Wednesday, November 23, 2011

Topics for Dissertations and Thesis Research Projects in Procurement Management, Supply Chain Management, Inventory Management, and Distribution Management

Keywords applicable to this article: supply chain components, inventory, logistics, supply chain network design, transportation network design, distribution network design, warehousing, depot management, push and pull supply chain, supply chain efficiency and effectiveness, Porter’s value chain, supply chain performance drivers, demand forecasting, aggregation planning, economies of scale, supply chain risk management, global supply chains, IT management in supply chains, E-supply chains, Lean Six Sigma in supply chain, sustainable supply chain.

Supply Chain Management is one such area that will never have dearth of research topics for dissertation and thesis projects. This is because the global business framework is changing very rapidly due to the challenges posed by globalization, which directly affects supply chain design and management by an organization. Environmental issues, rising oil prices, increase of carbon footprints, rising tariffs, rising threats in international waters and air cargo, increasing supply chain risks, high competition, rising customers’ expectations, etc. are significant challenges facing modern supply chain managers that are already under pressure to reduce lead times in every step of supply chain management. Modern supply chain practices need to be highly proactive, horizontally integrated, information driven, network based, and technology enabled. These challenges are rapidly eliminating the old beliefs and practices giving way to new ways of managing the components of supply chain. The core elements of supply chain – procurement management, production management, inventory management, distribution management, and retail management can no longer operate as distinct verticals but need to be integrated horizontally with the help of accurate and timely information management and flow, synchronous activities, effective coordination, decision-making power at lower levels, better economies of scale, elimination of wastes, increased reliability on actual demands (than demand forecasting), organization wide cost reduction targets and excellent service delivery. In this context, I hereby present some of the key areas where the students may like to conduct their research studies:

(A)  Function Integration of Procurement, Production, Inventory, Distribution, and Inventory Management: In modern supply chains, organizations are giving high emphasis on horizontal integration of supply chain components by breaking all the traditional functional barriers that have existed since the concept was born. Modern supply chain agents integrate effectively by sharing timely and accurate information with everyone in very transparent manner. For example, if the supply chain has multiple inventory points, the procurement manager may have access to daily, or even hourly, updates of the inventory levels at all the points. Functional integration is evident even with suppliers and customers. The systems like automatic reordering by an IT enabled system at fixed pre-negotiated prices whenever inventory levels dip below the reorder points, continuous flow of consumption information upstream and shipping information downstream between the endpoints, supplier managed inventory at customer premises, exact and timely flow of actual demand information reducing the need for demand forecasting, etc. are no longer just empirical theories in the dreams o0f academicians. I suggest that students may like to undertake academic research studies on how supply chain integration is carried out by modern companies by conducting on-field surveys and interviews. The studies can be conducted on a particular company or on the entire supply network of a commodity.

(B)  Supply Chain Network Design: The concept of network design is rapidly gaining popularity in supply chain management. In fact, many modern scholars are talking about renaming “Supply Chain Management” to “Supply Network Management”. This is because companies no longer just manage multi-tier suppliers in the form of chains but rather manage a whole network of suppliers for every key purchase. The concept of supply network has evolved as a result of globalization and rapid growth of Internet leading to reduced gaps between suppliers and buyers of the world. The network design concepts are applied in the areas of transportation, distribution, and retailing. The actual design depends upon the supply chain strategy, scope, cost, risks and uncertainties, and demand information. The key design considerations in network design are – nodes and links, direct shipments, milk runs, in-transit mergers, domestic transit routes, international transit routes, last mile transit routes, locations of depots, warehouses, distributor storage, retail outlets, and risks related to each node and link. The key factors that need to be taken into account are – strategic factors, technological factors, macroeconomic factors, political factors, infrastructure factors, competitive factors, socioeconomic factors, localization, response time expectations (of customers), facility costs, and logistics costs. In my view, network design in supply chain management has ample opportunities for conducting academic studies for students and professionals. The studies will be based more in interviews because the students will need to learn from specialist network designers in supply chains.

(C)  Pull Supply Chain Strategy: It is almost official now that the world is drifting towards pull supply chain strategy. Now the business houses are focusing more on gaining exact demand information rather than depending upon demand forecasts. The companies have already faced significant problems due to high inventory costs and wastage of unconsumed products in light of forecast inaccuracy. However, it may be noted that pull supply chain strategy is not as straightforward as push strategy. The strategists no longer have the leverage to just depend upon demand models, viewed as magic wands in the past, but are required to proactively collect actual demand information. This change requires effective integration with suppliers and buyers, and large scale information sharing through sophisticated information systems. The companies need to think much beyond Japanese Kanbans or lean strategies (even they have backfired, really!!). The students may like to study on what companies are doing or can do to shift to pull strategy as much as possible.

(D)  Supply Chain Efficiency and Effectiveness: Every organization spends significant amounts on supply chain management. Effective financial planning, cost control, timely service, high quality of service, and return on investments in supply chain are key drivers of efficiency and effectiveness. A number of metrics are taken as inputs to the strategic supply chain planning to ensure that optimum efficiency and effectiveness can be achieved. This research area may require on-site quantitative data collection, and quantitative analytics using SPSS and such other statistical analysis tools to arrive at the results. The students may have to discover independent and dependent variables and their correlations using descriptive and inferential statistical methods. Another research area in this field may be the Lean Six Sigma, which is a mix of Lean Supply Chain methods and Six Sigma tools. It is primarily targeted at eliminating wastes and improving supply chain efficiency. This is, however, a new research area and hence students may face shortage of references.

(E)  Supply Chain Integration: This research area may be taken as an extension of functional integration (point A). The student may like to study how companies are integrating with key suppliers and customers to improve flow of information about demands (upstream) and supply (downstream) and to reduce lead times. The modern concepts like direct delivery (from suppliers to customers), vendor managed inventories (VMI), cross-docking, optimal procurement policy, optimal manufacturing strategy, inventory minimization, input and output control, aggregation planning, process integration, real time monitoring and control, optimization of operations, supply chain object library, enterprise supply chain integration modeling, 3PL and 4PL, quick response (QR), efficient consumer response (ECR), continuous replenishment planning (CRP), and collaborative planning, forecasting, and replenishment (CPFR) are included in the scope of supply chain integration. The students may chose a particular area and conduct on-site interviews of supply chain experts about how these practices are incorporated by organizations in their supply chain integration strategies. The studies may be mostly qualitative.

(F)  Supply Chain Performance Drivers: The key performance drivers of supply chain management are – facility effectiveness, inventory effectiveness, transportation effectiveness, information effectiveness, sourcing effectiveness, pricing effectiveness, delivery effectiveness, quality effectiveness and service effectiveness. These drivers comprise multiple performance indicators that may be measured quantitatively by collecting data and applying them in SPSS. The studies in this area may primarily be quantitative with descriptive statistical analysis. In modern world, sustainable supply chain management to support the triple bottom-line (equity, environment, and economy)is also included in the scope of supply chain performance drivers. This is, however, a new research area and hence students may face shortage of references.

(G) Demand Forecasting: The concept of demand forecasting is diminishing as more and more companies are now focusing on getting accurate and timely demand information rather than depending upon forecasts. This is carried out by effective integration of information from all the nodes of the supply chain and disseminating upstream as well as downstream. However, there are many industries that will continue to depend upon push strategy and demand forecasting. The students may like to study about the drawbacks of traditional forecasting methods (like time series forecasting, moving averages, trend analysis, etc.) and the ways of improving forecasting accuracy. Many companies want to incorporate real time data in their forecasting models and focus on forecasting for shorter periods. This requires lots of additional knowledge over and above the traditional ways of working upon past demand data. The modern forecasting models may be based on accurate knowledge of customer segments, major factors that influence forecasting accuracy, information integration, bullwhip effect, scenario planning, simulations, external factors, risks, and causal (Fishbone or Ishikawa) analysis. Most of the studies may be qualitative or triangulated.

(H)  Aggregation Planning: Aggregation is carried out by a company to determine the levels of pricing, capacity, production, outsourcing, inventory, etc. during a specified period. Aggregation planning helps in consolidation of the internal and external stock keeping units (SKUs) within the decision and strategic framework for reducing costs, meeting demands and maximising profits. It may be viewed as the next step of either demand forecasting (push strategy) or demand information accumulation (pull strategy) for carrying out estimations of the inventory level, internal capacity levels, outsourced capacity levels, workforce levels, and production levels required in a specified time period. The students may like to conduct qualitative case studies to research about modern practices of aggregation planning in various industrial and retail sectors.

(I)   Global Supply Chains: In the modern world, suppliers in a country are facing direct competition from international suppliers as if the latter are operating within the country. This has happened due to modernization of information management and dissemination, supply routes, payment channels, electronic contracts, leading to improved reliability and reduced lead times of international suppliers. The students may like to undertake study on monitoring and management of global supply chains/networking by professionals working in MNCs.

(J)   E-Supply Chains: E-Supply Chains are linked with E-Businesses that use Internet as their medium for accepting orders and payments, and then using the physical channels to deliver the products. E-supply chain is an excellent example of pull strategy and short term demand forecasting. Information flow across the supply chain is instantaneous because both end points and the intermediate agents work through a single Internet enabled portal. E-Bay is viewed as one of the founders of this concept at global scales with built-in electronic contract signing and management, electronic payment processing, and electronic delivery processing. The students can find various case studies on E-Supply chains, although the empirical theories are still evolving. The research studies would be quite challenging, modern and unique, but poorly supported by literatures as the field is still evolving.

(K)  Supply Chain Risk Management: Supply chain risk management is gaining immense popularity due to globalization of competitive landscapes, and growing threats and uncertainty. Risk management in supply chains is directly linked with supply chain agility and hence it needs to be done in very organized and objective manner, incorporating quantitative models. Supply chain risk management is a novel dissertation/thesis research area based on the known and teething current problems in logistics/supply chain management. The root of the problems lie somewhere in the uncertainties in upstream as well as downstream flows of materials, funds, and information. For example, if there are errors in calculating economic order quantities (EOQ) and reorder levels, the ordering process may not synchronize well with the lead-times. On the other hand, the lead-times are uncertain due to various delay factors and fluctuation in costs if a transportation mode is changed. Holding inventory is the safest haven for logistics managers, but I am sure the top management of any organisation will never like it. The primary purpose of this subject matter is to keep lowest possible inventories while ensuring consistent, timely, and accurate supplies to the end users. The challenges are in the following areas:

(a) Lack of integration/synchronization/co-ordination
(b) Lack of appropriate quantitative models
(c) Lack of integrated information availability, even if the quantitative models are in place (i.e., the company has invested in SCM software tools)

The solution is somewhere in implementing an appropriate supply chain risk communication system. You will appreciate, supply chain risk is also a floating entity just like materials, funds and information. If the entire chain is integrated through an extranet portal system, and updates of every consignment code are uploaded periodically by all agents connected with the portal, there can be proactive risks generated by the software for the logistics managers such that they can take operating level, tactical level, and even strategic level mitigation actions. Although such a system is still in its conceptual stage, academic researchers can contribute to its overall conceptualisation and design. It may be integrated as a layer above the traditional SCM software. An agent sensing any variations in delay or cost may log a threat and its probability against a consignment code. The probability and impact levels may be fed to the logistics agents that can calculate the impact (like stock-out by a date). The outcome will be a risk value which will be escalated to an appropriate authority level, and appropriate mitigation action will be suggested. For example, if there is a temporary unrest in a country, the current consignments can be airlifted and subsequent orders placed to an alternate supplier.

I suggest that you may like to study the source of supply chain risks in a selected sample of transactions in your field and design a novel SCRC (supply chain risk communication) framework employing the ISO 31000, M-o-R, COSO, COBIT v5, and similar Enterprise Risk Management (ERM) frameworks for enterprise wide estimation and communication of risks. The key risks that you can target in your SCRM framework can be categorized as: disruptions, delays, forecast errors, procurement risks, supplier risks, lead time risks, receivable risks, capacity risks and inventory risks. You may collect a list of known supply chain threats in your area of interest, categorize them under one of these risk categories, judge the impact on business, judge the vulnerabilities, and arrive at the risk values using the quantitative formulations of the chosen model. Once the risk values are calculated, you may propose mitigation strategies pertaining to redundant suppliers, better supplier relationships (i.e., eliminating procurement hops), alternate routes (i.e., alternate loading/unloading ports and links), add capacity and inventory, shift warehouses, change distribution model (direct shipments, cyclic shipments, milk run shipments, in-transit merging, adding retail stores, cross-dock distribution, etc.), change transportation media, etc. You may validate the proposed SCRC framework by interviewing supply chain experts in your country. Hence, the problem statement of your thesis will be related to the known threats and vulnerabilities in supply chain management in the selected transactions (chosen by you), and the solution will be a novel Supply Chain risk communication framework to manage the risks resulting from these threats and vulnerabilities. It will be a quantitative research with descriptive and inferential statistical analysis.
The outcome of this model will be on-the-fly alerts on risk levels and their mitigation as soon as a risk is logged (you will need to define mitigation actions against various risk levels, and the suggested authorities to make decisions). You may like to validate your model by surveying experts in your network. A short, and to-the-point structured questionnaire may be used such that you can present validity and reliability analysis using SPSS.

(L)  Information Technology in Supply Chain Management: A number of information technology platforms are popular in supply chain management. Some of the key IT tools in supply chain management are IBM Supply Chain Simulator, Rhythm (by i2 Technologies), Advanced Planner and Optimizer by SAP, Manugistics, Matrix One, Oracle Supply Chain Management, etc. These tools possess various functionalities – like, enterprise planning, demand planning, production scheduling, distribution planning, procurement and replenishment planning, facilities location planning, replenishment planning, manufacturing planning, logistics strategy formulation, stocking levels planning, lead times planning, process costing, customer service planning, procurement, supply and transportation scheduling, global logistics management, constraint-Based master planning, demand management, material planning, network Design and optimization, supply chain analytics, transportation management, Vendor Managed Inventory (VMI) planning, continuous replenishment planning (CRP), and many more. The students may like to study about various IT systems and software tools for carrying out such activities in supply chain management. The studies may be primarily qualitative or triangulated.

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