Development of the critical success decision criteria for an equitable order sharing in an extended enterprise

Abstract

Purpose

This study identifies and ranks the appropriate critical success decision criteria (CSDC) for the bulk order distribution (sharing) amongst multiple manufacturers (suppliers) working as an extended enterprise (EE).

Design/methodology/approach

The study deploys a qualitative approach to generate the appropriate decision criteria. The balanced scorecard and Pareto's chart (using Minitab^® version 18) were used for gathering and analysing the pertinent criteria.

Findings

The process of evaluating and selecting the right manufacturers is essential. Manufacturer (supplier) selection is no longer decided solely based on cost/price criterion; currently, the quality and delivery criteria prevail. Additional incorporated criteria include price/cost, technical capability, production facilities and capacity, customer satisfaction and impression, geographical location, management and organisation, financial position, environmental concern, performance history, repair service, information technology and communication systems, procedural compliance, labour relation record, reputation, flexibility or diversification, attitude, operating controls, business desire, packaging ability, past business records, trust and loyalty, training aids, complaint handling service, warranties and claim policies, reciprocal arrangements, research and development and innovation, modern slavery concern, sustainable capability, collaborative/partnership and responsiveness. The study proposed a conceptual framework of an EE alongside how manufacturers working as a single virtual entity can consider the supply chain operations reference (SCOR^®) model.

Research limitations/implications

The identified CSDC are suitable for order allocation to domestic manufacturers. The deployed approaches could be extended to the mixed and quantitative approaches for increasing the generalisability.

Originality/value

The study establishes the pertinent CSDC that are important to execute equitable order distribution to manufacturers in an EE framework.

Citation

Taifa, I.W.R., Hayes, S.G. and Stalker, I.D. (2020), "Development of the critical success decision criteria for an equitable order sharing in an extended enterprise", The TQM Journal, Vol. 32 No. 6, pp. 1715-1742. https://doi.org/10.1108/TQM-05-2019-0138