Identifying Key Success Factors for Social Enterprises Serving Base‐of‐Pyramid Markets through Analysis of Value Chain Complexities

There are people in this world who have little or no access to basic needs and they struggle financially, living on less than a handful of dollars a day. A better understanding of how to supply/serve the world's poor is needed. In this paper, through the lens of Porter's value chain framework we investigate the challenges and opportunities social enterprises face in base‐of‐pyramid (BoP) markets based on secondary data on 23 organizations. Our contribution is twofold: First, we analyze value chain complexities for the social enterprise based on the value creation role (consumer, coproducer) and income level (poverty, extreme poverty) of the local population. We find that nature of customers’ requirements varies across customer segments in the BoP markets and social enterprises face unique challenges in fulfilling such differentiated demand patterns. Second, we develop an affordability–accessibility framework that helps to identify the situations that may be favorable/unfavorable for social enterprises to meet the challenges in BoP markets. We make four propositions that social enterprises may use to cope with difficulties in affordability and accessibility. Our findings will be useful for such organizations to understand and design better supply chains for the base of pyramid.     

Rapid rise of China's semiconductor industry: What are the implications for Singapore?

Lately, there has been a rush of foreign investment commitments in China's semiconductor industry, giving rise to predictions of a semiconductor revolution in the world's most populous country. Pull factors include China's entry into the World Trade Organization (WTO), which would clarify trading and investment rules, government incentives, and, of course, burgeoning domestic demand. For the moment, because of U.S. export restrictions, China's chip industry will be kept behind the technology curve by around five years. However, its ample supply of engineers and low labor costs will aid in the development of the assembly & test and design sectors, which are labor‐intensive. But given strong government commitment, the industry is likely to continue to progress upward, gaining from the diffusion of high‐tech know‐how through its alliances with multinational corporations and tier‐one foundries. In the industry's value chain, there is potential for Taiwan and China to complement each other in both domestic and global markets, across both high‐ and low‐end technology segments, and across the entire chain of activities. To meet the challenges, Singapore needs to further leverage on its competencies in infrastructure and logistics, as well as the well‐established ASEAN production network for greater economies of scale. For Singapore's semiconductor industry to remain competitive, there is a need to strengthen the full value chain, from integrated circuit (IC) design to wafer fabrication to packaging & test, by attracting and building up companies specializing in different competencies. Singapore semiconductor manufacturers should continuously strive to stay at the technology forefront and provide competitive customer services. © 2004 Wiley Periodicals, Inc.     

Multinational companies and human resource management in Ireland during recession: A retrospective from a highly globalized economy

This article provides a retrospective investigation of the impact of the recent “great recession” on human resource management (HRM) in multinational companies (MNCs) in Ireland. Ireland represents a particularly fitting location within which to address this topic given its standing as one of the world's most economically globalized and MNC‐dependent economies and also because the country was very severely impacted by the global financial crisis. Using both primary and secondary data from a variety of sources, our analysis considers the impact of recession on HRM in MNCs, with particular focus on employment, pay and benefits, industrial relations, and the role of the human resource (HR) function. The findings suggest that HR practitioners played a central role in implementing a series of initiatives, many of which were operational in nature, to improve business performance. In so doing, we argue that practitioners in MNCs in Ireland behaved as archetypical “conformist innovators” during the recent recession, delivering operational HR responses to improve their organization's bottom line.     

Sustainable Supply Chain Design in Social Businesses: Advancing the Theory of Supply Chain

A significant conceptual and practical challenge for companies is how to integrate triple bottom line (TBL) sustainability into their global supply chains. In supply chain research, the classic economic perspective—the business of business is to be profitable—still dominates, followed by coverage of the environmental dimension; the social dimension is underrepresented. Stakeholders, however, are calling for a TBL perspective that simultaneously includes environmental, social, and economic gains. While there have been recent theoretical advances on how to characterize supply chains in terms of their structure, how to connect these insights into supply chain design for TBL sustainability has not been studied. Therefore, the purpose of this research was to move the theory of supply chain forward into the sustainable supply chain management (SSCM) research agenda. Toward that purpose, the paper analyzes the sustainable supply chain design (SSCD) at social businesses, incorporating the physical chain and the information and financial support chains. Four social businesses located in Haiti are used as cases of innovative supply chain structures for TBL sustainability. By analyzing the supply chain structures and boundaries of these social businesses, three supply chain configurations combining physical and support chains are presented.     

Reaching customers at the base of the pyramid—a two‐stage business strategy

Two‐thirds of the world's population make less than $2,000 a year. There is increasing attention paid to how private firms can play a role in improving the quality of life of people at the bottom of the economic pyramid in ways that are mutually beneficial. But despite the promise of mutual benefit, many firms have not been able to serve very poor customers profitably. In this article, we present a two‐stage business strategy that will help firms to serve customers at the base of the pyramid. We suggest that in the first stage, firms need a deep cost management strategy, involving a focus on core customer value, and holistic operations reengineering. In the second stage, we suggest that firms need to consider a deep benefit management strategy, involving value reengineering, partnering for excellence, and creating inclusive channels. We support our ideas with examples of successful and unsuccessful cases of firms that have tried to serve the poor. © 2010 Wiley Periodicals, Inc.     

Corporate Social Responsibility: Its Economic Impact and Link to the Bullwhip Effect

This paper examines the economic impact of implementing Corporate Social Responsibility (CSR) in the supply chain operations of multinational corporations (MNC). Because they have global supply chains in emerging markets, MNCs face certain operational challenges. For example, unethical operations often result in a huge loss to MNCs in the long run, even though their initial cost seems to be low. In this paper, we extend the Bullwhip Effect theory in supply chain management to the ethical operations context, and define and evaluate a special Bullwhip Effect due to Unethical Operations (BEUO). Using economic data from various sources including Ford, Toyota, and GM in the auto industry, we first estimate the indices of BEUO for the three companies and demonstrate the economic necessity for MNCs to incorporate CSR with supply chain operations. We then propose a coherent approach, blending what we term the bottom-up and proactive methods, to achieve such an outcome. The bottom-up approach requires MNCs to switch their focus on stakeholders, shifting from shareholders to consumers and workers, and on decision levels from public relationships to supply chain operations. The proactive approach recommends initializing specific CSR operations to mitigate the negative impact of BEUO. Both theoretical analysis and case studies are conducted to evaluate our developed propositions that MNCs adopting the proposed CSR operations will in the long run achieve better economic performance. Recommended actions for implementation, based on best practices, are also presented.     

A SUPPLY CHAIN‐ORIENTED APPROACH OF WORKING CAPITAL MANAGEMENT

This article analyzes and illustrates the role of payment terms for working capital improvements in supply chains. So far, research has shown how individual industries and powerful companies were able to enhance their cash‐to‐cash cycles at both their supplier's and customer's expense. From a “network perspective,” the exploitation of individual advantages by a single powerful company lowers the overall financial wealth of the supply chain. Therefore, a collaborative working capital management approach is proposed, by which the cash‐to‐cash cycles of companies with the lowest weighted average cost of capital (WACC) should be extended, while companies with higher financing costs are relieved by a shortened cash‐to‐cash cycle. An unequal distribution of power, however, between supply chain members can be the main hindrance for developing a collaborative working capital management solution.     

Supply Chain Transparency as a Consumer or Corporate Tool: The Case of Nudie Jeans Co

Outsourcing has led both to the embedding of questionable sustainability practices in opaque supply chains and to anti-sweatshop challenges demanding more transparent supply chains. Previous research has argued that supply chain transparency can be both a consumer tool empowering consumers to pressure disclosing firms to improve sustainability conditions and a corporate tool for increasing revenues. Based on a study of the transparency project of Swedish company Nudie Jeans, the authors demonstrate that consumers do not leverage transparency but that transparency improves consumer willingness to buy. In doing this, the authors contribute to the literature in two important ways. First, the authors provide one of the first, if not the first, studies of whether consumers in practice leverage increased supply chain transparency, challenging the previous research claim that supply chain transparency is a useful consumer tool. Second, the authors move beyond studies of purchasing intentions and willingness to buy in experimental settings and confirm that supply chain transparency is a useful corporate tool in practice. The authors conclude by discussing the policy implications of companies being able to use transparency to increase sales without subjecting themselves to increased consumer pressure.     

Sustainable Retailing

As consumers seek products that cause minimal environmental harm and bring about positive social impact, and as awareness of supply chain impact grows, retailers must embrace sustainability. Given their unique position in the supply chain between upstream suppliers and downstream consumers, retailers are key to a circular economy in which products at the initial end-of-life stage are returned to the supply chain for continued use. By serving as a connection between suppliers and consumers, retail initiatives can help to reduce, reuse, and recycle. Furthermore, retailers can leverage their unique position in the supply chain to enable and legitimize a focus on social issues across the supply chain. We discuss such actions, the challenges that need to be overcome to have scalable impact, and the mechanisms retailers can utilize to make such progress.     

Assessing the Impact of Price Promotions on Consumer Response to Online Stockouts

The recent growth of e‐commerce technologies has disrupted the traditional retail environment, leading to more consumers shopping online. While the manner in which consumers shop is changing rapidly, our understanding of how changing consumer behaviors affect retail supply chain management is lacking. In particular, our understanding of how consumers react to stockouts in an online shopping environment remains unclear. Making the challenge even more difficult is the fact that price promotions are heavily used to attract consumers in an online retail environment where consumer switching costs are low. This research develops a theoretical framework, based on expectation‐disconfirmation theory, to explain the effect of price promotions on consumer expectations of product availability and their reactions to stockouts in an online retail environment. Surprisingly, our findings suggest that consumers are actually less dissatisfied with a stockout of a price promoted item than a nonprice promoted product and are less likely to switch to another retailer's website. These findings may suggest that price promotions actually create a type of switching cost in the online retail environment, leading to interesting implications for researchers and supply chain managers.     

An emerging market multinational Company's internationalization: From original equipment manufacturer to global brand leader

We examine an emerging market multinational company's (EMNC's) transformation from an original equipment manufacturer (OEM) to an original brand manufacturer (OBM) and global leader. Our longitudinal study of Hisense—China's largest TV company (and the world's third largest) spans three decades and involves detailed interviews with over 50 executives. We study how the company's global value chain network evolved, how it reconfigured its organization, upgraded its capabilities, and enhanced its brand reputation. We develop propositions that may contribute to improved explanations for an EMNC's internationalization sequence, development of competitive advantages, overseas management practices, and brand building.     

Doing business in China II. Investing and managing in china—how to dance with the dragon

This article presents the second part of a comprehensive analysis of the key issues involved in conducting business in China. It provides practical advice and recommendations on how to invest and manage successfully in the world's most complex market (“know‐how”). Topics include investment strategies, market‐entry options, key factors for success in management, as well as functional strategies for optimizing the value chain. Chinese business practices and culture, as well as different opportunities and threats, also are discussed. A key theme is that foreign investors and businessmen entering China and managing on the ground have to devise and execute intelligent strategic approaches that fully leverage new “third growth wave” opportunities in China and create a market niche in an extremely competitive environment. Otherwise, they will produce similarly disappointing results as most foreign investment in the Central Kingdom so far. © 2000 John Wiley & Sons, Inc.     

The Quest for Societal ROI in the Midst of the Perfect Storm: Can SCM Set the Standard for Twenty‐First Century Business Education?

The Academy's dual role is to discover and disseminate knowledge. For most of our tenure, we have focused on research's role in fulfilling this societal mandate. We continue that discussion here by calling for more “actionable” research—something that the supply chain discipline is particularly well positioned to do. We now extend the discussion to pedagogy. As the two epigraphs denote, society is looking for a return on its investment—even a reinvention of the university. Increased costs, poor student achievement, and disruptive technology create an environment perfect for disruption. Yet, if we do our job well, current and foreseeable technologies cannot provide the same kind of transformative education that can be cultivated through community‐engaged experiential learning. The good news: The supply chain discipline is perfectly positioned to set the standard for twenty‐first century business education.     

Globalisation and Industrial Policy: The Case of China

After a quarter of a century of industrial policy, China's objective of nurturing a group of globally competitive state‐owned enterprises appears to have succeeded beyond most expectations. However, China's SOEs are far from catching up with the world's leading firms. Protection through state ownership in a massive, fast‐growing economy has permitted China's SOEs to earn large profits and achieve high market capitalisations, but this is not the same thing as building globally competitive firms. The fact that China's industrial policy has been unsuccessful after a quarter of a century of intense effort demonstrates how difficult it is to construct an industrial policy in the era of capitalist globalisation, which has produced intense global industrial concentration across large parts of the global value chain. Although the detailed content of the next stage of reform of China's large state‐owned enterprises is unclear, China's determination to build a group of globally competitive large companies remains undimmed.     

Augmented reality: Designing immersive experiences that maximize consumer engagement

Innovative marketers can now leverage augmented reality to craft immersive brand experiences, create more interactive advertising, and enable consumers to experience products and spaces in novel ways. Augmented reality (AR) is the practice of displaying digital information over people's real-time view of objects, people, or spaces in the physical world. While AR can play a valuable role in integrated marketing programs, little is known about the practice and how to execute effective AR programs in the marketplace. We address this gap by presenting a framework that describes the active and passive ingredients of augmented reality. We then describe the basic design decisions that marketers need to make when planning an augmented reality campaign. In addition, we explain how understanding and addressing the dynamics between various active and passive AR ingredients can help marketers to optimize their AR campaigns and enhance various types of consumer engagement: user-brand engagement, user-user engagement, and user-bystander engagement. Through our framework and analysis, we develop eight actionable recommendations—described with the acronym ENTANGLE—marketing managers can use to design immersive AR experiences that maximize consumer engagement.     

SUPPLY CHAIN PROCESS INTEGRATION: A THEORETICAL FRAMEWORK

The current study was undertaken to further understanding of supply chain process integration. It is suggested that supply chain integration, the practice of realigning firms' operating structures, should be understood from an internal‐external perspective and a process view. Drawing upon four theories—Strategy‐Structure‐Performance framework, the resource based view of the firm, transaction cost economics, and social network analysis—and combining industry inputs, a theoretical framework of supply chain process integration is developed. It is argued that a firm's strategic priorities are key factors of supply chain process integration. Superior performance is likely to be achieved when necessary supply chain capabilities are developed through supply chain process integration.     

Supply Chain Citizenship: Investigating the Antecedents of Customer Interorganizational Citizenship Behaviors

Research has consistently established the strategic importance of supply chain collaboration. As a result, interfirm behavioral dynamics and relationships have emerged as key topics for both the academic and practitioner communities. This paper explores an interpersonal exchange tactic that is inherent to many collaborative initiatives—interorganizational citizenship behaviors (ICBs). The study specifically investigates why retail customers in business‐to‐business exchange relationships would exhibit ICBs, and explores how they assess and respond to the ICBs of suppliers. Findings of the study suggest that customers generally interpret and value the various types of ICBs differently, resulting in differential effects regarding the supply chain performance and relational implications of the behavior. These results not only inform managerial practice but also provide future research opportunities in the area of ICBs and the broader realm of interpersonal supply chain dynamics.     

Understanding Managers’ Reactions to Blockchain Technologies in the Supply Chain: The Reliable and Unbiased Software Agent

Organizations investing in supply chain information systems struggle to ensure successful adoption and implementation. Projects fail because of technical caveats, inability to meet business needs, and poor management of implementation. Implementation of blockchain technologies across a network of supply chain partners is more complex than internally focused technologies. It is necessary for partner firms to implement, contribute, and share information, and employees to actively use the capabilities of the technology to realize potential. Blockchain technologies can substitute for traditional interfirm intermediaries acting as an unbiased software agent embedded in the supply chain network. Understanding managers’ perceptions of and willingness to use blockchain technologies is crucial for successful implementation. Integrating design theory with classic diffusion processes, we conducted a scenario‐based role‐playing experiment with industry professionals to examine managers’ perceptions of blockchain technologies and willingness to use. We find that trustworthiness with regard to competence and perceived distributive justice is the focal drivers of managers’ willingness to use the technology. Additionally, both risk and interactional justice are not drivers of willingness to use blockchain technology despite significant claims to that effect. We provide implications for how managers can leverage these drivers to influence supply chain partners’ willingness to use the technology.