Key dimensions of value creation ability of supply management

The purpose of this paper is to examine the dimensions of supply management that may contribute to its ability to create value. Based on previous literature, this study proposes that key supplier management (KSM), the strategic level of supply management and supplier relationship management (SRM) capabilities can be supply management factors that significantly influence its ability to create value.

The issue is examined using survey data collected in Finland, and the concepts are tested using regression analysis.

The results show that KSM, the strategic level of supply management and SRM capabilities are significant dimensions of value creation in supply management. The findings support the contemporary understanding of value in which firms endeavour to create value for the company, its customers and its suppliers.

Previously, value creation has received minor attention in supply chain management research. Although previous research clearly shows that strategic supply management plays a significant role in firms’ competitiveness and performance, its role and potential in value creation have been less studied. Thus, this study contributes by empirically examining the factors affecting the ability of a firm’s supply management to create value.