Comments on "Information Distortion in a Supply Chain: The Bullwhip Effect"
Management Science
Analyzing information-enabled stockout management under vendor-managed inventory
Information Technology and Management
Antecedents and performance outcomes of global competence: An empirical investigation
Journal of Engineering and Technology Management
The Option Value of Returns: Theory and Empirical Evidence
Marketing Science
Information Acquisition and Sharing in a Vertical Relationship
Marketing Science
Expert Systems with Applications: An International Journal
Does RFID improve firms' financial performance? an empirical analysis
Information Technology and Management
Journal of Management Information Systems
Knowledge sharing-A key role in the downstream supply chain
Information and Management
Computers and Industrial Engineering
Journal of Management Information Systems
A vendor managed inventory model under contractual storage agreement
Computers and Operations Research
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Information integration efforts between manufacturers and retailers, in the form of information sharing, synchronized replenishment, and collaborative product design and development, have been cited as major means to improve supply chain performance. This paper develops a conceptual framework that relates information-integration initiatives to manufacturer profitability. The framework allows such initiatives to impact inventory management and revenue-enhancing measures that, in turn, increase manufacturer profit margins, or affect profit margins directly. Through an extensive survey in the food and consumer packaged goods industry, we empirically examine this framework. The analysis reveals that the various integration techniques are differentially associated with manufacturer performance. Collaborative planning on replenishment, in the form of vendor-managed inventory (VMI), is directly and positively related to manufacturer margins, while collaboration on new products and services is positively related to intermediate performance measures. Specifically, this latter form of collaboration allows the manufacturer to charge higher wholesale prices and, interestingly, is associated with lower retailer, and consequently manufacturer, stockouts. In contrast, collaboration on the handling of excess and defective retailer inventory (i.e., reverse logistics) results in higher manufacturer stockout levels, on average. Solely sharing information on either inventory levels or customer needs is associated with higher manufacturer performance measures up to a certain point; sharing this information is prevalent among manufacturers that achieve industry-average profitability relative to those that achieve below industry-average profitability. The paper explains these results in the context of the conceptual framework developed and discusses the managerial implications for effective coordination between supply chain partners.