EXPLORATORY STUDY ON ACHIEVING SUSTAINABLE COMPETITIVE ADVANTAGE THROUGH SUPPLY CHAIN INNOVATION FOR STRENGTHENING ORGANIZATIONAL PERFORMANCE

- This paper discusses a literature review concerning the importance of supply chain innovation to achieve sustainable competitive advantage for enhancing organizational performance. Supply chain innovations in firms and supply chain are integral to responding to dynamic markets and Customer needs. Supply chain relationships between firms are increasingly important for creating differential advantage over competitor by organizational capability. The data collection instrument used was a questionnaire which was administrated to a total sample of 75 managers. The response rate was 70%. Sample selection was based on convenience sampling. This explorative research examines a sample of firms active in supply chain relationships in Karnataka, to examine linkage between organizational capabilities, competitive advantage and supply chain innovation to meet changing market situations. Initial findings indicate that although firms focus on developing capabilities to innovate individually, but exhibit reliance on developing their supply chain innovation capacity.


INTRODUCTION
As far as the business world is concerned, the customer, who is perceived as the 'king', is the driver of change in the market place owing to their changing attitudes are pushing businesses to rethink their strategies, and those that are able to stand up to the challenge are taking advantage of it. It is focal concern of the firms to survive and thrive in a competitive business environment (Piyush Singhal et.al.,2011). As competition intensified and markets became global, operations get to be more intricate in managing the supply chain to fulfill the products delivery to the customers (Sridharan and Laforge, 1990;Zhao et al., 2001). The result is that the production and logistics and supply chain processes are becoming increasingly complex. The organization survival in the steadily changing business environment is currently turned into an issue of supply chain practices (Fine, 1998). Complexity and uncertainty is what companies have to overcome in their supply chain in order to compete better. The operations technique needs to be acclimated to adjust to the progressions as organization stretches business. The development of supply chain aims to enhance benefit, customer response and capicity to deliver value to the customers and also to enhance the interconnection and reliance among firms (Inda Sukati et.al.,2011). Because of business sector growing from local to global market increase customer demands, for example demanding low price, quicker delivery, high quality products or services and increase the variety of items (Braunscheidel, 2005). Success or failure of supply chains management practices are determined by the end customer in the marketplace (Towil and Christopher, 2007). Broring and his associates(2006), opined that the innovation is particularly important to firms occupied in developing markets where change is continuous and the principles and customs of conducting business are dynamic. Companies need to innovate their supply chain strategy and approach to develop competitive advantage and differentiate from competitors. According to Brett Able and Alex Royez,2004, success requires reducing cost bases through tight controls on expenses and redesigned work processes, more productive work force and re-engineered supply chains. Philosophically, organizations need to be partners with their customers. Also, Companies need to work on multiple levels-engineers working together to troubleshoot, process problems on their manufacturing lines and to improve productivity; marketing teams discussing new products and trends; and management working closely together to develop mutually beneficial business opportunities.

II. COMPETITIVE ADVANTAGE THROUGH SUPPLY CHAIN
According to Mc.Ginnis MA, Vallopra RM.1999, Competitive advantage is the degree to which an organization has the ability to create differential position over its rivals in the market. The competitive strategy is built around providing the customer with convenience, availability, and responsiveness. Effective supply chain and logistic management can provide a major source of competitive advantage, fulfilling vested interests of its stakeholders. In other words, acquiring a position of enduring performance over competitors. The performance can be measured in terms of short-term objectives of supply chain management, are fundamentally to enhance productivity and reduce inventory and process duration. While long-term objectives are to increase market share and profit for all stakeholders of the supply chain. Financial metrics have served as a device for looking at associations and assessing an association's conduct over times. Any organizational initiative, including supply chain management, should ultimately lead to enhanced organizational performance. Various former studies have measured organizational performance using both financial and market criteria, including return on investment, market share, profit margin, the growth of sales, and overall competitive position. The sources of competitive advantage are the "three C'sthe customer, the completion, and the company.

Value Value
Company Competitor

Figure 1. Sources of Competitive advantage
Needs seeking benefit at acceptable prices

Assets and utilisation
Assets and utilisation Cost Differential

Competitive advantage through supply chain Relationships
The organizations began to understand enhancing internal efficiencies is no more enough, but entire supply chains need to be made competitive. (Li et al.,2004). Depending on simply individual or single central organization for economic and industry competitiveness is not sustainable. This implies that competition no longer revolves around individual organizations. But, organizations must have effective relationship across supply chain partners to achieve coordination and integration. According to Lambert, D. M. and Knemeyer, A. M., (2006),Supply chain relationships are groups of organisations entering into a business in order to secure supply and demand as part of a market dynamic. Competitive advantage would be moderator between supply chain integration and organisational performance. Supply chain management requires a development far from armslength relationships toward partnership style relations. Supply chain management includes integration, co-ordination and collaboration throughout the supply chain i.e., intra-organisational and inter-organisational integration. It depicts the different relationships that exist between departments within a organisations or the relationship between various organisations. Barney, J., (1991) explains competitive relationship as those rivalries between supply organisations and units, within the same supply chain, for resources and capabilities in order to supply to an end user client. On the other hand, Contractor,F. J. and Lorange, P., (1988), describe cooperative relationships are the different levels of interdependence amongst supply chain firms, such as formal and informal states of coordination, partnerships, collaboration, and cooperation within a supply chain, as they unite interests and strive to derive common advantages. Coordinated supply chain relationships are the simplest form of cooperation between supply chain partners, often exemplified in 3 rd party and 4 th party logistics relationships. Partnerships can occur between either competitive or non-competitive relationships, at either the vertical or the horizontal levels within the supply chain. Partnerships are those supply chain relationships that are specific to either two-way (dyadic) formal supply chain relationships (Gulati, R., Nohria, N., and Zaheer, A., 2000) or three way (triadic) formal relationships (Madhavan, R. et al., 2004), and share a high degree of integration through mutual and specific agreements. As globalization drives rapid changes in market and company operations, strategic supply chain relationships are seen as critical to high performance and developing innovation capacity to meet both supply and demand (Peng, J. S., 2008). Accept that connecting the customer value proposition, sound supply chain operations, and robust risk management is key to success. Supply chain relationships are strategically assembled by firms to acquire resultant capabilities that ensure competitive advantage through the innovation capacity of the supply chain.

Supply Chain Innovation Capacity
The sustainable innovations will need to extend beyond one individual firm to a connected supply

Supply Chain Management
Supply Chain Relationships and Relational capabilities

Supply Chain innovation
Market trajectories and competitive advantage chain of firms needing to innovate together to reach a new market's potential. Markley and Davis (2007) states that accomplish a sustainable competitive advantage over competitors by linkage between the innovative firm and its supply chain is substantially vital. Customers increasingly demands a sustainable supply chain and individual firms to verify that different firms in the supply chain adopt appropriate management practices if they wish to protect their brands (Amaeshi et al. 2007). Preuss (2005) suggests that firms must work with their supply chain partners, both upstream and down, to deliver a truly sustainable service.
The practitioners and scholars believe that the effective supply chain management has become an important enabler to improve organization performance and valuable way of securing competitive advantage (Chirderhouse et al,2003;Li et al, 2006;Hamel,G. and Breen, B.,2007.) recommends that depending on simply individual or single central organization for economic and industry competitiveness is not sustainable. Endorsing a strategic approach to developing supply chain relationships are seen as basic to survival for many firms (Miles, R. E. and Snow, C. C., 2007). Skjoett-Larsen,T.(1999),indicates that supply chain relationships are affected by coordination, cooperation and collaborating within supply chains. Particularly, the range of intra and interorganisational competence and dynamic capabilities available from its participants (Blomqvist, K. and Levy, J., 2006, Zott, C., 2003, K. M. and Martin, J. A., 2000, Petroni, A., 1998. These capabilities are most relevant in developing innovation capacity in supply chain, which is frequently the impetus to realign to address the needs of potential or emerging conditions in the market, and create new market trajectories. The organizations with effective supply chain and risk management are capable to manage risks, surpass the market and acquire competitive advantage (Mark strom,2011).

IV. RESULTS AND DISCUSSION
Many of the respondent firms under study were developing or attempting to develop strategic supply chain relationships over the longer term, particularly through supply chain partnerships as opposed to larger scale collaborations. Significantly more number of firms indicated they were always seeking long-term dyadic or triadic contractual partnerships.
On the other hand with only few firms were involved in short term contracts. However, organizations involved on a regular basis in cooperative arrangements with competitors significantly lower. The results of the study are discussed below. Important Activities for maintaining supply chains Table 1 shows the level of importance respondent firms place on alignment and integration activities identified as integral to partnering or collaborating for competitive advantage. Interestingly, the results were in tune with the study of Maree Storer and Paul Hyland(2009), more than 52% of firms believe that developing joint capabilities to respond to market changes is of high importance. Following integrating logistics (52%), aligning functions across supply chain (50%) are next important activities. However, contradicting this are the low numbers of firms identifying the need to align other strategic and innovative activities with supply chain partners of high importance. Supply chain capabilities to meet changing markets and customer requirements.
The literature identified that supply chain actors need to be able to react to change and realign their capabilities to address changes in the market to achieve competitive capabilities required to develop supply chain innovation capacity. Indication of the respondents' attitudes toward adapting, reconfiguring and coordinating capabilities to meet supply chain market needs provided in Table 2. Following areas adapting processes, products and systems to market and customer needs (64.13%), reconfigure resources and capabilities on demand (63.03), coordinate and integrate resources and capabilities on demand (62.03%) are highly important respondent firms in the study. On the other hand coupling and decoupling supply chain relationships to acquire a different combination of resources and capabilities are important to 26.3% of respondents. Ability to align functions to meet supply chain demands is also important for 54% of respondents. Supply Chain Innovation Capacity to ensure competitive advantage of supply chain.
In the minds of these respondents various organizational capabilities are more important than others for ensuring a supply chain competitive advantage through innovation capacity within the supply chain. Table 3 shows that maintaining a competitive advantage through supply chain activities is overwhelming through the development of a continuous improvement capability (82.5%) and having the ability to develop and manage new technologies (76.25%). Interestingly, 42.88% of respondents believe that ability to adapt and align to climate change and other environmental challenges as highly important considering the importance of climate change and the proposed carbon trading emissions scheme at this time.
Table3. Ensure competitive advantage through Supply Chain Innovation Capacity. Important capabilities to create a competitive advantage Finally, in terms of dynamic capabilities and creating a competitive advantage, while incremental innovation was critically important for competitive advantage at a firm level, this appears unsupported at the inter-organizational level of the supply chain, with only 40.3% of respondents raising this as highly important. The fact in the study that only 41% of respondents saw the ability for organisations within a supply chain to reconfigure and recreate resources and capabilities on demand as highly important. However 64% of respondents do acknowledge the role that the ability of organisations within a supply chain to innovate internal resources and capabilities plays. Another important aspect, as related earlier is the ability for individuals and groups within a supply chain to create new learning from each other (55.1%). Similarly only 52% of firms felt it was highly important to align and integrate resources and capabilities as required on demand to meet the nature of business exchange and create new product, process and systems in the supply chain. It is apparent that these respondent firms in Karnataka supply chains focus more on innovation and improvement at the firm level than in utilizing their relationships with their supply chain partners.

SL.No
Table4. Important capabilities to create a competitive advantage V. CONCLUSION Firms in a supply chain focused on a new and dynamic market that is marked with dynamism and emerging rules will need a strategic emphasis on innovativeness within firms and across the supply chain to be successful and sustainable. This is an exploratory study of firms and their attitude toward developing competitive capabilities and innovation capacity within the supply chain. Initial findings indicating that firms still firmly focus on their own individual innovation capacity. There is some recognition of the potential of aligning and developing supply chain innovation capacity through supply chain relationships. At the same time, the literature advocates that supply chains that have engaged effective organisational relationships, in the form of partnerships or joint efforts, can and do make advancement capacity, by sharing competencies, capabilities and resources which often occurs in a dynamic and innovative manner in response to changes in the business environment or in response to customer demand. In the literature, coordinating, cooperating, partnering and collaborating within supply chains, and key methodology to creating supply chain relationships (Miles, R. E. and Snow, C. C., 2007) are seen as critical to survival. The firms in this study have only recognized the benefits of long term partnerships.It is not surprising that few firms have been able to bridge competition with cooperation in supply chain relationships, and engage in competition (Brandes, O. et al., 2007). It appears the respondents can see that strong relationships in the supply chain give rise to formal cooperation and provide some impetus to improve competitive advantage especially through continuous improvement and innovation practices. However, weakly aligned supply chains fails, if allocating resources and transpositioning abilities and skills, are not highly important to developing a supply chain's capacity to innovate in response to rapid changes in the market. Further, the discoveries structure a piece of a more extensive study to educate and amplify the current hypothetical models of Wagner & Boutellier (2002) and Ketchen Hult(2007), and comprehend whether firms can strategically create intra and interorganisational relationships within a supply chain to enhance innovation capacity and competitive advantage. Particularly of interest is the ability of the supply chain partners to adapt, incorporate and adjust new aptitudes, assets and useful abilities to match the prerequisites of an evolving environment (Teece, D. J. et al., 1997) in a dynamic manner. These discoveries despite the fact that not generalisable and restricted through the small sample and scale of the study still give great data to further research to figure out whether the discoveries apply to other supply chains both in India and internationally. product development: vertically medicated coopetition in the automotive supply chain. International Journal of Automotive Technology and Management., 2007, 7, 168-183. Brett