Skip to main content
Log in

Demand and supply integration: a conceptual framework of value creation through knowledge management

Journal of the Academy of Marketing Science Aims and scope Submit manuscript

Abstract

Strategy identifies two primary sets of processes through which the firm creates value for its customers by moving goods and information through marketing channels: demand-focused and supply-focused processes. Historically, firms have invested resources to develop a core differential advantage in one or other of these areas—but rarely in both—often resulting in mismatches between demand (what customers want) and supply (what is available in the marketplace). This paper suggests that successfully managing the supply chain to create customer value requires extensive integration between demand-focused processes and supply-focused processes that is based on a foundation of value creation through intraorganizational knowledge management. Integrating demand and supply processes helps firms prioritize and ensure fulfillment based upon the shared generation, dissemination, interpretation and application of real-time customer demand as well as ongoing supply capacity constraints. We draw upon literature in marketing, logistics, supply chain management and strategy to introduce a conceptual framework of demand and supply integration (DSI). We also offer insights for managerial practice and an agenda for future research in the relatively under-researched, but strategically important, area of demand and supply integration.

This is a preview of subscription content, log in via an institution to check access.

Access this article

Price excludes VAT (USA)
Tax calculation will be finalised during checkout.

Instant access to the full article PDF.

Institutional subscriptions

Fig. 1
Fig. 2

References

  • Alderson, W. (1958). The analytical framework for marketing. In D. Duncan (Ed.), Proceedings: Conference of Marketing Teachers from Far Western States, University of California, Berkley, pp. 15–28.

  • Alderson, W., & Cox, R. (1948). Towards a theory of marketing. Journal of Marketing, 12, 137–152.

    Google Scholar 

  • Alderson, W., & Martin, M. W. (1965). Toward a formal theory of transactions and transvections. Journal of Marketing Research, 2, 117–127.

    Google Scholar 

  • Anderson, P. F. (1982). Marketing, strategic planning and the theory of the firm. Journal of Marketing, 46, 15–26.

    Google Scholar 

  • Ballantne, D., & Varey, R. J. (2008). The service-dominant logic and the future of marketing. Journal of the Academy of Marketing Science, 36(1), 11–14.

    Google Scholar 

  • Barney, J. (1991). Firm resources and sustained competitive advantage. Journal of Management, 17, 99–120.

    Google Scholar 

  • Barki, H., & Pinsonneault, A. (2005). A model of organizational integration, implementation effort and performance. Organization Science, 16, 165–179.

    Google Scholar 

  • Bartels, R. (1983). Is marketing defaulting its responsibilities? Journal of Marketing, 47, 32–35.

    Google Scholar 

  • Bowersox, D. J., Mentzer, J. T., & Speh, T. W. (1995). Logistics leverage. Journal of Business Strategies, 12, 36–49.

    Google Scholar 

  • Bowersox, D. J., Closs, D. J., & Stank, T. P. (2003). How to master cross enterprise collaboration. Supply Chain Management Review, 7, 18–27.

    Google Scholar 

  • Brown, S. W., Webster, F. E., Steenkamp, J., Wilkie, W. L., Sheth, J. N., Sisodia, R. S., et al. (2005). Marketing renaissance: Opportunities and imperatives for improving marketing thought, practice, and infrastructure. Journal of Marketing, 69, 1–25.

    Google Scholar 

  • Calantone, R., Droge, C., & Vickery, S. (2002). Investigating the manufacturing–marketing interface in new product development: does context affect the strength of relationships? Journal of Operations Management, 20, 273–287.

    Google Scholar 

  • Cespedes, F. V. (1994). Industrial marketing: Managing new requirements. Sloan Management Review, 35, 45–60.

    Google Scholar 

  • Cespedes, F. V. (1996). Beyond teamwork: How the wise can synchronize. Marketing Management, 5, 24–37.

    Google Scholar 

  • Charan, R. (1991). How networks reshape organizations—For results. Harvard Business Review, 69, 104–115.

    Google Scholar 

  • Christopher, M. (2005). Logistics and supply chain management: Creating value-adding networks. London: Prentice Hall, Financial Times.

    Google Scholar 

  • Christopher, M., & Gattorna, J. (2005). Supply chain cost management and value-based pricing. Industrial Marketing Management, 34, 115–121.

    Google Scholar 

  • Crossan, M., Lane, H., & White, R. (1999). An organizational learning framework: From intuition to institution. Academy of Management Review, 24, 522–537.

    Google Scholar 

  • Daft, R. L., & Huber, G. P. (1987). How organizations learn: A communications framework. In N. DiTomaso, & S. Bacharach (Eds.), Research in the sociology of organizations (pp. 1–36). Greenwich, CT: JAI.

    Google Scholar 

  • Day, G. S. (1994). The capabilities of market driven organizations. Journal of Marketing, 58, 37–52.

    Google Scholar 

  • De Luca, L. M., & Atuahene-Gima, K. (2007). Market knowledge dimensions and cross functional collaboration: Examining the different routes to product innovation performance. Journal of Marketing, 71, 95–112.

    Google Scholar 

  • Dougherty, J., & Gray, C. (2006). Sales & operations planning—best practices: Lessons learned. Oxford, UK: Trafford.

    Google Scholar 

  • Drucker, P. F. (1973). Management. New York: Harper & Row.

    Google Scholar 

  • Ellinger, A. E. (2000). Improving marketing/logistics cross-functional collaboration in the supply chain. Industrial Marketing Management, 29, 85–96.

    Google Scholar 

  • Ellinger, A. E., Daugherty, P. J., & Keller, S. B. (2000). The relationship between marketing/logistics interdepartmental integration and performance in U.S. manufacturing firms: an empirical study. Journal of Business Logistics, 21, 1–17.

    Google Scholar 

  • Ellinger, A. E., Keller, S. B., & Hansen, J. D. (2006). Bridging the divide between logistics and marketing: Facilitating collaborative behavior. Journal of Business Logistics, 27, 1–27.

    Google Scholar 

  • Feldman, M. S., & March, J. G. (1981). Information in organizations as signal and symbol. Administrative Science Quarterly, 26, 171–186.

    Google Scholar 

  • Flint, D. J., & Mentzer, J. T. (2000). Logisticians as marketers: Their role when customers’ desired value changes. Journal of Business Logistics, 21, 19–45.

    Google Scholar 

  • Flint, D. J., & Mentzer, J. T. (2006). Striving for integrated value chain management given a services dominant logic for marketing. In R. F. Lusch, & S. Vargo (Eds.), Toward a service-dominant logic of marketing: dialogue, debate, and directions (pp. 139–149). Armonk, NY: Sharpe.

    Google Scholar 

  • Flint, D. J., Woodruff, R. B., & Gardial, S. F. (2002). Exploring the phenomenon of customers’ desired value change in a business-to-business context. Journal of Marketing, 66, 102–117.

    Google Scholar 

  • Flint, D. J., Larsson, E., Gammelgaard, B., & Mentzer, J. T. (2005). Logistics innovation: A customer value-oriented social process. Journal of Business Logistics, 26, 113–147.

    Google Scholar 

  • Galunic, C. D., & Rodan, S. (1998). Resource recombinations in the firm: Knowledge structures and the potential for Schumpeterian innovation. Strategic Management Journal, 19, 1193–1201.

    Google Scholar 

  • Giménez, C., & Ventura, E. (2003). Supply chain management as a competitive advantage in the Spanish grocery sector. International Journal of Logistics Management, 14, 77–88.

    Google Scholar 

  • Grant, R. M. (1996a). Toward a knowledge-based theory of the firm. Strategic Management Journal, 17, 109–122.

    Google Scholar 

  • Grant, R. M. (1996b). Prospering in dynamically-competitive environments: Organizational capability as knowledge integration. Organization Science, 7, 375–387.

    Google Scholar 

  • Griffin, A., & Hauser, J. R. (1996). Integrating R&D and marketing: A review and analysis of the literature. Journal of Product Innovation Management, 13(3), 191–216.

    Google Scholar 

  • Gummesson, E. (2008). Extending the service-dominant logic: From customer centricity to balanced centricity. Journal of the Academy of Marketing Science, 36(1), 15–17.

    Google Scholar 

  • Hansen, M. T., & Nohria, N. (2004). How to build collaborative advantage. Sloan Management Review, 46, 22–30.

    Google Scholar 

  • Hitt, M. A., Hoskisson, R. E., & Nixon, R. D. (1993). A mid-range theory of inter-functional integration, its antecedents and outcomes. Journal of Engineering and Technology Management, 10, 161–185.

    Google Scholar 

  • Huber, G. P. (1991). Organizational learning: The contributing processes and the literatures. Organization Science, 2, 88–116.

    Google Scholar 

  • Hunt, S. D., & Morgan, R. M. (1995). The comparative advantage theory of competition. Journal of Marketing, 59, 1–15.

    Google Scholar 

  • Hunt, S. D., Muncy, J., & Ray, N. M. (1981). Alderson’s general theory of marketing: A formalization. In B. M. Enis, & K. L. Roering (Eds.), The Review of Marketing (pp. 267–272). Chicago, IL: American Marketing Association.

    Google Scholar 

  • Hyman, M. R., & Mathur, I. (2005). Retrospective and prospective views on the marketing/finance interface. Journal of the Academy of Marketing Science, 33, 390–400.

    Google Scholar 

  • Johnson, J. C., & Borger, D. L. (1977). Physical distribution: Has it reached maturity? International Journal of Physical Distribution, 7, 283–293.

    Google Scholar 

  • Jüttner, U., Christopher, M., & Baker, S. (2007). Demand chain management—Integrating marketing and supply chain management. Industrial Marketing Management, 36, 377–392.

    Google Scholar 

  • Kahn, K. B. (1996). Interdepartmental integration: A definition with implications for product development performance. Journal of Product Innovation Management, 13, 137–151.

    Google Scholar 

  • Kahn, K. B., & Mentzer, J. T. (1998). Marketing’s integration with other departments. Journal of Business Research, 41, 53–62.

    Google Scholar 

  • Kingman-Brundage, J., George, W. R., & Bowen, D. E. (1995). Service logic: Achieving service system integration. International Journal of Service Industry Management, 6, 20–39.

    Google Scholar 

  • Kohli, A. K., & Jaworski, B. J. (1990). Market orientation: the construct, research propositions and managerial implications. Journal of Marketing, 54, 1–18.

    Google Scholar 

  • Krackhardt, D., & Hanson, J. R. (1993). Informal networks: the company behind the chart. Harvard Business Review, 71, 104–111.

    Google Scholar 

  • Langley, A. (1999). Strategies for theorizing from process data. Academy of Management Review, 24, 691–710.

    Google Scholar 

  • Lapide, L. (2002). New developments in business forecasting: You need sales and operations planning. Journal of Business Forecasting, 21(2), 11–14.

    Google Scholar 

  • Lawrence, P. R., & Lorsch, J. W. (1967). Organization and environment. Homewood, IL: Irwin.

    Google Scholar 

  • Lewis, R. J., & Erickson, L. G. (1969). Marketing functions and marketing systems: A synthesis. Journal of Marketing, 33, 10–14.

    Google Scholar 

  • Liedtka, J. M. (1996). Collaborating across lines of business for competitive advantage. Academy of Marketing Executive, 10, 20–37.

    Google Scholar 

  • Luo, X., Slotegraaf, R. J., & Pan, X. (2006). Cross-functional ‘coopetition’: The simultaneous role of cooperation and competition within firms. Journal of Marketing, 70, 67–80.

    Google Scholar 

  • Lusch, R. F., & Vargo, S. (2006). Toward a service-dominant logic of marketing: Dialogue, debate, and directions. Armonk, New York: Sharpe.

    Google Scholar 

  • Lynagh, P. M., & Poist, R. F. (1984). Assigning organizational responsibility for interface activities: an analysis of PD and marketing manager preferences. International Journal of Physical Distribution and Marketing Management, 14, 34–46.

    Google Scholar 

  • Madhavaram, S., & Hunt, S. D. (2008). The service-dominant logic and a hierarchy of operant resources: Developing masterful operant resources and implications for marketing strategy. Journal of the Academy of Marketing Science, 36(1), 67–82.

    Google Scholar 

  • McGrath, J. M. (2005). IMC at a crossroads: A theoretical review and a conceptual framework for testing. Marketing Management Journal, 15, 55–66.

    Google Scholar 

  • Mentzer, J. T., & Kahn, K. B. (1996). Logistics and interdepartmental integration. International Journal of Physical Distribution and Logistics Management, 26, 6–14.

    Google Scholar 

  • Mentzer, J. T., & Moon, M. A. (2004). Sales forecasting management: A demand management approach, second edition. Thousand Oaks, CA: Sage.

    Google Scholar 

  • Mentzer, J. T., Gomes, R., & Krapfel Jr., R. E. (1989). Physical distribution service: A fundamental marketing concept? Journal of the Academy of Marketing Science, 17, 53–62.

    Google Scholar 

  • Mentzer, J. T., DeWitt, W., Keebler, J., Min, S., Nix, N., Smith, C., et al. (2001). Defining supply chain management. Journal of Business Logistics, 22, 1–25.

    Google Scholar 

  • Mentzer, J. T., Flint, D. J., & Hult, G. T. M. (2001). Logistics service quality as a segment-customized process. Journal of Marketing, 65, 82–104.

    Google Scholar 

  • Min, S., & Mentzer, J. T. (2000). The role of marketing in supply chain management. International Journal of Physical Distribution and Logistics Management, 30, 765–787.

    Google Scholar 

  • Mohr, L. B. (1982). Explaining organizational behavior. San Francisco: Jossey Bass.

    Google Scholar 

  • Mollenkopf, D., Gibson, A., & Ozanne, L. (2000). The integration of marketing and logistics functions: An empirical investigation of New Zealand firms. Journal of Business Logistics, 21, 89–109.

    Google Scholar 

  • Moon, M. A. (2006). Breaking down barriers to forecast process improvement. Foresight: The International Journal of Applied Forecasting, 4, 26–30.

    Google Scholar 

  • Moorman, C., Zaltman, G., & Deshpande, R. (1992). Relationship between providers and users of market research: the dynamics of trust within and between organizations. Journal of Marketing Research, 29, 314–329.

    Google Scholar 

  • Morash, E. A., Droge, C., & Vickery, S. (1996). Boundary spanning interfaces between logistics, production, marketing, and new product development. International Journal of Physical Distribution & Logistics Management, 26, 43–62.

    Google Scholar 

  • Murphy, P. R., & Poist, R. F. (1992). The logistics-marketing interface: Techniques for enhancing cooperation. Transportation Journal, 2, 14–23.

    Google Scholar 

  • Murphy, P. R., & Poist, R. F. (1994). The logistics-marketing interface: marketer views on improving cooperation. Journal of Marketing Theory & Practice, 12(2), 1–13.

    Google Scholar 

  • Murphy, P. R., & Poist, R. F. (1996). Comparative views of logistics and marketing practitioners regarding interfunctional coordination. International Journal of Physical Distribution and Logistics Management, 26, 15–28.

    Google Scholar 

  • Nonanka, I. (1994). A dynamic theory of organizational knowledge creation. Organization. Science, 5, 14–37.

    Google Scholar 

  • Nonaka, I., & Takeuchi, H. (1995). The knowledge creating company. New York: Oxford University Press.

    Google Scholar 

  • Nunes, P. F., & Cespedes, F. V. (2003). The customer has escaped. Harvard Business Review, 81, 96–105.

    Google Scholar 

  • Olson, E. M., Walker Jr., O. C., & Ruekert, R. W. (1995). Organizing for effective new product development: the moderating role of product innovativeness. Journal of Marketing, 59, 48–63.

    Google Scholar 

  • Payne, A. F., Storbacka, K., & Frow, P. (2008). Managing the co-creation of value. Journal of the Academy of Marketing Science, 36(1), 83–96.

    Google Scholar 

  • Piercy, N. (2007). Framing the problematic relationship between marketing and operations functions. Journal of Strategic Marketing, 15, 185–207.

    Google Scholar 

  • Porter, M. E. (1985). The competitive advantage: Creating and sustaining superior performance. NY: Free Press.

    Google Scholar 

  • Porter, M. E. (1996). What is strategy? Harvard Business Review, 74, 61–78.

    Google Scholar 

  • Rinehart, L. M., Cooper, M. B., & Wagenheim, G. D. (1989). Furthering the integration of marketing and logistics through customer service in the channel. Journal of the Academy of Marketing Science, 17, 63–71.

    Google Scholar 

  • Ruekert, R., & Walker, O. (1987). Marketing’s interaction with other functional units: a conceptual framework and empirical evidence. Journal of Marketing, 51, 1–19.

    Google Scholar 

  • Ryan, F. W. (1935). Functional elements of marketing distribution. Harvard Business Review, 13, 205–224.

    Google Scholar 

  • Sabath, R. E., & Fontanella, J. (2002). The unfulfilled promise of supply chain collaboration. Supply Chain Management Review, 6, 24–29.

    Google Scholar 

  • Shaw, A. (1912). Some problems in market distribution. Quarterly Journal of Economics, 26, 706–765.

    Google Scholar 

  • Shrage, M. (1990). Shared minds: The new technology of collaboration. New York: Random House.

    Google Scholar 

  • Sinkula, J. (1994). Market information processing and organizational learning. Journal of Marketing, 58, 35–45.

    Google Scholar 

  • Slater, S. F. (1997). Developing a customer value-based theory of the firm. Journal of the Academy of Marketing Science, 25, 162–167.

    Google Scholar 

  • Slater, S. F., & Narver, J. C. (1995). Market orientation and the learning organization. Journal of Marketing, 59, 63–74.

    Google Scholar 

  • Slater, S. F., & Narver, J. C. (2000). Intelligence generation and superior customer value. Journal of the Academy of Marketing Science, 28, 120–127.

    Google Scholar 

  • Song, X. M., Montoya-Weiss, M. M., & Schmidt, J. B. (1997). Antecedents and consequences of cross-functional cooperation: a comparison of R&D, manufacturing, and marketing perspectives. Journal of Product Innovation Management, 14, 35–47.

    Google Scholar 

  • Speh, T. W. (1977). Physical distribution-marketing interfaces: Research and managerial implications. In The National Council of Physical Distribution Management Annual Conference Proceedings, pp 25–40.

  • Srivastiva, R. K., Shervani, T. A., & Fahey, L. (1999). Marketing, business processes and shareholder value: An organizationally embedded view of marketing activities and the discipline of marketing. Journal of Marketing, 63, 168–179.

    Google Scholar 

  • Stank, T. P., Keller, S. B., & Daugherty, P. J. (2001). Supply chain collaboration and logistical service performance. Journal of Business Logistics, 22, 29–48.

    Google Scholar 

  • Swink, M., & Song, M. X. (2007). Effects of marketing-manufacturing integration on new product development time and competitive advantage. Journal of Operations Management, 25, 203–217.

    Google Scholar 

  • Szulanski, G. (1996). Exploring internal stickiness: impediments to the transfer of best practices within the firm. Strategic Management Journal, 17, 27–43.

    Google Scholar 

  • Tjosvold, D. (1988). Cooperative and competitive independence. Group & Organization Studies, 13, 274–289.

    Google Scholar 

  • Tjosvold, D., Dann, V., & Wong, C. (1992). Managing conflict between departments to serve customers. Human Relations, 45, 1035–1054.

    Google Scholar 

  • Tuominen, M., Rajala, A., & Möller, K. (2000). Intraorganziational relationships and operational performance. Journal of Strategic Marketing, 8, 139–160.

    Google Scholar 

  • Van Hoek, R., & Mitchell, A. (2006). The challenge of internal misalignment. International Journal of Logistics: Research & Applications, 9, 269–281.

    Google Scholar 

  • Van de Ven, A. (1976). On the nature, formation, and maintenance of relations among organizations. Academy of Management Review, 1, 24–36.

    Google Scholar 

  • Vanderblue, H. B. (1921). The functional approach to the study of marketing. Journal of Political Economy, 29, 682.

    Google Scholar 

  • Vargo, S. L., & Lusch, R. F. (2004). Evolving to a new dominant logic for marketing. Journal of Marketing, 68, 1–17.

    Google Scholar 

  • Vargo, S. L., & Lusch, R. F. (2008). Why “service”? Journal of the Academy of Marketing Science, 36(1), 25–38.

    Google Scholar 

  • Voorhees, R. D., Teas, R. K., Allen, B. J., & Dinkler, E. T. (1988). Changes in the marketing–logistics relationship. Journal of Business Logistics, 9, 34–50.

    Google Scholar 

  • Wallace, T., & Stahl, B. (2006). Sales & operations planning: the executive’s guide. Cincinnati, OH: Wallace.

  • Webster, F. E. (1992). The changing role of marketing in the corporation. Journal of Marketing, 56, 1–17.

    Google Scholar 

  • Weld, L. D. H. (1917). Marketing functions and mercantile organization. American Economic Review, 7, 306–318.

    Google Scholar 

  • Wilkins, A. L., & Ouchi, W. G. (1983). Efficient cultures: exploring the relationship between culture and organizational performance. Administrative Science Quarterly, 28, 468–481.

    Google Scholar 

  • Woodruff, R. B. (1997). Customer value: The next source for competitive advantage. Journal of the Academy of Marketing Science, 25, 139–154.

    Google Scholar 

  • Woodruff, R. B., & Flint, D. J. (2006). Marketing’s service-dominant logic and customer value. In R.F. Lusch, & S. Vargo (Eds.), Toward a service-dominant logic of marketing: Dialogue, debate, and directions (pp. 183–195). Armonk, NY: Sharpe.

    Google Scholar 

  • Woodruff, R. B., & Gardial, S. F. (1996). Know your customer: New approaches to understanding customer value and satisfaction. Cambridge, MA: Blackwell Business.

    Google Scholar 

  • Workman Jr., J. R., Homburg, C., & Gruner, K. (1998). Marketing organization: An integrative framework of dimensions and determinants. Journal of Marketing, 62, 21–41.

    Google Scholar 

  • Zahra, S. A., Ireland, D., & Hitt, M. A. (2000). International expansion by new venture firms: International diversity, mode of market entry, technological learning, and performance. Academy of Management Journal, 43, 925–950.

    Google Scholar 

Download references

Author information

Authors and Affiliations

Authors

Corresponding author

Correspondence to Terry L. Esper.

Rights and permissions

Reprints and permissions

About this article

Cite this article

Esper, T.L., Ellinger, A.E., Stank, T.P. et al. Demand and supply integration: a conceptual framework of value creation through knowledge management. J. of the Acad. Mark. Sci. 38, 5–18 (2010). https://doi.org/10.1007/s11747-009-0135-3

Download citation

  • Received:

  • Accepted:

  • Published:

  • Issue Date:

  • DOI: https://doi.org/10.1007/s11747-009-0135-3

Keywords

Navigation