planning,transportationmanagement),internationalbusiness
system integration of business processes throughout the and organizational management (teams and internal
supply chain. Emphasiswas givento reengineering the chain coordination, strategic issues, organization and procedure,
in order to meet customer requirements and improve partnering and strategic alliances), and information
customer service (Lee et al., 1997). SCM research has since technology (electronic data interchange, online bidding, bar
evolved to encompass a combination of trends in the coding). Particular theories include transaction cost theory,
management literature, such as industrial markets, knowledge and resource-based theories of the firm for
integrated materials management, systems integration, the
example resource dependency theory, relational contract
“quality” revolution, management of relationships, and
theory, institutional theory, open systems theory, agency
business process integration and management.
theory, and relational models theory, to name a few.
During the late 1990s attempts were made to integrate
As may be predicted, researchers have also drawn on
different frameworks and views of SCM and, thereby, better
various methodologies for examining SCM. These include
define the domain of SCM. Since the late 1990s, several
qualitative, contextual, analytical, and quantitative
frameworks have been developed to guide research and
approaches. A primary research focus in SCM has been to
practice, such as the Global Supply Chain Forum (GSCF)
provide a widely accepted definition and model of
(Cooper et al., 1997) framework, the Supply-Chain
management implementation. As a result, it is not
Operations References (SCOR) model (Supply-Chain
uncommon to find the predominant use of exploratory
Council, 2003), and Srivastava et al.’s (1999) business
researchmethodssuchaspilotsurveys,literaturereview,and
processes and shareholder value framework.
Today,accordingtoMillsetal.(2004),researchinthearea case studies.
of SCM has developed into two distinct streams: Today, while some researchers still continue with the
(1) descriptiveresearchonindustrialnetworksconductedby pursuit of a definitional consensus, others have followed a
researchers from industrial marketing and purchasing; shift in SCM research emphasis to developing management
and models to guide SCM implementation (i.e. of relationships
(2) prescriptive research on supply chain management, and alliances, customer/supplier segmentation, business
based in the fields of strategic management, operations process standardization, supply chain performance
management and logistics. measurement).
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Marketing channels and marketing channel emergence of electronic (e.g. internet) channels of
management distribution, the nature, qualities and performance of inter-
Definition firm relationships, the governance of such relationships, the
The very earliest formal conceptions of marketing channels use of inter-firm influence and power, channel performance
focused on the functions performed by a distribution system andthechoiceofchannelsbyconsumersamongothertopics.
and the associated utility of these functions and the overall Detailing scholarly contributions to the literature, Frazier
system.Reflectingtheirpresenceinindustrialandtransitional (1999) reports that considerable progress has been made in
economies, marketing channels gradually came to be viewed our understanding of managerial behavior and decisions
as the set of interdependent organizations involved in the surroundingthedevelopmentandfunctioningofamarketing
process of making a product or service available for use or channel. Frazier (1999, p. 226) notes for example that:
consumption (Coughlin et al., 2001). This institutional-
...theknowledgethathasaccumulatedinrelationtohowinterfirmpower
oriented perspective draws attention to those members (e.g. originates and is then applied, how control of the channel relationship is
wholesalers, distributors, retailers, etc.) comprising the facilitated,andwhatintrachannelconflictandchannelmembersatisfaction
distribution system and engaged in the delivery of goods arebasedonisimpressive.Recenteffortstobetterunderstandhowstrong,
long-term channel relationships develop – including the impact of trust
and services from the point of conception to the point of
commitmentandrelationalnormsonchannelinteractionsarenoteworthy.
consumption (Anderson and Coughlan, 2002). The Furthermore, some progress has been made in our understanding of
management of such institutions through marketing channel organizationaldecisionsrelatingtoverticalintegration,theuseofmultiple
management involves theplanning,organizing,coordinating, channels,distributionintensityandbureaucraticstructuring.
directing and controlling efforts of channel members.
The author observes, however, that while the current
Today, according to some scholars the institutional
knowledge base provides a reasonable foundation of
perspective of marketing channels and their management is
thought, a variety of issues still exist regarding constructs
giving way to a more customer-focused view of the channel
and topics examined in prior research. In particular, Frazier
(El-Ansary, 2005). Reflecting marketing channels within
(1999, p. 226) details that the role of power in channel
newer experienced-based economies and involving value
relationships is often confused. Interfirm monitoring efforts
adding chains and larger networks of members, this
have received little attention. Few of the various different
emerging perspective emphasizes marketing channels as
facetsofinterfirmcommunicationhavebeenexaminedinany
providing for the conception, promotion and delivery of
depth. Intrachannel conflict and its impact on long-term
positivecustomer experiences.
channel relationships have been largely overlooked. The
Domain of interest relationship marketing paradigm as applied to distribution
Consistent with the functional conception of marketing channels has been pushed beyond its practical and natural
channels, early research in channels, circa the 1950s and boundaries. Important factors likely to shape channel
1960s (see Alderson, 1957), focused on identifying the integration, distribution intensity, and bureaucratic
various functions provided by marketing channels and structuring remain largely unexplored. The use and
explaining when and why these functions have utility management of multiple channels have been barely touched
(Anderson and Coughlan, 2002). Paralleling modern on.Physicaldistributionprocessesandtechnologieshavenot
emphasis of the institutions occupying a channel, received the attention they should in research on channel
contemporary research in marketing channels has focused organizationandmanagement.Further,accordingtoFrazier,
on the organization and ongoing management among these manyimportantmanagerialissuesrelatingtotheorganization
institutions. This research examines the managerial behavior and management of channels of distribution have yet to be
anddecisionsessentialtothedevelopmentandfunctioningof addressed in empirical channels research. Among those
a marketing channel. considered most important are:
According to Anderson and Coughlan (2002), important (1) how resource allocations to channels should be made
areas of research occupying the institutional domain of
across global product markets;
marketing channels include market channel structure, (2) how functions are shared-split between channel
governance, and relationship management. As these scholars
members;
explain, to enhance effectiveness and efficiency across the
(3) what combination of push and pull strategy is
various functions performed by members of a marketing
appropriate for firms using indirect channels;
channel, each attempts to influence others to operate in a
(4) when and how the internet should be used as a sales-
coordinatedfashionandinamannerthatrecognizesthattheir
distribution channel;
interdependence creates common interests. Because
(5) how coordination is achieved among distributors in
structure, governance and relationship management reflect
integrated supply networks;
howfirmsgarnerandthenexertinfluenceoveroneanotherin
(6) howgoalsareset,plansaredeveloped,andperformance
ordertobesuccessfulandtocompeteagainstothermarketing
appraised among channel members; and
channelsystems,theseareashavebecomeadominantfocusof
(7) howdistributorsshouldoperatetheirbusinesses(Frazier,
research under the institutional perspective.
1999, p. 226).
Informal review of recent contributions to the literature
substantiates the observations of Anderson and Coughlan Intermsofthefuture,asthetraditionaldomainofmarketing
(2002). These include contributions that inform our channels set around the institutional perspective of channel
understanding of the systemic nature and qualities constituentsgiveswaytoamorecustomer-focuseddefinition,
associated with larger channel systems, the role of dual it is likely the domain of marketing channels research will
channel structures, marketing channels and their interplay furtherexpandtoincluderelatedtopicsofinterest(El-Ansary,
with supply chain processes and logistical functions, the 2005).
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Unit and level ofanalysis robust generalizations concerning important phenomenon.
Attendant to the functional perspective of marketing Despite these challenges, as may be observed across time,
channels, early research adopted the channel system and its results from these multiple perspectives and methods are
functionsasitsprimaryunitandlevelofanalysis.Asthefield beginning to converge with some agreement in findings and
evolvedtoamoreinstitutional perspective,researchsimilarly explanations about what issues in marketing channels merit
evolved to capture a particular channel institution’s (most further inquiry (Anderson and Coughlan, 2002).
oftenthemanufactureror“channelcaptain”)perspectiveand
theireffortsatdesigning and managingthe channel.Viewing Logistics and logistics management
thechannelasmostoftendominatedbythemanufacturerand Definition
involving a strategic asset of the firm, inquiry focused on “Logistics” refers to the inbound and outbound flow and
informingthequestionofwhatisthebestmarketingchannel storage of goods, services, and information within and
for a particular firm’s product or service (Coughlin et al., between organisations. As a managerial activity, early
2001). conceptions of logistics focused on its role in the
As both the nature of marketing channels and research distribution of products and as a way to support an
attempting to understand such a phenomenon has evolved, organization’s business strategy and to provide time and
the unit and level of analysis adopted by researchers have place utility. Prior to the 1980s, logistics was primarily
similarlyevolved.Thisevolutionhasleadtocurrentemphasis concerned with the outbound flow of finished goods and
on dyadic relationships and emerging inquiry of triadic and services, with an emphasis on physical distribution and
larger network and system-based configurations of the warehouse management. During the 1980s, industry
channel and involving both strategic as well as more day-to- globalization and transportation deregulation led to the
daymanagerialactivities.Inthefuture,increasingemphasisof expansion of logistics beyond outbound flows to include
customer-focus marketing channels will likely call for recognition of materials management and physical
adoption of units and levels of analysis that comply with distribution as important elements. In 1986, the CLM
those held by the customer. (considered by many to be the pre-eminent professional
organization for academics and practitioners in the logistics
Theoryand methodology
field) defined logistics as: “the process of planning,
Inpursuitofinsightsandunderstanding,channelsresearchers
implementing, and controlling the efficient, cost-effective
have drawn upon a variety of theories and research methods
flow and storage of raw materials, in-process inventory,
to inform and conduct their work. In addition to descriptive
finished goods, and related information flow from point of
field research intended to portray the practices and
origintopointofconsumptionforthepurposeofconforming
performance outcomes associated with channels, scholars
to customer requirements” (see www.clm1.org). During the
havealsoemployedquasi-experimentalsettingstoisolateand
1990s, accelerated market changes due to shrinking product
examine phenomenon associated with the workings of a
lifecycles, demand for customization, responsiveness to
channel. Analytic models, both mathematical and empirical,
demand, and increased reliance on information technology
have also serviced such inquiry.
led to logistics being defined as “the process of strategically
Beyond a multitude of research settings and methods,
managing the procurement, movement and storage of
scholars have also borrowed from a number of different
materials, parts and finished inventory and related
theoreticalframeworkstoinformtheir understandingofsuch
information flow through the organization and its marketing
practices and phenomenon. As inventoried recently by
channels” (Christopher, 1998).
Anderson and Coughlan (2002), these include:
The 2000s experienced further changes to how logistics is
. from economics – explanations attendant to transaction
defined. Developments in international trade, supply chain
cost analysis, agency theory, game theory, analytical
management,technology,andbusinessprocessre-engineering
models of competition and market response and
generated a need to re-evaluate the logistics concept. During
evolutionaryeconomics;
this period, CLMannually revieweditsdefinition oflogistics
. fromsociology – theories ofdependence/powerand group
and revised that definition several times: in 2001, CLM
processes and institutional theories of legitimacy;
definedlogisticsas“thatpartofthesupplychainprocessthat
. from psychology – theories of social influence,
plans, implements and controls the efficient, effective flow
interpersonal relationships and conflict; and
and storage of goods, services, and related information from
. from marketing and strategic management – theories of
the point of origin to the point of consumption in order to
trust, competitive advantage and path dependence and
meet customer requirements”. Between this time and before
fromotherareas,politicaleconomyandlife-cycletheories,
2003,CLMagainmodifieditsdefinitionto:“thatpartofthe
to name a few.
supply chain involved with the planning, implementing and
Giventhiseclecticstateofaffairs,thesescholarscontendthat controllingoftheefficient,effectiveflowandstorageofgoods,
thefieldofmarketingchannelsresearchiscurrentlyinapre- services, and related information from the point of origin to
paradigmatic state with little agreement about how to frame the point of consumption for the purpose of conforming to
issues and what the appropriate mode of inquiry is. Such a customer requirements” (see www.clm1.org). Differences
state poses both opportunities and challenges for the future. among these definitions reflected the CLM’s attempts to
Given the lack of consensus, on the one hand, researchers capture differences between, and the scopes of, logistics
examining channel phenomenon have considerable freedom management and supply chain management.
toproceedinamanneroftheirchoice.Atthesametime,the ThemostrecentdefinitionoflogisticsfromCLM(nowthe
lack of consensus (and at times competition among differing Council of Supply Chain Management Professionals –
perspectives and methods) has made it more difficult to CSCMP), in 2003 is: “that part of supply chain
achieveconsensus and thus to accumulate findings thatyield management that plans, implements and controls the
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efficient, effective forward and reverse flow and storage of mathematics to psychology, theories of particular relevance
goods,services,andrelatedinformationbetweenthepointof include those having origins in economics, organizational
origin and the point of consumption in order to meet strategy, and marketing including transaction cost theory,
customers’ requirements” (see www.cscmp.org). Many resource-based theory, relational contracting theory and
academic textbooks and articles in the logistics discipline dyadic coordination theory. Reflecting its evolution to
typically adopt this CSCMP definition of logistics and include more systemic and strategic considerations, logistics
logistics management (as an example, see Stock and has most recently begun to integrate systems and network
Lambert, 2001), while some more recent examples provide theory.
an alternative, albeit related definition – for example that Logistics research has also evolved in its use of research
“logisticsreferstotheresponsibilitytodesignandadminister methods.Someresearchtendstobemorepositivistinnature,
systemstocontrolmovementandgeographicalpositioningof utilizing variations of quantitative approaches, while others
rawmaterials,work-inprocess,andfinishedinventoriesatthe tend to be more interpretative, and as such qualitative in
lowest total cost” (Bowersox et al., 2006, p. 22). Most nature. Frankel et al. (2005) examined articles published in
definitions accept the notion that, as in the CLM definition, the Journal of Business Logistics between 1999 and 2004 and
the emphasis is on leveraging low cost information against found a variety of data gathering techniques and forms of
more expensive logistics assets such as inventory, analysis including literature reviews, interviews, personal
warehousing, labor and transportation. observation surveys/questionnaires, focus groups, cases
studies, experiments and content analysis. They identified a
Domain of interest
numberoftrendsincludingtheincreasinguseofcaseanalysis,
Early logistics management research focused on the
multi-method (triangulation) approaches and use of the
management of transportation and warehouses. Today,
internet for data collection.
research in logistics addresses two aspects:
The current state of logistics research reflects its evolution
(1) supplychainlogistics,concernedwiththeflowofgoods;
from an emphasis on operational and functional areas to an
and
emphasis on the efficiencies that can be gained through the
(2) service response logistics, concerned with the co-
integrationandinterface(s)betweendisparateareasandother
ordination of non-material activities necessary for the
functional departments within the organization including
fulfillmentoftheserviceinacost – andcustomerservice
manufacturing, human resources, finance/accounting, etc.
– effectivemanner.
Today, logistics research is responding to recent calls for
AninformalreviewofresearchtopicsappearingintheJournal measuring the performance of the logistics system and sub-
of Business Logistics (JBL) between 2000 and 2005 identifies systems and its implications for overall firm performance,
trafficandtransportation,warehousingandstorage,inventory especially with an emphasis on the efficiencies that can be
management, packaging and return goods handling, salvage gained from extending this functional integration through
and scrap disposal as key foci of supply chain logistics; and collaboration across the entire supply chain.
order processing and information systems, customer service
andprocurementaskeyfociofserviceresponselogistics.Over Purchasing and purchasing management
time,logisticsresearchhasevolvedfromapureinternalfocus Definition
on cost control, and functional areas of inventory, Purchasing involves the satisfaction of individual firms’
transportation, warehousing and order processing to their requirements. Early definitions of purchasing emphasized
roleandimpactwithinbusinessprocessintegrationregarding thetacticalandclericaldecisionsinvolvedinthepurchasingof
suppliers and customers. products and supplies. During the 1990s purchasing evolved
tobeviewedaspartofabroaderfunctioncalledprocurement
Unit and level ofanalysis
or “the systematic process of deciding what, when, and how
Historically, logistics research focused on the firm and its
muchtopurchase;theactofpurchasingit;andtheprocessof
profitability.Inthemid-1990s,recognitionoftheimportance
ensuring that what is required is received on time in the
of dyadic relationships for achieving this objective emerged.
quantity and quality specified” (Burt and Pinkerton, 2003,
With increasing emphasis on end-to-end logistics integration
p. 64). As a function, procurement included purchasing,
and the linkage of multiple dyads, the focus of logistics
consumption management, vendor selection, contract
research further shifted in the 2000s to its present state and
negotiation and contract management (Poirier, 1999, p. 64).
focus on the system as its primary unit of analysis.
At the beginning of the 2000s, the terms “purchasing” and
Paralleling this broadening has been shifts in the level of
“procurement” became synonymous in the profession
analysis employed in logistics research, from a focus on the
(Monczka et al., 2002).
management of operations to optimizing logistics operations
Today, many researchers are taking a broader view of
to attain efficiency of the flow of goods, and to service
purchasing that emphasizes “managing the supply” of
response logistics. Today, the scope of logistics management
materials, services, and information. Supply management
and research includes external and strategic orientations
research tends to focus on studying the phenomenon of
encompassing consideration of the value adding activities
purchasing defined as requirement (i.e. need) satisfaction.
involved in the process of bringing a product to market.
Whilethereisnoagreementontheexactdefinitionandscope
Theoryand methodology of supply, professionals at all levels do agree that supply is a
Surveyingtheoriesappliedinlogisticsresearch,Stock(1995) series of linked relationships that add value at various levels
concluded that logistics benefits from borrowing from other (Kauffman, 2002). Supply management encompasses
theories as it is suited to approaches which “adopt “organizing the optimal flow of high-quality, value-for-
multidisciplinary methodological pluralism”. Although money materials or components to manufacturing
logistics has benefited from application of insights from companies from a suitable set of innovative suppliers”
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GregoryT.Gundlachetal. Volume21·Number7·2006·428–438
(Wagner, 2003). Concepts of interest in supply management Expansion of the unit of analysis employed by researchers
include management, development and integration of in purchasing has also been accompanied by changes in the
suppliers (Antonette et al., 2002). level of analysis. Early research addressed purchasing in
relation to its tactical/clerical role. During the 1970s and the
Domain of interest 1980spurchasingwasviewedasanon-strategicfunctionand
Early research in purchasing focused on improving the
hadlessorganizationalstatusrelativetoothermajorfunctions
internal efficiency of an individual firm within the supply
in the firm (Ammer, 1989). The 1990s brought a change in
network.Researchers focused onexploringthe most efficient
the focus of purchasing to include strategic considerations
approaches to performing purchasing responsibilities in
with an emphasis on total cost savings and value-added
relation to: direct or strategic materials needed to produce
activities (Burt and Pinkerton, 2003). Today, research on
thecompany’sproducts,andindirectorMRO(maintenance,
purchasing isbeginningtoexamine thevalueofcooperation,
repair, and operations) products consumed by the company
redirecting the tactical focus on internal efficiency toward
as part of its dailyoperations (Poirier, 1999).
strategic network improvement, and soliciting the help of
Fromthelate1990son,researcherstookabroader viewof
willing partners interested in building a dominant supply
purchasing.Emphasiswasgivento“managingthesupply”of
chain in a particular industry (Burt and Pinkerton, 2003).
materials, services, and information and resulted in a shift
fromfocusoninternalefficiencytootherlong-termoutcomes Theoryand methodology
such as collaborative learning, reductions in cycle time, and Early research on purchasing utilized transaction cost theory
newproductdevelopmentcycle.Thisemphasisextendedinto to examine purchasing’s contribution to internal efficiency,
the use of the internet and technology developments and i.e.cost savings attained by reducing raw materials costs and
examining team driven decision-making, which fostered selectingsuppliersthatoffer thelowestprices,withinafirm’s
collaborative activities with suppliers aimed at meeting the boundaries. From that time, purchasing/supply researchers
goals of the firm (Giunipero and Handfield, 2004).
have incorporated other theories including interdependence
With the beginning of the 2000s, researchers began to
theory to explore dyadic considerations between purchasers
realizetheimportanceofcoordinatingthesupplyofproducts,
and suppliers. Other researchers used agency theory,
services, and information rather than merely focusing on
management theory, resource-based theory of the firm,
buying the least expensive materials. After reviewing the
decision theory, and gaming theory to analyze the impact of
Journal of Supply Chain Management (JSCM, considered by
purchasing/supply strategies on performance.
many to be the leading journal in purchasing and supply
During the early 1990s, typically, purchasing/supply
research),CarterandEllram(2003)reportedseveralchanges
research relied upon descriptive methods with the objective
in the subject categories of topics across time that reflect the
of identifying best practices and assisting purchasing
evolutionfrompurchasingtosupplymanagement.According
professionals in their benchmarking efforts. Although
to the authors, one-third of the contributions to “purchasing
descriptive and benchmarking research is still widely used
performance” and the “status” and “recognition” of the
today,researchersfromthe1990sonwardsemployedavariety
purchasing function were made during 1975-1979. The
ofmethodsandmodelingtechniquesrangingfromqualitative
majority of the contributions to “inventory and production
contextual approaches to analytical quantitative ones.
management” were made in the 1970s and 1980s. Material
Today, the most influential trend on purchasing/supply
requirements planning (MRP) appeared from 1977 to 1984,
research is the emergence of SCM (Carter and Narasimhan,
while the majority of just-in-time (JIT) contributions were
1996).SCMdenotestheintegrationofpurchasingandsupply
made from 1986 to 1994. In the 1990s the emphasis on the
with other functions in the firm (Wisner and Tan, 2000).
strategic impact of purchasing emerged. Almost all
With the realization of the importance of coordinating the
contributions dealing with supply chain issues were made
supply of products, services, and information with the other
after 1994, emphasizing the broadening and integration of
functions, rather than focusing on buying the least expensive
purchasing into supply management and supply chain
materials,mostpurchasingresearchers’attentionshiftedfrom
management. This also mirrors the general recognition of
“purchasing” to “supply management”. Terms such as
the supply chain concept by purchasing professionals and
“integrated purchasing strategy” are being used in the
scholars (Carter and Ellram, 2003).
literature today to address certain elements or stages of this
new management philosophy (i.e. SCM). Many researchers
Unit and level ofanalysis
todayassesspurchasingandsupplystrategies’contributionon
Early purchasing research emphasized the internal
the basis of their contributions to SCM success (Wisner and
performance of individual firms’ purchasing function as a
unit of analysis and focused on the performance of the Tan, 2000).
purchasing department, measured by cost savings. With the
increased recognition that the success of purchasing depends
Analysis and discussion
on the extent to which its performance fits the needs of the
business and on the consistency between purchasing Our overview of the related disciplines of supply chain
capabilities and the competitive advantage sought by the management,marketingchannelsofdistribution,logisticsand
business,inthe1990stheunitofanalysisexpandedtoinclude purchasing highlights significant developments and changes
assessment of dyadic relationships. Emphasis on supply occurring in these fields reveals insights regarding the
management during the 2000s motivated researchers to relationship among them and points to a number of
extend their unit of analysis to include second tier suppliers opportunities and challenges for scholarship and attendant
and to collect data from multiple sources in the same supply consequences for practice. We briefly describe key findings
chain. here.
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Key developments and changes Logistics and logistics management
Anumberofsignificantdevelopments andchanges thathave The field of logistics has also undergone important
the potential of impacting scholarship and practice within developments and changes that are likely to be impactful to
each ofthe disciplines are identifiable from our examination. scholarshipandpractice.Reflectingitsindependentoriginyet
subsequent importance and association with SCM, the field
Supply chain and supply chain management has redefined itself over time to both conceive of logistics as
Perhaps the most prominent of these involves the rapid partofSCM,butalsoanindependentfunctionofbroadening
developmentandevolutionofthefieldofSCM.Arisinginthe and strategic importance to the firm. Both perspectives have
mid-1980s, the field has expanded through its process meritgiventheacknowledgedcriticalroleoflogisticsinSCM
orientation to integrate processes and functions which (i.e. logistics is recognized as an integrative support
include institutional concepts and issues addressed in mechanism to enhance efficiencies across the supply chain)
marketing channels, flows common to logistics and activities as well as the separable functions which define the field of
previouslythedomainofpurchasing.Importantly,whilethese logistics itself. Together, these developments and changes
fields remain vital in their own right, the emergence and representimportantadvances for thefield thatwill likelypay
developmentofSCMhasyieldedanoverarchingdomainthat dividends through elevating our understanding of logistics
aspires to provide for their common integration and and enhancing the development of SCM both in terms of
coordination in ways not imagined before. scholarship and practice.
As a discipline, SCM continues to become increasingly
Purchasingand purchasing management
market oriented, assessing and responding to the needs of
Finally,important changes in the field ofpurchasing thatare
target customers and other stakeholders by organizing and
likelytoimpactscholarshipandpracticeincludeitsevolution
coordinatingresourcesandactivitieswiththegoalofcreating
from a tactical and internal efficiency oriented function
value.Suchanevolutionreflectsthenaturalmaturationofthe
encompassingthefirmanditsimmediatesupplierstoinclude
field’s original goals.
strategic and external effectiveness based considerations
At the same time, a considerable lack of consensus
encompassing the firm and the larger network of firms
continues to exist within the field of SCM in relation to its
occupying the value chain. These changes reflect both the
precise definition and whether the field constitutes a
independentdevelopmentofthefieldandtheimpactofSCM
management philosophy, implementation of a management
and are captured in the evolution of terminology describing
philosophy,orasetofmanagementprocesses.Suchconfusion
the field.
should not be unexpected given the field’s early stage of
Consequently, the broadening of the discipline of
development and rapid evolution and will likely be resolved
purchasing implies a greater emphasis on the implications of
over time both in terms of scholarship and practice.
purchasing decisions on firm and supply chain performance.
Today, effective purchasing is not necessarily one that
Marketing channels and marketing channel management
promises maximum efficiency or least total cost, but rather
Within marketing channels, paralleling a shift in the larger
one that fits the needs of the business and strives for
discipline of marketing from focus on transactional exchange consistency between its capabilities and the competitive
toincludeexchangerelationships,perhapsthemostimpactful advantage being sought throughout the supply chain. These
development has been the field’s emphasis of relational (e.g. developments and changes reflect advances that are likely to
collaborative) versus competitive (e.g. arm’s length) enhance the role and prominence of purchasing in both
interactions among institutions comprising the marketing scholarship and practice.
channel.Thischangehasfundamentallyalteredthescholarly
landscape and practice of marketing channels and marketing Connections across the disciplines
channel management. Taken together, recognition of the important changes and
Accompanying the field’s emphasis of relationships and developments in each of the disciplines helps to provide
collaborative interaction has been a broadening of its insightsfor understandinghowthesedisciplinesrelatetoone
institutional perspective from that of an individual another including their similarities and distinctions. Notable
institution (and its channel) to that of dyads and larger and inthisregardishowsomerecentconceptionsofSCMinform
morecomplexunitsofanalysisincludingtriads,networksand this understanding through defining marketing channels,
systems ofinstitutions andtheir relationships.Thisevolution logisticsandpurchasingaspartofSCM.Forexample,SCM
has also been accompanied by expansion of marketing is defined by CSCMP to “include coordination and
channel concepts and theory from that which is informative collaboration with channel partners” – a key thrust of
to understanding the organization and management of a marketingchannelmanagementandto“include[asapartof
dominant institution’s channel at apoint in time to concepts SCM] all logistics management activities” and further in
and theory helpful for understanding the organization and relation to purchasing, “all activities involved in [...]
management of relationships and larger configurations of procurement”. Further credence to this conception is
relationships comprising a marketing channel over time. provided through logistics definitions that conceive of the
Together, the changes and developments in marketing field of logistics as “part of the supply chain” and its
channelsrepresentconsiderableprogressinunderstandingthe management.
institutions and functioning of marketing channels and The basis for including marketing channels, logistics and
marketing channel management. As a result, these changes purchasing as part of SCM likely extends from SCM’s
will likely enable the field to better understand and explain integrative orientation and therefore necessarily expansive
phenomenon occurring within marketing channels of scope compared to the more functional orientation and
distribution. narrowerbreadthoftheserelateddisciplines.Integratingsuch
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functions across the supply chain is an important and useful disciplinesforachievingitsgoals.Suchknowledgeisessential
goal.Ofnote,however,isthatsomemorerecentconceptions for overcoming hurdles to achieving SCM’s goals. For
of SCM are not limited to merely the integration of these example, observers have noted that such goals are often
functional areas. For example, read literally, the recent countered by conflict and individual firm’s efforts to
CSCMP definition advances beyond integration to include maximize their own performance through exercise of power
the actual “planning” and “management” of these functions and control and the use of opportunistic business practices.
aswell as other business processes across the supply chain. Such behavior and its resolution is at the core of research
What implications attend a conception of SCM as effortswithinmarketingchannels.Integrationandrelianceon
including, beyond its integrative orientation, the actual such knowledge should be helpful to SCM in overcoming
planning and management of the functional domains of such challenges. Indeed, absent such reliance and continued
marketing channels, logistics and purchasing? What developmentofotherinsightswithintheindividualdisciplines
consequences result for scholarship and practice within of relevance to SCM, it will likely be challenging for the
SCM? Within each of the functional domains? The answers expansive and worthygoals of SCM to be fully achieved.
to such questions appear more than academic given they are
currently under consideration by those within the field of Opportunities and challenges for scholarship
SCM.TheJournalofBusinessLogistics(2006),forexample,in Examination and assessment of the developments and
recognitionoftheintenseandcontinuinginterestinSCMfor changes occurring in SCM, marketing channels of
twodecades,butstillremaining“uncertaintyastowhatSCM distribution, logistics and purchasing also reveals a number
is and what functions and/or processes should be included of implications for scholarship. These include both
within it”, recently issued a call for a special issue of the opportunities and challenges for research (i.e. knowledge
journal to “document and describe the scope and domain of generation)aswellasteachingandinstruction(i.e.knowledge
supply chain management”. The insights and understanding dissemination) within and across the fields.
developed from such an effort and others is likely to be
important to both SCM and its related fields. Research
For those who might be concerned with the breadth and Of particular note for research are the increasing overlaps in
depth of intellectual and practice-based aspirations reflected definitions and topics of interest that have developed over
by CSCMP’s conception of the SCM discipline, a helpful time across these disciplines. For example, both SCM and
distinction is that SCM’s larger philosophy has been marketingchannelsidentifyandspecifythecoordinationand
suggested by others to be limited to the integration and collaboration of channel partners as a topic of interest,
coordination of the respective disciplines it embraces rather although from different vantage points and applying varying
thentheir morespecific planningand management(Mentzer methodsandtheories.Further,SCMspecificallyidentifiesthe
et al., 2001; Chan and Lee, 2005; Croxton et al., 2001). field of logistics as encompassed in its domain of interest.
These distinctions have also been addressed by others. For Similar observations and overlaps are present and attend the
example, the alternative perspectives represented in the relationship of purchasing and SCM.
different viewpoints of CSCMP and others has been labeled Accepting differences in perspective and orientation, the
by Larson and Halldorsson (2002) as reflecting the presence of such overlaps yield significant opportunities for
“Unionist” versus the “Intersectionist” view of SCM. interdisciplinaryresearchanddevelopment.Insomeinstances
According to Larson and Halldorsson (2002), under the such cross-disciplinary efforts have already been identified
“Unionist” view, where SCM subsumes logistics, marketing, andarecurrentlybeingexploredtoaconsiderableextent(e.g.
operations management, purchasing, etc., supply chain SCM/logistics) and in other instances to a somewhat lesser
managers have greater decision making authority than other extent (e.g. SCM/purchasing). In both cases, continued
functional managers, requiring that the reporting across disciplinaryefforts are likely to prove fruitful.
relationships within the firm be altered. This view is In other areas (e.g. SCM and marketing and marketing
generally consistent with the perspective offered by the channels as well as other functional areas) such integration
CSCMP through its definition of SCM. Alternately, remains a continued opportunity. For example, Grimm
according to Larson and Halldorsson (2002), under the (2004, p. 59) points out:
“Intersectionist” view, SCM is considered a broad strategy Whilemanyacademicdisciplinesareconductingresearchinsupplychain,
whichcutsacrossbusinessprocessesbothwithinthefirmand thereisanunfortunatelackofcommunicationandcooperationamongstthe
variousdisciplinesregardingsupplychainresearch.[...]Thisisunfortunate,
through the channels. This view is generally consistent with
aseachfieldofferscontributionstothewholeofthecross-disciplinaryworld
Mentzer et al.’s (2001) perspective that supply chain ofsupplychainmanagement.
management involves the strategic coordination of
traditional business functions and the tactics across these WithparticularrespecttoSCMandmarketing,theevolution
business functions as well as Croxton et al.’s (2001) of SCM to focus on end-user considerations overlaps with
perspective that supply chain management involves a change coremarketingconceptsincludingthemarketingconceptand
from managing individual functions to integrating activities market orientation. Further development and integration of
into key supply chain processes. In this fashion, the these fundamental insights both within and across each
intersectionist perspective of SCM does not imply a union discipline is likely to be beneficial to both. In addition, in
ofmarketing,logistics,andpurchasing.Rather,under sucha relation to marketing channel management and SCM,
perspective SCM coordinates cross-functional efforts across development and integration of insights regarding the
multiple firms (Mentzer et al., 2001; Chan and Lee, 2005). coordination and collaboration of channel partners has the
Importantly, for both perspectives most agree that SCM is potentialoffurtheringunderstandingofsuchphenomenonin
critically dependent on the depth of understanding and waysthatelevatetheefficiencyandeffectivenessofmanagerial
managerial insights developed in each of the functional initiatives in both SCM and marketing channels.
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Teaching and instruction rapidemergence,otherorganizationshaveyettobenefitfrom
In addition to research, implications for instruction and its application. At the same time, lack of consensus about
teaching,includingcurriculumenhancement,extendfromthe whatSCMisandwhatitisnotlikelyhasresultedinconfusion
changes and developments occurring within and across the and in some instances inhibited its adoption its adoption in
disciplines of SCM, marketing channels, logistics and ways that provide benefits to practice.
purchasing. Many of these implications may be cast as Other parallels are also identifiable. For example, the shift
questions for consideration and contemplation by those in focus from competitive to collaborative interaction in
involved in such efforts. marketing and marketing channel management is detectable
Offirstimpressioniswhetherexisting curricula adequately in many aspects of marketing channel practice ranging from
coverthechangesanddevelopmentsthatareoccurringwithin theincreasingprevalenceofinstitutionssuchasjointventures,
these subject areas? Although programs designed to instill strategic alliances, and partnerships to the nature of
knowledge of many of the specific functions (e.g. logistics, interactions that may be found in many day-to-day channel
marketing channels,etc.) maybeidentified, is thecontent in exchanges. Similarly, the integration of logistics into SCM is
thesecurriculaadequategiventhechangesanddevelopments also identifiable in manyorganizations. Finally, the evolution
thathaveoccurredwithinthesedisciplines?Dosuchcurricula
and broadening of purchasing to include strategic and
require amendment to adequately address these changes and
external effectiveness considerations may be found in some
developments?
organizations.
A further question is whether existing curricula should be
Also paralleling changes and developments within each of
integrated to cover and bridge these related disciplines? Do
the areas of SCM, marketing channel, logistics and
existingcurriculaadequatelycoverthesubjectknowledgethat
purchasing management is consideration by many
has developed over time and currently resides within and
organizations of how best to go about the managerial
acrosstheserelateddisciplines?Shouldthey?Whatchallenges
challenges of practising across these related areas. While
result in attempting to develop such an integrative
some organizations continue to work on them, others have
curriculum? What content should be included? Excluded?
successfully met the challenges of understanding and
Arelatedquestionregardshowcurriculaintendedtocover
integrating these related disciplines to their overall benefit.
and bridge these subjects should be labeled? Given the
For example, although very different retailers, Wal-Mart and
integrative goals of SCM, should such curricula be labeled
Target have been able to achieve profitable sales, increase
similarly and include content on the functional areas?
customer count, increase trip frequencies, increase
Alternately, given the functional orientation of marketing
transaction size, increase productivity; and reduce costs by
channels,logisticsandpurchasing,shouldsuchlabelsremain
aligning and focusing all marketing (including marketing
with the addition of SCM as a kind of capstone perspective
channels), purchasing and logistics functions on achieving
intendedtoprovidestudentswithinsightsandunderstanding
their overall supply chain goals (Hoytand Company, 2005).
(ifnotaphilosophy)ofhowsuchfunctionscanbesuccessfully
integrated to achieve optimal performance across the supply
chain? Or should such a philosophic orientation as provided
Conclusion
through SCM be positioned as a foundation course, with
those functions that it coordinates being positioned as The related disciplines of supply chain management,
elements to be embraced and added as courses over time? marketing channels of distribution, logistics and purchasing
At present, both pedagogical approaches may be found haveundergonesignificantdevelopmentandevolutioninthe
currently in practice (or under consideration) at many last two decades. Spurred by both external and internal
institutions where consideration is being given to how best forces, changes in and across these disciplines have
to include supply chain management in their curricula fundamentally altered the scholarly landscape to which they
(Rutner and Fawcett, 2005). relate and the way in which they are practiced. This essay
Finally, a larger question regards how other business soughttoexamineandtakestockofthisnewlandscapeandto
functions should be treated with respect to the changes and
revealitsopportunitiesandchallengesforscholarshipandits
developments that have occurred within and across these
consequences for practice.
related disciplines? Overall, the challenge for educational
institutions is to expand their perspective while at the same
timeimprovingtherelevanceandqualityoftheirofferings.In References
this regard, it is important that these and other questions be
approached following an integrative process-oriented Alderson,W.(1957),MarketingBehaviorandExecutiveAction,
pedagogy that provides ample opportunity for the input and Irwin, Homewood, IL.
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purchasing function”, Journal of Purchasing and Materials
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consequences for practice extend from the changes and management: structure, governance and relationship
developmentsoccurringwithinandacrosstherelatedfieldsof management”, in Weitz, B.A. and Wensley, R. (Eds),
supply chain management, marketing channels of Handbook of Marketing, Sage Publications, London,
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interconnections. Many of these parallel those already Antonette, G., Giunipero, L.C. and Sawchuk, C. (2002),
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beenadoptedandprogressedinmanyorganizations,givenits through Technology, JGC Enterprises, Goshen, NY.
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