SUPPLY CHAIN UNCERTAINTY: AN EMPIRICAL STUDY OF INDONESIA’S AGRO-INDUSTRY

Yandra Rahadian Perdana

Abstract


Supply chain management (SCM) is a multi-stakeholder network for managing the flow of raw materials, finished products, information and money. The supply chain’s network refers to the interdependencies of the processes and activities. Taking this into account, stakeholders deal with an environment of volatility, uncertainty, complexity and ambiguity (VUCA). The dynamic nature of the supply chain’s environment implies uncertainty in the upstream and downstream sides. Drawing from the literature, manufacturers need to mitigate any uncertainty in their supply chains, which can consist of supply, demand, and technology uncertainties. However, the previous literature neglected any discussion of supply chain uncertainty in the context of the agro-industry. Hence, to answer this gap, this study aimed to investigate the supply chain’s environmental uncertainty factors in the agro-industry’s sectors. Accordingly, this study obtained 30 respondents from the agro-industry in Indonesia. This study reported that the agro-industry in Indonesia has uncertainties about supply, demand and technology. It is faced with the inability of suppliers to consistently deliver raw materials, in terms of their quantity and quality. Meanwhile, demand uncertainty is caused by the fluctuations in customers’ demands and the industry’s low forecasting accuracy. Moreover, the rapidly changing technology has implications for uncertainty in services and product standards; making it difficult for manufacturers to anticipate the changes. This uncertainty in the supply chain’s environment needs to be controlled by the agro-industry through supply chain integration

Keywords


supply chain; VUCA; demand uncertainty; supply uncertainty; technology uncertainty

Full Text:

PDF

References


Ahmad SAA, Shah NM, Khalilur RM and Zarina TA.2020. Supply chain integration and its impact on supply chain agility and organizational flexibility in manufacturing firms. International Journal of Emerging Markets.

Angkiriwang R, Pujawan IN and Santosa B.2014. Managing uncertainty through supply chain flexibility: reactive vs. proactive approaches. Production & Manufacturing Research. 2(1). 50–70.

Bennett N and Lemoine GJ.2014. What a difference a word makes: Understanding threats to performance in a VUCA world. Business Horizons. 57(3). 311–317.

Bigliardi B, Bottani E and Casella G.2020. Enabling technologies, application areas and impact of industry 4.0: a bibliographic analysis. Procedia Manufacturing. 42. 322–326.

Chang W, Ellinger AE, Kate K and Franke GR.2016. Supply chain integration and fi rm fi nancial performance : A meta- analysis of positional advantage mediation and moderating factors. European Management Journal. 34(3). 282–295.

Chavez R, Yu W, Gimenez C, Fynes B and Wiengarten F.2015. Customer integration and operational performance: The mediating role of information quality. Decision Support Systems. 80. 83–95.

Drees JM and Heugens PPMAR.2013. Synthesizing and extending resource dependence theory. Journal of Management. 39(6). 1666–1698.

Fiksel J.2006. Sustainability and resilience: toward a systems approach. Sustainability: Science, Practice and Policy. 2(2). 14–21.

Flynn BB, Koufteros X and Lu G.2016. On theory in supply chain uncertainty and its implications for supply chain integration. Journal of Supply Chain Management. 52(3). 3–27. Available at: https://search.proquest.com/docview/1807679641?accountid=13771.

Frączkiewicz-Wronka A and Szymaniec K.2012. Resource based view and resource dependence theory in decision making process of public organisation - research fi ndings. Management. 16(2). 16–29.

Hald KS and Mouritsen J.2013. Enterprise resource planning, operations and management: Enabling and constraining ERP and the role of the production and operations manager. International Journal of Operations & Production Management. 33(8). 1075–1104.

Hudnurkar M, Deshpande S, Rathod U and Jakhar SK.2017. Supply Chain Risk Classification Schemes: A Literature Review. Operations and Supply Chain Management: An International Journal. 10(4). 182–199.

Huo B, Ye Y, Zhao X, Wei J and Hua Z.2018. Environmental uncertainty, specific assets, and opportunism in 3PL relationships: A transaction cost economics perspective. International Journal of Production Economics. 203. 154–163.

Kembro J, Selviaridis K and Näslund D.2014. Theoretical perspectives on information sharing in supply chains: a systematic literature review and conceptual framework. Supply Chain Management: An International Journal. Edited by S. Kostas. 19(5/6). 609–625.

Kim KK, Ryoo SY and Lee H.2016. Environmental uncertainty and interorganizational information sharing: Accommodating manufacturer and supplier perspectives. Information Development. 32(5). 1485–1502.

Lezoche M, Hernandez JE, Alemany Díaz M del ME, Panetto H and Kacprzyk J.2020. Agri-food 4.0: A survey of the supply chains and technologies for the future agriculture. Computers in Industry. 117. 103187.

Li M and Xiao Y.2013. RFID-based tracking and tracing information platform of logistics. in IEEE Conference Anthology. 1–4.

Liu G (Jason), Shah R and Schroeder RG.2010. Managing demand and supply uncertainties to achieve mass customization ability. Journal of Manufacturing Technology Management. 21(8). 990–1012.

Michael W.2018. Impacts of supply chain uncertainty and risk on the logistics performance. Asia Pacific Journal of Marketing and Logistics. 30(3). 689–704.

Minkyun K.2016. Assessing the impact of business uncertainty on supply chain integration. The International Journal of Logistics Management. Edited by C. Sangmi. 27(2). 463–485.

Mittal R, Abbasi H and Pareek S.2012. Supply Chain Integration in Vendor Managed Inventory. Journal of Supply Chain Management Systems. 1(2). 56–64.

Oghazi P, Rad FF, Zaefarian G, Beheshti HM and Mortazavi S.2016. Unity is strength: A study of supplier relationship management integration. Journal of Business Research. 69(11). 4804–4810.

Ozkan-Ozen YD, Kazancoglu Y and Kumar Mangla S.2020. Synchronized Barriers for Circular Supply Chains in Industry 3.5/Industry 4.0 Transition for Sustainable Resource Management. Resources, Conservation and Recycling. 161. 104986.

Paulraj A and Chen IJ.2007. Environmental uncertainty and strategic supply management: A resource dependence perspective and performance implications. Journal of Supply Chain Management. 43(3). 29–42.

Perdana YR, Ciptono WS and Kusdhianto S.2019. Broad span of supply chain integration: theory development. International Journal of Retail & Distribution Management. 47(2). 186–201.

Perdana YR, Ciptono WS and Setiawan K.2018. The Relationship Between Internal and External Integration of Supply Chain and Operational Performance. in Proceedings of the International Conference on Industrial Engineering and Operations Management. Paris. 1821–1829.

Pfeffer J and Salancik GR.2003.The External Control of Organizations: A Resource Dependence Perspective. Stanford: Stanford University Press.

Rachbini DJ, Arifin B, Yustika AE, Hartati ES, Listiyanto E, Firdaus AH, Talattov APG and Abdullah M.2011.OUTLOOK INDUSTRI 2012: Strategi Percepatan dan Perluasan Agroindustri. Jakarta.

Ramanathan U.2014. Performance of supply chain collaboration - A simulation study. Expert Systems with Applications. 41(1). 210–220.

Routroy S and Behera A.2017. Agriculture supply chain: A systematic review of literature and implications for future research. Journal of Agribusiness in Developing and Emerging Economies. 7(3). 275–302.

Shao X-F, Liu W, Li Y, Chaudhry HR and Yue X-G.2021. Multistage implementation framework for smart supply chain management under industry 4.0. Technological Forecasting and Social Change. 162. 120354.

Simangunsong E, Hendry LC and Stevenson M.2012. Supply-chain uncertainty: a review and theoretical foundation for future research. International Journal of Production Research. 50(16). 4493–4523.

Sreedevi R and Saranga H.2017. Uncertainty and supply chain risk: The moderating role of supply chain flexibility in risk mitigation. International Journal of Production Economics. 193. 332–342.

Stevens GC and Johnson M.2016. Integrating the Supply Chain … 25 years on. International Journal of Physical Distribution & Logistics Management. 46(1). 19–42.

Su Y and Yang C.2010. Why are enterprise resource planning systems indispensable to supply chain management? European Journal of Operational Research. 203(1). 81–94.

Sullivan GM and Artino Jr AR.2013. Analyzing and interpreting data from likert-type scales. Journal of graduate medical education. 5(4). 541–542.

Sutduean J, Singsa A, Sriyakul T and Jermsittiparsert K.2019. Supply Chain Integration, Enterprise Resource Planning, and Organizational Performance: The Enterprise Resource Planning Implementation Approach. Journal of Computational and Theoretical Nanoscience. 16(7). 2975–2981.

Yan T and Azadegan A.2017. Comparing inter-organizational new product development strategies: Buy or ally; Supply-chain or non-supply-chain partners? International Journal of Production Economics. 183, Part. 21–38.

Yuji S, Kei TY and Hua TK.2020. Managers’ risk perception of supply chain uncertainties. Industrial Management & Data Systems. 120(9). 1617–1634.

Yunus EN and Tadisina SK.2016. Drivers of supply chain integration and the role of organizational culture: Empirical evidence from Indonesia. Business Process Management Journal. 22(1). 89–115.




DOI: https://doi.org/10.21107/agrointek.v15i3.9306

Refbacks

  • There are currently no refbacks.




Copyright (c) 2021 Yandra Rahadian Perdana

Creative Commons License
This work is licensed under a Creative Commons Attribution 4.0 International License.

Indexed by

Crossref logo

Mailing Address:

Agrointek: Jurnal Teknologi Industri Pertanian

Department of Agroindustrial Technology, Faculty of Agriculture, University of Trunojoyo Madura
Raya Telang St. PO BOX 2, Kamal - Bangkalan - Jawa Timur
Phone: (031) 3013234, Email:agrointek@trunojoyo.ac.id

Creative Commons License
This work is licensed under a Creative Commons Attribution 4.0 International License