Evolutional Characteristics of the Global Supply Chain in Various Industries

Introduction

This chapter discusses the characteristics of global supply chains based on a literature review and cases from Asia. The supply chain (SC) is a crucial aspect of company management. The SC includes the entire process, from material supply to after-service. In this process, not only material and products are considered, but information and money are also the objectives of management (Bowersox, D. J., & Closs, 1996; Chopra, 2015). From the perspective of the resource-based view and competitive advantage, the SC has a significant strategic influence on a company's performance and social image.

The global SC (GSC) of a multinational corporation (MNC) refers to material imports, managing overseas factories, product exports, and interaction with foreign countries. The GSC has a broader range, including international business and cross-cultural management. Free On Board (FOB) is the main style of the SC in the USA. Meanwhile, the cost insurance and freight (CIF) style is adopted in most cases in Japan (Kurosu & Iwama, 2017). However, there is an increasing number of MNCs in Japan, and they need to conduct business with foreign consumers, foreign companies, or overseas subsidiaries. Consequently, they face GSC-related strategies and issues. During the coronavirus disease (COVID-19) pandemic crisis, Komatsu of Japan stabilized its GSC because of its reasonable global logistics distribution. During this crisis, many Japanese factories and manufacturers had to reduce working hours or stop work altogether. However, Komatsu managed to deploy materials and parts from its overseas logistics base, which contributed to its survival during this crisis.

Sun, Fu, & Jiang (2020) conducted an empirical study on the degree of SC concentration and overinvestment based on the data (2008–2017) of Chinese listed companies. According to Sun et al. (2020), the relationship between supplier and client has positive and negative impacts on a company. The concentration of the SC has a reverse U-shaped relationship with overinvestment. Further group tests show that this relationship is more evident in private enterprises and when the degree of industry prosperity is relatively low. Hence, SCs are important for companies in both developed and developing economies.

The GSC in both developed countries and emerging economies is experiencing a revolution. However, the progress in and characteristics of various industries are different. Srinivasan et al. (2021) proposed a typology of SC types, strategies, and people management according to product complexity and environmental uncertainty (Table 1). Hence, this chapter aims to identify its evolutionary features across diverse industries in Japan and China through an analysis of the literature.

Background

With the influence of globalization in developed countries such as Japan, many transformations have occurred in the SC. Artificial intelligence (AI) has been used to control automatic program systems in many manufacturing factories. Meanwhile, robots are fully used to deliver postal matters or work in factories to handle parts of the products. Drones are also utilized to manage farm production systems. Moreover, many industries are conducting digital transformation (DX) to control and coordinate digital data management systems. Overall, the progress in DX and AI in GSCs is a universal phenomenon in various industries. Additionally, the green SC is at a high level in Japan. A green SC means that the idea of environmental protection and resource conservation is implemented across the entire SC (Meng, Li, Yin, & Li, 2021). However, some distinctiveness still exists among these industries (e.g., technology, human resources, local and international standards, infrastructure, monopoly problems in container harbors, customs duties, barriers, and obstacles in trading; Kurosu & Iwama, 2017).