Analysis of Supply Chain Performance Measurement System in Addis Ababa: The Case of Selected Shoe Factories

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Addis Ababa University


Supply chain performance measure has a vital role in the improvement of the organization’s overall performance. As a result, different measurement factors were employed and performance frameworks have been changed rapidly due to the effect of today’s competitive global market over a period of time. Although Ethiopia’s manufacturing sector has been developing in a way to fit in a global arena, it is still struggling at an infant stage, this show these factories has problem in their supply chain performance which indicates the presence of problems needs further improvement. This happens due to lack of holistic performance measurement approaches employed for their supply chain performance measurement. The overall objective of this study was to investigate the supply chain performance measurement practices of Ethiopian footwear companies using holistic measurement factors in combination of macro processes and decision making level within performance measurement framework. The study was conducted in three shoe manufacturing companies using a predesigned Likert scale type questionaries’ for purchasing, production and marketing department each companies. Hypothesis was also developed and its significance was tested using SPSS. Additionally, AHP model was employed to check for the desirability of the measurement factors using MATLAB. For checking the internal consistency of the items under study, Cronbach’s alpha was employed and it was learnt that the data were reliable. The results in between groups and within groups are compared using analysis of variances ANOVA. The priority given for each measurement factors were also measured using AHP model. Then, the result of the study shows that the majority of the performance measurement factors differ among the three manufacturing companies at a 5% significant level. Similarly, measuring factors which were given more priority or which are more desirable than other factors to be used for measuring supply chain performance in the case shoe companies were also identified. Moreover areas which need further improvement were also identified, As a result, it was devised that shoe factories should have to give due attention for developing green supplier selection policy, safe and advanced working environment, optimal inventory policy, proper waste management, proper management of obsolete raw material, proper operation of information technology and assessing on degree of bottleneck for managing bottlenecks to achieve best performance in their supply chain and to be competitive in global market.



Supply chain performance, Performance measurement factors, supply chain Macro process, Decision making level, Desirable performance measurement factors