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Journal of Business & Industrial Marketing The changing landscape of supply chain management, marketing channels of distribution, logistics and purchasing Gregory T. Gundlach, Yemisi A. Bolumole, Reham A. Eltantawy, Robert Frankel,
Article information: To cite this document: Gregory T. Gundlach, Yemisi A. Bolumole, Reham A. Eltantawy, Robert Frankel, (2006) "The changing landscape of supply chain management, marketing channels of distribution, logistics and purchasing", Journal of Business & Industrial Marketing, Vol. 21 Issue: 7, pp.428-438, https://doi.org/10.1108/08858620610708911 Permanent link to this document: https://doi.org/10.1108/08858620610708911
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Users who downloaded this article also downloaded: (1993),"Characteristics of Supply Chain Management and the Implications for Purchasing and Logistics Strategy", The International Journal of Logistics Management, Vol. 4 Iss 2 pp. 13-24 <a href="https:// doi.org/10.1108/09574099310804957">https://doi.org/10.1108/09574099310804957</a> (1997),"Supply Chain Management: More Than a New Name for Logistics", The International Journal of Logistics Management, Vol. 8 Iss 1 pp. 1-14 <a href="https://doi.org/10.1108/09574099710805556">https://doi.org/10.1108/09574099710805556</a>
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The changing landscape of supply chain management, marketing channels of distribution, logistics and purchasing Gregory T. Gundlach, Yemisi A. Bolumole, Reham A. Eltantawy and Robert Frankel
Coggin College of Business, University of North Florida, South Jacksonville, Florida, USA
Abstract Purpose – The paper seeks to examine the changing landscape of supply chain management, marketing channels of distribution, logistics and purchasing. Design/methodology/approach – The authors examine and take stock of the changing nature and landscape surrounding the related disciplines of supply chain management, marketing channels of distribution, logistics and purchasing. This examination highlights the considerable evolution and significant advances occurring within and between these disciplines. Findings – The authors find that this new landscape provides both opportunities and challenges for future scholarship and practice in these related disciplines. Originality/value – The examination and findings should be of value to those attempting to understand the evolving nature and interrelationship of these fields, and those who currently practise within them.
Keywords Supply chain management, Distribution channels and markets, Distribution management, Purchasing
Paper type Viewpoint
The last two decades have witnessed the development and
continuing evolution of a number of related disciplines
including supply chain management (SCM), marketing
channels of distribution, logistics and purchasing. Reflective
of both academic development and managerial innovation,
advances occurring within these fields and across them have
yielded considerable insights and furthered business
knowledge and practice. At the same time, this evolution
has fundamentally altered the scholarly landscape addressing
these related fields and their managerial practice. Examples of such changes include the increasing
expansion and prominence of supply chain management
as a field of inquiry and practice, its encompassment of
logistics, the evolving sophistication and re-emergence of
purchasing as a strategic function, and the increasing
emphasis of relationships and dynamic considerations
within marketing channels research and practice. In this
essay, we examine and attempt to take stock of this new
landscape to better understand the nature and
interrelationship of these disciplines and the implications
of changes occurring within and across them for
scholarship and their consequences for practice. Our
examination highlights the ongoing changes occurring in
these fields, reveals insights regarding the nature of their
inter-relationship, and points to a number of opportunities
and implications for scholarship and practice.
Background
Drawing on selected literatures and with the intention of
providing background (versus an in-depth review), we first
overview accepted definitions and research topics of interest
for each area, common units and levels of analysis applied to
research, prevalent theories and methods for such research,
and recent trends identified for both research and practice.
Table I organizes our analysis framework and summarizes the
key findings of this overview.
Supply chain and supply chain management Definition The supply chain is generally conceptualized as a network of
companies from suppliers to end-users, which have with the
intention of integrating supply/demand via coordinated
company efforts. The origin of the term “supply chain
management” is thought to reside in the work of consultants
during the early 1980s (Oliver and Webber, 1982). A review
of the supply chain management literature during the late
1980s and the early 1990s reveals the interchangeable use of
neologisms: logistics management, network sourcing,
supplier-base reduction, and inter-organizational integration.
In the late 1990s, to some extent, supply chain management
supplanted the term “logistics” (Rogers and Leuschner,
2004). In an attempt to clarify confusion surrounding the
term, the Council of Supply Chain Management
Professionals (CSCMP) announced a modified definition of
SCM and a statement that clarified its scope and boundaries.
CSCMP, formerly the Council of Logistics Management
(CLM) and the National Council of Physical Distribution
Management (NCPDM), was formed in 1963 with the
objective to develop the theory and understanding of the
supply chain processes and to foster professional dialogue and
development in the field. Academic textbooks and researchers
in the field of logistics and supply chain management typically
The current issue and full text archive of this journal is available at
www.emeraldinsight.com/0885-8624.htm
Journal of Business & Industrial Marketing
21/7 (2006) 428–438
q Emerald Group Publishing Limited [ISSN 0885-8624]
[DOI 10.1108/08858620610708911]
428
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Ta b le
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an d
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:
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m et
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p ro
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: Tr
an sa
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n co
st th
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,
in te
rd ep
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th eo
ry ,
m an
ag em
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th eo
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d ec
is io
n th
eo ry
, th
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so u
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b as
ed
th eo
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f th
e fi
rm ,
an d
g am
in g
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h o
d o
lo g
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es cr
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q u
al it
at iv
e
co n
te xt
u al
ap p
ro ac
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an d
an al
yt ic
al
q u
an ti
ta ti
ve (m
at h
em at
ic al
an d
em p
ir ic
al )
m o
d el
s
The changing landscape
Gregory T. Gundlach et al.
Journal of Business & Industrial Marketing
Volume 21 · Number 7 · 2006 · 428–438
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adopt the CSCMP definitions. According to the CSCMP (see
www.cscmp.org):
Supply chain management encompasses the planning and management of all activities involved in sourcing and procurement, conversion, and all logistics management activities. Importantly, it also includes coordination and collaboration with channel partners, which can be suppliers, intermediaries, third-party service providers, and customers. In essence, supply chain management integrates supply and demand management within and across companies.
This is a broader and more detailed definition of SCM than
those put forward by researchers to date, some of which
include:
The integration of key business processes from end user through original suppliers, that provides products, services, and information that add value for customers and other stakeholders (Croxton et al., 2001).
The systemic, strategic coordination of the traditional business functions and the tactics across these business functions within a particular company and across businesses within the supply chain, for the purposes of improving the long-term performance of the individual companies and the supply chain as a whole (Mentzer et al., 2001, p. 18).
The efficient management of the end-to-end process of designing, planning and forecasting, sourcing though complex supplier networks, manufacturing, and distributing products from raw material to the end customer, and the final disposal of the product by the customer (Chan and Lee, 2005, p. 31).
The design and management of seamless, value-added processes across organizational boundaries to meet the real needs of the end customer (Institute of Supply Management, 2005).
Although differences exist in terms of the scope of SCM
among these definitions, there are many commonalities. Each
relies on terms such as coordination and integration and
emphasizes the harmonization of operations among supply
chain members. A further commonality is their focus on
cross-functional business processes with the objective of
providing value for the entire supply chain (Lambert et al., 2005).
Domain of interest In the early 1980s researchers focused on understanding the
system integration of business processes throughout the
supply chain. Emphasis was given to reengineering the chain
in order to meet customer requirements and improve
customer service (Lee et al., 1997). SCM research has since evolved to encompass a combination of trends in the
management literature, such as industrial markets,
integrated materials management, systems integration, the
“quality” revolution, management of relationships, and
business process integration and management. During the late 1990s attempts were made to integrate
different frameworks and views of SCM and, thereby, better
define the domain of SCM. Since the late 1990s, several
frameworks have been developed to guide research and
practice, such as the Global Supply Chain Forum (GSCF)
(Cooper et al., 1997) framework, the Supply-Chain Operations References (SCOR) model (Supply-Chain
Council, 2003), and Srivastava et al.’s (1999) business processes and shareholder value framework. Today, according to Mills et al. (2004), research in the area
of SCM has developed into two distinct streams: (1) descriptive research on industrial networks conducted by
researchers from industrial marketing and purchasing;
and (2) prescriptive research on supply chain management,
based in the fields of strategic management, operations
management and logistics.
This situation is not a perfect dichotomy, however, as
researchers in each of these areas have carried out both, and
other forms of research.
Unit and level of analysis The predominant unit of analysis in early SCM research was
the dyad, emphasizing the management of boundary-
spanning activities. As the field evolved in the late 1990s,
the unit of analysis became predominantly the network as
firms increasingly recognized their role as part of a number of
supply chains, having multiple customers and multiple as well
as alternative suppliers. During the 2000s, the systems
approach has been used to provide a framework for
understanding SCM. “This systems approach provides the
framework in which to best respond to business requirements
that otherwise would seem to be in conflict with each other”
(Hugos, 2003). Current interest in differing units of analyses
continues as SCM research aims to provide analytical depth
and implementation models for SCM practice. Apart from
differing units of analysis, SCM research has encompassed a
range of analysis levels including tactical, operational, strategy
and strategic orientations.
Theory and methodology Because SCM is at the confluence of many other disciplines,
drawing on these fields to inform its integrative philosophy, it
necessarily incorporates the various concepts, theories and
methods found in each of these other disciplines. These
include concepts and theories from marketing (customer
relationship management, buying strategies), industrial
economics (make-or-buy, procurement, supplier/customer
evaluation), operations management (inventory
management, production planning), logistics (distribution
planning, transportation management), international business
and organizational management (teams and internal
coordination, strategic issues, organization and procedure,
partnering and strategic alliances), and information
technology (electronic data interchange, online bidding, bar
coding). Particular theories include transaction cost theory,
knowledge and resource-based theories of the firm for
example resource dependency theory, relational contract
theory, institutional theory, open systems theory, agency
theory, and relational models theory, to name a few. As may be predicted, researchers have also drawn on
various methodologies for examining SCM. These include
qualitative, contextual, analytical, and quantitative
approaches. A primary research focus in SCM has been to
provide a widely accepted definition and model of
management implementation. As a result, it is not
uncommon to find the predominant use of exploratory
research methods such as pilot surveys, literature review, and
case studies. Today, while some researchers still continue with the
pursuit of a definitional consensus, others have followed a
shift in SCM research emphasis to developing management
models to guide SCM implementation (i.e. of relationships
and alliances, customer/supplier segmentation, business
process standardization, supply chain performance
measurement).
The changing landscape
Gregory T. Gundlach et al.
Journal of Business & Industrial Marketing
Volume 21 · Number 7 · 2006 · 428–438
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Marketing channels and marketing channel
management Definition The very earliest formal conceptions of marketing channels
focused on the functions performed by a distribution system
and the associated utility of these functions and the overall
system. Reflecting their presence in industrial and transitional
economies, marketing channels gradually came to be viewed
as the set of interdependent organizations involved in the
process of making a product or service available for use or
consumption (Coughlin et al., 2001). This institutional- oriented perspective draws attention to those members (e.g.
wholesalers, distributors, retailers, etc.) comprising the
distribution system and engaged in the delivery of goods
and services from the point of conception to the point of
consumption (Anderson and Coughlan, 2002). The
management of such institutions through marketing channel
management involves the planning, organizing, coordinating,
directing and controlling efforts of channel members. Today, according to some scholars the institutional
perspective of marketing channels and their management is
giving way to a more customer-focused view of the channel
(El-Ansary, 2005). Reflecting marketing channels within
newer experienced-based economies and involving value
adding chains and larger networks of members, this
emerging perspective emphasizes marketing channels as
providing for the conception, promotion and delivery of
positive customer experiences.
Domain of interest Consistent with the functional conception of marketing
channels, early research in channels, circa the 1950s and
1960s (see Alderson, 1957), focused on identifying the
various functions provided by marketing channels and
explaining when and why these functions have utility
(Anderson and Coughlan, 2002). Paralleling modern
emphasis of the institutions occupying a channel,
contemporary research in marketing channels has focused
on the organization and ongoing management among these
institutions. This research examines the managerial behavior
and decisions essential to the development and functioning of
a marketing channel. According to Anderson and Coughlan (2002), important
areas of research occupying the institutional domain of
marketing channels include market channel structure,
governance, and relationship management. As these scholars
explain, to enhance effectiveness and efficiency across the
various functions performed by members of a marketing
channel, each attempts to influence others to operate in a
coordinated fashion and in a manner that recognizes that their
interdependence creates common interests. Because
structure, governance and relationship management reflect
how firms garner and then exert influence over one another in
order to be successful and to compete against other marketing
channel systems, these areas have become a dominant focus of
research under the institutional perspective. Informal review of recent contributions to the literature
substantiates the observations of Anderson and Coughlan
(2002). These include contributions that inform our
understanding of the systemic nature and qualities
associated with larger channel systems, the role of dual
channel structures, marketing channels and their interplay
with supply chain processes and logistical functions, the
emergence of electronic (e.g. internet) channels of
distribution, the nature, qualities and performance of inter-
firm relationships, the governance of such relationships, the
use of inter-firm influence and power, channel performance
and the choice of channels by consumers among other topics. Detailing scholarly contributions to the literature, Frazier
(1999) reports that considerable progress has been made in
our understanding of managerial behavior and decisions
surrounding the development and functioning of a marketing
channel. Frazier (1999, p. 226) notes for example that:
. . . the knowledge that has accumulated in relation to how interfirm power
originates and is then applied, how control of the channel relationship is
facilitated, and what intrachannel conflict and channel member satisfaction
are based on is impressive. Recent efforts to better understand how strong,
long-term channel relationships develop – including the impact of trust
commitment and relational norms on channel interactions are noteworthy.
Furthermore, some progress has been made in our understanding of
organizational decisions relating to vertical integration, the use of multiple
channels, distribution intensity and bureaucratic structuring.
The author observes, however, that while the current
knowledge base provides a reasonable foundation of
thought, a variety of issues still exist regarding constructs
and topics examined in prior research. In particular, Frazier
(1999, p. 226) details that the role of power in channel
relationships is often confused. Interfirm monitoring efforts
have received little attention. Few of the various different
facets of interfirm communication have been examined in any
depth. Intrachannel conflict and its impact on long-term
channel relationships have been largely overlooked. The
relationship marketing paradigm as applied to distribution
channels has been pushed beyond its practical and natural
boundaries. Important factors likely to shape channel
integration, distribution intensity, and bureaucratic
structuring remain largely unexplored. The use and
management of multiple channels have been barely touched
on. Physical distribution processes and technologies have not
received the attention they should in research on channel
organization and management. Further, according to Frazier,
many important managerial issues relating to the organization
and management of channels of distribution have yet to be
addressed in empirical channels research. Among those
considered most important are: (1) how resource allocations to channels should be made
across global product markets; (2) how functions are shared-split between channel
members; (3) what combination of push and pull strategy is
appropriate for firms using indirect channels; (4) when and how the internet should be used as a sales-
distribution channel; (5) how coordination is achieved among distributors in
integrated supply networks; (6) how goals are set, plans are developed, and performance
appraised among channel members; and (7) how distributors should operate their businesses (Frazier,
1999, p. 226).
In terms of the future, as the traditional domain of marketing
channels set around the institutional perspective of channel
constituents gives way to a more customer-focused definition,
it is likely the domain of marketing channels research will
further expand to include related topics of interest (El-Ansary,
2005).
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Unit and level of analysis Attendant to the functional perspective of marketing channels, early research adopted the channel system and its functions as its primary unit and level of analysis. As the field
evolved to a more institutional perspective, research similarly evolved to capture a particular channel institution’s (most often the manufacturer or “channel captain”) perspective and
their efforts at designing and managing the channel. Viewing the channel as most often dominated by the manufacturer and involving a strategic asset of the firm, inquiry focused on informing the question of what is the best marketing channel
for a particular firm’s product or service (Coughlin et al., 2001). As both the nature of marketing channels and research
attempting to understand such a phenomenon has evolved, the unit and level of analysis adopted by researchers have similarly evolved. This evolution has lead to current emphasis
on dyadic relationships and emerging inquiry of triadic and larger network and system-based configurations of the channel and involving both strategic as well as more day-to- day managerial activities. In the future, increasing emphasis of
customer-focus marketing channels will likely call for adoption of units and levels of analysis that comply with those held by the customer.
Theory and methodology In pursuit of insights and understanding, channels researchers have drawn upon a variety of theories and research methods to inform and conduct their work. In addition to descriptive
field research intended to portray the practices and performance outcomes associated with channels, scholars have also employed quasi-experimental settings to isolate and examine phenomenon associated with the workings of a
channel. Analytic models, both mathematical and empirical, have also serviced such inquiry. Beyond a multitude of research settings and methods,
scholars have also borrowed from a number of different theoretical frameworks to inform their understanding of such practices and phenomenon. As inventoried recently by Anderson and Coughlan (2002), these include: . from economics – explanations attendant to transaction
cost analysis, agency theory, game theory, analytical
models of competition and market response and evolutionary economics;
. from sociology – theories of dependence/power and group processes and institutional theories of legitimacy;
. from psychology – theories of social influence, interpersonal relationships and conflict; and
. from marketing and strategic management – theories of trust, competitive advantage and path dependence and from other areas, political economy and life-cycle theories,
to name a few.
Given this eclectic state of affairs, these scholars contend that the field of marketing channels research is currently in a pre-
paradigmatic state with little agreement about how to frame issues and what the appropriate mode of inquiry is. Such a state poses both opportunities and challenges for the future.
Given the lack of consensus, on the one hand, researchers examining channel phenomenon have considerable freedom to proceed in a manner of their choice. At the same time, the lack of consensus (and at times competition among differing
perspectives and methods) has made it more difficult to achieve consensus and thus to accumulate findings that yield
robust generalizations concerning important phenomenon.
Despite these challenges, as may be observed across time,
results from these multiple perspectives and methods are
beginning to converge with some agreement in findings and explanations about what issues in marketing channels merit
further inquiry (Anderson and Coughlan, 2002).
Logistics and logistics management Definition “Logistics” refers to the inbound and outbound flow and
storage of goods, services, and information within and
between organisations. As a managerial activity, early conceptions of logistics focused on its role in the
distribution of products and as a way to support an
organization’s business strategy and to provide time and
place utility. Prior to the 1980s, logistics was primarily concerned with the outbound flow of finished goods and
services, with an emphasis on physical distribution and
warehouse management. During the 1980s, industry
globalization and transportation deregulation led to the expansion of logistics beyond outbound flows to include
recognition of materials management and physical
distribution as important elements. In 1986, the CLM
(considered by many to be the pre-eminent professional organization for academics and practitioners in the logistics
field) defined logistics as: “the process of planning,
implementing, and controlling the efficient, cost-effective flow and storage of raw materials, in-process inventory,
finished goods, and related information flow from point of
origin to point of consumption for the purpose of conforming
to customer requirements” (see www.clm1.org). During the 1990s, accelerated market changes due to shrinking product
lifecycles, demand for customization, responsiveness to
demand, and increased reliance on information technology
led to logistics being defined as “the process of strategically managing the procurement, movement and storage of
materials, parts and finished inventory and related
information flow through the organization and its marketing
channels” (Christopher, 1998). The 2000s experienced further changes to how logistics is
defined. Developments in international trade, supply chain
management, technology, and business process re-engineering generated a need to re-evaluate the logistics concept. During
this period, CLM annually reviewed its definition of logistics
and revised that definition several times: in 2001, CLM defined logistics as “that part of the supply chain process that
plans, implements and controls the efficient, effective flow
and storage of goods, services, and related information from
the point of origin to the point of consumption in order to meet customer requirements”. Between this time and before
2003, CLM again modified its definition to: “that part of the
supply chain involved with the planning, implementing and
controlling of the efficient, effective flow and storage of goods, services, and related information from the point of origin to
the point of consumption for the purpose of conforming to
customer requirements” (see www.clm1.org). Differences
among these definitions reflected the CLM’s attempts to capture differences between, and the scopes of, logistics
management and supply chain management. The most recent definition of logistics from CLM (now the
Council of Supply Chain Management Professionals –
CSCMP), in 2003 is: “that part of supply chain
management that plans, implements and controls the
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efficient, effective forward and reverse flow and storage of
goods, services, and related information between the point of origin and the point of consumption in order to meet customers’ requirements” (see www.cscmp.org). Many academic textbooks and articles in the logistics discipline typically adopt this CSCMP definition of logistics and logistics management (as an example, see Stock and Lambert, 2001), while some more recent examples provide
an alternative, albeit related definition – for example that “logistics refers to the responsibility to design and administer systems to control movement and geographical positioning of raw materials, work-in process, and finished inventories at the lowest total cost” (Bowersox et al., 2006, p. 22). Most definitions accept the notion that, as in the CLM definition, the emphasis is on leveraging low cost information against
more expensive logistics assets such as inventory, warehousing, labor and transportation.
Domain of interest Early logistics management research focused on the management of transportation and warehouses. Today, research in logistics addresses two aspects: (1) supply chain logistics, concerned with the flow of goods;
and (2) service response logistics, concerned with the co-
ordination of non-material activities necessary for the fulfillment of the service in a cost – and customer service – effective manner.
An informal review of research topics appearing in the Journal of Business Logistics (JBL) between 2000 and 2005 identifies traffic and transportation, warehousing and storage, inventory management, packaging and return goods handling, salvage and scrap disposal as key foci of supply chain logistics; and order processing and information systems, customer service and procurement as key foci of service response logistics. Over
time, logistics research has evolved from a pure internal focus on cost control, and functional areas of inventory, transportation, warehousing and order processing to their role and impact within business process integration regarding suppliers and customers.
Unit and level of analysis Historically, logistics research focused on the firm and its profitability. In the mid-1990s, recognition of the importance of dyadic relationships for achieving this objective emerged. With increasing emphasis on end-to-end logistics integration and the linkage of multiple dyads, the focus of logistics research further shifted in the 2000s to its present state and focus on the system as its primary unit of analysis. Paralleling this broadening has been shifts in the level of
analysis employed in logistics research, from a focus on the management of operations to optimizing logistics operations to attain efficiency of the flow of goods, and to service response logistics. Today, the scope of logistics management
and research includes external and strategic orientations encompassing consideration of the value adding activities involved in the process of bringing a product to market.
Theory and methodology Surveying theories applied in logistics research, Stock (1995)
concluded that logistics benefits from borrowing from other theories as it is suited to approaches which “adopt multidisciplinary methodological pluralism”. Although logistics has benefited from application of insights from
mathematics to psychology, theories of particular relevance
include those having origins in economics, organizational
strategy, and marketing including transaction cost theory,
resource-based theory, relational contracting theory and dyadic coordination theory. Reflecting its evolution to
include more systemic and strategic considerations, logistics
has most recently begun to integrate systems and network
theory. Logistics research has also evolved in its use of research
methods. Some research tends to be more positivist in nature,
utilizing variations of quantitative approaches, while others tend to be more interpretative, and as such qualitative in
nature. Frankel et al. (2005) examined articles published in the Journal of Business Logistics between 1999 and 2004 and found a variety of data gathering techniques and forms of analysis including literature reviews, interviews, personal
observation surveys/questionnaires, focus groups, cases
studies, experiments and content analysis. They identified a
number of trends including the increasing use of case analysis, multi-method (triangulation) approaches and use of the
internet for data collection. The current state of logistics research reflects its evolution
from an emphasis on operational and functional areas to an
emphasis on the efficiencies that can be gained through the
integration and interface(s) between disparate areas and other
functional departments within the organization including manufacturing, human resources, finance/accounting, etc.
Today, logistics research is responding to recent calls for
measuring the performance of the logistics system and sub-
systems and its implications for overall firm performance, especially with an emphasis on the efficiencies that can be
gained from extending this functional integration through
collaboration across the entire supply chain.
Purchasing and purchasing management Definition Purchasing involves the satisfaction of individual firms’
requirements. Early definitions of purchasing emphasized
the tactical and clerical decisions involved in the purchasing of
products and supplies. During the 1990s purchasing evolved to be viewed as part of a broader function called procurement
or “the systematic process of deciding what, when, and how
much to purchase; the act of purchasing it; and the process of
ensuring that what is required is received on time in the quantity and quality specified” (Burt and Pinkerton, 2003,
p. 64). As a function, procurement included purchasing,
consumption management, vendor selection, contract
negotiation and contract management (Poirier, 1999, p. 64). At the beginning of the 2000s, the terms “purchasing” and
“procurement” became synonymous in the profession
(Monczka et al., 2002). Today, many researchers are taking a broader view of
purchasing that emphasizes “managing the supply” of
materials, services, and information. Supply management
research tends to focus on studying the phenomenon of purchasing defined as requirement (i.e. need) satisfaction.
While there is no agreement on the exact definition and scope
of supply, professionals at all levels do agree that supply is a
series of linked relationships that add value at various levels (Kauffman, 2002). Supply management encompasses
“organizing the optimal flow of high-quality, value-for-
money materials or components to manufacturing
companies from a suitable set of innovative suppliers”
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(Wagner, 2003). Concepts of interest in supply management
include management, development and integration of
suppliers (Antonette et al., 2002).
Domain of interest Early research in purchasing focused on improving the
internal efficiency of an individual firm within the supply
network. Researchers focused on exploring the most efficient
approaches to performing purchasing responsibilities in
relation to: direct or strategic materials needed to produce
the company’s products, and indirect or MRO (maintenance,
repair, and operations) products consumed by the company
as part of its daily operations (Poirier, 1999). From the late 1990s on, researchers took a broader view of
purchasing. Emphasis was given to “managing the supply” of
materials, services, and information and resulted in a shift
from focus on internal efficiency to other long-term outcomes
such as collaborative learning, reductions in cycle time, and
new product development cycle. This emphasis extended into
the use of the internet and technology developments and
examining team driven decision-making, which fostered
collaborative activities with suppliers aimed at meeting the
goals of the firm (Giunipero and Handfield, 2004). With the beginning of the 2000s, researchers began to
realize the importance of coordinating the supply of products,
services, and information rather than merely focusing on
buying the least expensive materials. After reviewing the
Journal of Supply Chain Management (JSCM, considered by many to be the leading journal in purchasing and supply
research), Carter and Ellram (2003) reported several changes
in the subject categories of topics across time that reflect the
evolution from purchasing to supply management. According
to the authors, one-third of the contributions to “purchasing
performance” and the “status” and “recognition” of the
purchasing function were made during 1975-1979. The
majority of the contributions to “inventory and production
management” were made in the 1970s and 1980s. Material
requirements planning (MRP) appeared from 1977 to 1984,
while the majority of just-in-time (JIT) contributions were
made from 1986 to 1994. In the 1990s the emphasis on the
strategic impact of purchasing emerged. Almost all
contributions dealing with supply chain issues were made
after 1994, emphasizing the broadening and integration of
purchasing into supply management and supply chain
management. This also mirrors the general recognition of
the supply chain concept by purchasing professionals and
scholars (Carter and Ellram, 2003).
Unit and level of analysis Early purchasing research emphasized the internal
performance of individual firms’ purchasing function as a
unit of analysis and focused on the performance of the
purchasing department, measured by cost savings. With the
increased recognition that the success of purchasing depends
on the extent to which its performance fits the needs of the
business and on the consistency between purchasing
capabilities and the competitive advantage sought by the
business, in the 1990s the unit of analysis expanded to include
assessment of dyadic relationships. Emphasis on supply
management during the 2000s motivated researchers to
extend their unit of analysis to include second tier suppliers
and to collect data from multiple sources in the same supply
chain.
Expansion of the unit of analysis employed by researchers
in purchasing has also been accompanied by changes in the
level of analysis. Early research addressed purchasing in
relation to its tactical/clerical role. During the 1970s and the
1980s purchasing was viewed as a non-strategic function and
had less organizational status relative to other major functions
in the firm (Ammer, 1989). The 1990s brought a change in
the focus of purchasing to include strategic considerations
with an emphasis on total cost savings and value-added
activities (Burt and Pinkerton, 2003). Today, research on
purchasing is beginning to examine the value of cooperation,
redirecting the tactical focus on internal efficiency toward
strategic network improvement, and soliciting the help of
willing partners interested in building a dominant supply
chain in a particular industry (Burt and Pinkerton, 2003).
Theory and methodology Early research on purchasing utilized transaction cost theory
to examine purchasing’s contribution to internal efficiency,
i.e. cost savings attained by reducing raw materials costs and
selecting suppliers that offer the lowest prices, within a firm’s
boundaries. From that time, purchasing/supply researchers
have incorporated other theories including interdependence
theory to explore dyadic considerations between purchasers
and suppliers. Other researchers used agency theory,
management theory, resource-based theory of the firm,
decision theory, and gaming theory to analyze the impact of
purchasing/supply strategies on performance. During the early 1990s, typically, purchasing/supply
research relied upon descriptive methods with the objective
of identifying best practices and assisting purchasing
professionals in their benchmarking efforts. Although
descriptive and benchmarking research is still widely used
today, researchers from the 1990s onwards employed a variety
of methods and modeling techniques ranging from qualitative
contextual approaches to analytical quantitative ones. Today, the most influential trend on purchasing/supply
research is the emergence of SCM (Carter and Narasimhan,
1996). SCM denotes the integration of purchasing and supply
with other functions in the firm (Wisner and Tan, 2000).
With the realization of the importance of coordinating the
supply of products, services, and information with the other
functions, rather than focusing on buying the least expensive
materials, most purchasing researchers’ attention shifted from
“purchasing” to “supply management”. Terms such as
“integrated purchasing strategy” are being used in the
literature today to address certain elements or stages of this
new management philosophy (i.e. SCM). Many researchers
today assess purchasing and supply strategies’ contribution on
the basis of their contributions to SCM success (Wisner and
Tan, 2000).
Analysis and discussion
Our overview of the related disciplines of supply chain
management, marketing channels of distribution, logistics and
purchasing highlights significant developments and changes
occurring in these fields reveals insights regarding the
relationship among them and points to a number of
opportunities and challenges for scholarship and attendant
consequences for practice. We briefly describe key findings
here.
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Key developments and changes
A number of significant developments and changes that have
the potential of impacting scholarship and practice within
each of the disciplines are identifiable from our examination.
Supply chain and supply chain management Perhaps the most prominent of these involves the rapid
development and evolution of the field of SCM. Arising in the
mid-1980s, the field has expanded through its process
orientation to integrate processes and functions which
include institutional concepts and issues addressed in
marketing channels, flows common to logistics and activities
previously the domain of purchasing. Importantly, while these
fields remain vital in their own right, the emergence and
development of SCM has yielded an overarching domain that
aspires to provide for their common integration and
coordination in ways not imagined before. As a discipline, SCM continues to become increasingly
market oriented, assessing and responding to the needs of
target customers and other stakeholders by organizing and
coordinating resources and activities with the goal of creating
value. Such an evolution reflects the natural maturation of the
field’s original goals. At the same time, a considerable lack of consensus
continues to exist within the field of SCM in relation to its
precise definition and whether the field constitutes a
management philosophy, implementation of a management
philosophy, or a set of management processes. Such confusion
should not be unexpected given the field’s early stage of
development and rapid evolution and will likely be resolved
over time both in terms of scholarship and practice.
Marketing channels and marketing channel management Within marketing channels, paralleling a shift in the larger
discipline of marketing from focus on transactional exchange
to include exchange relationships, perhaps the most impactful
development has been the field’s emphasis of relational (e.g.
collaborative) versus competitive (e.g. arm’s length)
interactions among institutions comprising the marketing
channel. This change has fundamentally altered the scholarly
landscape and practice of marketing channels and marketing
channel management. Accompanying the field’s emphasis of relationships and
collaborative interaction has been a broadening of its
institutional perspective from that of an individual
institution (and its channel) to that of dyads and larger and
more complex units of analysis including triads, networks and
systems of institutions and their relationships. This evolution
has also been accompanied by expansion of marketing
channel concepts and theory from that which is informative
to understanding the organization and management of a
dominant institution’s channel at a point in time to concepts
and theory helpful for understanding the organization and
management of relationships and larger configurations of
relationships comprising a marketing channel over time. Together, the changes and developments in marketing
channels represent considerable progress in understanding the
institutions and functioning of marketing channels and
marketing channel management. As a result, these changes
will likely enable the field to better understand and explain
phenomenon occurring within marketing channels of
distribution.
Logistics and logistics management The field of logistics has also undergone important
developments and changes that are likely to be impactful to
scholarship and practice. Reflecting its independent origin yet
subsequent importance and association with SCM, the field
has redefined itself over time to both conceive of logistics as
part of SCM, but also an independent function of broadening
and strategic importance to the firm. Both perspectives have
merit given the acknowledged critical role of logistics in SCM
(i.e. logistics is recognized as an integrative support
mechanism to enhance efficiencies across the supply chain)
as well as the separable functions which define the field of
logistics itself. Together, these developments and changes
represent important advances for the field that will likely pay
dividends through elevating our understanding of logistics
and enhancing the development of SCM both in terms of
scholarship and practice.
Purchasing and purchasing management Finally, important changes in the field of purchasing that are
likely to impact scholarship and practice include its evolution
from a tactical and internal efficiency oriented function
encompassing the firm and its immediate suppliers to include
strategic and external effectiveness based considerations
encompassing the firm and the larger network of firms
occupying the value chain. These changes reflect both the
independent development of the field and the impact of SCM
and are captured in the evolution of terminology describing
the field. Consequently, the broadening of the discipline of
purchasing implies a greater emphasis on the implications of
purchasing decisions on firm and supply chain performance.
Today, effective purchasing is not necessarily one that
promises maximum efficiency or least total cost, but rather
one that fits the needs of the business and strives for
consistency between its capabilities and the competitive
advantage being sought throughout the supply chain. These
developments and changes reflect advances that are likely to
enhance the role and prominence of purchasing in both
scholarship and practice.
Connections across the disciplines
Taken together, recognition of the important changes and
developments in each of the disciplines helps to provide
insights for understanding how these disciplines relate to one
another including their similarities and distinctions. Notable
in this regard is how some recent conceptions of SCM inform
this understanding through defining marketing channels,
logistics and purchasing as part of SCM. For example, SCM
is defined by CSCMP to “include coordination and
collaboration with channel partners” – a key thrust of
marketing channel management and to “include [as a part of
SCM] all logistics management activities” and further in
relation to purchasing, “all activities involved in [. . .]
procurement”. Further credence to this conception is
provided through logistics definitions that conceive of the
field of logistics as “part of the supply chain” and its
management. The basis for including marketing channels, logistics and
purchasing as part of SCM likely extends from SCM’s
integrative orientation and therefore necessarily expansive
scope compared to the more functional orientation and
narrower breadth of these related disciplines. Integrating such
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functions across the supply chain is an important and useful
goal. Of note, however, is that some more recent conceptions of SCM are not limited to merely the integration of these
functional areas. For example, read literally, the recent CSCMP definition advances beyond integration to include
the actual “planning” and “management” of these functions as well as other business processes across the supply chain. What implications attend a conception of SCM as
including, beyond its integrative orientation, the actual planning and management of the functional domains of
marketing channels, logistics and purchasing? What consequences result for scholarship and practice within
SCM? Within each of the functional domains? The answers to such questions appear more than academic given they are
currently under consideration by those within the field of SCM. The Journal of Business Logistics (2006), for example, in recognition of the intense and continuing interest in SCM for two decades, but still remaining “uncertainty as to what SCM is and what functions and/or processes should be included
within it”, recently issued a call for a special issue of the journal to “document and describe the scope and domain of
supply chain management”. The insights and understanding developed from such an effort and others is likely to be
important to both SCM and its related fields. For those who might be concerned with the breadth and
depth of intellectual and practice-based aspirations reflected by CSCMP’s conception of the SCM discipline, a helpful distinction is that SCM’s larger philosophy has been
suggested by others to be limited to the integration and coordination of the respective disciplines it embraces rather
then their more specific planning and management (Mentzer et al., 2001; Chan and Lee, 2005; Croxton et al., 2001). These distinctions have also been addressed by others. For example, the alternative perspectives represented in the
different viewpoints of CSCMP and others has been labeled by Larson and Halldorsson (2002) as reflecting the “Unionist” versus the “Intersectionist” view of SCM.
According to Larson and Halldorsson (2002), under the “Unionist” view, where SCM subsumes logistics, marketing,
operations management, purchasing, etc., supply chain managers have greater decision making authority than other
functional managers, requiring that the reporting relationships within the firm be altered. This view is generally consistent with the perspective offered by the
CSCMP through its definition of SCM. Alternately, according to Larson and Halldorsson (2002), under the
“Intersectionist” view, SCM is considered a broad strategy which cuts across business processes both within the firm and
through the channels. This view is generally consistent with Mentzer et al.’s (2001) perspective that supply chain management involves the strategic coordination of traditional business functions and the tactics across these business functions as well as Croxton et al.’s (2001) perspective that supply chain management involves a change from managing individual functions to integrating activities
into key supply chain processes. In this fashion, the intersectionist perspective of SCM does not imply a union
of marketing, logistics, and purchasing. Rather, under such a perspective SCM coordinates cross-functional efforts across
multiple firms (Mentzer et al., 2001; Chan and Lee, 2005). Importantly, for both perspectives most agree that SCM is
critically dependent on the depth of understanding and
managerial insights developed in each of the functional
disciplines for achieving its goals. Such knowledge is essential
for overcoming hurdles to achieving SCM’s goals. For
example, observers have noted that such goals are often
countered by conflict and individual firm’s efforts to
maximize their own performance through exercise of power
and control and the use of opportunistic business practices.
Such behavior and its resolution is at the core of research
efforts within marketing channels. Integration and reliance on
such knowledge should be helpful to SCM in overcoming
such challenges. Indeed, absent such reliance and continued
development of other insights within the individual disciplines
of relevance to SCM, it will likely be challenging for the
expansive and worthy goals of SCM to be fully achieved.
Opportunities and challenges for scholarship
Examination and assessment of the developments and
changes occurring in SCM, marketing channels of
distribution, logistics and purchasing also reveals a number
of implications for scholarship. These include both
opportunities and challenges for research (i.e. knowledge
generation) as well as teaching and instruction (i.e. knowledge
dissemination) within and across the fields.
Research Of particular note for research are the increasing overlaps in
definitions and topics of interest that have developed over
time across these disciplines. For example, both SCM and
marketing channels identify and specify the coordination and
collaboration of channel partners as a topic of interest,
although from different vantage points and applying varying
methods and theories. Further, SCM specifically identifies the
field of logistics as encompassed in its domain of interest.
Similar observations and overlaps are present and attend the
relationship of purchasing and SCM. Accepting differences in perspective and orientation, the
presence of such overlaps yield significant opportunities for
interdisciplinary research and development. In some instances
such cross-disciplinary efforts have already been identified
and are currently being explored to a considerable extent (e.g.
SCM/logistics) and in other instances to a somewhat lesser
extent (e.g. SCM/purchasing). In both cases, continued
across disciplinary efforts are likely to prove fruitful. In other areas (e.g. SCM and marketing and marketing
channels as well as other functional areas) such integration
remains a continued opportunity. For example, Grimm
(2004, p. 59) points out:
While many academic disciplines are conducting research in supply chain, there is an unfortunate lack of communication and cooperation amongst the various disciplines regarding supply chain research. [. . .] This is unfortunate, as each field offers contributions to the whole of the cross-disciplinary world of supply chain management.
With particular respect to SCM and marketing, the evolution
of SCM to focus on end-user considerations overlaps with
core marketing concepts including the marketing concept and
market orientation. Further development and integration of
these fundamental insights both within and across each
discipline is likely to be beneficial to both. In addition, in
relation to marketing channel management and SCM,
development and integration of insights regarding the
coordination and collaboration of channel partners has the
potential of furthering understanding of such phenomenon in
ways that elevate the efficiency and effectiveness of managerial
initiatives in both SCM and marketing channels.
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Volume 21 · Number 7 · 2006 · 428–438
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Teaching and instruction In addition to research, implications for instruction and teaching, including curriculum enhancement, extend from the
changes and developments occurring within and across the
disciplines of SCM, marketing channels, logistics and purchasing. Many of these implications may be cast as
questions for consideration and contemplation by those involved in such efforts. Of first impression is whether existing curricula adequately
cover the changes and developments that are occurring within
these subject areas? Although programs designed to instill knowledge of many of the specific functions (e.g. logistics,
marketing channels, etc.) may be identified, is the content in these curricula adequate given the changes and developments
that have occurred within these disciplines? Do such curricula
require amendment to adequately address these changes and developments? A further question is whether existing curricula should be
integrated to cover and bridge these related disciplines? Do
existing curricula adequately cover the subject knowledge that has developed over time and currently resides within and
across these related disciplines? Should they? What challenges result in attempting to develop such an integrative
curriculum? What content should be included? Excluded? A related question regards how curricula intended to cover
and bridge these subjects should be labeled? Given the integrative goals of SCM, should such curricula be labeled
similarly and include content on the functional areas?
Alternately, given the functional orientation of marketing channels, logistics and purchasing, should such labels remain
with the addition of SCM as a kind of capstone perspective intended to provide students with insights and understanding
(if not a philosophy) of how such functions can be successfully integrated to achieve optimal performance across the supply
chain? Or should such a philosophic orientation as provided through SCM be positioned as a foundation course, with
those functions that it coordinates being positioned as elements to be embraced and added as courses over time?
At present, both pedagogical approaches may be found
currently in practice (or under consideration) at many institutions where consideration is being given to how best
to include supply chain management in their curricula (Rutner and Fawcett, 2005). Finally, a larger question regards how other business
functions should be treated with respect to the changes and
developments that have occurred within and across these related disciplines? Overall, the challenge for educational
institutions is to expand their perspective while at the same time improving the relevance and quality of their offerings. In
this regard, it is important that these and other questions be
approached following an integrative process-oriented pedagogy that provides ample opportunity for the input and
participation of relevant stakeholders.
Consequences for practice
Together with the implications for scholarship, important
consequences for practice extend from the changes and developments occurring within and across the related fields of
supply chain management, marketing channels of distribution, logistics and purchasing and their
interconnections. Many of these parallel those already discussed. For example, although the practice of SCM has
been adopted and progressed in many organizations, given its
rapid emergence, other organizations have yet to benefit from
its application. At the same time, lack of consensus about
what SCM is and what it is not likely has resulted in confusion
and in some instances inhibited its adoption its adoption in
ways that provide benefits to practice. Other parallels are also identifiable. For example, the shift
in focus from competitive to collaborative interaction in
marketing and marketing channel management is detectable
in many aspects of marketing channel practice ranging from
the increasing prevalence of institutions such as joint ventures,
strategic alliances, and partnerships to the nature of
interactions that may be found in many day-to-day channel
exchanges. Similarly, the integration of logistics into SCM is
also identifiable in many organizations. Finally, the evolution
and broadening of purchasing to include strategic and
external effectiveness considerations may be found in some
organizations. Also paralleling changes and developments within each of
the areas of SCM, marketing channel, logistics and
purchasing management is consideration by many
organizations of how best to go about the managerial
challenges of practising across these related areas. While
some organizations continue to work on them, others have
successfully met the challenges of understanding and
integrating these related disciplines to their overall benefit.
For example, although very different retailers, Wal-Mart and
Target have been able to achieve profitable sales, increase
customer count, increase trip frequencies, increase
transaction size, increase productivity; and reduce costs by
aligning and focusing all marketing (including marketing
channels), purchasing and logistics functions on achieving
their overall supply chain goals (Hoyt and Company, 2005).
Conclusion
The related disciplines of supply chain management,
marketing channels of distribution, logistics and purchasing
have undergone significant development and evolution in the
last two decades. Spurred by both external and internal
forces, changes in and across these disciplines have
fundamentally altered the scholarly landscape to which they
relate and the way in which they are practiced. This essay
sought to examine and take stock of this new landscape and to
reveal its opportunities and challenges for scholarship and its
consequences for practice.
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Corresponding author
Gregory T. Gundlach can be contacted at: Ggundlac@
unf.edu
The changing landscape
Gregory T. Gundlach et al.
Journal of Business & Industrial Marketing
Volume 21 · Number 7 · 2006 · 428–438
438
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