Thesis Final PDF

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UNIVERSITI TEKNOLOGI MALAYSIA

DECLARATION OF THESIS / UNDERGRADUATE PROJECT PAPER AND COPYRIGHT
Author’s full name : MUHAMMAD ASYRAF BIN ZAILUDIN

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Date of birth : 2nd JANUARY 1994

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Title : THE IMPORTANCE OF SUPPLY CHAIN

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MANAGEMENT FOR READY MIXED PRODUCTION
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AND DELIVERY PROCESS
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Academic Session : 2015/2016

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I declare that this thesis is classified as :
CONFIDENTIAL (Contains confidential information under the Official Secret

Act 1972)*
RESTRICTED (Contains restricted information as specified by the

organization where research was done)*
√ OPEN ACCESS I agree that my thesis to be published as online open access

(full text)
I acknowledged that Universiti Teknologi Malaysia reserves the right as follows:
1. The thesis is the property of Universiti Teknologi Malaysia.

2. The Library of Universiti Teknologi Malaysia has the right to make copies for the purpose
of research only.
3. The Library has the right to make copies of the thesis for academic exchange.
Certified by :
SIGNATURE SIGNATURE OF SUPERVISOR
DR. BALQIS BT. OMAR

(NEW IC NO. /PASSPORT NO.) NAME OF SUPERVISOR
Date : Date :
NOTES : * If the thesis is CONFIDENTAL or RESTRICTED, please attach with the letter from
the organization with period and reasons for confidentiality or restriction.
“I hereby declare that I have read this thesis and in my/our*
opinion this thesis is sufficient in terms of scope and quality for the
award of the degree of Bachelor of Civil Engineering”
Signature : ....................................................
Name of Supervisor : DR. BALQIS BT. OMAR
Date : JUNE 2016
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THE IMPORTANCE OF SUPPLY CHAIN MANAGEMENT FOR READY

MIXED CONCRETE PRODUCTION AND DELIVERY PROCESS
MUHAMMAD ASYRAF BIN ZAILUDIN
A report submitted in partial fulfillment of the

requirements for the award of the degree of
Bachelor of Civil Engineering
Faculty of Civil Engineering

Universiti Teknologi Malaysia
JUNE, 2016
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I declare that this report entitled “The Importance of Supply Chain Management for
Ready Mixed Concrete Production and Delivery Process” is the result of my own
research, except as in cited references. The report has not been accepted for any
degree and is not concurrently submitted in candidature of any other degree.
Signature :
Name : MUHAMMAD ASYRAF BIN ZAILUDIN
Date : JUNE 2016
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To;
My Parent
&
My family…
Thanks for your pray, attention and spiritual support

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ACKNOWLEDGEMENTS
It is a great pleasure to address those people who helped me throughout this

project to enhance my knowledge and practical skills especially in research area. My
deepest and most heartfelt gratitude goes to my only one supervisor, Dr. Balqis bt.
Omar for the continuous guidance and support from her has enabled me to approach
work positively, and make even the impossible seem possible.
I also owe a debt of gratitude to my family and friends for their support and
encouragement throughout my bachelor degree program and in also in writing this
report.
Finally, thanks to all those who had contributed, either directly or indirectly,
to the research and compilation of this project report.
Thank you…
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ABSTRACT
Supply chain management is a concept originated and flourished in the

manufacturing industry. It is a link of organization network that involves many parties
contributing to the development and quality of products or services delivered to the
customer. Improper implementation of supply chain management can lower the level of
the performance in terms of cost, time and quality of products. This study explores the
effectiveness of an existing supply chain management practice for a ready mixed concrete
production by reviewing its material supply chain to determine the parties and processes
involved in the supply chain. Material supply risks and the benefits gained from the
implementation of the existing supply chain management have also been identified in this
study. An interview and a questionnaire survey were conducted to obtain the required
information. Results of the interview and survey show that the workers at the concrete
batching plant have a good understanding of supply chain management, and the material
supply risks and the benefits gained from its implementation. They also have an
appreciation regarding the importance of effective and efficient supply chain
management. Finally, a framework has been proposed to improve the efficiency of the
existing supply chain management by improvising the existing framework. Based on this
study, it can be concluded that effective supply chain management is very important to
increase the efficiency of the ready mixed concrete production and delivery process.
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ABSTRAK
Pengurusan rantaiaan bekalan adalah konsep yang berasal daripada industri

pembuatan. Pengurusan rantaian bekalan adalah penghubung rangkaian organisasi yang
melibatkan pelbagai pihak yang menyumbang kepada pembangunan dan kualiti produk
atau perkhidmatan yang ditawarkan kepada pelanggan. Pengurusan rantaian bekalan yang
tidak dilaksanakan dengan betul dapat mempengaruhi tahap prestasi dari segi kos, masa
dan kualiti produk. Projek ini mengkaji tahap keberkesanan pengurusan rantaian bekalan
yang sedia ada dalam proses pembuatan konkrit bancuh siap dengan menyemak bahan
pengurusan rantaian bekalan untuk mengenal pasti pihak dan proses yang terlibat dalam
rantaian bekalan tersebut. Risiko bekalan bahan yang terdapat dalam proses pembuatan
konktit bancuh siap dan kebaikan yang diperolehi daripada pelaksanaan pengurusan
rantaian bekalan juga telah dikenal pasti dalam projek ini. Satu temu duga dan kajian soal
selidik telah dijalankan untuk mengumpul maklumat yang diperlukan bagi projek ini.
Daripada hasil temu duga dan kajian soal selidik yang dijalankan, menunjukkan bahawa
kesemua pekerja di kilang pembuatan konkrit bancuh siap mempunyai pemahaman yang
baik mengenai pengurusan bekalan bahan, risiko bekalan bahan, dan manfaat yang
diperolehi daripada pelaksanaannya. Mereka juga meghargai kepentingan pengurusan
rantaian bekalan yang cekap dan berkesan. Akhir sekali, satu rangka kerja telah
dicadangkan untuk meningkatkan kecekapan pengurusan rantaian bekalan yang sedia ada
dengan memperbaiki rangka kerja yang sedia ada. Berdasarkan kajian ini, dapat
disimpulkan bahawa pengurusan rantaian bekalan yang berkesan adalah sangat penting
untuk meningkatkan kecekapan proses pembuatan dan penghantaran konkrit bancuh siap.
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TABLE OF CONTENTS
CHAPTER CONTENT PAGE
TITLE i
DECLARATION ii
DEDICATIONS iii
ACKNOWLEDGMENTS iv
ABSTRACT v
ABSTRAK vi
TABLE OF CONTENTS vii
LIST OF TABLES x
LIST OF FIGURES xi
LIST OF APPENDICES xii
1 INTRODUCTION 1
1.1 Introduction 1
1.2 Background of study 2
1.3 Problem statement 3
1.4 Aims and Objectives 4
1.5 Scope of Study 5
1.6 Thesis structure 5
1.7 Summary 7
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2 LITERATURE REVIEW 8
2.1 Introduction 8
2.2 Definitions of Supply Chain Management 9
2.3 Origin of Supply Chain Mangement 11
2.4 Concept of Supply Chain Management 11
2.5 Issues and Challenges in SCM 15
2.6 Types of Issue in SCM 15
2.6.1 Partnership, Alliances, and Cooperation Issues 16
2.6.2 Logistic Management 16
2.6.3 Trust and Commitment 18
2.7 Benefits of Supply Chain Management 18
2.8 Ready Mixed Concrete Industry Background 19
2.9 SCM in Ready Mixed Concrete Production and Delivery 20
Process
2.10 Supply Chain Risk Management 21
2.10.1 Material Flow Risk 22
2.12 Summary 26
3 METHODOLOGY 27
3.1 Introduction 27
3.2 Interview 28
3.2.1 Interview Results 28
3.3 Survey 32
3.3.1 Questionnaire Structures 33
3.3.2 Data Analysis 34
3.4 Methodology Flow Diagram 36
3.5 Summary 37
4 RESULTS AND ANALYSIS 38

4.1 Introduction 38
4.2 Questionniare Survey 39
4.2.1 Survey Objective 39
4.2.2 Questionnaire 40
4.2.3 Respondent 40
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4.3 Survey Results 41

4.3.1 Section A: Personal particulars 41
4.3.2 Section B: The importance of product’s quality and 43
dependable suppliers
4.3.3 Section C: How your organization ensures the 46
effectiveness supply chain management practices
4.3.4 Section D: Benefits gained through the 48
implemetation of supply chain management
4.4 Interview Results 51
4.4.1 Background Information 52
4.4.2 Supplier Relationship 52
4.4.3 Inventory 53
4.4.4 Transportation 54
4.4.5 Information 56
4.4.6 Customer Relationship 56
4.5 Discussion 57
4.5.1 The importance of product’s quality and 57
dependable suppliers
4.5.2 How your organization ensures the 58
effectiveness of supply chain management practices
4.5.3 Benefits gained through the implementation 59
of supply chain management
4.5.4 Research Framework 60
4.6 Summary 63
5 CONCLUSIONS AND RECOMMENDATION 64

5.1 Conclusion 64
5.2 Recommendation 68
REFERENCES 69
APPENDIX A 71
x
LIST OF TABLES
TABLE NO. TITLE PAGE
3.1 Categories for RI Ranges 35

3.2 Research methodology flow 36
4.1 Percentage of respondents by profession 42
4.2 Respondents’ working experience 43
4.3 Frequency Analysis (FA) and Relativity Index (RI) for the 44
importance of product’s quality and dependable suppliers
4.4 Frequency Analysis (FA) and Relativity Index (RI) on how 46
the organization ensures the effectiveness of supply chain
management practices
4.5 Frequency Analysis (FA) and Relativity Index (RI) for the 50
benefits gained through the implementation of supply chain
management
4.6 Advantages and disadvantages of using owned truck 54
4.7 Advantages and disadvantages of using third party logistic 55
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LIST OF FIGURES
FIGURE NO. TITLE PAGE
2.1 Supply chain best practice management process 14

2.2 Generic configuration of a supply chain in manufacturing 14
3.1 Types of cardinality 30
3.2 Entity relationship diagram (ERD) based on Engineering 31
Information’s style
3.3 Five ordinal measures of agreement of Likert’s scale 34
3.4 Research methodology flow
4.1 Distribution of respondents by profession 42
4.2 Distribution of respondents by years of working 43
experience
4.3 RI for the importance of product’s quality and dependable 45
suppliers
4.4 RI on how the organization ensures the effectiveness of 48
supply chain management practices
4.5 RI of the benefits gained through the implementation of 51
supply chain management
4.6 Existing framework for the production and delivery 61
process of ready mixed concrete
4.7 Improvised framework for the production and delivery 62
process of ready mixed concrete
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LIST OF APPENDICES
APPENDIX TITLE PAGE
A Sample of Questionnaire 71
1
CHAPTER 1
INTRODUCTION
1.1 Introduction
This project studies the application of supply chain management in the

production and delivery process of ready mixed concrete. It shows that supply chain
management practices can be used to facilitate supply chain interactions in the
manufacturing industry especially in the manufacturing of ready mixed concrete,
thereby improving the production and delivery process of ready mixed concrete. This
chapter introduces the study by presenting the project background. The problem
statement and scope of the project are presented in this chapter. The aims and
objectives of the project are outlined. The final section of this chapter presents the
structure of the thesis.
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1.2 Background of Study
The production growth of ready mixed concrete in Malaysia has been on the
increased because the scale of construction in Malaysia has created a demand for a
large volume of building materials especially concrete, so it is easy for the contractors
to use ready mixed concrete to speed up the time of construction because it is readily
usable product. Therefore, it is important to study existing supply chain management
of the ready mixed concrete to ensure there is no wastage and problem within the
process of production and transportation of the product to the construction site.
Scott and Westbrook (1991) and New and Payne (1995) described supply chain
management as the chain linking each element of the manufacturing and supply
process from raw materials through to the end user, encompassing several
organizational boundaries. According to this broad definition, supply chain
management refers to the entire value chain and addresses materials and supply
management from the extraction of raw materials to its end of useful life. Hence supply
chain management (SCM) can identify the flow of material used for the production of
ready mixed concrete starting from raw material until finished product.
The utilization of inventories of the organization must be optimized by

focusing on how organization utilize their supplier’s processes, technology and
capability to enhance competitive advantage (Farley, 1997), and the coordination of
the manufacturing, logistic, and material management function within an organization
(Lee and Billington, 1992). By doing all of this, the performance of the supplier’s
system for manufacturing of ready-concrete in Malaysia can be enhanced effectively.
SCM is a concept that originated and flourished in the manufacturing industry.

The first visible signs of SCM were in the Just-In-Time (JIT) delivery system, as part
of the Toyota Production System (Shingo, 1988). This system aimed to regulate
supplies to the Toyota motor factory just in the right-small-amount, just in the right
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time. The main objective of this system was to drastically decrease inventories, and to
effectively regulate the suppliers' interaction with the production line. Just-In-Time
delivery system can be implemented into the production of ready mixed concrete
because working with the supplier as a partner in long-term relationship of loyalty and
trust would improve the quality and decrease the cost of production (Deming, 1982).
The production time and quality are important in the manufacturing of ready
mixed concrete, hence the manufacturers are forced to look for more effective ways to
coordinate the flow of materials into and out of the company. Last but not least, supply
chain management can be implemented within the production and delivery process of
the ready mixed concrete to organize effectively the flow of the raw material until it
becomes a product and successfully transferred to the client.
1.3 Problem Statement
Many organizations do not manage their supply chain properly, hence the
production and delivery of their products become ineffective and inefficient.
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1.4 Aims and Objectives
This project aims to study the effectiveness of existing supply chain

management (SCM) process for ready mixed concrete.
In order to achieve the above aim, this project has the following objectives:
1. To study or review the material supply chain management (SCM) for

ready mixed concrete.
2. To evaluate the level of understanding regarding the implementation of

supply chain management in the production and delivery process of
ready mixed concrete among the workers.
3. To identify the benefits gained through the implementation of supply

chain management in the production and delivery process of ready
mixed concrete among the workers.
4. To identify material supply risks within the production of ready mixed

concrete.
5. To develop a framework to improve the efficiency of supply chain for

ready mixed concrete production.
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1.5 Scope of Study
This project focuses on reviewing the flow of materials for the production of
Ready-Mixed-Concrete process by using supply chain management at the Holcim
Malaysia Sdn. Bhd. batching plant of ready-mixed concrete located in Senai, Johor
Bahru. Emphasis is given for identifying the level of understanding regarding the
implementation of supply chain management in the production and delivery process
of ready mixed concrete within the workers at the batching plant. Benefits gained
through the implementation of supply chain management in the production of ready
mixed concrete are also to be determined in this project.
1.6 Thesis Structure
Chapter 1: Introduction
Chapter 1 introduces the concept of the supply chain management by providing the
general background and its relationship with the production and delivery process of
ready mixed concrete. The aim and objectives of this project, followed by problem
statement and scope of study are also presented in this chapter.
Chapter 2: Literature Review
Literature review related to supply chain management in ready mixed concrete

production is presented in this chapter. It consists of the background, concept and
definition of supply chain management. This chapter also tries to determine the
relationship between the implementation of supply chain management and the
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production and delivery process of supply chain management. Other sub-topics in this
chapter includes the theoretical formwork, material supply risk within the supply
chain, ready mixed concrete background and benefits gained through supply chain
management.
Chapter 3: Research Methodology
Chapter 3 deals with the methods used to obtain the data for data analysis purpose.
Types of research methodology approaches are also presented in this chapter.
Chapter 4: Data Collection, Data Analysis and Discussion of Results
Chapter 4 describes the data collection process and analyzes the data in an organized
manner. Then it discusses about the results and key findings of this research based on
the analyzed data.
Chapter 5: Conclusion and Discussion
The final chapter is Chapter 5, it summarizes and concludes all the results and findings
of this project and proposes the solutions to improve the existing supply chain
management.
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1.7 Summary
This chapter has presented the general background to the project followed by
its aim and objectives. Problem statement and scope of study are also presented in this
chapter. The next chapter of the thesis focuses on the literature review related to the
supply chain management and ready mixed concrete.
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CHAPTER 2
LITERATURE REVIEW
2.1 Introduction
This chapter presents the definitions, concepts and origin of supply chain
management. It also states the benefits of supply chain management. The background
of ready mixed concrete and its relation with supply chain management are also be
included in this chapter. Types of material flow risk within the supply chain are also
presented in this chapter. Types of issue and challenge in supply chain management
are also be included in this chapter.
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2.2 Definitions of Supply Chain Management
Supply chain is a set of organizations that pass materials forward (La Londe
and Masters, 1994). It also can be defined as the alignment of organizations that brings
products or services to market (Lambert, et. al., 1998). Another definition refers to
supply chain as the network of organizations that are involved, through upstream and
downstream linkages, in the different processes and activities that produce value in the
form of products and services delivered to the ultimate consumer (Christopher, 1992).
It can be concluded that supply chain management is a link of organization network
that involves many parties contributing to the development and quality of products or
services delivered to the customer.
Scott and Westbrook (1991) and New and Payne (1995) stated that supply
chain linking each element of the manufacturing and supply process from raw
materials through to the end user, encompasses the entire value chain and addresses
materials and supply management from extraction of raw materials to its end of useful
life. Supply chain management also focuses on how firms utilize their supplier’s
process, technology, and capability to enhance competitive advantage (Farley, 1997).
Coordination of the manufacturing, logistics and material management functions
within organization is also considered as supply chain management (Lee and
Bilington, 1992).
The objective of supply chain management is to build trust, exchanging

information on market needs, developing new products, and reducing the supplier base
to particular original equipment manufacturer so as to release management resources
for developing meaningful, long term relationship (Berry, 1994). Copacino (1997)
defined a supply chain in term of logistics which refer to the art of managing the flow
materials and product from source to user. The logistics system includes the total flow
of materials, from the acquisition of raw materials to delivery of finished product to
the ultimate user.
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Supply chain management requires traditionally separate the material functions

to report to a person in charge for coordinating the entire materials process, and also
requires joint relationship with suppliers across multiple layers (Monczka, et. al.,
1998). It can be shown that the primary objective of supply chain management are to
integrate and manage the sourcing, flow, and control of materials using a total system
perspective across multiple functions and multiple tiers of suppliers.
When two or more organizations in a supply chain management entering into

a long term agreement, the development of trust and commitment to the relationship
can be achieved (La Londe and Masters, 1994). Supply chain is also considered as
management of a network of relationships within a firm and between interdependent
organizations and business units consisting of material suppliers, purchasing,
production facilities, logistics, marketing, and related systems that facilitate the
forward and reverse flow of materials, services, finances and information from the
original producer to final customer with the benefits of adding value, maximizing
profitability through efficiencies, and achieving customer satisfaction (Stock and
Boyer, 2009).
Supply chain is the total chain of exchange from original source of material,
through various organizations involved in extracting and processing raw materials,
manufacturing, assembling, distributing, and retailing to end customer (Saunders,
1997). It shows that all the organizations network involved in the supply chain need to
interact with each other to deliver product or service to end customer, linking flows
from raw material supply to final delivery.
According these definitions, a summary definition of the supply chain

management can be stated as all activities involved in delivering products from raw
materials to the customer. Supply chain management coordinates and integrates all of
these activities into a smooth process without any problems. It also act as a linkage
between partners in the chain including department within an organization and the
external partners including suppliers, carriers, and third party companies.
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2.3 Origin of Supply Chain Management
The origins of supply chain management (SCM) are unclear, but its
development appears to start along the lines of physical distribution and transport
(Croom, 2000). The term ‘Supply Chain Management’ was originally introduced by
consultants in the early 1980s (Oliver and Webber, 1992). Typically supply chain is a
network of materials, information and services processing links with the characteristic
of supply, transformation and demand. Supply chain management also explains the
logistic activities, the planning and control of materials and information flows
internally within a company or externally between companies (Christopher, 1992;
Cooper 1997; Fisher, 1997).
Supply chain management (SCM) concept had been used and originated from
manufacturing industry. The application of SCM could be shown in the Just-In Time
(JIT) delivery system which was part of the Toyota Production System (Shingo, 1988).
The objective of this system was to regulate supplies to Toyota motor factory just in
the right-small-amount, just in the right time. SCM originated in the field of quality
control. As early 1950, in an address to Japanese industrial leaders, Deming suggested
that working with the supplier as a partner in a long-term relationship of loyalty and
trust would improve the quality and decrease the cost of production (Deming, 1982).
2.4 Concept of Supply Chain Management
The supply chain has been defined as “the network of organizations that are
involved, through upstream and downstream linkages, in the different processes and
activities that produce value in the form of products and services in the hands of the
ultimate customer” (Christopher, 1992).
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Supply Chain Management is very detail because it reviews the entire supply
chain in order to increase transparency and alignment of the supply chain’s
coordination and configuration, regardless of functional or corporate boundaries
(Cooper and Ellram, 1993). The basic idea of supply chain management (SCM) is to
identify the interdependency in the supply chain and thereby improve its configuration
and control based on such factors as integration of business processes.
There are also other concepts of supply chain management. First, there are
development issues of supply chain management, including order information
transparency, reduction in variability, synchronizing of materials flows, critical
resources management and configuration of the supply chain (Lin and Shaw, 1998).
Second, there are strategies for supply chain management including establishment of
stable partnership, modular outsourcing of components, design for suitability for
manufacture, flexible manufacturing technologies, evolution of the supply chain with
the product life cycle, and information acquisition and sharing (Lin and Shaw, 1998).
Third, there are levels of supply chain management that can be distinguished,
including initial partnership (e.g. building good relations with suppliers and
distributors), logistic management (e.g. implementing and controlling the flow
involving all actors in the chain). ‘Genuine SCM’ refers to continuous improvement
of all aspects of the entire chain (Giunipero and Brand, 1996). Supply chain
management gives the overall flows of the entire supply chain such as the flow of
materials, bonding between supplier and manufacturer which can affect the quality of
the end product before delivered to the customer. By implementing SCM into the
manufacturing system, any defects can be detected because all the activities and the
processes have been presented in the form of framework, hence we can improvised the
system.
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Supply chain concept has been stimulated from many directions including the
quality revolution (Dale, 1994), views of material management and integrated logistic
(Carter and Price, 1993). It is also considered as a growing interest in industrial
markets and networks (Ford, 1990; Jarillo, 1993). To develop a common conceptual
base of the overall activities, identifying of relevant findings and integrate them into
an empirically tractable, meaningful research framework must be done. The pressing
need and value of a conceptual framework conducive and instrumental to further
research have recently been accentuated in operation management literature (Chen and
Small, 1996; Ho, 2002).
Implementation of the supply chain concept could be a remedy for low

efficiency of constructions enterprises that often suffer from schedule and cost
overruns, quality deviations and poor health and safety (Love, et. al., 2004). The
implementation of Supply Chain Management not only can be used in construction
only but it can also be applied to manufacturing and delivery process of materials.
Figure 2.1 shows the supply chain best practice management process while Figure 2.2
shows the generic configuration of a supply chain in manufacturing.
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Figure 2.1: Supply chain best practice management process (Stewart, 1997)
Figure 2.2: Generic configuration of a supply chain in manufacturing (Vrijhoef and

Koskela, 2000)
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2.5 Issues and Challenges in SCM
Successful implementation of supply chain management is likely dependent

upon the need for breaking down barriers not only between internal department and
business processes, but also across companies within the entire supply chain (Vollman,
1997). Effective communication among the organization within the supply chain is
very important for continuous improvement of products or services in terms of quality.
The emergence of network organizations, which can lead to a complex web of

linkages to be coordinated and managed also considered as challenging and difficult
feature of supply chain management. This kind of problem can imply difficulties,
which include lack of common purpose, multiple and hidden goals, power imbalances,
culture and procedures, conflict over autonomy and accountability, over-dependence
and continuing lack of openness and opportunistic behavior (Cox and Towsend, 1998).
2.6 Types of Issue in SCM
It can be shown that supply chain management encompasses planning,

manufacturing and operation management necessary to bring a product to the market
place, from the sourcing material to the delivery of the completed product. There are
many types of issues within the supply chain such as:
 Partnership, alliances and cooperation issues

 Logistic Management
 Trust and Commitment
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2.6.1 Partnership, Alliances and Cooperation Issues
Trust has been stated as an important element in partnership among customer

and supplier and it is necessary for enhancing cooperation and collaborative
relationships, for long term relationship, and for the common benefit (Sahay, 2003).
Marriage with customer-supplier relationship also can be considered as an importance
thing in the supply chain management (Bullington, 2005). An organization that
develops supplier relationship and make it a priority will be rewarded with better
financial performance and greater customer satisfaction.
An organization that practices a good relationship with the customer can affect
its success in managing the supply base as well as its performance (Scoot and
Westbrook, 1991; Ellram, 1991; Turner, 1993). A key element of successful supply
base management involves downstream integration of customers as well as the
management of upstream suppliers. Each entity in the supply chain is a supplier as
well as a customer. Supply chain can become unsuccessful without a foundation of
effective supply chain organizational relationship, any efforts to manage the flow of
information or materials within the supply chain (Hanfield and Nicholas, 1999).
2.6.2 Logistic Management
Logistic is a part of supply chain management which focuses on the strategic

business (Hale, 1999; Houlihan, 1988). The once narrow focus of logistic becomes a
comprehensive topic that span the entire value chain from suppliers to customers
(Shapiro, 1993; Langley and Holcomb, 1992). Most of the benefits of forward and
backward vertical integration can be obtained by coordinating the logistic operation of
independent organization in the value chain (La Londe and Masters, 1994). Supply
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chain management is synonymous with integrated logistics system (Johnson, 1999;

Lambert, 1998; Bowersox and Closs, 1996; Coyle, 1996).
Logistic system encompasses the integration of process, system and
organizations that control the movement of goods from the suppliers to a satisfied
customer without waste (Ellram, 1991). Logistics means an integrated logistic system
includes inventory management, vendor relationship, transportation, distribution,
warehousing and delivery services. Merchandise must be replenished quickly and
arrive where and when it is needed in smaller lot sizes, especially in a JIT system
(Handfield, 1994). Effective coordination of logistics activities, by means of excellent
information technology processes, is essential to organizational performance (Lewis
and Talalayevsky, 1997). The advancement in the technology, the usage of bar coding
and radio frequency scanning technologies has greatly aided the evolution of the
integrated logistics concept.
Logistic is related to a branch of knowledge based on economics, technology,

and IT that investigates the relations and pattern goods and information flows in the
economy and economic organizations. Logistic comprises planning, organizing and
control of flows of goods from purchase, through processing to distribution to the end
user, in order to fulfill market requirement and by minimal cost and minimal capital
engagement (Michlowicz, 2002). The objective of the logistic management is to
tighten cooperation between its members. Integration and coordination is to enable
using the improvement of each member to the advantage of whole process and
optimizing the value added by each member of the chain to the goods or services
offered to the customer according to their expectation (Hoover, et. al., 2001).
Based on Johnson and Wood (1997), there are five important key terms which
are logistic, inbound logistic, material management, physical distribution and supply
chain management to interpret. Logistic comprises the entire process of materials and
products moving into and out of organization. Inbound logistics covers the movement
of material received from suppliers. Material management describes the movement of
material and components within an organization. Physical distribution is about the
movement of goods outward from the end of the assembly line to the customer. Supply
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chain management is somewhat larger than logistics, and it links logistics more
directly with the user’s total communications network and with the firm’s engineering
staff.
2.6.3 Trust and Commitment
The two vital components of improving the relationship are trust and
commitments (De Ruyter, 2001). The cooperation arises directly from both
relationship trust and commitment (Morgan and Hunt, 1994). There are several aspects
of trust in supply chain performance such as confidence in preferred trading partner,
always keep promises, always honest, good reputation, trust in preferred trading
partner, believe information provided, close personal friendship, trading partner
always consider best interest (Batt, 2003). Trust is the belief that the partners will act
in ways that will bring positive outcomes for the organization and does not want to
take unexpected actions that may bring a negative outcome (Anderson and Narus,
1990). Trust also can be defined as the willingness to rely on an exchange in partner
in whom has one has confident (Moorman, 1993). Trust is the extent to which the
buyer believes that the supplier has the necessary expertise to perform the activity
effectively and reliably (Ganeshan 1994).
2.7 Benefits of Supply Chain Management
Supply chain is very important because many organizations progressively find

themselves requiring effective supply chains or networks to successfully compete in
19
the global market economy (Lambert, 2008). The main goal of implementing supply
chain management is to achieve greater profitability by adding value and creating
efficiencies, thereby increasing customer satisfaction (Stock and Boyer, 2009). By
improving the supply chain, it will give benefits to supply chain members such as cost
decrease, lower inventory levels, shorter lead time and lessened demand uncertainties.
Improved process performance will enhance the quality of the product, customer
service, market responsiveness and target market access (Lambert, 2005).
Supply chain management has an objective to provide a strategic weapon to

build up and enhance sustainable competitive advantage by cost reduction without
affecting customer satisfaction (Mentzer, 2001). Key benefits of supply chain
management include increased inventory turnover, increase revenues, SCM cost
reduction, product availability decreased order cycle time, responsiveness, economic
value added, capital utilization, decreased time to market and reducing logistic costs
(Fawcett, 2008). The perfect planning in supply chain management regarding material
arrival, production schedule and distribution not only reduces the inventory and
inventory cost but also reduces the wasted time and energy (Verma, 2006).
2.8 Ready Mixed Concrete Industry Background
Concrete is “an artificial rock-like material made from a proportioned mix of

hydraulic cement, water, fine and coarse aggregates, air and sometimes additives (Van
Oos, 2005). In addition, concrete also can be made from ready-mix concrete at the
concrete batching plant. Nowdays, concrete is very important and widely used as
building materials in the world. Ready mixed concrete have a lot of benefits in light
attaining consistent quality standards, being environmentally friendly, and demanding
less site space have accounted for its application in infrastructure and residential
building projects.
20
Concrete is nothing but a homogenous mix of cement with stone aggregates,

construction sand and water (Shailendra Chouksey, 2012). “Ready Mix Concrete” or
RMC is mixed away from the construction sites by mixing ingredients by weights in
automatic plants and is delivered to the construction site in truck mounted drum mixers
called “Transit Mixers” or “Truck Mixers” (Shailendra Chouksey, 2012). The method
to mix the ready mix concrete was first invented and patented by the Germans more
than 100 years ago in 1903 (Shailendra Chouksey, 2012). The first commercial
delivery of concrete was made in 1913 in Baltimore, USA using a small drum type
transit mixer and the first ready mix concrete plant was built at Heathrow airport site
in London in 1931 (Shailendra Chouksey, 2012).
2.9 SCM in Ready Mixed Concrete Production and Delivery Process
The application of Supply Chain Management in the production of ready mix

concrete is very vital to ensure the quality of the materials, product, relationship
between suppliers and customer’s satisfaction. The scheduling of ready mix concrete
production and delivery is essentially a problem of material logistics planning, which
is “a decision process for strategically managing the procurement, movement and
storage of raw materials, finished product inventory and the related information flows
throughout the organization and its marketing channels in such a way that the current
and future profitability is maximized by cost-effective fulfillment of orders”
(Christopher, 1992).
Raw materials stocks at a plant are diminished because all the materials must
be used for daily production of ready mix concrete. Ready mix concrete plant
transform raw materials into concrete in its production facility and is committed to
delivering concrete to different construction sites by truck mixers so as to match on
site concreting progress. Concrete has its own time to set and harden, due to this
problem, the batching and delivery of the ready mix concrete is a classic example of
21
Just-In-Time construction system (Tommelein and Li, 1999). Anson and Wang (1994)
also highlighted the negative effect of the poor coordination between ready mix
concrete plants and site contractors on the productivity of concreting processes. The
relatively poor matching performance between the supply of concrete and the site
requirements in Hong Kong building sites was characterized by both truck mixers’
queuing on site and site crews staying idle due to late truck mixers’ arrivals (Anson
and Wang, 1998).
According to Tommelein and Li (1999), “current practices for managing the

concrete supply chain upstream in term of raw materials acquisition or perquisite work
on site are not geared toward Just-In-Time (JIT) production”. The ready mixed
concrete industry has become important sector in the construction industry in many
countries. Almost 90 per cent of the concrete required on site is supplied ready mixed
from off-site batching plants in Singapore (Wang, et. al., 2001).
2.10 Supply Chain Risk Management
Supply chain risk management can be defined as the ability of a firm to

understand and manage its economic, environmental, and social risks in the supply
chain which could be materialized by the adoption of contingency planning and having
resilient and agile supply chains (Carter and Rogers, 2008). The ability to react to an
unexpected disruption and maintain operations after the event also can be considered
as one of the important aspect in supply chain risk management (Rice and Caniato,
2003). Supply chain risk management is viewed as the management of supply chain
risk through coordination or collaboration among the supply chain partners so as to
ensure profitability and continuity (Tang, 2006).
22
Contingency planning is also referred to as business continuity planning

because it is a very important approach to prepare for the possibility of future
emergency and disruption. This approach comprises continuous supplier assessment,
development and maintenance of alternative capacities, mirrored and backup
information system and specific response plans (Rice and Caniato, 2003).
2.10.1 Material Flow Risk
Material flow involves the physical movement within the supply chain. The
physical movement includes the transportation of goods, delivery movement, storage
and inventories. There are many risks and disruptions involved in the process of
material flow such as transportation incapability, halted manufacturing, lack of
capacity, inability to access inventories and so on. This sub-topic only discusses the
material flow risk in terms of source, make and delay.
i) Source
Sourcing involves the acquisition of physical products or services. This sub-

topic covers single sourcing risk, supplier selection, and supply product
monitoring/quality.
1. Single Sourcing
A minor fire accident in Philips’ clean room in March 2000 caused Ericsson a
major loss of USD400 million (Norrman and Jansson, 2004). Philips
Electronics N.V. was a Dutch firm in Albuquerque, New Mexico, USA that
23
supplied 40% of their production to Ericsson and Nokia (Peck et al., 2003).
Ericsson’s failure, however, was not because of not being responsive, but was
mainly due to their single sourcing strategy. Unlike Nokia, who quickly turned
to alternative suppliers in the USA and Japan, Ericsson had no substitute
supplier (Peck et al., 2003). Hence it is important to have backup suppliers
because it can be useful when it comes to uncertainty situation where the main
supplier cannot supply the raw materials due to certain problem.
2. Supplier Selection
The supplier selection process requires many aspects to be considered. The

aspects that must to be considered during the selection process are supplier
reliability, country risk, transport reliability and supplier’s suppliers’ reliability
(Levary, 2007). Sometimes by choosing the right supplier can lower the
manufacturing costs and provides better responsiveness to many situations thus
it increase the variety of choices and concerns during supplier selection
process.
3. Supply Product Monitoring/Quality
The process to produce the product has limited producer’s control over the
process and decisions, especially if the supply chain network is extended. The
incapability of supplier to produce according to the standard demanded leads
to poor quality of product (Fitzgerald, 2005). This kind of incapability occur
due to limited skills and technology, and can be overcome when time and
resources are invested in developing the required standard.
24
ii) Make
The major issues in this sub-topic involves three types of issues which are
product and process design risk, production capacity risk, and operational disruption.
It is very important to determine all types of risks, thus mitigation measure can be
taken to encounter the problem.
1. Product and Process Design Risk
The inability to adapt to product and process changes has urged the
organization to actively involve its key supplier at an early stage of the new
product development process. Due to investing large sum of capital in
positioning products on the market, it is important to involve supplier and
customers at the early stage of the product development process to obtain
higher quality of product. Khan (2008) conclude that a well designated product
and process flow will help an organization to mitigate risks which arise
between production and suppliers.
2. Production Capacity Risk
Identifying resource capacity is very important, i.e. technological capacity and

skills. Technological risk can be encountered with early supplier involvement
(Handfield. 1999). It is important to have an experience or expertise with the
technology, hence the organization may have better information about where
the technology can be successfully applied. By having the experience, the
organization may absorb the risk well, so it would not affect the whole of the
supply chain.
25
3. Operational Disruption
Based on previous study, operational disruption can be categorized into three

main sources which are operational contingencies, natural disasters, and
political instability (Kleindorfer and Saad, 2005). Based on M. Nakamoto
(1997) stated that on February 1997 there was a fire a parts factory owned by
Japanese manufacturer Aisin Seiki Co. Ltd., a key supplier for Toyota. The
auto giant was forced to temporarily shut down production at most of its
Japanese plants. Companies can resolve the disruptions in material flow by
building inventory, or by having backup suppliers because it is unlikely that all
suppliers would be disrupted at the same time (Chopra and Sodhi, 2004).
Disruptions that affect the material flows are unpredictable and rare but often
quite damaging.
iii) Delay
Delay in material flow always occur when a supplier cannot respond to changes
in demand. Other factors that cause delays are poor-quality output at supplier plant,
high levels of handling or inspection during border crossing and changing
transportation modes during shipping (Chopra and Sodhi, 2004).
26
2.12 Summary
This chapter has presented the definition, background, origin, concept, and
benefits of the supply chain management. Issues and challenges in supply chain
management has also been highlighted in this chapter. This chapter also links the
relationship between supply chain management and the production of ready mixed
concrete. Finally, material flow risks within the supply chain also has been presented.
The next chapter explains the research methods used to obtain and analyze data for the
project.
27
CHAPTER 3
RESEARCH METHODOLOGY
3.1 Introduction
There are two types of methods to gather information for this project
which are by interviewing and doing questionnaire survey. An interview was
conducted with a certain personnel involved in the production and delivery of
ready mixed concrete in order to obtain the information needed for this project.
A questionnaire survey was also performed to obtain feedback about the
importance of supply chain management in the production and delivery of ready
mixed concrete.
28
3.2 Interview
Data were collected by interviewing the maintenance engineer and plant

superintendent at the ready mixed concrete batching plant. A set of questions
were designed as a tool to gather opinions and responses from them about the
existing process, current problems and aspects related to the supply chain
management. The questions were organized under broad heading including
background information, supplier relationship, inventory, transportation,
information and customer relationship. It was a face-to-face interview session
and site visit to observe the material supply chain management. Semi-structured
interviews allow the interviewer freedom to explore the expert’s views or
opinions while maintaining a level of comparability between interviewees.
3.2.1 Interview Results
Theoretical Research Framework
After all the data had been transcribed, the interview data were translated
into graphical method or framework.To develop a framework, there are five
consequential steps which support modelling process such as (1) define supply
chain model purpose, (2) establish supply chain performance measures, (3)
determine product type, (4) define supply chain configuration, and (5)
characterize supply chain elements (companies, processes, and flows) (O’Brien,
et. al., 2009).
29
One of the tools to develop framework is entity relationship diagram

(ERD). The entity relationship diagram has been widely used in structured
analysis and conceptual modelling (Song, et. al., 1995). It is also stated that the
entity relationship diagram is easy to understand, powerful to model real-world
problems and readily translated into a database schema. The ERD diagram is
constructed using Information Engineering’s style. Entity type is represented as
a box. The relationship is shown as a line connecting two associated entities and
given a name. ERD also has cardinality, it specifies the number of relationship
instances in which an entity can participate. Types of cardinality are as follows:
30
Figure 3.1: Types of cardinality (Song, et. al., 1995)

31
Department
Supply
Department
of
Employee Project
Dependent Works on
Order Part
Research
Internal
Funded
Technical Account
Project
Secretary
Foundation Corporate
Figure 3.2: Entity relationship diagram (ERD) based on Engineering Information’s style (adapted from Journal of Computer
and Software Engineering, Vol. 3, No.4 (1995), pp. 427-459
31
32
3.3 Survey
The survey method was adopted to identify the importance of supply chain
management for ready mixed concrete production and delivery process. A set of
questionnaires were distributed to the target respondents that were involved in the
production and delivery of ready mixed concrete. Then the analysis of the data was
performed by using questionnaire result analysis method. The questionnaire survey
focused on the importance of supply chain management in the production and delivery
of ready mixed concrete. It was designed objectively to evaluate the level of
understanding regarding the implementation of supply chain management among the
workers and the benefits gained through the implementation of supply chain
management.
33
3.3.1 Questionnaire Structure
The questionnaire was structured into four sections:
a) Section A: Obtain information about the respondent’s profession and role in

the production and delivery process of ready mixed concrete, the organization
in which he or she represents and his or her working experience in the
industry.
b) Section B: Obtain information about the importance of product’s quality and

dependable suppliers in the supply chain.
c) Section C: Obtain information about how an organization ensures the

effectiveness of supply chain management practices.
d) Section D: Evaluate the benefits gained through the implementation of supply

chain management in the production and delivery process of ready mixed
concrete.
34
3.3.2 Data Analysis
The sample of questionnaire used for the survey in this project is shown in
Appendix A. Questions in section B, C and D are based on Likert’s scale of five
ordinal measures of agreement towards each statement (from 1 to 5) as shown in
Figure 3.1
Figure 3.3: Five ordinal measures of agreement of Likert’s scale
Each scale represents the following rating:
1 = totally disagree
2 = disagree
3 = neutral in agreement
4 = agree
5 = totally agree
35
The data collected from the questionnaire survey was analyzed using frequency
analysis and “Relative Indices” (RI) technique. This technique using RI has been used
by Nesan (1997) and Holt et al. (1996) in the same context of application. RI was
calculated using the following formula:
∑ (1𝑛1 +2𝑛2 +3𝑛3 +4𝑛4 +5𝑛5 )

RI =
5 (𝑛1 +𝑛2 +𝑛3 +𝑛4 +𝑛5 )
where: 𝑛𝑥 = the number of respondent agreeing with the “x” choice
The computation of RI using this formula yields the value of RI ranging from
point two to one, where point two represents minimum strength and one the maximum
strength (Holt et al., 1996). The table below shows the categories for RI ranges.
Table 3.1: Categories for RI Ranges (Chua Chun Cee, 2003)
RI Range Category
0.20 – 0.35 Very Low
0.36 – 0.51 Low
0.52 – 0.67 Neutral
0.68 – 0.83 High
0.84 – 1.00 Very High
36
3.4 Methodology Flow Diagram
 Interviewing the maintenance engineer

Interview and plant superintendent at ready
mixed concrete batching plant
 To understand the existing process of
production and delivery of ready mixed
concrete
 To study or review the material supply
chain management (SCM) for ready-
mixed concrete.
 To identify material supply risk arise
within the production of ready mixed
concrete.
1. Sets of questionnaire were handed to

workers at the concrete batching plant
2. The questionnaire was aimed at:
a) Evaluating the level of

understanding of SCM among the
workers
Questionnaire b) Obtaining feedback about the
benefits of SCM
Figure 3.4: Research methodology flow

37
3.5 Summary
This chapter has described the methods used to obtain and analyze data for this
project. The types of the methods used were interview and questionnaire survey. An
interview with the maintenance engineer and plant superintendent were conducted to
study the overall supply chain management involved in the production and delivery
process of ready mixed concrete. Then, questionnaire survey form were distributed to
concrete batching plant workers. Questionnaire survey has the objective to evaluate
the level of understanding regarding the implementation supply chain management in
the production and delivery process of ready mixed concrete. The other objective of
the questionnaire survey was to determine the benefits gained through the supply chain
management.
The next chapter analyzes all the data obtained for this project.
38
CHAPTER 4
DATA COLLECTION, DATA ANALYSIS AND DISCUSSION OF RESULTS
4.1 Introduction
This chapter describes the data collection process involved in the project. The
data collection methods include questionnaire survey and semi-structured interview.
This chapter also analyses the questionnaire survey and interprets the data obtained
from the interview session. For the questionnaire survey, the collected data were
analyzed by using frequency analysis and relativity index. While for the interview
method, the data obtain verbally from the executive plant manager were recorded in
this chapter.
39
4.2 Questionnaire Survey
A survey was carried out among the workers at the concrete batching plant to
learn about the application and implementation of SCM in the manufacturing system
to an early indication on how important SCM was in the production of ready mixed
concrete.
4.2.1 Survey Objective
The objective of the survey was to:
i. To identify the level of understanding regarding the implementation of supply

chain management in the production and delivery process of ready mixed
concrete among the workers.
ii. To evaluate the benefits gained through the implementation of supply chain
management in the production and delivery process of ready mixed concrete
among the workers.
40
4.2.2 Questionnaire
To achieve the above objectives, a set of questionnaire was developed to

determine the importance of SCM in the production and delivery process of ready
mixed concrete. Respondent were asked to give ratings based on five point Likert scale
(1 - totally disagree, 2 - disagree, 3 - neutral, 4 - agree, 5 - totally agree) for the
questions given. This questionnaire only focused on close-ended questions, so it can
limit the respondents’ answers to the survey.
The questionnaire was divided into four sections, i.e Sections A, B, C, and D,
which included personal particulars of the respondent and the implementation of SCM
at concrete batching plant. Respondents were asked to tick the item if they observed it
at their organization and give ratings of their recommendation of their practice at the
batching plant based on the Likert scale.
4.2.3 Respondent
Twenty sets of questionnaires were distributed at the concrete batching plant,

but only ten sets of questionnaires were successfully received back from the
respondents. The ten respondents were engineers, plant superintendent, technicians,
sales and safety officer. The questionnaire survey was carried out at the Holcim ready
mixed concrete batching plant located at PTD 41424 Jalan Idaman 2/5, Kawasan
Perindustrian Desa Idaman, Senai, 81400, Johor Bahru.
41
4.3 Survey Results
The survey data were analyzed by using frequency analysis and relative Index
to determine the level of importance of each question given. Only ten of the
respondents opted to answer the questionnaires. The results from the questionnaire are
presented in the following sub-section.
4.3.1 Section A: Personal Particulars
a) Number of Respondents
Out of the twenty sets of questionnaires sent out, only ten were returned. Out of
the ten respondents, two were engineers, one was plant superintendent, five were
technician and two were sales officer. Figure 4.1 shows the distribution of respondents
by profession. Meanwhile, Table 4.1 shows the percentage of the respondents by
profession.
42
Number of Respondent involved in the Survey of Supply

Chain Management of Ready Mixed Concrete
2 2
Engineer Plant Superintendent Tecnician Sales officer
Figure 4.1: Distribution of respondents by profession
Table 4.1: Percentage of respondents by profession

Job Position Engineer Plant Superintendent Tecnician Sales officer
Frequency 2 1 5 2
Percentage (%) 20 10 50 20
b) Respondent’s Experience
The respondents surveyed have different years of working experience. Four of

them have one to five years of working experience, which represent the largest group.
Another two of them have less than one year of working experience. While one of
them have more than ten years of working experience and the remaining three of them
have five to ten years of working experience. Figure 4.2 shows the distribution of
respondent by years of working experience. Meanwhile, Table 4.2 shows the
respondents’ working experience.
43
Respondents' Experience
10% 20%
<1 year
30%
1 to 5 years
5 to 10 years
40%
<10 years
Figure 4.2: Distribution of respondents by years of working experience
Table 4.2: Respondents’ working experience

Experience (years) <1 1 to 5 5 to 10 <10
Frequency 2 4 3 1
Percentage (%) 20 40 30 10
4.3.2 Section B: The importance of product’s quality and dependable suppliers
This section determined the relationship between product’s quality and

dependable suppliers and SCM based on the respondents’ opinions. Table 4.1 shows
the Frequency Analysis (FA) and Relativity Index (RI) for the importance of product’s
quality and dependable suppliers.
44
Table 4.3: Frequency Analysis (FA) and Relativity Index (RI) for the importance of
product’s quality and dependable suppliers.
FREQUENCY ANALYSIS
totally totally
disagree neutral agree total RI Category
Questions disagree Agree
Q1. Your organization
rely on few dependable 0 0 3 5 2 10 0.78 High
suppliers
rely on few high quality 0 0 1 5 4 10 0.86 Very High
suppliers

consider quality as 0 0 0 6 4 10 0.88 Very High
number one criterion in
selecting suppliers
strive to create long term
0 0 0 7 3 10 0.86 Very High
relationship with its
suppliers
helps its supplier to
0 0 0 7 3 10 0.86 Very High
improve their product
quality
Q6. Your organization has

continuous improvement 0 0 0 7 3 10 0.86 Very High
programs that include its
key suppliers
Q7. Development of trust
among partners, with
suppliers taking full
responsibility for the
0 0 2 7 1 10 0.78 High
quality of their product,
leading to the elimination
of inspection of supplied
product.

actively involves its key 0 0 2 4 4 10 0.84 Very High
suppliers in new product
development processes
certifies its suppliers for 0 0 0 8 2 10 0.84 Very High
quality

regularly solve problems 0 0 3 4 3 10 0.8 High
jointly with its suppliers
45
From Table 4.3, it is shown that the reliance on few quality suppliers,
consideration of quality as number one criterion in selecting suppliers, creation of long
term relationship with its suppliers, helping its supplier to improve the product, having
continuous improvement program that includes its key suppliers, actively involving its
key suppliers in new product development process and certifying its suppliers for
quality show very high RI with 0.86, 0.88, 0.86, 0.86, 0.86, 0.84 and 0.84 respectively.
While the other questions which are reliance on few dependable suppliers,
development of trust among partners with suppliers taking full responsibility for the
quality of their product, leading to the elimination of inspection of supplied product
and regularly solving problems jointly with its suppliers only show high RI with 0.78,
0.78 and 0.80 respectively.
Figure 4.3: RI for the importance of product’s quality and dependable suppliers
46
4.3.3 Section C: How your organization ensures the effectiveness of supply

chain management practice
Table 4.4: Frequency Analysis (FA) and Relativity Index (RI) on how the
organization ensures the effectiveness of supply chain management practice
FREQUENCY ANALYSIS
totally totally
Questions disagree disagree neutral agree Agree total RI Category
Very
continuous quality 0 0 0 2 8 10 0.96
High
improvement program
Very
produces only what has 0 0 0 0 10 10 1
High
been ordered by customers
Very
pushes suppliers for shorter 0 0 0 7 3 10 0.86
High
lead times
Q4. Your company
organized properly
ordering, receiving and 0 0 0 9 1 10 0.82 High
other paper work from its
suppliers
Q5. Your organization’s
product are stored at
Very
appropriate distribution 0 0 0 7 3 10 0.86
High
points close to customer in
the supply chain
frequently interacts with
Very
customers to sets its 0 0 0 4 6 10 0.92
High
reliability, responsiveness
and other standards
Very
frequent follow-up with its 0 0 0 3 7 10 0.94
High
customers for quality
Very
strive to reduce time 0 0 0 1 9 10 0.98
High
wastage in operations
frequently evaluates the Very
0 0 1 4 5 10 0.88
formal and informal High
complaints of its customer
Q10. Your organizations
periodically evaluates the
importance of its 0 1 2 2 5 10 0.82 High
customer
47
Table 4.4 shows the RI on how the organization ensures the effectiveness of its
supply chain management practice. Every organization has its own method to
implement supply chain management in the business system. Analysis shows that the
organization had continuous quality improvement program, the organization
frequently interacts with customer to sets its reliability, responsiveness and other
standards, has frequent follow-up with its customers for quality and strive to reduce
time wastage in operations with very high values of RI which are 0.96, 0.92, and 0.94
respectively.
The highest RI value (RI=1) recorded goes to question two which asks if the
organization produces only what has been ordered by customers. As the organization
only produces ready mixed concrete, the organization has to produce the ready mixed
concrete based on the customer’s demand because concrete tends to hardening within
a specific time, so the concrete must be produced at the right time and directly
delivered to the site within specified time.
RI value for the organization’s properly organizing ordering, receiving and

other paper work from its suppliers and periodically evaluates the importance of its
relationship with its customer shows the same value of RI which is 0.82 which is
considered as high RI value. Meanwhile, the RI for other methods are categorized very
high also but they range from 0.86 to 0.88. Figure 4.4 shows the comparison for RI on
how the organization ensures the effectiveness of supply chain management practice.
48
Figure 4.4: RI on how the organization ensures the effectiveness of supply chain
management practice
4.3.4 Benefits gained through the implementation of Supply Chain

Management (SCM)
To evaluate the benefits gained through the implementation of supply chain

management, a list of benefits had been listed. The feedbacks from respondents show
that there are many benefits that can be gained through supply chain management.
There are four types of benefits that give very high RI value ranging from 0.94
to 0.96. SCM can reduce the cost of operation, can increase the quality of the product,
can increase the delivery speed of the product to the site and can increase the
efficiencies for the whole production process. It can be seen that by implementing
SCM in the manufacturing process it can increase the efficiencies of the whole process
49
thus reduce the cost of the operation. Hence, the quality of the product can also be
increased.
SCM can reduce lead time only give a high RI value which is 0.82 while the
other types of benefits give very high RI value ranging from 0.86 to 0.88. Table 4.5
shows the analysis for RI of the benefits gained through the implementation of supply
chain management whereas Figure 4.5 shows the comparison of the benefits gained
through the implementation of supply chain management.
50
Table 4.5: Frequency Analysis (FA) and Relativity Index (RI) for the benefits gained
through the implementation of supply chain management
FREQUENCY ANALYSIS
totally totally
Questions disagree disagree neutral agree Agree total RI Category
has continuous quality 0 0 0 2 8 10 0.96 Very High
improvement program
produces only what has
0 0 0 0 10 10 1 Very High
been ordered by
customers
pushes suppliers for 0 0 0 7 3 10 0.86 Very High
shorter lead times
Q4. Your company
organized properly
ordering, receiving and 0 0 0 9 1 10 0.82 High
other paper work from its
suppliers
Q5. Your organization’s
product are stored at
appropriate distribution 0 0 0 7 3 10 0.86 Very High
points close to customer
in the supply chain
frequently interacts with
customers to sets its
0 0 0 4 6 10 0.92 Very High
reliability,
responsiveness and other
standards
has frequent follow-up
0 0 0 3 7 10 0.94 Very High
with its customers for
quality
strive to reduce time 0 0 0 1 9 10 0.98 Very High
wastage in operations
frequently evaluates the
formal and informal 0 0 1 4 5 10 0.88 Very High
complaints of its
customer
Q10. Your organizations
periodically evaluates the
importance of its 0 1 2 2 5 10 0.82 High
customer
51
Figure 4.5: RI of the benefits gained through the implementation of supply chain
management (SCM)
4.4 Interview Results
An interview was carried out to acquire more information for the whole process
of the supply chain management at the ready mixed concrete plant. The studied supply
chain management includes the process of reviewing the material supply chain
management and investigating material supply risks arising from the production of
ready mixed concrete. Based on the information obtained from this interview, a
framework can be developed to show the whole picture of the processes within the
supply chain management.
52
The data collected were based on semi-structured interview with the plant
executive manager who was responsible for the whole management process at the
concrete batching plant. The semi-structured interview consisted of only one part. The
objective of the interview was to study the overall supply chain management at the
concrete batching plant in terms of material flow, supplier relationship, inventory,
transportation, information technology and customer relationship.
4.4.1 Background Information
The names of the maintenance engineer and plant superintendent were Mrs.
Banmathi Mahaindran and Mr. Muhammad Faizal bin Othman. They had been
working with Holcim Sdn. Bhd. for almost 5 to 10 years. They were totally responsible
for the whole process at the concrete batching plant in terms of manufacturing, product
distributing and sale. They had to make sure all that the concrete produced at the
batching plants met the quality and specification given by the client.
4.4.2 Supplier Relationship
Based on the interview, the number of suppliers involves in the supply chain
are four. Types of the supplier comprise of aggregate supplier, sand supplier,
admixture supplier and cement supplier. Holcim Sdn Bhd practice one source for one
supplier which means that every source of raw materials such as aggregate, sand,
cement, and admixture only has one supplier for each material.
53
There are also supplier related issues and challenges within the supply chain.
Lack of quality and shortage of the quantity of raw materials delivered to the concrete
batching plant seems to be the major problem for the manufacturer of the ready mixed
concrete. As an example, sometimes the aggregate’s supplier deliver the aggregate to
the batching but the size of the aggregate sent by the supplier does not meets the criteria
given by the manufacturer. The size of the aggregate must be sent by the supplier must
be in the range of 5 – 20 mm. For sand, it is important to check moisture content,
organic content and silt content to assure that the quality of the sand delivered by the
supplier is of high quality because it is possible for the supplier to cheat the
manufacturer by giving low quality of sand to them.
The manufacturer make an arrangement or orders all raw materials through

phones and email. Both methods are considered as the fastest way to deal with the
supplier. The information can be transferred effectively and fast. Hence all the raw
materials ordered by the manufacturer can be delivered on time and in the right
quantity to the concrete batching plant.
4.4.3 Inventory
Every first day of the month there is an inventory check because it is important
to make sure that the incoming and outgoing materials tally with the records in the
book stock. Loss and gain of the inventory stock are considered as common inventory
related issue and challenge faced by the manufacturer. Sometimes the total loss is
higher than total gain due to shortage of raw materials delivered by the suppliers. It is
important to keep the inventory stock checklist updated gradually to prevent any loss.
54
4.4.4 Transportation
There are three owned trucks by Holcim Sdn Bhd and another four trucks
comes from the third party logistic. Hence the total numbers of trucks operating at the
Senai concrete batching plant are seven units. During the interview, the maintenance
engineer and plant superintendent also explained about the advantages and
disadvantages of using owned trucks and third party logistic to deliver the ready mixed
concrete to the client. Table 4.6 shows the advantages and disadvantages of using
owned truck while Table 4.7 shows the advantages and disadvantages of using third
party logistic.
Table 4.6: Advantages and disadvantages of using owned truck
Owned Truck
Advantage Disadvantage
 Truck is available when  High maintenance cost
required
 Cost of idle time caused by  High operation cost includes
inclement weather, work being fuel, operator and oil
behind planned programme or
delay in deliveries of material
will generally be less on owned
plant than hired
55
Table 4.7: Advantages and disadvantages of using third party logistic
Third Party Logistic
Advantage Disadvantage
 Hire firms are responsible for  Potential loss of reputation
repairs and replacement because the firms is responsible
for one of the most critical
functions of its business.
 Hire rates can include operator,  Loss of direct control because the
fuel and oil manufacturer relies on the
competency, reliability and
honesty of the hired firms and its
staff.
The manufacturer also has a logistic department managed by one fleet assistant
and one logistic superintendent. The manufacturer also utilizes Global Positioning
System (GPS) in their trucks, hence it is easy to locate their trucks wherever the trucks
travel. The manufacturer also takes the attendance of their truck’s drivers in order to
make sure the drivers come at work on time.
One of the issue related to the transportation is driver issue. Some of the drivers
especially from the third party logistic are always having delay in the process of
delivering ready mixed concrete to the client.
56
4.4.5 Information
With the aid of modern technologies, a software can be developed to simplify

the supply process. To maintain the raw data such as customer information and record
of purchase order, the manufacturer uses SAP Business One software to manage and
record all sort of data. The software organizes the inventory data, monitors and
manages delivery of the product information, and creates electronic invoices easily.
High processing speed to access data and the ability to maintain the data are considered
as the important criteria to select a specific information technology system.
4.4.6 Customer Relationship
Most of the customers are from the construction companies that requires the
ready mixed concrete for the construction process to build concrete structure. By using
ready mixed concrete the, customers can speed up the process of the construction
because they do not have to mix the concrete manually.
There are many customer related issues and challenges within the supply chain
such as slump test issue, low cube test strength, and shortage of ready mixed concrete
delivered to the customer. Sometimes the reading of the slump test of the fresh concrete
delivered does not meet the requirement of the customer. Then the manufacturer has
to deliver back new ready mixed concrete to the site because the manufacturer provides
two hours warranty to the customer if there is any defects on the ready mixed concrete.
The two hours warranty is given in order to maintain the customer’s satisfaction.
57
If the value of the cube strength test after 28 days achieve below the target
strength, the customer has the right to reject the ready mixed concrete that has been
delivered to the site and request for the new order. It is important to check the quality
of the product before it is approved to be delivered to the customer. Shortage of ready
mixed concrete delivered to the customer occurs because of there is no double
checking before it is delivered to the customer.
4.5 Discussion
This section discusses the finding of this study. This section has been divided
into three parts. The first parts discusses the importance of product’s quality and
dependable suppliers. The second part discusses how the organization ensures the
effectiveness of supply chain management practice. Finally, the benefits gained
through the implementation of supply chain management are discussed.
4.5.1 The importance of product’s quality and dependable suppliers
This part discusses the findings based on the results from questionnaire
regarding the importance of product’s quality and dependable suppliers. Discussion of
the findings is based on the Relativity Index (RI) as the indicator corresponding to
each statement. The values of RI ranging from 0.2 to 0.10 with 0.2 give the lowest
degree of rating for responses and 1.0 give the highest degree of responses.
Based on Table 4.3 and Figure 4.3, it is shown that the organization considers
quality as number one criterion in selecting suppliers because it obtained the highest
58
RI value with 0.88. From the results, it explains that by having the best quality of raw
materials supplied to concrete batching plant, it can assure the quality of the ready
mixed concrete produced meet the specification set by the manufacturer. Based on
Table 4.3 and Figure 4.3, it is also shown that all the questionnaire results give high
and very high RI values thus it can be said that the organization practices a good
relationship with their supplier. An organization that develops supplier relationship
and makes it a priority is rewarded with better financial performance and customer
satisfaction.
4.5.2 How the organization ensures the effectiveness of supply chain

From Table 4.2 and Figure 4.2, it is shown that the organization produces only
what has been ordered by customer, because it gives maximum value of RI which is
1.00. This makes sense because the ready mixed concrete cannot be produced early
and kept in the storage. Ready mixed concrete has a specific time to set and harden
thus it must be produced directly after ordering has been made by the customer. It is
to prevent the ready mixed concrete being set and harden before it arrives at the site.
Based on the questionnaire results it can be seen that the organization practices
a good relationship with customer because the RI value for the organization frequently
interact with customers to set its reliability, responsiveness and other standards
(RI=0.92), frequently follow up with its customers for quality (RI=0.94), frequently
evaluates the formal and informal complaints of its customer (RI=0.88) and
periodically evaluates the importance of its relationship with its customer (RI=0.82)
gave high and very high RI values. A good relationship with the customer can affect
its success in managing the supply chain as well as its performance. It can be said that
59
the organization consider customer satisfaction as one of their top priority in delivering
products and services.
The organization also has continuous quality improvement program (RI=0.96).

To ensure their products are still relevant in the future market, the products must
undergo continuous improvement program to increase the quality of the products. It is
proven that an effective time management can lead to an effective supply chain
management because it can be seen that the organization always pushes suppliers for
shorter lead time (RI=0.86) and strives to reduce time wastage (RI=0.98). The
organization also ensures the products are stored at appropriate distribution points
close to the customer (RI=0.86), hence the ready mixed concrete can be delivered
effectively to the customers, thus reducing time wastage.
4.5.3 Benefits gained through the implementation of supply chain management
From Table 4.3 and Figure 4.3, it is shown that the two main benefits gained
from supply chain management are SCM can reduce the cost of operation (RI=0.96)
and increase the delivery speed of the product to the site (0.96) because both of the
questions give the highest RI value. Thus it can be explained that supply chain
management can affect the level of the performance in terms of cost, time and quality
in the production of ready mixed concrete.
60
4.5.4 Research Framework
Based on the observation and the information obtained from the maintenance
engineer and plant superintendent, a research framework had been developed to show
the process of the ready mixed concrete’s material flow. Holcim Malaysia Sdn. Bhd.
practices one source for one supplier to obtain raw materials such as aggregate to
produce ready mixed. They do not have any backup supplier on standby if there is any
disruption occur at supplier stage. As an example, the supplier cannot supply the
required raw materials due to certain problem. Thus a new improvised framework has
been developed by adding backup supplier for each raw materials within the supply
chain. By doing that, it can reduce the material supply risk. Figure 4.6 shows the
existing framework while Figure 4.7 shows the improvised framework for the
production and delivery process of ready mixed concrete.
61
Figure 4.6: Existing framework for the production and delivery process of ready mixed concrete
61
62
The number of backup

suppliers have been
added. Many to one
relationship
Figure 4.7: Improvised framework for the production and delivery process of ready mixed concrete
62
63
4.6 Summary
All the data collection and data analysis have been described in this chapter.
The methods used to analyze the data are by using framework and frequency
analysis. The analyzed data obtained from the questionnaire survey are shown in
the form of graphical method which is bar chart. The process to analyzed the data
obtained from the semi-structured interview is based on the information that had
been told by the maintenance engineer and plant superintendent about the overall
supply chain management in the production of ready mixed concrete.
Based on the discussion it can be summarized that the organization is

always concerns and aware about the implementation of supply chain management
to create a successful supply chain management.
64
CHAPTER 5
CONCLUSION AND RECOMMENDATION
5.1 Conclusion
Based on the questionnaire distribution, interview and result analysis,

five objectives of this research have been achieved. Conclusion are made
according to the five objectives.
65
1. To study or review the material supply chain management (SCM)

for Ready-Mixed Concrete.
The first objective was to study or review the material supply

chain management for ready mixed concrete. The material supply chain
management for ready mixed concrete has been studied through
literature review, observation and interview session with the ready
mixed concrete plant executive.
From the literature review, observation and information obtained

from the interview session, material supply chain for ready mixed
concrete includes many entities such as supplier, manufacturer and
customer. Material supply chain is a process which starts from the
extraction of raw materials such as aggregate, sand, cement and
admixture, to the production of ready mixed concrete, then to the
delivery of the product to the customer.
2. To identify the benefits gained through the implementation of

ready mixed concrete among the workers.
This project also identified the benefits gained through the

implementation of supply chain management in the production and
delivery process of ready mixed concrete among the workers. The
results from this project show that there are benefits gained through
66
implementation of supply chain management in the production of ready

mixed concrete. However, based on the analysis, it is indicated that there
two main benefits gained through the implementation of supply chain
management.
The two main benefits are:
a. Can reduce the cost of operation.

b. SCM can increase the delivery speed of the product to the site.
3. To evaluate the level of understanding regarding the

implementation of supply chain management in the production and
delivery process of ready mixed concrete among the workers.
This research has also evaluated the level of understanding of

supply chain management among the workers. Based on the data
analysis from the questionnaire survey, it can be concluded that all the
workers have high level of understanding regarding supply chain
management because the analysis tables show almost high category for
every question given.
67
4. To identify material supply risk within the production of ready

mixed concrete.
Based on the interview that was conducted before, there are

many material supply risks that have been identified within the supply
chain in terms of supplier relationship, inventory, transportation, and
customer relationship. By having material supply risks, it can reduce the
effectiveness of supply chain management of the production and
delivery process of ready mixed concrete due to uncertain disruptions.
5. To develop a framework to improve the efficiency of supply chain

for Ready-Mixed Concrete production.
The objective has been achieved by making an improvement to

the existing process. Refer to Figure 4.7.
5.2 Recommendation
The implementation of supply chain management (SCM) in the local

manufacturing industry is not high, there are many areas for further research
and improvement. Among the areas that require further studies are:
68
 Study a few more concrete batching plant regarding the

implementation of supply chain management
By studying more concrete batching plants, it can identify the

similarities and differences of the way another organization implements
supply chain management into their system, thus a right conclusion can
be obtained through the comparison between the concrete batching
plants.
 To identify strategies to implement supply chain management in

manufacturing system
The local manufacturing industry has been said to be resistance to

change. Therefore, strategies need to be identified so that there will be
at least guidelines on how to overcome the obstacles in implementing
supply chain management in the manufacturing system.
 Study the supply chain management risk in the manufacturing

system
More study can also be conducted in identifying the types of risk within
the supply chain and mitigation measures taken by certain organization
to encounter the risks or problems within the supply chain.
69
REFERENCES
John T. Mentzer, William De Witt, James S. Keebler, Soonhong Min, Nancy

W. Nix, Carlo D. Smith and Zach G. Zacharia (2001). Defining Supply
Chain Management. Journal of Business Logistic, Vol.22, No.2.
Keah Choon Tan (2001). A framework of supply chain management literature.

European Journal of Purchasing & Supply Management 7, 39 – 48.
Rajendra Kumar Shukla, Dr. Dixit Garg and Dr. Ashish Agarwal (2011).
Understanding of Supply Chain: A Literature Review. International
Journal of Engineering Science and Technology.
I. J. Chen and A. Paulraj (2004). Understanding supply chain management:

critical research and a theoretical framework. INT. J. PROD. RES.,
VOL. 42, NO. 1, 131 – 163.
Ruben Vrijhoef and Lauri Koskela (2000). The four roles of supply chain
management in construction. European Journal of Purchasing &
Supply Management 6, 169 – 178.
Anna Sobotka and Agata Czarnigowska (2005). Analysis of supply system

models for planning, construction projects logistic. Journal of Civil
Engineering and Management, Vol XI, No. 1, 73 – 82.
Morgan, Robert and Shelby Hunt (1994). The Commitment—Trust Theory of

Relationship Marketing. Journal of Marketing, Vol. 58, Summer, pp.
20-38.
70
Dag Naslund and Stevan Williamson (2010). What is Management in Supply

Chain Management? - A Critical Review of Definitions, Frameworks
and Terminology. Journal of Management Policy and Practice, vol.
11(4).
William J.O’Brien, Carlos T. Formoso, Ruben Vrijhoef, Kerry A. London

(2009). Construction Supply Chain Management Handbook. United
States of America
Iris D. Tommelein and Annie En Yi Li (1999). Just-in-Time Concrete Delivery:

Mapping Alternatives for Vertical Supply Chain Integration.
University of California, Berkeley, CA, USA.
Il – Yeol Song, Mary Evans, and E.K. Park (1995). A Comparative Analysis
of Entity-Relationship Diagram. Journal of Computer and Software
Engineering, Vol. 3, No.4 (1995), pp. 427-459
Martin Christopher (1992). Logistic and Supply Chain Management. United

Kingdom, London.
S. Nurmaya Musa (2012). Supply Chain Risk Management: Identification,

Evaluation and Mitigation Techniques. Department of Management
and Engineering, Linkoping University, Sweeden, 13 – 16.
Sunil Chopra and ManMohan S. Sodhi (2004). Managing Risk to Avoid

Supply-Chain Breakdown, Vol. 46 No. 1, 1 – 11.
Chee, C. C. (2003). Supply Chain Management Throungh Partnering in

Malaysian Construction Industry. Johor Bahru: Faculty of Civil
Engineering, University Technoogy Malaysia.
71
APPENDIX 1
Sample of Questionnaire Form
THE IMPORTANCE OF SUPPLY CHAIN MANAGEMENT FOR READY

MIXED CONCRETE PRODUCTION AND DELIVERY PROCESS
Supply Chain Management is a way of managing work in organized manner.

Implementation of supply chain management can review the entire supply chain and
addresses the flow of materials from the acquisition of raw materials to delivery of
finished product to the ultimate customer. The supply chain concept offers a useful
framework for analyzing the concrete production and delivery process. Supply chain
management can increase the efficiency for the whole production process. To create a
successful supply chain management, it must be implemented properly in order to
obtain the best results in terms of quality of the product and the efficiencies for the
whole production process.
The aims of this survey are to collect information regarding:
 To evaluate the level of understanding regarding the implementation of

ready mixed concrete within the workers at the batching plant
 Benefits gained through the implementation of supply chain
management
It is hoped that you will spare some time to answer the questions. All the
information provided will be treated with confidentially. Thank you for your
cooperation and participation.
72
QUESTIONNAIRES
Section A: Personal Particulars
1. Name of Company: ____________________________________________
2. Position in company: ___________________________________________
3. Years of working experience
Less than 1 year

1 – 5 years
5 – 10 years
Over than 10 years
73
Section B: The importance of product’s quality and dependable suppliers
(Scale: 1 to 5, 1=totally disagree; 2=disagree; 3=Neutral; 4=agree; 5=totally agree)
1. Your organization relies on few dependable suppliers 1 2 3 4 5
2. Your organization relies on few high quality suppliers 1 2 3 4 5
3.Your organization considers quality as number one 1 2 3 4 5

criterion in selecting suppliers
4. Your organization strives to create long term 1 2 3 4 5
relationship with its suppliers
5. Your organization helps its supplier to improve their 1 2 3 4 5
product quality
6. Your organization has continuous improvement 1 2 3 4 5
programs that include its key suppliers
7. Development of trust among partners, with suppliers 1 2 3 4 5
taking full responsibility for the quality of their product,
leading to the elimination of inspection of supplied
product.
8. Your organization actively involves its key suppliers 1 2 3 4 5
in new product development processes
9. Your organization certifies its suppliers for quality 1 2 3 4 5
10. Your organization regularly solves problems jointly 1 2 3 4 5

with its suppliers
74
Section C: How your organization ensures the effectiveness of supply chain

(Scale: 1 to 5, 1=totally disagree; 2=disagree; 3=Neutral; 4= agree; 5=totally agree)
1. Your organization has continuous quality 1 2 3 4 5

improvement program
2. Your organization produces only what has been 1 2 3 4 5
ordered by customers
3. Your organization pushes suppliers for shorter lead 1 2 3 4 5
times
4. Your company organizes properly ordering, receiving 1 2 3 4 5
and other paper work from its suppliers
5. Your organization’s products are stored at appropriate 1 2 3 4 5
distribution points close to customer in the supply chain
6. Your organization frequently interacts with customers 1 2 3 4 5
to set its reliability, responsiveness and other standards
7. Your organization has frequent follow-up with its 1 2 3 4 5
customers for quality
8. Your organization strives to reduce time wastage in 1 2 3 4 5
operations
9. Your organization frequently evaluates the formal and 1 2 3 4 5
informal complaints of its customer
10. Your organizations periodically evaluates the 1 2 3 4 5
importance of its relationship with its customer
75
Section D: Benefits gained through the implementation of supply chain

management (SCM)
(Scale: 1 to 5, 1=totally disagree; 2=disagree; 3=Neutral; 4= agree; 5=totally agree)
1. SCM can reduce the cost of operation 1 2 3 4 5
2. SCM can reduce the inventory level 1 2 3 4 5
3. SCM can reduce lead time of the production process 1 2 3 4 5
4. SCM can increase the quality of the product 1 2 3 4 5
5. SCM can improve customer service 1 2 3 4 5
6. SCM can increase the delivery speed of the product to 1 2 3 4 5

the site
7. SCM can increase the efficiencies for the whole 1 2 3 4 5
production process
8. Lead to better sequence of process, so increasing 1 2 3 4 5
production efficiency
9. SCM can improve quality of supplier’s service and 1 2 3 4 5
commitment
10. “Just In Time” delivery of materials on site, avoiding 1 2 3 4 5
the problem of storing and double handling of materials

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PSZ 19:16 (Pind.

UNIVERSITI TEKNOLOGI MALAYSIA

Author’s full name : MUHAMMAD ASYRAF BIN ZAILUDIN

Date of birth : 2nd JANUARY 1994

Title : THE IMPORTANCE OF SUPPLY CHAIN

Academic Session : 2015/2016

I declare that this thesis is classified as :

CONFIDENTIAL (Contains confidential information under the Official Secret

RESTRICTED (Contains restricted information as specified by the

√ OPEN ACCESS I agree that my thesis to be published as online open access

I acknowledged that Universiti Teknologi Malaysia reserves the right as follows:

1. The thesis is the property of Universiti Teknologi Malaysia.

SIGNATURE SIGNATURE OF SUPERVISOR

DR. BALQIS BT. OMAR

THE IMPORTANCE OF SUPPLY CHAIN MANAGEMENT FOR READY

MUHAMMAD ASYRAF BIN ZAILUDIN

A report submitted in partial fulfillment of the

Faculty of Civil Engineering

Thanks for your pray, attention and spiritual support

It is a great pleasure to address those people who helped me throughout this

Supply chain management is a concept originated and flourished in the

Pengurusan rantaiaan bekalan adalah konsep yang berasal daripada industri

CHAPTER CONTENT PAGE

4 RESULTS AND ANALYSIS 38

4.3 Survey Results 41

5 CONCLUSIONS AND RECOMMENDATION 64

TABLE NO. TITLE PAGE

3.1 Categories for RI Ranges 35

FIGURE NO. TITLE PAGE

2.1 Supply chain best practice management process 14

APPENDIX TITLE PAGE

This project studies the application of supply chain management in the

1.2 Background of Study

The utilization of inventories of the organization must be optimized by

SCM is a concept that originated and flourished in the manufacturing industry.

1.3 Problem Statement

1.4 Aims and Objectives

This project aims to study the effectiveness of existing supply chain

1. To study or review the material supply chain management (SCM) for

2. To evaluate the level of understanding regarding the implementation of

3. To identify the benefits gained through the implementation of supply

4. To identify material supply risks within the production of ready mixed

5. To develop a framework to improve the efficiency of supply chain for

1.5 Scope of Study

1.6 Thesis Structure

Chapter 2: Literature Review

Literature review related to supply chain management in ready mixed concrete

Chapter 3: Research Methodology

Chapter 4: Data Collection, Data Analysis and Discussion of Results

Chapter 5: Conclusion and Discussion

2.2 Definitions of Supply Chain Management

The objective of supply chain management is to build trust, exchanging

Supply chain management requires traditionally separate the material functions

When two or more organizations in a supply chain management entering into

According these definitions, a summary definition of the supply chain

2.3 Origin of Supply Chain Management

2.4 Concept of Supply Chain Management

Implementation of the supply chain concept could be a remedy for low

Figure 2.2: Generic configuration of a supply chain in manufacturing (Vrijhoef and

2.5 Issues and Challenges in SCM

Successful implementation of supply chain management is likely dependent

The emergence of network organizations, which can lead to a complex web of

2.6 Types of Issue in SCM