An Analysis of the Key Success Factors for Lean Supply Management: A Case Study of Unilever's Tea Supply Chain in Africa

Abstract

To achieve leanness in the supply chain, supply managers must of necessity embrace a set of key success factors which - when fully operationalised and supported in an organisation - underlie the realisation of optimal inventories, low supply costs and the shortest lead times. This study examined this phenomenon in the case of Unilever's tea supply operations in Africa. The specific objectives were to determine the extent of adoption of lean supply management practices at Unilever's tea supply chain in Africa and to identify barriers to the realisation of a more efficient supply operation within the organisation's tea supply system in the region. The author adopted a framework that defined a supply chain at four levels, namely: the upstream, the focal firm (static network), the downstream, and the dynamic network. These four levels were mapped out as supplier relations, internal organisation of the buying firm, customer relations, and strategy level activities, respectively. For this study, the focal firm was the Tea Division of Unilever Kenya Limited (also referred to as Kenya Tea Buying Organisation). The research methodology deployed was the case study using an electronic questionnaire with both structured and open-ended questions. Responses to structured questions were on a sixpoint Likert scale. Data was collected from a population of 46 across 10 countries that were part of the supply network under investigation. Five of the target respondents were senior management from third party entities that provided core services to the focal firm, while the rest were managers at different levels within Unilever's global tea supply network. Data was analysed using descriptive statistics. The means and standard deviations of Likert scale data were computed, tabulated and ranked for interpretation. The findings indicated that most of the key success factors were present but to varying degrees of implementation. On the other hand, there were a number of impediments to successful lean supply management - notably, a lack of performance measures for suppliers and an inefficient execution of out-sourced services. Amongst other recommendations, the study proposed that long-term contracting should be expanded to minimise the supply risks associated with auction and spot buying. At the same time, performance measurement and feedback systems for suppliers and third party service providers should be developed, implemented and enforced.