Various members of the supply chain indicated that the power seems to lie with farmers or retailers, but rarely with themselves. I have already discussed how with the forces of globalization, the business boundaries are being broken down by the capacity of new information technology and communication methods to transcend countries and trading opportunities. Business boundaries, and their associated social roles, and behaviours, are more open and fluid than they once were. Yet, these businesses still reflect on themselves as individuals operating as independent units among a group of competitors. When asked about how they communicate with farmers and other entities in the chain, there was a uniformity in the responses from members of uncoordinated chains.
“Hmm… communicate? We just place our orders, and ship our products. The times we need to talk to someone it is because there has been a mistake or an oversight. It is all done electronically now. There is no need for
communication beyond that, beyond sending the order numbers. We never need to communicate with the growers, they are so far down the line from us.” INTSC4
“Trade shows are one way of keeping up with new developments, but for what we do, there is not the need to talk to anyone else. I think it would confuse
things if we were talking to sources other than those we directly order from.” INTSC9
“We talk to the farmers to let them know how their clip is doing relative to the rest at auction. We arrange testing, and do some of the classing internally. We compile the statistics from auctions. We also compile the weekly and monthly market reports. All of this information is made available to our clients
[farmers]. The problem isn’t us communicating with farmers, it’s other members of the chain communicating with us. But they can’t right? Or the farmers will know too much and set the reserves high, and that means profit loss down the line, or exporters and operators looking elsewhere.” INTSC1
As for the farmers, their contact with global networks is also limited by their need to be on the farm conducting their business in order to provide the raw supply for the network of other businesses that rely on them. Hence, they may be perceived as being in positions of power through that provision of supply. However, it does not necessarily place them in the best position to initiate and maintain relationships further along the chain that would help ensure the raw supply made it to market in an effective and efficient way; cooperatively and with open communication.
It has been suggested that the “network enterprise” (Castells, 1996) is the
organizational form best suited to a global, information economy, where survival depends on being a part of a network, decentralizing the control of the network, and maintaining these relationships, across diverse cultural, economic, and institutional contexts. The members of the cooperative supply chains and the representatives that I interviewed described these characteristics precisely:
“We are organized in how we go about making our products because it means that the materials, the orders, the research and development, and the trends we’re following are all predictable and manageable. Everyone’s involved in the decision making and takes responsibility for their part of the process, and because of that problems get solved quickly and creatively, instead of being burdened by bureaucracy and paperwork, lost memos and emails. There’s no blame here because there’s no one in particular to blame, no CEO or CFO for that matter, just everyone carrying their own load and letting each other know precisely where we’re at. We think of ourselves as a safety net for ourselves.” INTSC11
“The farmers we talk to that are involved with [fine wool company name] and [cooperative company name] have a leg-up on the others when it comes to knowing where they will be a few years from now. Maybe it’s because they
know exactly where their wool goes and they are more involved in the whole process? Or because of that pride, they are interested in becoming more knowledgeable about the business world and they have a better understanding of how things work? For any reason, they are less threatened when there’s a downturn like we’re havin’ now. We don’t have to make calls on their behalf. They make them themselves.” INTSC13
The encouragement of cooperation and coordination among the wool industry, as described by the members of the supply chain themselves, is certainly a starting block towards increasing the sustainability of the industry, and the re-establishment of a community instinct among wool growers and the wool market around the world. The problem can be cast as a social psychological one; where decision making strategies need to be described, and improved along the entire chain, with a combined effort towards not making fundamental judgment errors when faced with uncertain and complex situations.
6.8
Summary of the Results from Supply Chain Member Interviews
This chapter has presented the finding of the interviews with various members of the supply chains delivering New Zealand wool to the markets. Respondents have described five major influences on their decision making. These included considerations of the ways of negotiating the changes in their decision environments, wanting to maintain personal identities while also being cognizant of social identities, using strategic positioning to feel powerful, navigating economic games with the other ‘players’ in the chains, and making decisions in the direction of chain unification.
In a way similar to the farmers, the environment in which supply chain decision makers find themselves had a lot to do with how they approached supply chain decisions and relationships. Members of the opportunistic chains were greatly influenced by the actions of other entities, and had the perception that games were a typical part of the chains they belonged to. In the cooperative chains, however, members concentrated their efforts on making unified decisions, and appeared to have no regard for influencing the actions of other
entities or chains, except to create alignment and build relationships. They were not as focused on their competitors as the competitive chain members were. The cooperative chain members instead focused their energy on performing in synchrony. This required a long term focus and commitment from members which removed the short term gains that game playing might bring. All the members of the cooperative chain, including farmers, marketing
directors, and retailers influence each other through their commitment to the product they are creating and selling. By working to build their cohesiveness through open and regular communication, these entities ensure all the members of the chain are united.
This revealed only one of several ways that the members of the supply chain influenced the way farmers made decisions on their farms. The following Analysis chapter will look at three other such situations, and attempt to describe and provide alternatives to how to solve the social psychological problem of working as a group across many boundaries, using parallels between economic game approaches, and evolutionary group selection