Supply Chain Integration Practices in the U.S. Electronics Industry
Iwan Sudrajat
Abstract
Supply chain management (SCM) has become a pressing issue in many industries. It is particularly important in the electronics industry because of its rapid pace of change and the high level of competition. The degree of integration in SCM today is much greater than it was historically, when supply chains were essentially unmanaged beyond single supplier-customer relationships. It is believed that the competition nowadays is no longer so much between firms but between supply chains. While the importance of supply chain integration is apparent, empirical evidence regarding supply chain integration is lacking. This dissertation explores the strategic and operational levels of supply chain integration (SCI) practices in the U.S. electronics manufacturing industry. The results of a survey conducted among electronics manufacturing firms in the U.S. about these practices are presented. The study identifies the supply chain orientation and sourcing policies as the strategic level of supply chain integration. The operational level of supply chain integration looks at logistics, quality, and design activities in three areas: between the firm and its suppliers, between the firm and its customers, and internally. This study shows that there are differences in the extent to which components of supply chain integration are currently implemented in the U.S. electronics manufacturing industry. The differentiating characteristics for a firm are shown to be its size, annual sales, ownership, its supply chain orientation, the flexibility & innovativeness of its supplier selection criteria, and its long-term commitment with suppliers. The results show that some firms have achieved high degree of supply chain integration with both their suppliers and their customers, while others have achieved only a low degree of integration. Also, the number of firms with high integration towards their customers is far greater than those with high integration towards their suppliers.
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