Posted: June 11th, 2015

Mitigating demand uncertainty through supply chain strategies: the case of food smes in hajj phenomenon

Introduction

This chapter presents the results obtained from the study semi-structured interviews, online surveys and document review. The qualitative data presented is gathered from interviews with 12 CEOs working in different SMEs across Saudi Arabia while the quantitative data is obtained from an online survey undertaken on 239 respondents from the SMEs in the food sector across the Kingdom of Saudi Arabia (KSA). The primary data was collected to provide evidence on how relevant supply chain strategies can be used to mitigate the demand uncertainty of KSA’s food small and medium sized enterprises (SMEs) during the Hajj phenomenon. Therefore, this chapter is divided into three sections. The first section presents the demographic information of the respondents, that is; their education levels, occupation, work experience, and company location among others. The second section presents results of the control variables, that is; firm size, firm age and firm production type. The last section presents results on the relationship between the various constructs. These include: the relationship between II and external integration (SI and CI); the relationship between the various forms of SCI (II, CI and SI) and postponement; the relationship between SCI and MCC; the relationship between II and PP; the relationship between II and MCC; the relationship between CI and PP; relationship between CI and MCC; the relationship between SI and PP; the relationship between SI and MCC; the relationship between Mass Customization and Postponement; the contingent effects of Demand Uncertainty and Competitive Intensity; and the relationship between II, SI, CI, PP, and MCC with Demand Uncertainty Mitigation (DUM).

Basic Demographic variables

The online survey as well as the semi-structured interviews asked the respondents to provide some basic information about themselves and their organizations. Out of the 239 respondents who undertook the quantitative online survey, 3.3% had high school education level, 65.7% had a Bachelor’s degree, 25.5% had a master’s degree and 2.5% had a PhD as shown in the table below.

Further, the respondents were asked to state their current job positions and the results show that majority (91.2%) were in the top management and the rest in middle management (7.1%) and junior management (1.7%). When asked to describe their role in the organizations, 87.9% said there CEOs, 4.2% were vice-presidents and 7.9% said they were operations managers. The respondents were also asked to state how long they have been working for their current employers and majority (40.6%) had worked for 10-15 years, 18% for 15-20 years, 14.2% for 5-10 years, and another 14.2% for 20-25 years. Seven respondents (2.9%) had worked for 1-5 years and only one had worked for over 30 years in their current organizations. The number of years an employee had worked in a firm was also used to determine the age of the firm, which was considered a key control variable.

Based on the location of their firms, 89.1% said their offices were based in Makkah while the remaining 10.9% reported that their offices were based in Jeddah. All the data is tabulated in the tables below.

Control Variables

In order to better determine the hypothesized relationships, three control variables namely, firm size, firm age and firm production type were used. The firm size was determined by asking the study respondents to indicate the number of firm employees. Also, the firms’ logged scores were analyzed to determine the number of employees that a firm may have. Further, the year of registration was used to determine the age of the firm, and the employees were asked to also state when the firm started its operations. The firm production category was determined based on the type of food that the establishment made. Therefore, three categories were formulated: fresh meal, pre-cooked, raw material wholesale.

The online survey participants were asked to state the number of employees in their firm and the results were as shown in the table below.

The data from the online surveys was further grouped and analyzed and the results were as the pie chart below. Based on the results, 3% came from organizations with 25 employees, 11% were from organizations with 30-50 employees, 15% were from firms with 50-70 employees, 16% from organizations with 90-110 employees and another 16% from organizations with 130-150 employees. The remaining 9%, 10%, 13%, and 7% were from companies with 90-110, 110-130, 150-170, and 210-250 employees respectively.

The respondents were further asked to name the sectors in which their organizations belonged. As the pie chart below shows, almost half of the online survey informants (49%) came from firms operating under the food manufacturing sector while 22% came from food provider sector. The other 14% worked for firms that were in the subcontractors’ sector, 12% from Hajj campaigns sector and the minority 3% were from the SC management sector.

As earlier mentioned, the data on the number of years an employee had worked in a firm was used to determine the age of the firm. Therefore, based on the results received, the chart below tabulates the results obtained.

Relationship between Various Constructs

The current study had hypothesized that SCI not only has a significant direct and indirect effect on the PP and MCC, but also plays a critical role throughout the employment of PP as an important strategy, empowering MCC to mitigate demand uncertainty. In order to ascertain the relationship between various hypothesized constructs, the study participants were asked several questions that aimed at obtaining data that would ascertain the relationship between these constructs.