At the Forefront of Innovative Supply Chain Management

The past two years have shown us not only how disruptive a pandemic can be, but how interconnected the global economy currently is in terms of supply chain logistics. Recent proponents of lean supply management and lean manufacturing have recently begun reassessing their strategy due to the sudden spikes and drops in consumer demand. Researchers at the Schulich School of Business are exploring the myriad of issues that come with innovation and product differentiation, while also studying the different interconnected forces that continue to influence both local and global supply chains.

Over the past two years, the COVID-19 pandemic has highlighted existing challenges related to the flow of goods and services. Schulich professors have shared valuable research regarding the impacts of supply chain optics, and Schulich’s newly launched George Weston Ltd. Centre has remained forwardthinking about what is to come.

M. Johnny Rungtusanatham, the Canada Research Chair in Supply Chain Management and Professor of Operations Management and Information Systems, continues to author many leading research papers during the pandemic about a range of emerging supply chain issues. In one paper, Rungtusanatham found that buyers have a strong preference for consignment-based inventory management approaches, thereby decoupling inventory ownership and inventory placement responsibilities. Companies can only have so many items on the shelves in their stores; therefore, when consumer demand suddenly increases, it is difficult to meet that demand.

“Shortages experienced are not just due to sudden demand spikes, but also because of aversion to stockpiling,” says Rungtusanatham. “Not stockpiling is actually sage management practice, especially for goods with low supply certainty.”

“Shortages experienced are not just due to sudden demand spikes, but also because of aversion to stockpiling.

Not stockpiling is actually sage management practice, especially for goods with low supply certainty.”

M. JOHNNY RUNGTUSANATHAM

Canada Research Chair in Supply Chain Management; Professor of Operations Management and Information Systems

Rungtusanatham has been recognized for co-authoring one of the top papers in the 50-year history of the Decision Sciences Journal (DSJ)

“The severity of supply chain disruptions: Design characteristics and mitigation capabilities”

ranks as the journal’s #10 most cited paper.

Supply chain disruption risk can also impact the flow of goods. Manufacturers engaging in product innovations should invest both in strengthening their network position with suppliers and in their capability to access, integrate, and utilize external knowledge.

“Supply chain disruptions are unavoidable and often beyond the control of any one company,” says Rungtusanatham. “But our research shows one of the dark sides of product innovation is that it can create higher product variety and greater supplier dependence.”

Retail inventory shrinkage is another issue that Rungtusanatham has studied. It arises primarily from theft or administrative error. The former includes employee thefts and shoplifting and constitutes the larger portion. To combat this phenomenon, retailers have invested in technologies to monitor (e.g., security cameras), detect thefts (e.g., sensors at entrances), and deter thefts (e.g., locked cabinets), as well as through visible security personnel. The Walmart greeter, for example, is there not only to welcome you but also to demotivate shoplifters.

According to another research paper Rungtusanatham co-authored, business associations and other institutional intermediaries can play an important role in helping minority businesses succeed by providing training and access to large corporations.

“Research shows that minority businesses have a lower rate of success than non-minority-owned businesses because they face higher barriers to business growth,” says Rungtusanatham. “These barriers include difficulty accessing skilled labour, acquiring financing, and entering mainstream markets.” Rungtusanatham has also been recognized for co-authoring one of the top papers in the 50-year history of the Decision Sciences Journal (DSJ). “The severity of supply chain disruptions: Design characteristics and mitigation capabilities” ranks as the journal’s #10 most cited paper.

“It is gratifying to know that our research is so relevant today, especially with supply disruptions triggered by COVID-19. I have shared the managerial advice from this research with supply chain managers and leaders through the School’s association with Supply Chain Canada,” says Rungtusanatham.

Isik Bicer, an Assistant Professor of Operations Management and Information Systems at Schulich, has also co-authored high-profile research papers that address supply chain concerns.

One paper identified ways that companies can improve profits, customer responsiveness and cost efficiency with their product proliferation strategy. One of the difficulties of product category management is the sharp increase in operational costs when product variety is expanded. To alleviate the negative impact of operational costs associated with category management, manufacturers often delay the differentiation, so that the order quantities of the final products are determined only after accurate demand forecasts are available. Although delaying the differentiation is very effective in improving profitability, it has some limits and could occasionally hurt profits.

“The dark side of the delayed differentiation strategy is that this strategy may cause a loss of profit if its implementation requires redesigning the operations by expediting high-cost activities,” says Bicer. The implications of this research for the retail industry were presented at the annual meeting of the Consortium of Operational Excellence in Retailing (COER), jointly organized by Harvard Business School and the Wharton School.

Bicer also researched how companies have the potential to reduce much more environmental waste on the production side of the product life cycle than on the consumption side — the opposite of most current mainstream thinking on product sustainability.

“Usually, policymakers aim to develop sustainability policies to increase the product lifetime once customers start to use the products,” says Bicer. “However, the potential to reduce environmental waste at the production side is much bigger than the consumption side.”

“Usually, policymakers aim to develop sustainability policies to increase the product lifetime once customers start to use the products. However, the potential to reduce environmental waste at the production side is much bigger than the consumption side.”

ISIK BICER

Assistant Professor of Operations Management and Information Systems

THE GEORGE WESTON LTD CENTRE FOR SUSTAINABLE SUPPLY CHAINS

Made possible by significant support from George Weston Ltd, the George Weston Ltd Centre for Sustainable Supply Chains was launched in May 2021.

“Supply chains are the heart of Canada’s economy and provide the food, medication, and other items Canadians need by connecting communities from coast to coast to coast,” says Galen Weston, Chairman and CEO of George Weston Ltd. “We are delighted to partner with the Schulich School of Business to deepen our country’s expertise and develop sustainable supply chains that will contribute to a stronger, more resilient Canada.”

Building on Schulich’s unique Master of Supply Chain Management program, leading-edge research and George Weston Ltd’s world-class expertise in sustainable supply chains, the Centre aims to become a leading global hub. “Every organization should ask: do we have the capability and talent to lead positive change in our supply chain relationships with customers and suppliers that also includes other salient stakeholders such as society and the environment,” says Dr. David Johnston, Master of Supply Chain Management (MSCM) Program Director and Research Chair, George Weston Ltd Centre for Sustainable Supply Chains. “The Centre is here to help with the answers.”

The goal of the Centre is to help organizations design resilient supply chains that balance the long-term needs of people, planet, and profit. It brings together diverse stakeholders to explore major challenges such as climate change, digital transformation, supply disruptions, and the need for greater social inclusion. The Centre shares supply chain best practices and is committed to developing the next generation of responsible industry leaders. The Centre recently announced the appointment of 15 Faculty Associates. Faculty Associates play an integral role in contributing to the Centre’s research, education, and outreach initiatives while pursuing their own unique approaches to topics at the intersection of sustainability and supply chain management. This cohort comes from diverse backgrounds, including strategy, statistics, business analytics, accounting, and sustainability, and possesses a wide variety of global work and consulting experiences.

The Centre established new scholarship support for graduate students with the launch of the George Weston Ltd Sustainable Supply Chain Leader Scholarship. It is offered annually to two incoming domestic students enrolled in the Master of Supply Chain Management (MSCM) program based on high academic standing, work experience related to Supply Chain Management and strong evidence of leadership ability.

“Every organization should ask: do we have the capability and talent to lead positive change in our supply chain relationships with customers and suppliers that also includes other salient stakeholders such as society and the environment.”

DR. DAVID JOHNSTON

Master of Supply Chain Management (MSCM) Program Director; Research Chair, George Weston Ltd Centre for Sustainable Supply Chains

The Centre will co-sponsor five industry conferences in 2022 in collaboration with its educational partner Supply Chain Canada. The Centre will be aiding in the organization of the events and will be participating in various speaking and presentation opportunities to increase brand awareness. As part of the sponsorship agreement for the events, the Centre has arranged for complimentary passes to this event series for students and alumni of Schulich’s Master of Supply Chain Management program to aid in their career networking and professional development.

The Centre hosted the 2nd annual Supply Chain Research Forum — “Supply Chain Problems: Practical Insights from Emerging Research,” in 2022. This Research Forum was for invited Canada-based academic researchers to present emerging findings relevant to solving business challenges firms encounter in designing, optimizing, and sustaining their supply chains. The Research Forum brought together approximately 75 to 100 guests including researchers, industry practitioners, current students, and alumni. Schulich professors Isik Bicer and M. Johnny Rungtusanatham participated in the forum on behalf of the Centre.

The Centre also sponsored Canada’s Logistics Conference 2022 in partnership with educational partner, CITT (Canadian Institute of Traffic and Transportation). The annual conference was held in-person in Montreal and brought together industry practitioners to discuss emerging issues surrounding supply chain management. This initiative serves to build further brand exposure for the Centre and presents an opportunity to further market the MSCM program among CITT’s membership of early and mid-career professionals. In addition, the Centre presented a thought leadership session related to supply chain sustainability as part of the conference program.

As the world optimistically moves towards the end of the pandemic, our professors, researchers, and the George Weston Ltd Centre will ensure that Schulich will continue to remain at the forefront of supply chain research and innovation. *

The Centre hosted the 2nd annual Supply Chain Research Forum — “Supply Chain Problems: Practical Insights from Emerging Research,” in 2022.

The Research Forum brought together approximately 75 to 100 guests including: researchers, industry practitioners, current students, and alumni.

The Centre sponsored Canada’s Logistics Conference 2022 in partnership with educational partner, CITT (Canadian Institute of Traffic

and Transportation).

The annual conference was held in-person in Montreal and brought together industry practitioners to discuss emerging issues surrounding supply chain management.