Title: Assessing benefits of supply chain integration using system dynamics methodology

Authors: Amit Sachan, B.S. Sahay, Ramneesh Mohan

Addresses: Management Development Institute, Mehaurali Road, Gurgaon 122 001, India. ' Institute of Management Technology, Raj Nagar, Ghaziabad 201 001, India. ' Center for Global Supply Chain Management, Institute of Management Technology, Raj Nagar, Ghaziabad 201 001, India

Abstract: The driving force of effective Supply Chain Management (SCM) is integration among the channel members. With this in mind, the objective of this paper was planned. The research work models the Total Supply Chain Cost (TSCC) of grain supply chain and analyses the effectiveness of the various types of integration possible in the grain supply chain. A causal loop methodology has been used to identify dynamic interaction among key variables affecting grain supply chain cost. This was then used to formulate the system dynamics model of TSCC. The model was used to validate nine possible scenarios on the basis of three types of integration, namely cooperative model, contract farming and collaborative supply chain model, and on the basis of their likelihood of occurrence – optimistic, pessimistic and most likely. The paper concludes with a set of managerial implications for increasing supply chain effectiveness.

Keywords: supply chain management; SCM; integration; total supply chain costs; TSCC; system dynamics; grain supply chains; benefits; supply chain integration; cooperation; contract farming; collaboration; modelling; supply chain effectiveness.

DOI: 10.1504/IJSTM.2006.011292

International Journal of Services Technology and Management, 2006 Vol.7 No.5/6, pp.582 - 601

Published online: 13 Nov 2006 *

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