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Information and Knowledge Leakage in Supply Chain

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Abstract

The current world of post industrial value generation sees companies increasingly analyzing their internal operations against their external organizations to identify supply/demand fluctuations along the supply chain. Within these integrated relationships between internal and external parties in the supply chain, knowledge and information have become very important production resources. The existence and success of an increasing number of organizations strongly depend on their capabilities to utilize knowledge and information for profit generation. By managing more efficient information sharing, the volume of company confidential information passing through the supply chain increases, and this brings about more incidences of knowledge leakage and information leakage. A survey by PricewaterhouseCoopers in 2014 shows information security spending over the next 12 months would increase 60.27 % in Asia and 48.98 % in all regions. This emphasizes the importance of information privacy and therefore the necessity to study the information and knowledge leakage in integrated supply chain. The objectives of this study are to investigate the factors triggering information and knowledge leakage and create a mitigation framework to soften the impact of leakages on performance. The above objectives will be met by formulating and examining several hypotheses of a conceptualized information leakage (IL) and knowledge leakage (KL) framework. A case study derived from a structured interview is adopted as a methodology in this research. As a result, this paper contributes a novel theoretical model that characterizes information and knowledge leakage in an integrated supply chain. Therefore, it also adds new knowledge of managing information and knowledge leakage to supply chain management.

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Acknowledgments

The authors would like to thank Mr Ernest Chong for his help in the case study data collection. Wong W.P. thanks the support of Universiti Sains Malaysia RU Grant (1001/PMGT/816191).

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Authors and Affiliations

  1. Nottingham University Business School, Nottingham, UK

    Kim Hua Tan

  2. Universiti Sains Malaysia, Penang, Malaysia

    W. P. Wong

  3. Cardiff Business School, Cardiff, UK

    Leanne Chung

Authors
  1. Kim Hua Tan
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Corresponding author

Correspondence to W. P. Wong.

Appendix A- Questionnaire Sample

Appendix A- Questionnaire Sample

1.1 Items/ Variables

Internal Integration

Item

Measurement items

SCII 01

We encourage cross-functional integration on key internal supply chain activities such as manufacturing, procurement, marketing, accounting, and logistics.

SCII 02

We practise such internal integration to prevent and solve problems

SCII 03

Open communication of relevant information occurs among all internal employees

External Integration

Item

Measurement items

SCEI 01

We integrate closely with suppliers (including direct and indirect suppliers)

SCEI 02

We integrate closely with distributors/retailers

SCEI 03

We integrate closely with customers (including direct and indirect customers)

SCEI 04

Our organisation collaborate intensively with Multinational Corporations (MNCs)

SCEI 05

We outsource most of our operations to external parties

SCEI 06

We cooperate with external parties in new product development (NPD)

SCEI 07

We cooperate with external parties in developing new process technologies

SCEI 08

We practise such external integration to prevent and solve problems

Integration measures

Item

Measurement items

SCIM 01

We enable external parties to access our planning systems

SCIM 02

We share our production plans with external parties

SCIM 03

We implement joint EDI access/networks with external parties

SCIM 04

We perform packaging customization with external parties

SCIM 05

We share common use of third-party logistical services

SCIM 06

We share common outsourcing providers/sub-contractors with trading partners and/or other external parties

Information Sharing and Leakage/Lost

Item

Measurement items

ISL 01

We share our business units’ proprietary and/or confidential information with trading partners and/or external parties

ISL 02

Our trading partners and/or external parties share their proprietary and/or confidential information with us

ISL 03

We and our trading partners and/or other external parties exchange information which helps business planning.

ISL 04

We experience issues with information leakage/lost to external parties

ISL 05

We experience issues with information leakage through technological related incidents (ie: company’s data bases being hacked)

ISL 06

We experience issues with information leakage through internal employees’ fraud (i.e., theft or unauthorized information acquisition by employees)

ISL 07

We encounter issues of information leakage through the collaboration efforts with external parties.

ISL 08

We encountered issues with information leakage through the movement of employees to other organisations

ISL 09

There is a high possibility that external parties would benefit from the leaked information.

ISL 09

Severe disruptions to our daily operations and supply chain have taken place due to information leakage/lost

Knowledge leakage/Lost

Item

Measurement items

KLL 01

We and our trading partners and/or other external parties integrate our knowledge bases to further enhance our operations.

KLL 02

We experience issues with knowledge leakage/lost to external parties.

KLL 03

We experience issues with knowledge leakage through the movement of employees to other organisations.

KLL 04

We encounter issues with knowledge leakage through fraud cases (i.e., unauthorised transfer of your organisation’s operational knowledge)

KLL 05

Severe disruptions to our daily operations and supply chain have taken place due to knowledge leakage/lost.

Mitigation/Prevention methods on Information knowledge leakage

Item

Measurement items

MPM 01

We have established procedures to mitigate and/or prevent the event of information leakage.

MPM 02

We have established procedures to mitigate and/or prevent the event of Knowledge leakage.

MPM 03

Our organisation has effective strategies in storage information.

MPM 04

Our organisation has effective strategies in codifying and storing knowledge.

Open ended questions:

  1. a.

    How dependent is your company on a single person for certain knowledge and experience?

  2. b.

    What mitigation and/or prevention measures are taken by your organisation to counteract the issues of information/knowledge leakage

  3. c.

    Do you see any risks in global supply chain integration process? (please specify any risks associated with it.)

  4. d.

    What is the risk and possibility of outsourcing providers, suppliers and/or sub-contractors becoming competitors arising from supply chain integration?

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Tan, K.H., Wong, W.P. & Chung, L. Information and Knowledge Leakage in Supply Chain. Inf Syst Front 18, 621–638 (2016). https://doi.org/10.1007/s10796-015-9553-6

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