Measuring the supply chain competitiveness of e-commerce industry in Indonesia

Abstract

Purpose The purpose of this study is to measure the supply chain competitiveness of the e-commerce industry in Indonesia. Design/methodology/approach The study used a multi-criteria decision-making model based on the analytic hierarchy process. Four main criteria are used to measure the supply chain competitiveness, i.e. cost, differentiation, sustainability and infrastructure. Findings The findings of this study show that cost is the most important criterion with a degree of importance of 33.19%, followed by infrastructure of 29.40%, differentiation of 27.96% and sustainability of 9.45%. It shows that the internally controlled strategy contributes about 70% of supply chain competitiveness. The internal infrastructure criterion that consists of software and hardware contributes 65.92% to the whole infrastructure criterion. The internal infrastructure then contributes 19.38% to supply chain competitiveness. Therefore, the internally controlled strategies and internal infrastructure contribute up to 90.08% to the supply chain competitiveness of e-commerce in Indonesia. This result implies that to attain the supply chain competitiveness, the company must carry out strategies focusing on the performance such as cost, differentiation, sustainability as well as on the internal infrastructure such as software and hardware. Research limitations/implications In this paper, the authors limited their study to the business to business (B2B) and business to consumer (B2C) players because these two platforms have been experiencing a very rapid growth. While e-commerce business can take many platforms besides B2B and B2C, the future research should include other platform such as consumer to consumer as well. Because the focus in this study is more the information and material flows, it will be of great interest if the future research covers the platform of mobile payment as well that guarantee the ease of cashflows within supply chains. Also, with the occurrence of the Covid-19 pandemic when this paper was written, in the near future, it is then of great interest to incorporate the pandemic context into the proposed model used in this study. The further study should analyze long-term changes happened as the result of pandemic such as behavioral changes of online shopping from customer side or shift in e-commerce supply chain infrastructure and inventory practice. Practical implications With this study, it is expected that it can be determined which criteria contribute the most to the supply chain competitiveness of the e-commerce industry in Indonesia that will be useful for industry player. Originality/value E-commerce development in Indonesia is still facing serious challenges. The multi-criteria decision making approach used in this research lays a foundation of how supply chain competitiveness is determined based on the judgment of experts coming from major companies within the supply chain.