Modelling of critical factors for responsiveness in supply chain

Purpose - In globalized economy, product life cycle is reducing continuously, customers demands are changing fast, and lead time for response is decreasing. In such scenario, ability of firms to quickly respond to changes in their external environment is a primary determinant of firm's performance. This can be only possible when whole of the supply chain (SC) is responsive. For this, firms have to manage internal operations effectively to enable SC, responsive for market requirements. The purpose of this paper is to identify different factors for responsive SC. Design/methodology/approach - Based on literature review, total 17 critical factors for the responsive SC have been identified. Some of these factors are process oriented and some are result oriented. To develop structural relationship among these factors from strategic perspective, interpretive structural modeling (ISM) approach has been applied. Findings - It is observed that top management commitment, strategy development, resource development, use of technology, risk and reward sharing are major drivers for responsive SC. By managing these enablers, organizations can also benefit in terms of inventory management, lead time reduction and agility. Research limitations/implications - ISM has got some limitations. Major limitation is that the relationships developed are subjective and there are chances of biasing. Therefore findings need to be validated with case studies and empirical findings. Practical implications - Top management should strive for effective use of resources and technology to improve SC capabilities to meet market changes. Originality/value - This study develops structural relationships between different factors and it will help organizations in taking initiatives for improving responsiveness.