Today's competition is not so much defined as 'firm versus firm' as it is 'supply chain versus supply chain'. The supply chain of a manufacturer is a network of suppliers, factories, warehouses, distribution channels, and retailers through which raw materials or parts are acquired, transformed, and delivered to customers.
Nowadays, many world class manufacturers are focusing on their core competencies and are increasing their outsourced added value. This outsourcing means that the hub-firm is buying systems and sub-assemblies rather than individual parts to be assembled in house. Therefore we need to regard the competitiveness of supply chain as the integrated combination of the competitiveness of its constituents.
We can also think that the constituent firms of a supply chain may have different roles for improving the competitiveness of total supply chain. It is worth analyzing each firm's effective role for total competitiveness according to several variables such as the characteristics of traded parts and inter-firm relationship features.
We examine eleven supply chains based on three manufacturers in Korean home appliances industry and two in automotive industry. Lack of previous research in this area leads to our exploratory case study
We address the issue of supply chain competitiveness from the manufacturing capability perspective. Incorporating arguments of manufacturing strategy into the supply chain issue, this study (a) examines the patterns of required capabilities across a supply chain, and (b) finds influencing factors on the congruence between the required and possessed capabilities of a member firm in the chain. We also address the differences of inter-firm relationships and capability requirements across the supply chain. It is thought that these differences come from the inter-firm relationship's position in the supply chain. But we want to suggest alternative explanation based on our case study.
As a result, we identify the followings. First of all, we recognize the connection between capability requirements to suppliers and competitive priorities of manufacturer for critical parts. On the contrary, for suppliers of miscellaneous items, delivery and cost are the most desirable capability dimensions. In addition, we explore the factors influencing congruence between requirements from a market or downstream firms and possessed manufacturing capabilities of constituent firms. Mutual cooperativeness, specificity of transaction-related assets, and criticalness of traded parts are found to be of importance in explaining the congruence when the trading parts are critical for market performance of final product. Generic competitiveness of suppliers, however, is a dominant factor for the congruence.
Finally, with the refinement of our results, we propose a supply chain competitiveness model for further empirical research. And we point out that the Fine's industry clockspeed concept has to be introduced for enhancing the content of supply chain analysis. The case of RosettaNet project is presented for illustrating the industry's efforts for incorporating the clockspeed concept to the supply chain management.