Supply Chain Management Practices in SMEs of India: Some Managerial Lessons from Large Enterprises

Abstract

The objective of this paper is to provide insight into the similarities and dissimilarities of Supply Chain Management (SCM) practices between large enterprises (LE) and small- and-medium enterprises (SME) of India. Survey method is used to gather the responses from Indian organizations. Exploratory factor analysis is performed to reduce the number of variables, and Reliability analysis is performed to check the consistency of the constructs. A set of hypothesis has been formulated and tested using ANOVA. The findings reveal that the selected sectors have similar opinion regarding the business objectives, supply chain objectives, and reasons for choosing outsourcing strategy. Disagreement exists amongst the sectors on factors developing trust between buyers and suppliers, and kind of relationships maintained with suppliers. It is also observed that SMEs face different barriers than the LEs while implementing SCM practices. Also, SMEs have a cultural difference and adopt different criteria for selecting benchmarking partners vis-a-vis LEs. This paper identifies, and empirically tests the way the LEs and SMEs differ in employing SCM practices. More importantly, this paper is one of the few which explains the importance of SCM implementation in SME’s perspective. This study adds to the existing SCM literature by finding certain interesting results regarding organizational culture, barriers to SCM implementation, and benchmarking practices in SME context.