Page 1 of 26 ANZAM 2013
15. Technology, Innovation and Supply Chain Management Competitive Sessions Demand-supply Chain management for the Chinese fast fashion apparel industry
Abstract
This paper explores the applicability of the demand-supply chain management (DSCM) approach to help improve the supply chain performance of the Chinese fast fashion industry. Based on a comprehensive desktop research, the paper provides a thorough literature review on the paradigm evolvement from demand chain management (DCM) to DSCM and investigates the current supply chain approaches used by the apparel industry in China. The paper attempts to develop a theoretical DSCM framework that incorporates the various underlying drivers and obstacles of DSCM application. The proposed DSCM framework extends the conventional one-size-fits-all solution by advocating a dynamic outside-in thinking that integrates marketing value stream with multiple supply chain network solutions under an aligned organizational culture and leadership style.
Keywords
Supply chain Management (SCM); Demand chain management (DCM), Demand-supply chain
management (DSCM), Responsiveness, Efficiency and Innovativeness
1. INTRODUCTION
Fashion textile (FT) industry has raised the concern in the study of supply chain management
(SCM) for many years. There are many studies targeting the dynamic characteristics of it with many
different kinds of SC solutions (Bruce, Daly, & Towers, 2004; Castelli & Brun, 2010; Christopher,
Lowson, & Peck, 2004). It could be traced from the early traditional one-size-fit-all solutions of lean,
agile or leagile strategy to recently overarching approach that aligning market management with supply
capabilities. The contemporary study presents the exploratory idea of integrating all these strategic
solutions and packing them into flexible combinations for segmented value streams under demand-driven
supply chain (DSC) paradigm (Jüttner, Christopher, & Baker, 2007; Masson, Iosif, MacKerron, & Fernie,
2007). With the growing complexity of current global context, the success of a FT company is largely
determined by how the organization design its network package to achieve the optimal balance of SC
responsiveness and efficiency (Christopher et al., 2004). Retailers that can successfully manage the
complex supply network to achieve supply chain speed and flexibility will maximize profits when they do ANZAM 2013 Page 2 of 26
15. Technology, Innovation and Supply Chain Management Competitive Sessions meet market needs, while at the same time minimizing the penalties associated with missing the market
(Masson et al., 2007).
Chinese market as one of the most influential market in the global FT trade (Candace, Ngai, &
Moon, 2011), undergoes dramatic challenges for recent years. From macro-environment perspective,
since the 2010 labor strike triggered huge labor-cost raising, Chinese economy is gradually losing the
advantage of world factory position (CN, 2011, 2012). The model of OEM and mass production is
confronted with phasing out (Chuang, 2008). From industrial development perspective, in line with many
fashion trends take-over, large invasion of international fast fashion retailers put a fierce competition in
the local market after 2010 with many famous brand launches, such as Gap, Zara, H&M, Uniqlo, C&A
(Li & Fung, 2011). Furthermore, consumers who are largely exposed to these fickle changes tend to shop
with more fashion consciousness and savvy buying behaviors (Dickson, Lennon, Montalto, Shen, &
Zhang, 2004; Flaven, 2013; Parker, Hermans, & Schaefer, 2004; Zhang, Li, Gong, & Wu, 2002). Figure 1
shows the various issues faced by the local fast fashion industry categorized into three general aspects.
In this context, these challenges add more supply chain complexities for the local FT industry.
Compared with global fashion brands, domestic brand retailers have less marketing experience result
from years of industrial focus on labor-intensive manufacturing(Chan, 2011). Some of them try to jump
on the ‘fast’ fashion bandwagon as a way-out with imitating classic successful model which ends up with model dislocation and fatal lost (International Trade Centre, 2011; Lu, 2011). Which way should Chinese
FT industry go in this critical transitional trend? A more dynamic solution tailored for local FT environment would be urgently needed.
Though there are many SCM studies focusing on the research of global FT industry, limited research has been done upon the Chinese FT industry. According to the literature review, it lacks of systematic studies in this field from the overarching perspective which could not only focus either on supply capability strengthening or marketing behavior analysis but integrate both from macro- institution and organization settings. Issues like new economy transition, specialized institutional environment, diverse customer segmentations, and transforming consumer psychographics, all add complexity for Page 3 of 26 ANZAM 2013
15. Technology, Innovation and Supply Chain Management Competitive Sessions supply chain operation in local FT companies. It could be preliminary seen, A more dynamic outside-in
solution, which configures multiple supply chain networks based on separated value streams, would be
needed for the local FT industry.
In this study, demand-supply chain management (DSCM) is proposed as an overarching
collaborative solution for the current Chinese fast fashion industry. The term and concept was introduced
by Hilletofth (2011, p. 187) as “… the management of a supply chain network that links customers and
suppliers together through market segmentation, strategic alignment, and differentiation of supply
solutions with the objectives to improve efficiency through value creation and waste reduction and
enhance responsiveness by meeting diverse customer needs.” DSCM requires not only integration of
marketing strength and supply chain capabilities at the demand chain management level but also requires
the alignment of organizational culture and leadership style with the external market (Hilletofth, Ericsson,
& Christopher, 2009; Hilletofth & Hilmola, 2008; Hoover Jr, Eloranta, Holmström, & Huttunen, 2002;
Jacobs, 2006; Lau, 2012).
The purpose of this study is to explore the possibility of applying the DSCM approach to help
improve the demand-supply chain performance of the Chinese fast fashion apparel industry. The research
question is as follows:
How can Chinese FT supply chain network and operation be restructured and aligned with market
demand under DSCM approach for performance improvement?
This study reviews current literature research on DCM and DSCM across a broad spectrum and then
highlights existing fast fashion demand and supply network studies conducted in the context of China. A
framework specifically tailored for the Chinese fast fashion industry is proposed.
The paper is structured as follows: First, a thorough literature review is given on the DSCM definition,
paradigm evolution and the benefits that bring to the current supply chain network and fast fashion
industry. Based on historical literature and case studies review, the necessities and challenges when
DSCM is implemented in the real industry will also be elaborated. Then, a theoretical DSCM framework
based on alignment theory (Chorn, 1991) for Chinese fast fashion industry is proposed and presented. ANZAM 2013 Page 4 of 26
15. Technology, Innovation and Supply Chain Management Competitive Sessions After that, the methodology of the study, which is primarily a desktop research with secondary data, is
discussed. Finally, limitations of the study are discussed and directions of future research are also
suggested.
2. LITERATURE REVIEW
2.1 Evolution of Demand Supply Chain Management
DSCM is a concept or approach that merged from Supply Chain Management (SCM) and demand
chain management (DCM). The Conventional SCM practices began in 1980s optimize internal production
efficiency with supply-focused process comprising inbound logistics, operations and outbound logistics
(Oliver & Webber, 1982; Priem & Swink, 2012). It aims at cutting cost and refining the intra-business processes (Esper, Ellinger, Stank, Flint, & Moon, 2010).
SCM practices gradually became demand-drive due to the emphasis on consumers/customers and
the change in the way products are distributed and manufactured ((Langley, Gibson, & Novack, 2008)).
The change brought about the need to manage supply chain from a demand perspective that considers the
end-users of a company as the departure point and not its final destination (Wieland & Wallenburg,
2011). Porter (1985) first put forward the concept of disaggregation of two paradigms. In this regards, the
whole value chain is separated into supply activities and demand marketing service. According to Porter
(1985), Marketing, sales and service on the end half of the value-chain, and collectively driving and
sustaining demand, are the three main elements of the demand chain (Figure 2).
Christopher (2005, p. 5) also argues against the limitations of the uni-dimensional, cost-focused
supply chain and suggests the following:
“Supply chain management should be termed demand chain management to reflect the fact that the
chain should be driven by the market, not by suppliers. Equally the ‘chain’ should be replaced by
‘network’ since there will normally be multiple suppliers and, indeed, suppliers to suppliers as well as
multiple customers and customers’ customers to be included in the total system” Page 5 of 26 ANZAM 2013
15. Technology, Innovation and Supply Chain Management Competitive Sessions DCM preceded the SCM concept and evolved two stages from half-realization awareness stage to
real completion stage in the market place (see Table 1). The first stage is the so-called market-driven
supply chain management or demand-driven supply chain (DDSC) which started to concern demand
fulfillment with more agile supply chain strategy due to the bullwhip effect, inventory excesses or
shortage (Schelmetic, 2013). However, the focus is still on the question of “what customers want” instead
of “why and how” with demand treated as an exogenous condition (Schelmetic, 2013). For example,
Holmstrom et al. (2001, p. 24) compare the supply chain with customer’ demand chain with the linkage of
both for demand-supply chain proposition and conclude the following:
“Demand and supply management are linked in two places- the order penetration point and value-
offering point”
In the second stage, the demand chain is considered as an entity in its own right that involves the
coordination of marketing role with supply chain processes or capabilities. It is a broader scope
connecting marketing factors such as customer behaviour study, marketing planning, branding with
actionable strategies and plans for the whole groups of firms in the network (Langabeer & Rose, 2001).
Under this notion, the essence of DCM is the synergy between marketing management and SCM with
tight demand creation and fulfillment coordination (Hilletofth, 2007; Jüttner et al., 2007; Rainbird, 2004;
Walters, 2006). The objectives of DCM are to attract and retain desirable customers and improve its
product positioning (effectiveness) in profitable markets (efficiency). To achieve this, it may involve
managing unprecedented amount of complexity in a volatile marketplace, while coping with long
distances, trimmed budgets, and perhaps reduced manpower (Hugos, 2006). The growing need for DCM
reinforces the importance of processes in demand and supply network and also serve as the basis of
DSCM approaches (Hammer, 2003; Trinca, 2003).
2.2 Studies on DSCM
The focus from DCM to DSCM highlighted the evolving nature of supply chains that involve
multi-disciplines and broader business scopes. As the supply chain requirements change over time, the ANZAM 2013 Page 6 of 26
15. Technology, Innovation and Supply Chain Management Competitive Sessions definitions of DSCM have also been updated to reflect the changes that now encompass process-driven
coordination among demand and supply chain network (see Table 2). The literature review reveals that
recent studies have taken a holistic approach to understanding DSCM and take into consideration or
macro and micro business processes. Since marketing function is identified as a key factor in DCM,
researchers have taken a step further advocating DSCM be a more practical-focused analysis
encompassing all cross-disciplinary processes without strict functional organization boundaries (Jüttner et
al., 2007; Rainbird, 2004; Van Goor, 2007). Hiletofth (2011, p. 187) defines DSCM as “an approach to gain a superior competitive advantage by balancing cost efficiency, responsive effectiveness,
differentiation and innovativeness process across functional organizational and inter-organizational
boundaries ”. The study embraces the overarching proposition of DSCM that incorporates organizational
capabilities within the value proposition from a management perspective.
Recent study by Baghai, Coley, and White (2000) suggests the organizational capabilities that
embedded in a company’s people, processes and institutional knowledge are basic value catalyst to
enhance the fusion between supply and demand drivers. Lau (2012) suggests of DSCM as a new field of
modern study relating to the holistic demand supply chain collaboration not only from combination of
marketing strength and supply chain capabilities but also corresponding adjustments in business strategy,
leadership style and organizational culture. Gattorna (2010) also stresses the important role of human
resource in the dynamic alignment framework by integrating marketing rules, internal supply chain
strategies with the internal culture and leadership style. To serve for better understanding DSCM under
diverse business settings, Table 3 summarizes the historical literatures via stages, disciplines, and
industries categories.
The literature review also highlight the research in DSCM is still limited and mostly are
exploratory studies within few industries. Only few research studies to date focus on studying the
contemporary DSCM from a broader multiple disciplinary perspective. The success of DSCM requires
heavy financial investment and structural changes in the long run (Hilletofth, 2012). It has also been
identified that Chinese companies have not yet to fully understand the implications of adopting DSCM Page 7 of 26 ANZAM 2013
15. Technology, Innovation and Supply Chain Management Competitive Sessions within their businesses e.g. supply chain collaboration (Ericsson, 2011; Hilletofth, 2011), IT support
(Walters, 2008), leadership (Jüttner, Christopher, & Godsell, 2010). A summary of the enablers and
barriers to DSCM implementation is summarised in Error! Reference source not found. . Although the
arguments (references) for DSCM is rich, not much research has been done on how the processes should
be integrated and how implementation issues may differ in varying contexts e.g. countries and industries.
This paper contends that DSCM can be a model stimulating new ways of operation to optimize the
fashion apparel supply chain in China with its complex economic and institutional background.
2.3 DSCM in the Fashion Industry and Chinese Fashion Apparel Market
A systematic literature review via computerized data retrieval via 64 business relating databases
including e-journals, industrial news, newspapers and reports, e-books and thesis is carried out at the first
stage. Journals and books which closely relate to the topic are initially focused and several closed-relating
SCM databases are followed by regular retrieval for updating information and articles. Despite the rich
literature on fashion industry’s SCM, only few studies have been conducted for DSCM and in particular
for the Chinese fashion industry (See Error! Reference source not found. & Table 6). Existing studies in
Chinese fashion industry supply chain field tend to be business reports that emphasises on marketing,
branding to support supply chain neglect the need to consider demand as the main driver of the supply
chain (See Error! Reference source not found. ). Most of researcher mainly put focus on its specialized
Chinese GuanXi network and institutional model from one perspective of marketing side whereas the
integration between SCM and marketing management in a deeper level is hardly been explored. This also
demonstrates a lack of understanding of the enablers and barriers to DSCM in the context of the Chinese
Fast Fashion industry. The proposed research aims to investigate the readiness of the Chinese fast fashion
companies in the adoption of DSCM by proposing the use of the alignment theory (Chorn, 1991).
3. THEORETICAL UNDERPINNING AND PROPOSED FRAMEWORK
To provide a theoretical underpinning for the approach, alignment theory is used to account for the
need to match supply chain capabilities with marketing demand and align the internal competences with ANZAM 2013 Page 8 of 26
15. Technology, Innovation and Supply Chain Management Competitive Sessions the external institutional environment and leadership style to develop corresponding supply chain
solutions. The alignment theory (Chorn, 1991) contends that the strategic fit of a firm is in essence the
matching of the organization with the external environment. The principle considers the degree of
alignment that exits between market environment, organization culture, leadership style and company
strategy (Chorn, 1991).
The alignment theory concludes that there are four types of ‘logics’ sectors in the market, which are
Production, Administration, Development and Integration. Each of them has its coordinating strategic solution in terms of four elements, which are competitive situation, strategy, and organization culture and leadership style. The optimal marketing alignment exists when the logic sets bear a close similarity with each other in these four elements (Figure 3).
It provides a theoretical basis for DSCM (Hilletofth, 2011), which requires not only demand-supply chain collaboration, internal infrastructural support, but organizational competences, firm-based principles to enhance the demand and supply chain performance and competitiveness to the company.
Therefore, successful companies know how to align its supply chain solutions with the customer requirement by using the methods of market segmentation, price discrimination or other combination of supply management. Based on the underpinning theory and the review of the current situation of the
Chinese fashion apparel industry, this paper puts forward the following two propositions:
Proposition 1: From a marketing perspective, different market segments in the Chinese market should be identified and supplied with relevant supply capabilities under the notion of DSCM to achieve
better performance.
Proposition 2: The supply chain operation in the Chinese fast fashion industry should be closely
aligned with the special leadership environment and culture background in China for better performance.
Based on the literature review and the two alignment theories discussed, a tentative framework to
investigate the feasibility of applying DSCM to the Chinese fast fashion industry is proposed (Figure 4).
The framework gives a direction with the purpose of testing the underlying drivers and obstacles for
DSCM application in China. The framework attempts to show that true DSCM requires end-to-end DSC Page 9 of 26 ANZAM 2013
15. Technology, Innovation and Supply Chain Management Competitive Sessions collaboration involving not only combination of marketing strength and supply chain capabilities but also
changes in organizational culture as well as leadership style to develop new strategy to respond to
changing customer demand. The highlighted part in the framework emphasizes the essence of DSCM
which incorporates organizational leadership into value chain/demand chain management.
Findings from this study identify the potential enablers and barriers of DSCM application in the
Chinese FT industry. With further refinement, the proposed framework can serve as a model to test the
various relationships between the enablers, barriers and actual DSC process for industrial supply chain
optimization.
4. PROPOSED RESEARCH METHOD
This study uses a desktop research to review the literature comprehensively on the paradigm evolvement
from DCM to DSCM. It also investigates the DSCM application, if any, in the fashion apparel industry of
China and the general awareness of DSCM in the fast fashion apparel sector. Desktop research, which is
similar to the case study method, is appropriately for preliminary exploration of a problem which is not
yet clearly defined or fully understood. It provides the required flexibility for investigation when a “how”
or “why “question is being asked about a phenomenon (Yin, 1994). The approach is also considered
suitable for studying areas where the experiences of individuals and the contexts of actions are critical or
where the theory and research at their early, formative stage (Williamson & Bow, 2002; Yin, 2008). The
approach has been widely used in exploratory study of DSCM research (see for example (Hilletofth,
2011, 2012; Hilletofth et al., 2009; Hilletofth, Ericsson, & Lumsden, 2010; Hilletofth & Hilmola, 2008;
Lau, 2012) and SC strategic design for the textile and the apparel industries (see for examples (Bruce &
Daly, 2006; Bruce et al., 2004; Cao, Zhang, To, & Ng, 2008; Jacobs, 2006; Kumar & Arbi, 2007).
A systematic information retrieval was undertook which include 64 databases on business relating
databases which includes 9 main peer-reviewed logistics and supply chain management journal databases
and 10 databases on latest fashion and textile industry news, marketing databases. e-book collections, e-
videos and news and newspapers. A two-stage literature review was performed. First, relevant articles ANZAM 2013 Page 10 of 26
15. Technology, Innovation and Supply Chain Management Competitive Sessions published in reputed international journals, especially those reporting findings on fast fashion studies,
were reviewed and summarized. Then, information was also collected from industry news and reports as
well as recent conference and seminar papers and newspapers. Special focus was also placed on studies
on the application of DCM and DSCM in the current Chinese fashion textile development. The priority of
resources take the sequence from broad syntheses of the literature from around 500 articles to 50 specific journal articles and books then followed by looking for recent conference papers on the keyword topics by regular time.
5. CONCLUSION AND FUTURE RESEARCH
Through a comprehensive desktop research with analysis of secondary data, this study has
investigated the current studies of cutting-edge DSCM and its nascent understanding for Chinese fast
fashion apparel industry. DSCM as an overarching contemporary approach has not been fully investigated
in the real market. A comprehensive literature review on the Chinese apparel industry reveals that most of
the studies about Chinese FT market stand on the ground of either SCM or marketing management perspective in a broad sense. This study contributes to knowledge by proposing the integration of both
from managerial outside-in manner under DSCM perspective. The value of applying the dynamic
approach of DSCM will be amplified when it is tested in a dynamic Chinese environment with multi- purpose consideration. This paper fills the gap by proposing the framework and finding the potential
drivers and obstacles of DSCM to understand the appropriateness of applying DSCM to the Chinese FT
industry for network improvement. Supported by further studies in actual practice, the findings of this
research will contribute both to knowledge as well as actual supply chain management practices in the
industry.
The proposed framework gives a preliminary guidance for the industrial development and testing based on the preliminary research of literature review and desktop research. Although, it has contributed
to knowledge by providing a snapshot of the current situation, the use of secondary data inferior to using primary data to gather more in-depth information to explore how DSCM could be imbeded to optimize Page 11 of 26 ANZAM 2013
15. Technology, Innovation and Supply Chain Management Competitive Sessions the real local fast fashion industry in the case of China. Some practical drivers and obstacles to implement
in the identical Chinese industry needs more experimenting research to further validate the feasibility
result. Therefore, future research could focus on employing in-depth case study or questionnaire survey to
collect disaggregated data and business case-study from practitioner to further refine the framework and
facilitate the development of DSCM practice.
ANZAM 2013 Page 12 of 26
15. Technology, Innovation and Supply Chain Management Competitive Sessions Figure 1- Challenges faced by Local Fast Fashion Industry in China
Figure 2- Demand Chain Structure (Porter, 1985)
Value Chain
Supply Chain Demand Chain
Sourcing Manufacturing Distribution Marketing Sales Service
Table 1- Two Developing Stages of DCM Stage Synopsis Studies Phase ⅠⅠⅠ: A more narrow definition of DCM based on (Goldman, Nagel, & Preiss, 1995); Replacement of distinction between the efficient physical supply and (Fisher, 1997); SCM (Ontology) the market mediation roles, which defined the term (Cooper, Lambert, & Pagh, 1997); as market mediation supply chains (Vollmann & Cordon, 1998); Regarding demand as exogenous condition (Srivastava, Shervani, & Fahey, 1999); Addressing the issues in the frame of SCM definition (Lambert & Cooper, 2000); (Childerhouse, Aitken, & Towill, 2002); (Christopher & Payne, 2002); (De Treville, Shapiro, & Hameri, 2004); (Womack & Jones, 2010 ); Page 13 of 26 ANZAM 2013
15. Technology, Innovation and Supply Chain Management Competitive Sessions
Phase ⅡⅡⅡ: Integrating demand and supply orientated processes (Slater, 1997); Synergies It is suggested to view DCM as a macro level process (Mentzer et al., 2001); between which includes all activities that companies (Baker, 2004); marketing and undertake in their quest to create and deliver (Rainbird, 2004); SCM needs-based customer value propositions (Flint, 2004); (Epistemology) By differentiating products and delivery, sourcing (Walters & Rainbird, 2004); processes to proactively satisfy different customer (Walters, 2006); needs with distinctive SC solutions (Christopher, Peck, & Towill, 2006); (Jüttner et al., 2007); (Hammer, 2003 )
Table 2- Definitions of DSCM Definition Studies “The management of supply production systems designed to promote higher customer Williams et al. (2002) satisfaction levels through electronic commerce) that facilitates physical flow and information transfer, both forwards and backwards between suppliers, manufacturers, and customers” (p. 692).
‘’A set of practices aimed at managing and coordinating the whole demand chain, starting Selen and Soliman (2002) from the end customer and working backward to raw material supplier” (p. 667).
It aims to provide superior customer value at lower cost by organizing the company Hilletofth (2011) around understanding how customer value is created cost efficiently (from demand management), how customer value is fulfilled cost efficiently (from supply management), and how these processes and management directions can be aligned.
An approach to gain a superior competitive advantage by balancing the cost efficiency, Hilletofth and Ericsson (2007); responsive effectiveness, differentiation and innovativeness process across functional, Juttner et al. (2007); organizational and inter-organizational boundaries. Walters and Rainbird (2004)
Table 3- Historical Researches on DSCM from Different Research Perspectives Preliminary Macro business Micro Functional Study Industry related theoretical strategic process- Specific logistics perspective breakage study overview driven Overarching business strategic Overarching demand (Gattorna, 2009) √ √ √ embracing Human Resource, supply chain network alignment chain strategies (Hilletofth, 2011, 2012; Furniture industry Hilletofth et al., 2009; demand and supply √ √ Hilletofth & Hilmola, 2010) chain management FMCG DSCM/SC (Van Goor, 2007) √ √ √ collaboration Enterprise based demand supply (Esper et al., 2010) √ √ √ integration based on knowledge based theory Range of different (Jüttner et al., 2007) √ √ √ industries (Rainbird, 2004; Walters & Australia Fast food √ √ Rainbird, 2004 ) industry: McDonalds Downstream wholesale (Lau, 2012) √ √ Delivery/ distribution and retail distribution (Canever, Van Trijp, & Beef industry from √ √ Beers, 2008 ) DSCM perspective Segmenting service delivery and (Holmström et al., 2008) OEM Industry √ √ asset management based on industrial service operations ANZAM 2013 Page 14 of 26
15. Technology, Innovation and Supply Chain Management Competitive Sessions
Table 4- The enablers and Obstacles of Applying DSCM
Enablers References Obstacles References Supply chain strategic designing (Esper et al., 2010; Hilletofth, The revolutionary supply chain (Hilletofth, 2007, based on marketing/ demand 2007; Jacobs, 2006; Jüttner et reconstruction from physical and mental 2011; Jacobs, research al., 2007; Walters & Rainbird, perspective 2006) 2004)
The proper balance between (Ericsson, 2011; Esper et al., Challenge to create acceptance for new (Ericsson, 2011; demand creation and fulfillment, 2010; Hilletofth, 2011; Jacobs, mindsets and new ways of behavior (many Jacobs, 2006; Van between revenue growth and cost 2006; Jüttner et al., 2007) approaches are still based on old business Goor, 2007) reduction paradigm with focus on intra company effectiveness and efficiency
Advanced market segmentation (Hilletofth et al., 2009; Juttner Highly control manpower along the (Hilletofth, 2007, and intelligence et al., 2007; Walters and shareholders 2011; Jacobs, Rainbird, 2004) 2006)
Information sharing/ relationship (Charlebois, 2008; Frohlich & Conflicts of interest along supply chain (Ericsson, 2011; management Westbrook, 2002; Williams, Jacobs, 2006; Van Maull, & Ellis, 2002 ) Goor, 2007 ) Trust and loyalty (Charlebois, 2008; Childerhouse Huge financial investment (Hilletofth, 2007, et al., 2002; De Treville et al., 2011; Jacobs, 2004; Esper et al., 2010; 2006; Van Goor, Frohlich & Westbrook, 2002; 2007) Heikkilä, 2002)
Integrated IT support (Al-Mudimigh, Zairi, & Ahmed, 2004; Selen & Soliman, 2002; Walters, 2008)
Commitment from senior (Esper et al., 2010; Hilletofth, leadership style fit (culture 2011; Jüttner et al., 2007; change/business strategy Langabeer & Rose, 2001) alignment/functional process and department fit)
Page 15 of 26 ANZAM 2013
15. Technology, Innovation and Supply Chain Management Competitive Sessions Table 5- The DCM and DSCM Studies in Fashion Apparel Industry and Chinese Fashion Industry Research areas Literature reviews Main perspective Marketing oriented SCM/ (Bhamra, Heeley, & Tyler, 1998; Bruce & Daly, 2006; Bruce et It is proposed the effective buying behavior for Lean agile leagile al., 2004; Cao et al., 2008; Chandra & Kumar, 2000; fast fashion focuses on the management of coordination/ internal SCM Christopher et al., 2004; Fernie & Sparks, 2004; Jones, 2002; portfolio of suppliers, relationship building as perspective Lowson, 2002; Mason-Jones, Naylor, & Towill, 2000; Stratton well as interfacing effective with internal & Warburton, 2003 ) activities DCM perspective from (Hoover Jr et al., 2002; Jacobs, 2006; Stockert, 2005); To assess the actual state of DCM compared NPD, CRM and marketing with its promises of a few years ago management Development of Chinese (Chan, 2011; Dickson et al., 2004; Hui & Jun, 2010; Most of studies still focus on studying internal fashion apparel industry International Trade Centre, 2011; Kwan, Yeung, & Au, 2003; supply chain integration and specifically looking Lam & Postle, 2006; Li & Fung, 2011; Zhenxiang & Lijie, 2011) at some operational issues or technical problems under SCM definition.
Table 6- Key demand supply chain research for Chinese Fashion Apparel and Textile Industry Literature Title Research focus Research methods Type (Kwan et al., A statistical investigation Holistic industrial report— Examination of China’s Desktop Research Business 2003) of the changing apparel demographic and economic indicators over the past 20 report retailing environment in years, and the changing pattern of other macro-factors China and micro -factors (Taylor, 2004) China textile trade Industrial trading report— Introducing the special issue × Editorial on the textile trade in China. Outlining its growth which has reinforced its role as a preferred supplier to major markets, and its alignment with other members of the WTO. (Chan, 2011) Fashion retailing in Holistic industrial report— Examining the macro Desktop research Business China: an examination of development issues of fashion retailing in china and exploratory report its development and research techniques issues (International The Chinese Market for Holistic industrial report—Focusing on giving a Business case study Business Trade Centre, clothing comprehensive business overview on local Chinese FT and desktop study report 2011) market. The topic delivers through many perspectives, such as macro economy, trading, marketing and logistics perspectives . (Yi, 2012) Fast fashion model Industrial news report— Analyzing the issues in the local × Editorial questioning to be ‘Fast’ FT companies for recent years. in China (Zhang et al., Casual wear product Marketing/consumer behavior perspective—the Quantitative survey Research 2002) attributes--A Chinese importance of product attributes of casual wear for study paper consumers’ perspective Chinese consumers was investigated. A total of 15 attributes were identified. It is found geographic and demographic factors had great impact on these attributes . (Dickson et al., Chinese consumer Marketing/consumer behavior perspective-- Identifying Quantitative cluster, Research 2004) market segments for the product attributes salient to consumers’ apparel multiple regression paper foreign apparel products purchase intentions and other statistical analysis. (Chuang, 2008) A strategic study for Marketing/consumer behavior/branding —analyzing the Desktop study Business quickening brand favorable and unfavorable factors for brand development report building of Chinese for local apparel industry and putting forward some main textiles and garment measures and strategies for brand development industry (Wang, 2009) The empirical study on Marketing/consumer behavior perspective—Analyzing Quantitative Research the ladder like the regional development characteristics of China’s clustering analysis paper development trend of textile industry. , namely regional ladder-like methods Textile industry development mode. Pointing out the big distinction between strong and weak region. (Li & Fung, China’s apparel market Marketing/branding perspective —statistic industrial Business case study Business ANZAM 2013 Page 16 of 26
15. Technology, Innovation and Supply Chain Management Competitive Sessions
2011) report for these five years. Introducing the latest and desktop study report development on local FT industry and bringing the future trend about this industry. (Eng-Meng, Clothing brand Branding—news report on famous local brand × Editorial 2013) Metersbonwe takes cue Metersbonwe business model reconfiguration from Zara’s fast fashion (Flaven, 2013) In China, Hangzhou Branding—In today’s large and highly competitive China × Editorial Brands Face Identity market, developing a real brand identity is crucial to Crisis success. (Lam & Postle, Textile and apparel Internal supply chain perspective—the paper focuses on Case study Research 2006) supply chain reviewing the concept of supply chain management and Paper management in Hong Fisher SC strategy. Analyzing how to use Fisher’ s SC Kong strategy to balance tradeoff between efficiency and effectiveness for Hong Kong textile supply chain (Candace et al., Supply chain flexibility in Internal supply chain perspective-- To illustrate and An exploratory Research 2011) an uncertain examine the different flexibility strategies adopted by multi-case study paper environment: supply chain participants as a result of different involving 5 Chinese exploratory findings from environmental uncertainties FT companies 5 case studies
Figure 3 - Dimensions of Strategic Fit (Chorn, 1991)
Page 17 of 26 ANZAM 2013
15. Technology, Innovation and Supply Chain Management Competitive Sessions Figure 4- Proposed Framework for Applying DSCM in the Chinese Fashion Apparel Industry
The Achievement of DSCM approach under alignment theory
Enterprise Institutional environment (Subculture fitting) Organizational structure design Enablers Barriers Alignment Alignment
Coordination Marketing Management (Outside-in process) Supply Chain Management (Identifying dominant (from product design to buying behaviour) corresponding supply chain operation )
Enablers to achieve the DSCM alignment Barriers to achieve the DSCM • SCM factors: o Strategic supply chain planning • Huge financial investment o Integrated IT support • The revolutionary supply chain reconstruction • Marketing factors: • Challenge to create acceptance for new mindsets and o Marketing segmentation new ways of behavior o Marketing intelligence • Conflicts of interest along the supply chain o CRM • Highly control manpower among shareholders • Context organizational management (COM) factors: o Trust and loyalty … o Commitment from senior leadership style fit (Culture change/business strategy)
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ANZAM 2013 Page 26 of 26
15. Technology, Innovation and Supply Chain Management Competitive Session Demand-supply Chain Management for the Chinese Fast Fashion Apparel
Industry
Ying Ye
School of Business IT and Logistics, RMIT University, Australia
Email: [email protected]
Dr Kwok Hung Lau
School of Business IT and Logistics, RMIT University, Australia
Email: [email protected]
Leon Kok Yang Teo
School of Business IT and Logistics, RMIT University, Australia
Email: [email protected]