Supply Chain Technology Adoption in Malaysian Automobile Industry

NOTE: One of my research projects in the past involved Malaysian auto industry. I thought this area would present an interesting example for a supply chain management topic. I found the below scholarly article to be a relevant example for this subject.

• What is the problem, opportunity, or challenge addressed in the article?

The article is written with an objective to identify the relevance of technology adoption factors and to explain how it can influence suppliers of automotive manufacturers to adopt the supply chain Technology (SCT).

The article analyzed several crucial issues of Malaysian Supply Chain Industry.

Malaysian automobile industry has a significant impact on its economy. The industry is facing a lot of challenges due to globalization, liberalization, and increasing competitions. Malaysian manufacturers are trying to shorten production time, increase customer service levels, provide higher level of conformance and quality, and offer more variety in product lines. The adaptation of SCT is necessary to overcome such issues. However, implementation of Supply Chain Technology is an issue for various organizations. For example, companies that adopt SCT should use this process on regular basis but fail to do so. There are three variables effect the successful adoption of SCT: the organizational structure of a company, organizational size, and supply chain member pressure. These variables were chosen because there is an ongoing argument among them and needs to be further studied.

. There is a significant ambiguous relationship between decentralized organizational structure & SCT adoption. In fact, the authors site several studies with contradictory results. Several of these studies showed that decentralized structures have better chance for adopting innovative technology, while others argued that centralized systems facilitates faster and efficient adoption because senior managers can adopt technology even if there is any resistance from lower management.

2. There is significant relationship between supply chain member pressure & SCT adoption.

Authors categorize supply chain member pressure as being one of the inter-organizational factors such as commitment and cooperation of all involved members. These participants can demonstrate complex economic & business relationships between themselves that result in a number of social, political, and economic factors. These factors, in turn may influence the adoption of inter-organization system. The implementation of SCT positively affects the narrow focus of managers and the conflict between logistic providers, suppliers, and customers. Gradually the differences are eliminated and alliances are formed.

3. Organizational size. Few