Impact of information integration on decision-making in a supply chain network

Decision-making in a supply chain is a key factor for meeting the strategic goals of an organisation. Customer demand is rapidly changing in today's turbulent environment, and organisation must be responsive enough to meet these changes. The responsiveness of the organisation incurs cost, and a trade-off between responsiveness and efficiency is necessary to meet organisation strategy for enabling competitive advantage. Information integration across the supply chain enables the network to respond quickly to continuously changing customer demand. The potential screened suppliers are evaluated in a dynamic environment using beer game simulation for limited and system-wide information availability. The simulation is run for stable and random orders to get results for varied inventory levels and bullwhip effect (order fluctuations). Thus, the selected and evaluated suppliers enabled prioritisation of the suppliers to meet the organisation's strategic objectives. The results from the study suggested that the inventory level and bullwhip effect reduced significantly as a result of integrating the information for both stable and random orders. Thus, a robust framework is devised for long-term decision-making in enabling an organisation to meet its strategic objectives. The paper focuses on devising a structured methodology for supplier selection which is an important decision in a supply chain. After initial evaluation of potential suppliers, the decision-making involves selecting suppliers. The decision-making must fulfil the firm to be responsive to customer while also serving the purpose of cost efficiency. Thus, by properly tuning the information integration in a supply network, the methodology suitably quantifies the inventory levels and bull-whip effect for effective decision-making.