An Evaluation Framework for Supply Chains Based on Corporate Culture Compatibility

To date research focused on the role corporate culture plays when planning a supply chain management system (SCMS) has been limited. Although many executives have recognize the importance of corporate culture (e.g., Hollingsworth, 1988), research however, has only begun to review the role corporate culture plays on planning information systems to avoid cultural conflicts (Leidner & Kayworth, 2006). Therefore, without a sound understanding of the corporate culture compatibility that influence organization behaviour it will be difficult to successfully plan SCMS initiatives. The purpose of this research is to develop an initial framework based upon the SCMS planning and culture literature to identify the needs for cultural compatibility that impact planning of SCMSs. The fundamental premise of this research is that the literature supports the view that an organization must establish a corporate culture understanding to achieve an effective performance and competitive advantage inside the organization (Chan, Shaffer, Snape, 2004) and within the boundaries of a supply chain (Mentzer et al., 2001) prior to successfully planning SCMSs. The role of corporate culture can become especially critical at the boundary-spanning level of the organization, where organizations systems interface with other members of the supply chain. Accordingly, when supply chain’s organizations collaborate under cultural compatibility environment, the SCMS is more likely to be executed in a uniform and effective manner (Mentzer et al., 2001). Nevertheless, recent frameworks of SCM planning ignore the role corporate culture plays to achieve an effective collaborative performance. In the next section we give a short review of supply chain planning and management philosophy. This is followed by a theoretical investigation of the problem by reviewing the limitation in the current supply chain models. We then outline the significance of corporate culture compatibility to improve supply chain planning and achieve the ultimate SCM performance. This outline proposes the need for a new framework that is defined in the followed section. Finally, an agent-based simulation model concerning a three-level supply chain is described. This developed model integrates the proposed framework of cultural learning to evaluate the SCM performance. The results are, then discussed and significant outcomes are outlined.