E-Business and Supply Chain Management

Topics: Supply chain management, Supply chain, Management Pages: 21 (5514 words) Published: October 16, 2010
e-Business and Supply Chain Management: An Overview and Framework1 Forthcoming in Production and Operations Management special issue on e-Business and Supply Chain Management

M. Eric Johnson Center for Digital Strategies Tuck School of Business Administration Dartmouth College Hanover, NH 03755 www.tuck.dartmouth.edu/digitalstrategies m.eric.johnson@dartmouth.edu phone: 603-646-0526; fax: 603-646-1308

Seungjin Whang Global Supply Chain Management Forum Graduate School of Business Stanford University Stanford, CA 94305-4024 http://www.stanford.edu/group/scforum/ whang_jin@gsb.stanford.edu phone: (650)723-4756; fax:(650) 725-0468


The web is having a significant impact on how firms interact with each other and their customers. Past stumbling blocks for supply chain integration such as high transaction costs between partners, poor information availability, and the challenges of managing complex interfaces between functional organizations are all dissolving on the web. In this paper, we examine how the web is changing supply chain management. We present a survey of emerging research on the impact of e-business on supply chain management including descriptive frameworks, analytical models, empirical analysis, and case studies. We classify the work into three major categories: e-Commerce, e-Procurement, and eCollaboration.


An early version of this paper was presented at the Supply Chain Thought Leaders Roundtable held in Como, Italy. Special thanks to the participants who shared their cases and articles with the authors.


Nothing has rocked the young field of supply chain management like the emergence of the Internet. While the management of information flows have always been a key aspect of supply chain management, the rapid growth of web-based information transfer between companies, their suppliers, and their customers has decidedly increased the importance of information management in creating effective supply chains. Indeed, the Internet has emerged as a most cost-effective means of driving supply chain integration. We define e-Business as the marriage between the Internet and supply chain integration. This marriage is transforming many processes within the supply chain from procurement to customer management and product design.

In this paper, we explore how e-Business is changing supply chains and examine the rapidly evolving research in this area. Following the framework of Lee and Whang (2002c), we divide the various forms of e-Business applications into three categories – eCommerce, e-Procurement, and e-Collaboration (Figure 1). e-Commerce helps a network of supply chain partners to identify and respond quickly to changing customer demand captured over the Internet. e-Procurement allows companies to use the Internet for procuring direct or indirect materials, as well as handling value-added services like transportation, warehousing, customs clearing, payment, quality validation, and documentation. e-Collaboration facilitates coordination of various decisions and activities beyond transactions among the supply chain partners, both suppliers and customers, over the Internet. For example, coordination of engineering changes in the bill-of-materials for a product that is manufactured by an outsourced partner.

The remainder of this paper is broken into three sections examining research in these three forms of e-Business. In our survey, we include a wide range of research, from classical model building and empirical studies to cases and frameworks. At the end of each section, we review the papers included in this special issue of POMS, relating them to the earlier work. Given the early stage of research in this area, much of the published




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Figure 1. e-Business forms and their impact on the supply chain.

research is in the form of case studies and descriptive frameworks....
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